AUSTIN, TEXAS, May 26, 2013 - The vice chair of the homeland security committee in the Texas House says there is a direct connection between drug cartels and Medicaid fraud being perpetrated along the South Texas border region.
For this and other reasons, state Rep. Allen Fletcher said he offered an amendment to Senate Bill 8 that will allow the Office of Inspector General (OIG) to hire commissioned peace officers for their investigations into Medicaid fraud. Senate Bill 8 is a major piece of legislation dealing with fraud, waste, and abuse in the Medicaid program.
“There is Medicaid fraud all over the state, Dallas, Houston, you name it. The cartels are in Dallas and Houston. But way along the border, and all along the border, McAllen, Brownsville, Cameron County, Hidalgo County, Starr, all those areas, there is huge cartel influence and I assure you that these individuals that are involved in setting up these bogus clinics and hiring these dentists and doctors to file these fraudulent Medicaid claims, it’s cartels,” Fletcher said.
Fletcher is one of just a few retired police officer serving in the Texas House. He investigated white collar crime for Houston Police Department for many years. Fletcher said he spoke to Jack Stick, deputy inspector general for enforcement for the Office of Inspector General Texas Health and Human Services Commission, about carrying an amendment for Stick to allow OIG to have commissioned peace officers working as investigators.
“I was called by the Inspector, Jack Stick. He said he needed his investigators to have police powers when they are working on this Medicaid fraud in South Texas. We have allocated a lot of money to go after the millions of dollars in Medicaid fraud that we have in our state. I thought that based on the Medicaid fraud that it would be important that the OIG in their role in investigating Medicaid fraud in our state and especially since we have such a rampant situation - we are leading the nation in Medicaid fraud - that the OIG and its officers should have police powers,” Fletcher said.
Fletcher said Stick has not told him that drug cartels are involved with Medicaid fraud. However, he said he has had conversations with DPS about the problem.
“I am the vice chairman of homeland security and we oversee DPS. I have visited with them about some of the different clinics I perceive to be hotspots for the Medicaid fraud and I can tell you DPS thinks there is a cartel connection. Why don’t you go talk to them? Talk to the director of the DPS, Steve McCraw,” Fletcher said.
“I have not had a conversation with Jack Stick about cartels. I have been in committee meetings and conference meetings where they are all discussing this. You can quote me. I am saying they are involved in it. I am a 38-year commissioned peace officer. I have been involved in white collar crime investigations for some 20 something years. I can tell you that based on what is happening in Texas in Medicaid fraud and what is going on in the clinics along the border of our state I say the cartels are involved.”
Two Democrats on the conference committee for SB 8 say they did not sign the conference committee report for the legislation in part because of Fletcher’s amendment. The two are state Sen. Carlos Uresti, D-San Antonio, and state Rep. Richard Raymond, D-Laredo.
“It is absolutely absurd to say cartels are connected with Medicaid fraud,” Uresti said. “I have never heard that. We have never heard such testimony. We do not have such facts. It is ridiculous to be making a statement like that. It is unfounded. If it was happening Senator Nelson would have brought it up and she didn’t.”
Senator Jane Nelson, R-Flower Mound, is chair of the Senate Committee on Health and Human Services. Uresti is a member of the committee. Nelson authored SB 8.
Uresti said he and state Sen. Juan Hinojosa, D-McAllen, are working on language in conference committee to address the amendment Fletcher added. Hinojosa told the Guardian he had spoken to Dr. Kyle Janek, the Texas commissioner for health and human services, about the issue. Hinojosa said he was working on language for SB 8 that would require OIG peace officers to be trained by DPS and that the use of such peace officers would have to be approved by the Texas Attorney General’s Office. Uresti said the OIG would be limited to hiring five commissioned peace officers.
“The reason I did not sign the conference committee report for SB 8 is because the issue of peace officers working for the OIG was never discussed in a committee. There was no stand-alone bill on that issue. There was no hearing on that in the Senate, either in committee or on the Senate floor,” Uresti said.
“I want to know what kind of training are these inspectors are going to receive. They are going to be walking into a nursing home, with elderly people. How are they going to conduct themselves?” Uresti asked.
Rep. Raymond said he would not sign the conference committee report for SB 8 for two reasons.
“When you go into a doctor’s office to go review files you don’t need to go in with guns strapped on you. It is just silly,” Raymond said. “Rep. Fletcher is a dear friend of mine. But even dear friends can be very wrong and I think he is wrong on this. I know it was not his idea.”
Raymond said the other reason he could not sign off on the conference report for SB 8 is that he offered an amendment that was watered down in conference. “My amendment dealt with the transportation of children who go and get therapy. I defined that in the case of hardship a parent or guardian could designate another adult as long as they were not a paid employee of a provider. I defined what hardship was. The language got changed in conference. It became ambiguous. I think it was a good, solid amendment. I could not sign the report.”
Raymond also disputed claims that Medicaid fraud is more widespread along the border. He said that as chair of the House Committee on Human Services he heard more about such fraud from other parts of Texas.
“It is not fair for Jack Stick or anyone else to continue to try to paint us in South Texas and along the border with a broad brush. The cartels claim, if you have got evidence, put it on the table. You cannot just start pulling McCarthy-style tactics,” Raymond said. “They are stereotyping and it is not fair to South Texas and the border.”
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