Federal judge critical of prosecution – Texas psychologist awaits sentencing on Medicaid fraud

By James Bradshaw Senior Editor
January 1, 2009



A Texas child psychologist awaits sentencing on charges of Medicaid fraud for a practice that is legal in 48 states – billing for psychological testing to aid in diagnosing children’s mental problems.

Ironically, state authorities have since approved decriminalizing the rule under which Sam S. Hill III, Ph.D., was convicted in September of defrauding the system of $1,965 over a five-year period while assessing patients at Driscoll Children’s Hospital in Corpus Christi.

“It’s a shame that this would happen to Sam,” his lawyer, Keith M. Gould, told The National Psychologist. “In my opinion he’s not only a great psychologist, he’s a great human being.”

The aggressive four-year investigation by the Texas Attorney General’s Office and the FBI has galvanized public support for Hill. The Corpus Christi Caller-Times headlined its account of his tribulations: “Friend of children, enemy of the state.”

Even U.S. District Judge Hayden Head Jr. questioned why authorities did not pursue some avenue other than criminal prosecution to resolve the Medicaid rules issue. Head found Hill guilty in September but delayed sentencing until Jan. 15 to await the outcome of the state’s efforts on the rules change.

Hill ran afoul of a Texas Medicaid rule that forbids billing for psychological testing performed by technicians working under a licensed psychologist, a common practice in psychological evaluations.

Even before Hill was indicted, an advisory group for the Texas Health and Human Services Commission began considering revising the rule when it was learned that only Texas and Mississippi deny such claims.

Gould said state officials have now approved the change and are awaiting final approval from federal Medicaid authorities, which is expected to be routine.

Prosecutors said they pursued charges against Hill because he knowingly violated Texas rules. They have referred all questions on the case to the U.S. Attorney’s Office, which will not comment while a case is pending.

Gould said the issue for Hill is whether the state should be allowed to dictate how psychologists practice their profession. Hill is a decorated Vietnam War veteran and has provided psychological services at Driscoll Children’s Hospital regardless of clients’ ability to pay since 1994 when he co-founded a developmental behavior clinic there.

Hill also has regularly counseled and testified on child abuse cases in Nueces County, leaving many to wonder who will fill that void if the conviction causes him to lose his license. Gould said Hill will automatically lose his license if sentenced to jail time but may be able to retain the license if given probation.

Meanwhile, C. Gerald O’Brien, Ph.D., president of the Mississippi Psychological Association (MPA), said the testing issue was raised there recently by Edward L. Manning, Ph.D., a neuropsychologist at the University of Mississippi Medical Center in Jackson.

Manning wrote Sept. 8 to Robert L. Robinson, Ph.D., the executive director of the state’s Division of Medicaid asking if CPT codes could be used to bill for tests administered to children since state rules forbid billing under Medicaid codes. Manning also questioned why state Medicaid rules forbid billing for any psychological services for adults.

Manning said Robinson responded that the Medicaid program will not pay for mental health services provided “under the supervision of the Medicaid provider or to be performed by technicians.”

Manning said he will pursue the matter further because he does not think neuropsychological consultation and testing are necessarily “mental health” issues.

O’Brien said seeking changes in Medicaid billing rules will be added to the MPA’s agenda for the state legislative session that begins in January, but he added that past efforts to expand coverage have been denied on grounds the state does not have the money to pay for them.

He said MPA members have not raised the billing issue in recent years, probably because the rules are so restrictive that most Mississippi psychologists will not accept Medicaid patients, leaving many without needed treatment.

“That leaves psychologists who work for public agencies in a bit of a bind,” O’Brien said. He said Mississippi Medicaid rules covering psychological services are so restrictive that even services for children can only be billed if a child was referred to a psychologist by a primary care physician.

State policies are inconsistent in many ways, he said, pointing out that community mental health centers, which are funded separately from Medicaid, can bill for psychological tests administered by psychometrists or other licensed technicians.

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