Waco physician sues Baylor Scott & White Health Plan over Medicaid reimbursements

WACO, Texas (KWTX) - A Waco physician has filed a breach of contract lawsuit against Baylor Scott & White Health, alleging the huge health care provider is wrongfully withholding Medicaid reimbursement payments from him.

Dr. Darrell S. Wheeler, who has been a neonatologist in Waco more than 30 years, is seeking unspecified damages in his lawsuit, filed in Waco’s 414th State District Court.

Wheeler’s attorney, John Rivas, of Austin, declined comment on the lawsuit Friday, as did Scott & White spokeswoman Christy Millweard.

The lawsuit says that Wheeler has been enrolled with the Texas Medicaid program administered by the Texas Medicaid and Healthcare Partnership since 2008. His enrollment authorizes Wheeler to treat Medicaid beneficiaries and be reimbursed by the Medicaid program.

For years, Wheeler has been billing Texas Medicaid through various managed care organizations under his National Provider Identifier (NPI) and Texas Provider Identifier (TPI) numbers, the suit states. In July, Wheeler and Scott & White Health Plan entered into a participating group provider agreement where Wheeler agreed to provide care to Scott & White’s Health Plan’s members.

In exchange, Scott & White agreed to timely reimburse Wheeler for claims for his services.

The lawsuit alleges that in September 2021, Texas Medicaid and Healthcare Partnership officials phased out the use of TPI numbers for all Medicaid claim submissions. It said in place of TPIs, health care providers must submit claims using NPIs, the lawsuit alleges.

“In or around October of 2022, without reason or explanation, defendants began to prove Dr. Wheeler’s claims (submitted under his personal NPI number) as being submitted by Dr. Wheeler’s medical practice, Waco Neonatal Group, PA…” the lawsuit states. “In the decades since Dr. Wheeler has worked with the defendants, Dr. Wheeler has never submitted any claim under the practice’s name or NPI.

“In the past, all Medicaid claims submitted under Dr. Wheeler’s NPI had been paid by the defendants. Upon processing the claims as the practice’s, defendants denied payments on those claims citing that the practice did not have a TPI number,” the suit alleges.

Wheeler was told that the claim denials were caused by a “computer system glitch” since Scott & White had not updated its claim processing system to accommodate the TPI phase out. He was told a number of other physicians have experienced the same claim issue and told Wheeler to pursue Scott & White’s “internal review process.”

Wheeler appealed each of the claim denials.  On May 16, 2023, Scott & White rejected his appeals, the suit alleges.

“It cited the lack of TPI number as a basis for the claim denials,” the suit alleges. “However, the decision fails to explain why defendants inexplicitly processed Dr. Wheeler’s personal claims as his practice’s. Furthermore, it fails to address why defendants require a TPI number to pay a claim, when TMHP has already eliminated the TPI number for years.

“Defendants’ refusal to pay the legitimately submitted claims by Dr. Wheeler constitute a substantive breach of that explicit terms of the agreement,” according to the lawsuit.

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