Lessons from the OIG: Common Billing Errors Texas Home Health Providers Need to Know

The Texas Health and Human Services Office of Inspector General (HHSC-OIG) has a message for Texas providers and suppliers: Billing compliance matters, and the agency is watching. The Office of Inspector General (OIG) recently published its quarterly report for fiscal year 2026. Per the report, the HHSC-OIG recovered more than $95.7 million from December 1, 2025, to February 28, 2026.

HHSC-OIG has acknowledged that the vast majority of Texas Medicaid home care professionals are dedicated to their work and deliver excellent care to their clients. That said, HHSC-OIG continues to see the same billing errors repeated across the system through its audits, inspections, reviews and investigations. Notably, home health agencies were the number one provider type involved in HHSC-OIG's preliminary investigations this quarter, accounting for 21 percent of all cases, and ranked third in full-scale investigations at 15 percent.

Some of these problems surface through data-driven initiatives that examine claims and flag unusual billing patterns, while others come to light through tips from fellow providers or Medicaid clients themselves. Regardless of whether a violation is accidental or intentional, HHSC-OIG's mandate is straightforward: Verify that services billed to Medicaid were actually performed, were medically necessary and met the applicable standard of care.

Errors the HHSC-OIG Keeps Finding

Based on recent home care investigations, HHSC-OIG has published a summary of common billing errors in the home health care setting. Providers should pay close attention to these recurring problem areas:

• Failure to have a registered nurse perform a nursing assessment of the client within the client's home environment before seeking authorization for private duty nursing services. This is a foundational requirement, and skipping or shortcutting it exposes providers to significant liability.
• Documentation deficiencies. HHSC-OIG frequently identifies cases in which a client's record contains insufficient information to support that nurses performed tasks in accordance with physician orders as reflected on the Home Health Certification and Plan of Care or the daily skilled nursing flowsheets.
• Failure to maintain adequate documentation to support the private duty nursing services billed or verify that services were actually rendered. Providers should include the date the client was last seen by the physician in the plan of care.
• Billing irregularities. These include billing for dates of service when the client is known to be at an inpatient facility, billing as though a registered nurse performed services when the patient's file indicates the services were actually performed by a licensed vocational nurse, and entering false information into Electronic Visit Verification systems.

Each of these errors, whether the result of carelessness or something more deliberate, can trigger serious consequences.

The Financial Stakes Are Real

If the compliance rationale alone is not compelling enough, the financial consequences should be. The following are examples of matters the OIG settled with home health providers in recent quarters, ranging from five-figure repayments to seven-figure settlements.

• An HHSC-OIG investigation revealed that an agency reported providing home health care attendant services to a client during the time the client was hospitalized and residing in a nursing home. The provider cooperated with HHSC-OIG and settled the matter for $10,587.
• HHSC-OIG found that a home health provider's medical records did not support the use of the UA modifier billed for certain clients receiving private duty nursing services. The UA modifier provides additional reimbursement for patients who are ventilator-dependent or have a tracheostomy. The provider agreed to settle the matter for $147,291.
• HHSC-OIG settled with a Texas home health provider whose medical records did not support the use of the TD modifier for some clients. The TD modifier provides additional reimbursement for services rendered by a registered nurse instead of a licensed vocational nurse, and the provider's records also failed to support some billed units as having been worked at all. The provider agreed to a settlement of $1,721,586.
• HHSC-OIG settled three separate cases involving home health providers in Dallas, McAllen and Austin. In each case, investigations determined that personal care attendants billed Medicaid for services not rendered, including bathing, feeding and dressing patients when those services were never actually provided. The providers agreed to repay $11,303, $19,000 and $37,305, respectively, for a combined total of $67,608.
• HHSC-OIG settled with a home health provider that employed a personal care attendant who was listed on the Employee Misconduct Registry (EMR) following an arrest for an offense that prohibits employment in such positions. The same provider had also improperly submitted claims for personal care attendant services that the attendant never rendered. HHSC-OIG agreed to a settlement of $35,136. This case is a pointed reminder that all Medicaid providers should check both the Exclusions Database and EMR before extending an offer of employment.

Beyond Settlements: Criminal Consequences

It is important to understand that billing violations do not always end with a civil settlement. In some cases, the HHSC-OIG's investigations may lead to criminal prosecution. In February 2026, a Lubbock woman was sentenced to 17 years in federal prison and ordered to pay $227,377 in restitution after defrauding Texas Medicaid and retaining funds meant to care for her severely disabled, now deceased son.

The case was initiated by HHSC-OIG, further investigated by the Texas Office of Attorney General's Medicaid Fraud Control Unit and the FBI, and ultimately prosecuted by the U.S. Attorney's Office for the Northern District of Texas.

What Providers Should Do Now

The OIG has made clear that it views provider education as a critical component of its fraud, waste and abuse prevention efforts. To that end, HHSC-OIG has published educational resources specifically highlighting common home health violations. Letters addressed to both providers and attendants are available in English and Spanish on HHSC-OIG's website.

The agency is also engaging directly with the home health industry. On February 18, 2026, Inspector General Raymond Winter and Principal Deputy Inspector General Susan Biles presented at the Texas Association for Home Care and Hospice Winter Conference in Fort Worth. The presentation provided an overview of HHSC-OIG's role in program integrity and offered guidance on avoiding the most common errors identified in HHSC-OIG audits and investigations.

Additionally, HHSC-OIG launched a new OIG Referral System (ORS) on December 15, 2025, replacing its legacy fraud reporting portal with a public-facing system that routes allegations directly to the appropriate investigative unit. Providers should be aware that it is now easier than ever for colleagues, clients and the public to report suspected fraud, waste or abuse.

In light of this heightened scrutiny, Texas home health provider should consider taking the following steps:

1. Conduct an internal audit of your billing practices and documentation procedures against the common errors outlined above.
2. Ensure your staff understands the documentation requirements for every service billed to Medicaid, including the proper use of modifiers.
3. Verify that your hiring processes include checks against the Exclusions Database and EMR without exception.
4. If you identify a potential issue, consult with experienced healthcare compliance counsel.

The cost of proactive compliance is typically less than the cost of an external investigation, and regulatory agencies typically look more favorably upon providers who can establish a culture of compliance and proactive compliance efforts. Texas home health providers who invest in getting it right on the front end will be far better positioned to protect their agencies, clients and reputations.