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This morning's Today show had a horrifying story about a chain of dental clinics specializing in caring for low-income kids.  Back in 2010, Small Smiles, a chain of clinics based in Pueblo, Colorado; agreed to reimburse the federal government and several state governments for $24 million to settle charges it performed shoddy and unnecessary work on kids and billed Medicaid for the procedures.  The company also entered into a sweeping corporate integrity agreement with the Department of Health and Human Services Office of Inspector General.  But NBC News' Lisa Myers reports that Small Smiles still hasn't cleaned up its act.

Typical is the story of Nathan Hatchman.  Back in 2010--just after Small Smiles settled with the government--his mother, Autum Archuleta, took him to one of its clinics in Denver.  She heard then-two-year-old Nathan crying in the treatment room and rushed in to see what was going on.

She says Nathan was crying and struggling to move while being held down by three clinic employees and wrapped from his head to his feet in a stabilization device called a papoose board. She thinks he wasn't properly numbed.

"He wasn't the same for a long time after we brought him home," Archuleta said. "He cried a lot...He wasn't my little boy. He didn't smile...The night terrors were the worst. I mean it was a lot of sleepless nights."

It turned out that the dentist working on Nathan had given him three crowns, two baby root canals and six silver fillings in 25 minutes--work that another dentist deemed shoddy and mostly unneeded.  Nathan was still traumatized a year later.

Another story is that of four-year-old Jamier Brown, who had most of his teeth filled and capped at a Small Smiles in Dayton.  Months later, his gums are still discolored and his teeth hurt.  Two dentists later said he should have been seen by a pediatric dentist, and one of them bluntly said Small Smiles botched the work on his front teeth.

Watch the report here:

Small Smiles first came to attention in 2007, when WJLA-TV in Washington aired a chilling story about its practices.  The reporter who did the story, Roberta Baskin, later wrote that several staffers were in tears after watching the piece.  It triggered a federal and state investigation that culminated in the 2010 settlement.  Yet, according to records obtained by NBC, many of those same practices still exist today--including treatment performed without medical necessity or with inadequate anesthesia.  

The company brings in $150 million a year from Medicaid; one doctor took in 90 percent of his revenue in one year from Medicaid.  Since Medicaid's reimbursement rates are very low, Small Smiles reportedly relies on volume.  According to one dentist who briefly worked there before quitting, the results usually aren't pretty.

Dr. Kianor Shah worked for Small Smiles briefly in 2011.  He says he left after witnessing disturbing practices. The dentist showed NBC News notes he took about treatments he observed during his time there. Scattered across several pages were words like "restraint brutal," "unnecessary" and "no way."

"I observed excessive use of the papoose board and excessive use of force to restrain children as well as overtreatment for procedures that could have been done with much less invasive approach."

Shah claims dentists were coerced into abusing children and overcharging Medicaid by the promise of bonuses and pressure from management.

"I was advised, quote unquote, 'The dentists eat what they kill.' That means that they're gonna get paid for as much work as they do on those Medicaid kids. And that was about the last straw for me."

In other words, a lot of these clinics are fixated on the revenue--and comfort and medical necessity be damned.

Senator Chuck Grassley, who has been investigating dental clinics that take in most of their income from Medicaid, was also horrified when he heard this story.  He thinks Small Smiles should be kicked out of Medicaid altogether--a move that would likely put it out of business.

The HHS OIG has given Church Street multiple chances to keep the clinics in business, levying penalties against the company and threatening to exclude them from receiving federal dollars. But the threats generally come with an out — a way to repair the breaches and avoid being exclusion.

Senator Grassley believes that cycle should come to an end.

"The inspector general has given this group a lot of second chances. Every time they get their hand in the cookie jar. All sorts of excuses. So you get back to how long can this go on — the fleecing of the tax payers, the abuse of children? And you get back to the point that maybe it's about time for the inspector general to disqualify this company from Medicaid."

However, Lisa Re, an HHS OIG branch chief, says that it isn't that simple.
The Inspector General's office says the Small Smiles clinics have progressively improved, and while that improvement has been "uneven," the company is providing essential care to a vulnerable population. The agency maintains that it is better to aggressively monitor the company than to shutter it.  

"If we had closed down Small Smiles last year, there would have been an uncontrolled shut down of this company leaving half a million kids scrambling for dental care," said Lisa Re.

The issue is further complicated by the states, which are responsible for administering Medicaid. The OIG surveyed states about the impact of closing the clinics and got a strong reaction.

"Some of the states were alarmed that we were even considering closing any of the clinics because they simply didn't have enough dentists to provide any care to these kids," said Re.

The numbers seem to bear this out.  Almost four-fifths of dentists nationwide don't take Medicaid, primarily because of the low reimbursement rates.

Small Smiles is under new ownership which says it's trying to clean up the company's act.  But you have to wonder if this company should be down to its last strike.  After all, there comes a point where the need to provide affordable dental care isn't worth putting kids in harm's way.

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