TX SB1038

Expands the definition of Medicaid "claim" to include any application, request, or demand for a benefit or payment, and adds a definition of "material" as having a natural tendency to influence

Creates 21 categories of violations including knowingly submitting false claims, soliciting kickbacks, making false statements to obtain unauthorized benefits, obstructing the Office of Inspector General, and failing to maintain required documentation

Establishes administrative penalties of up to twice the amount paid plus $5,000-$15,000 per violation causing injury to elderly persons, disabled individuals, or minors (or up to $10,000 per violation not causing such injury), with amounts tied to federal False Claims Act maximums

Extends the deadline for persons charged with violations to respond to preliminary reports from 10 days to 30 days for both informal review requests and formal hearing requests

Allows whistleblower awards of up to 5% of recovered administrative remedies (not just penalties) for individuals who report Medicaid fraud, abuse, or overcharges

Takes effect September 1, 2025, and applies only to violations occurring on or after that date