The Texas Health and Human Services Commission is concerned that the unit, Affiliated Computer Services Inc, did not dedicate sufficient trained staff to audit the Medicaid requests, letting dentists get paid for procedures not covered by the program, the WSJ said.

Karen Arena, a spokeswoman for Xerox, had no immediate comment on the report when contacted by Reuters.

Xerox was quoted by the paper as saying it does not face similar scrutiny in other states, adding that it helps administer Medicaid programs in 36 U.S. states and the District of Columbia and processes $54 billion in annual Medicaid spending.

The current scrutiny of Xerox is part of a wider Texas investigation into Medicaid abuse that has largely targeted dentists and orthodontists, who have been accused of improperly billing the state for unnecessary procedures.

Medicaid is a federal-state program that insures lower-income people.

(Reporting by Sunayan Bhattacharjee in Bangalore; Editing by Edwina Gibbs)

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