Health insurance fraud, broadly defined, is any deceptive practice by healthcare or healthcare-related providers (physicians, hospitals, clinics, diagnostic testing labs, certain allied health professionals, suppliers of durable medical equipment, etc.) to unlawfully obtain payments from private insurance companies, Medicare and/or Medicaid. These fraudulent activities take a wide variety of forms, bearing witness to the inventiveness of those bent on health insurance fraud. Here are some of the common types, with examples provided for clarification if needed.
Upcoding Services
- Description: Billing for a more expensive service or procedure than was actually provided.
- Examples: Charging for a comprehensive exam when only a basic exam was conducted. Claiming a minor surgical procedure as a major surgery to receive higher payment.
Upcoding Time
- Description: Inflating the amount of time spent on a procedure to bill for higher reimbursement.
Unbundling
- Description: Billing separately for procedures that are usually bundled together and billed as a single service.
- Example: Charging individually for multiple blood tests that are typically covered under one panel.
Billing for Services Not Rendered
- Description: Charging for medical services, procedures, or equipment that were never provided to the patient.
Duplicate Claims
- Description: Submitting multiple claims for the same service to receive more than one payment.
Kickbacks
- Description: Accepting payments or gifts in exchange for referring patients to specific service providers.
- Example: A doctor referring patients to a particular lab for tests in exchange for a share of the lab's profits.
Performing Unnecessary Services
- Description: Conducting and billing for medical procedures or tests that are not medically necessary.
- Example: Ordering an MRI for a patient with a minor complaint that does not warrant an expensive imaging procedure.
Altering Medical Records
- Description: Modifying or falsifying medical records to justify unnecessary treatments or higher charges.
- Example: Changing a patient’s diagnosis to one that allows for more expensive treatment.
Prescription Drug Fraud (Joint fraud by physician and pharmacy)
- Description: Writing fake prescriptions for expensive medications that are billed to the insurer but never dispensed to the patient.
Billing for More Expensive Durable Medical Equipment (DME)
- Description: Charging for higher-cost medical equipment than what was actually provided.
- Example: Providing a basic wheelchair but billing for an advanced, more expensive model.
Providing Medically Unnecessary DME (Joint fraud by physician and DME provider)
- Description: Prescribing DME that the patient does not need.
- Example: Recommending a home hospital bed for a patient who doesn’t need one.
Fictitious Patients
- Description: Creating fake patient records to bill for services never provided to real patients.
Health insurance fraud not only causes financial losses to health insurance companies, state governments and the federal government, but can also jeopardize patient care by prioritizing profit over proper medical treatment. It is crucial to implement robust anti-fraud measures, including thorough auditing, patient education and legal enforcement.
