Health care fraud is the intentional and unlawful practice of filing fraudulent or deceptive claims for reimbursement. The following practices are examples of fraud:
- Falsifying a patient's diagnosis
- Accepting kickbacks for patient referrals
- Billing a patient more than the copay amount
- Billing for a higher level of treatment than was provided
- Performing unnecessary procedures to collect insurance payments
- Misrepresenting treatments as medically necessary when they are not
Inadvertent errors, such as occasionally reporting the wrong billing code, are not considered fraudulent.
False claims can be divided into two categories—fraudulent and abusive.
- Health care fraud occurs when someone intentionally misrepresents a fact on a health care claim to receive—or increase—reimbursement from a health plan. Fraud also occurs when someone misrepresents the delivery of health care services or supplies.
- Health care abuse involves actions that are inconsistent with accepted, sound (medical or business) practices.
Our Administrative Manual includes examples of fraudulent, abusive or inappropriate billing for services, as well as common violations of provider agreements and member contracts.
Medicare fraud and abuse compliance training
Medicare general compliance training and fraud, waste and abuse training must be completed within 90 days of hire and annually thereafter. Providers, employees, board members, agents and contractors that provide administrative services or health care services for or to Medicare Advantage members must complete this training. Note: Providers who have met the fraud, waste and abuse certification requirements through enrollment into Parts A or B of the Medicare program or through accreditation as a supplier of durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) are deemed to have met the fraud, waste and abuse training and education requirements.
- This training is provided by the Centers for Medicare and Medicaid Services free of charge.
- You must keep a copy of the training materials and maintain proof that such training has been completed for each individual.
The following practices can help protect your office from intentional fraud:
- Verify that billing codes are accurate.
- Protect your prescription forms, which are often stolen during medical visits and used in pharmacy fraud schemes.
- Check patient histories to help prevent prescription medication fraud. Ask patients if they are seeing or have obtained prescriptions from other providers.
- Implement procedures to ensure that information, such as the nature of services provided, is accurately communicated to your billing staff and to any third-party firms and services.
Prevent provider identity theft
Provider identity theft can have a significant financial impact on providers and health plans. It is also potentially harmful to a provider's professional reputation. The CMS Center for Program Integrity (CPI) has developed a Provider Identity Theft video that explains how to recognize, report and prevent the fraudulent use of a provider's medical information.
Member ID card/identity fraud
Many cases of identity fraud are reported involving member ID cards that are misplaced, stolen or loaned to an acquaintance. Theft can also happen when a member's information is presented by someone else at his or her time of service.
When cases of member ID card fraud are discovered, we will seek reimbursement from the person(s) committing the fraud; however, if a provider is found negligent in obtaining the proper identification, restitution may be sought from the provider. To protect your practice from this type of deception, we recommend taking the following precautions:
- Photocopy the front and back of each patient's (or their guardian's) member ID card and driver's license at every visit.
- Take a digital photo of each patient when he or she checks in for their first visit. Include it as part of his or her permanent electronic record. Then refer to the picture each time that patient checks in.