The largest area of fraud against the government is Medicare fraud. Approximately 10% of all bills submitted to Medicare are inflated or improper, which amounts to tens-of-billions of dollars each year. The government is asking you to help save the Medicare program by reporting Medicare fraud. In fact, the Department of Justice will pay you a reward of up to 25% of what it recovers if you follow its procedure for reporting Medicare fraud. This article explains how to report Medicare fraud and what to look for to spot Medicare fraud.
Because Medicare pays out $500 billion a year, even a small percentage of fraud amounts to a lot. Because it loses 10% a year to fraud, that amounts to $50 billion a year. Below are common ways doctors and hospitals are cheating Medicare. You are eligible for a significant monetary reward if you report one of these types of Medicare fraud.
Examples of Medicare fraud by Hospitals and Doctors
Below are just a sampling of the ways hospitals and others health care providers cheat:
- charging for tests, services or supplies not actually provided
- falsely stating how many hours were spent (i.e. routinely adding 30 minutes)
- charging for tests or services not really needed (i.e. routine ordering of blood work, frequently requesting a full panel of tests where only one or two are needed, or providing psychotherapy to people with Alzheimer disease)
- lying about any work or service performed
- upcoding (i.e. patient really has “bronchitis”, but Medicare is knowingly billed for treating “pneumonia”)
- billing for unallowable or unreasonable costs of goods or services
- billing for routine supplies (i.e. band aids, lubricants, irrigation solutions, gloves, slippers, prep kits, towels, monitors, humidifiers, oxygen [by the hour], anesthesia circuits, elbow or heel pads, mask, electrodes for ECG, and foam head rests)
- charging incremental nursing services (i.e. IV starts, and stat or monitor charges)
- unbundling services billed to Medicare (i.e. billing for individual tasks that really consist of one larger procedure)
- receiving or paying kickbacks for client referrals or to use particular products
- claiming ambulance costs for routine or non emergency travel
- using unskilled or unlicensed workers
- Long Term Acute Care Hospital (LTACH) cheating on number of days
Medicare Fraud by Drug Companies
Pharmaceutical companies cheat Medicare in three big ways, amounting to billions of dollars each year. First, they receive kickbacks from doctors and hospitals for referring patients. Second, drug companies promote off-label uses for drugs other than what the FDA approved for its intended use. Third, by failing to follow Current Good Manufacturing Practices (cGMP) their drugs are considered adulterated. (The FDA has strict requirements that apply to every drug manufacturer. Before a drug is approved, the pharmaceutical company must not only test the drug and prove its effectiveness, but it must establish and then strictly follow tight manufacturing procedures and controls.)
How to report Medicare fraud
The Department of Justice pays huge monetary rewards under the False Claims Act for reporting Medicare fraud. It pays up to 25% of what it recovers based upon your report of fraud, which amounts to millions of dollars. However, knowing how to report Medicare fraud is just as important as knowing about Medicare fraud. For instance, you must use an attorney to file for a monetary reward under the False Claims Act. You must also follow the government’s strict procedures for applying for a Department of Justice reward. But it can be worth the effort because the average reward for Medicare and Medicaid fraud is close to $1 million, and rewards have been as high as $100 million. It is time for you to learn how to report Medicare fraud.