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Medicare Fraud

Medicare fraud is a general term that refers to an individual or corporation that seeks to collect Medicare health care reimbursement under false pretenses. Most Medicare payment errors are unintentional mistakes and are not the result of physicians, providers, or suppliers trying to take advantage of the Medicare system.  However, large sums of taxpayer money are lost each year due to intentional Medicare Fraud.  A person who has a question or concern regarding a Medicare claim submitted on his/her behalf, can discuss the concern directly with the physician, provider, or supplier that provided the service and/or report suspicion of abuse directly to Medicare.

The effort to prevent and detect fraud is a cooperative one that involves:

  1. The Centers for Medicare & Medicaid Services (CMS)
  2. People associated with Medicare
  3. Providers of Medicare services including physicians, providers, and suppliers
  4. State and Federal Agencies such as, the Department of Health and Human Services Office of the Inspector General, the Federal Bureau of Investigation (FBI), and the Department of Justice.

Medicare fraud involves purposely billing Medicare for services that were never provided or received.

Some examples of Medicare fraud include:

  1. Billing Medicare or another insurer for services or items the patient never got.
  2. Billing Medicare for services or equipment which are different from what the person got.
  3. Use of another person’s Medicare card to get medical care, supplies, or equipment.
  4. Billing Medicare for home medical equipment after it has been returned.

Medicare beneficiaries should be aware of the following red flags:

  1. Circumstances in which the beneficiary is told that the tests are free and that the provider only needs your Medicare number for his records.  This cannot be taken as a general rule since there are clinical laboratory tests, where there is no co-payment and the provider may in good faith state that the test is free, since there is no cost to the  Medicare patient.
  2. Instances where the beneficiary is told that Medicare wants the person to have a particular item or service.
  3. When the provider tells the beneficiary that they know how to get Medicare to pay for it.
  4. When the beneficiary is told that the more tests Medicare provides, the cheaper they are.
  5. Representations to the effect that all the equipment and service are totally free; it will not cost the beneficiary anything.
  6. In cases where payments or gifts are made to the beneficiary to go to certain clinics or offices.

There are certain other circumstances which may prompt the beneficiary to remain cautious.  These include cases where:

  1. Co-payment charges are made on clinical laboratory tests, and on Medicare covered preventive services such as PAP smears, prostate specific antigen (PSA) tests, or flu and pneumonia shots.
  2. There is routine waiver of co-payments on any services, other than those previously mentioned, without checking the beneficiary’s ability to pay.
  3. The provider advertises “free” consultations to people with Medicare.
  4. Where providers claim that they represent Medicare.
  5. When providers use pressure or scare tactics to sell high priced medical services or diagnostic tests.
  6. When providers bill Medicare for services the beneficiary did not receive.
  7. When providers use telemarketing and door-to-door selling as marketing tools.

A person who suspects fraud should report such instances immediately to Medicare.   Additionally each person should review their payment notices, sometimes called explanation of benefits,  from Medicare upon receipt for errors.  These payment notices are sent each time Medicare is billed for service.  The notices show what Medicare was billed for, what Medicare paid and what the person owes.  By carefully reviewing these notices, Medicare recipients can ensure that Medicare was not billed for health care services or medical supplies and equipment s/he did not receive.

Taking the following precautions will also go a long way in preventing fraud:

  1. Do not give out your Medicare Health Insurance Claim Number to any person other than to the concerned physician or other Medicare provider.
  2. Do not allow anyone, except appropriate medical professionals, to review the medical records or recommend services.
  3. Do not contact a physician to request a service that you do not need.
  4. Use caution in accepting Medicare services that are advertised as free.
  5. Be cautious when offered free testing or screening in exchange for your Medicare card number.
  6. Be cautious of any provider who maintains they have been endorsed by the Federal government or by Medicare.
  7. Avoid any provider who tells you that an item or service is not usually covered, but they know how to bill Medicare to get it paid.

It is in the best interest of all citizens to report suspected fraud.  Healthcare fraud, whether against Medicare or private insurers results in monetary loss, and ultimately results in increased health care costs for all citizens.

Whenever a patient notices an error in Medicare billing, they should first contact the provider.  Simple mistakes in billing can easily be corrected by the physician, provider, or supplier’s office.  If  the physician, provider, or supplier’s office does not help with the questions or concerns  and the patient suspects Medicare fraud s/he should call or write to the Medicare Company that paid the claim.  The name, address, and telephone number of the Medicare Company providing the service will be on the Medicare Summary Notice (MSN) the person received.

Before contacting the Medicare claims processing company, the person should carefully review the facts as s/he knows them and also as shown on the Medicare Summary Notice to see if there is any difference between the two.  It will also help to write down:

  1. The provider’s name and any identifying number you may have.
  2. The item or service you are questioning.
  3. The date on which the item or service was supposedly furnished.
  4. The amount approved and paid by Medicare.
  5. The date of the Medicare Summary Notice.
  6. The name and Medicare number of the person who supposedly received the item or service.
  7. The reason you believe Medicare should not have paid.
  8. Any other information you may have showing that the claim for the item or service should not have been paid by Medicare.

A person who writes to the service provider should clearly state at the beginning of the letter that you are filing a fraud complaint.  This will help to ensure that the complaint is forwarded to the fraud unit.


Inside Medicare Fraud