Healthcare Fraud

Fraud in healthcare occurs when companies charge Medicare or Medicaid for items – such as drugs or equipment – that they did not actually provide. Because Medicare and Medicaid are government-funded insurance programs, these erroneous charges add billions of dollars on to the government’s expenses. In turn, these expenses must be covered by the taxpayers at some point.

Types of Healthcare Fraud

Healthcare fraud occurs in many different forms. One type occurs when Medicare and Medicaid are charged for items, procedures, or services that were never provided to a patient. There are many ways for these charges to be included on medical bills. However, this type of fraud often occurs in diagnostic testing and procedures. The charges for a procedure that never occurred are added on the bill along with other legitimate charges.

Patient Billing Fraud

Another type of healthcare fraud occurs when a service is provided to a patient and the bill is subsequently coded for reimbursement with a code that will refund a higher amount of money. Another form of this is known as unbundling. This occurs when an organization charges for individual components of a procedure or service instead of charging for the service as one amount which could mean substantial savings to the insurance company.

Patient Service Fraud

Sometimes, medical providers will enter into agreements with vendors, confirming receipt of a portion of any money made when a product or service is provided using that vendor’s products. If a patient does not need the medication or service, this is another type of fraud and must be reported. Additionally, large facilities and organizations submit reports to Medicare every year detailing how much the organization spent taking care of patients as a whole. These reports can mean billions of dollars to the organization that can help improve their facility and equipment. When an organization inflates the dollar amount reported to Medicare this is fraud.

Whistleblower Responsibilities

A person who notices that an organization is fraudulently reporting expenses to Medicare and Medicaid is commonly known as a whistleblower. A whistleblower can be either internal when all concerns are expressed to executives within the organization or external when allegations must be made to an outside organization in order for change to take place.

Whistleblower Retaliation

Even though a whistleblower may bring wrongdoing to the attention of authorities and testify against those involved, the whistleblower may still be subject to some form of retaliation within the organization itself or under the law. Many people are discouraged from coming forward concerning wrongdoing because they fear the treatment they may receive from co-workers and executives in their particular organization. However, support for whistleblowers is growing, and more and more countries are seeing groups founded to aide those people who want to stop fraudulent activity. For example, in the United Kingdom, the Public Interest Disclosure Act 1998 a person who comes forward to expose wrongdoing from retaliation and dismissal.

Whistleblower Protection

In the U.S., protection for whistleblowers varies from case to case and state to state depending on the state in which the fraudulent activity took place. Any person who plans on disclosing the fraudulent activity of their organization must be knowledgeable of any recourse available to them should the executives retaliate for information provided by the whistleblower. This person must be aware of how much information and involvement in prosecution is needed in order for protection to be provided them. Lastly, when the government is finished reviewing the case, the whistleblower has an opportunity to receive a reward for being the first person to come forward about the fraudulent activity. However, the whistleblower also must be the first person to file the claim for the reward.