Medicare Fraud and Abuse: What is It and How Can I Spot It?
Medicare fraud and abuse is a massive issue that affects thousands of seniors every year. In fact, in April 2019, the Centers for Medicare & Medicaid Services (CMS) suspended payments to 130 sellers for over $1.7 billion in claims. The sellers were paid over $900 million. Federal officials also arrested 24 people in fraud cases that resulted in over $1.2 billion in losses for Medicare that month.
With Medicare’s trust fund struggling to see 2030, catching and eliminating fraud is essential. While CMS, the government, and plans are all striving to do their part in this fight, the first and best guardians against Medicare fraud are Medicare beneficiaries.
Much of the information below, including any facts in this post that are not cited otherwise, is from CMS’ MLN Booklet “Medicare Fraud & Abuse: Prevent, Detect, Report.”
What is Medicare Fraud?
A fairly wide umbrella of acts fall under the term “Medicare fraud.” Generally speaking, acts of Medicare fraud must be knowingly committed, so an honest mistake usually isn’t considered fraud. They can also be committed by anyone, from doctors to beneficiaries to outside parties.
CMS typically considers Medicare fraud:
- Knowingly submitting, or causing to be submitted, false claims or making misrepresentations of fact to obtain a Federal health care payment for which no entitlement would otherwise exist
- Knowingly soliciting, receiving, offering, or paying renumeration (e.g. kickbacks, bribes, or rebates) to induce or reward referrals for items or services reimbursed by Federal health care programs
- Making prohibited referrals for certain designated health services
In laymen’s terms, Medicare fraud is when you lie or misrepresent Medicare claims to get a payment, bribe someone, or accept bribes in exchange for medical referrals or making a referral that you’re not allowed to.
What is Medicare Abuse?
Though often discussed in unison, Medicare fraud and Medicare abuse are different in important ways. Medicare fraud is often lying about or fabricating Medicare-approved services or medical necessity of said services. This differs from Medicare abuse, which includes overcharging Medicare, charging the program for unnecessary services, or misusing billing codes on a claim. Abuse may also include practices that don’t provide patients with medically necessary services or that don’t meet certain standards of care.
Medicare abuse includes overcharging Medicare, charging the program for unnecessary services, or misusing billing codes on a claim.
Essentially, the differences between Medicare fraud and abuse lie in whether you actually received the services, as well as the circumstances and person’s or organization’s intent and knowledge of the legality of the actions. Simply put, it’s the difference between outright lying and stretching the truth. Both are wrong, but with stretching the truth, there’s usually some truth there, though it’s been exaggerated or misused.
How to Protect Yourself from Medicare Fraud and Abuse
So, how can you help combat Medicare fraud or abuse and protect yourself from it? The first step to stopping Medicare fraud is trying to prevent it. While you can’t stop certain types of Medicare fraud or abuse, like if Medicare were to be charged for a service you didn’t receive, you can protect yourself from one type. This is identity theft-related Medicare fraud, like if your Medicare card is stolen and somebody uses it to receive coverage (medical identity theft). Medicare is taking steps to help protect your identity with the new Medicare cards, but you should also do your part to prevent and help catch identity theft.
The first step to stopping Medicare fraud is trying to prevent it.
Even if you do everything you can to prevent Medicare fraud and abuse, it can still happen. This makes it important to continually be on lookout for signs of it. The best way to watch for fraud and abuse is to monitor reports and notices sent to you by CMS and your Medicare plan (if you have a Medicare Advantage, Part D, or Medicare Supplement plan). For Original Medicare, you’ll receive a Medicare Summary Notice (MSN) every three months. For a privately-managed plan, you’ll receive an Explanation of Benefits (EoB) after getting covered services or items. In both cases, an MSN and an EoB breaks down the services you received, what was paid by Medicare or the plan, and how much you owe. Watch them for any suspicious activity or charges.
What to Do If You Suspect Medicare Fraud or Abuse
If you notice charges for services or items you didn’t receive, charges from health care providers that you’re not familiar with, or other suspicious activity, report it immediately! You’ve possibly become the victim of Medicare fraud or abuse. You can report suspicious claims online at the Office of the Inspector General or by calling 1-800-MEDICARE (1-900-633-4227, TTY 1-877-486-2048).
When you’re ready to report the claim for fraud, it’s important to have the following details ready:
- Your name and Medicare number
- The specific service or item
- When the service or item was listed as given
- Who gave the service or item and any identification information you have, like identification numbers
- How much the service cost, how much Medicare approved, and how much Medicare or your plan paid
- Why you suspect this service or item is fraudulent
Once you have made the report, someone will be on the case investigating whether there was fraud or abuse. If you discover that you’re a victim of Medicare fraud or abuse, don’t fret. As long as you properly report it, the right professionals should be able to rectify the situation.
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Being a victim of Medicare fraud or abuse can be scary. Fraud costs Medicare millions of dollars every year! By being vigilant and reporting suspicious claims, you can help minimize the damage that Medicare fraud and abuse has on you and others.
Aging in Place — What You Need to Know About Medicare Fraud
Centers for Medicare & Medicaid Services — Medicare Fraud & Abuse: Prevent, Detect, Report
Office of Inspector General — Medicare Fraud Strike Force