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Useful Resources
Minnesota Consumer Awareness Education and Resource Guide for 1998
CHAPTER III: Minnesota Medical Care & Anti-Fraud Project
Who?
The Minnesota Medical Care and Anti-Fraud Demonstration Project is a collaborative effort between the Administration of Aging, Minnesota Board on Aging, and the Arrowhead and Southwest Area Agencies on Aging. The project goal is to train volunteer peer educators to empower other senior citizens by teaching them about Medicare benefits and to recognize and report questionable medical services and suspected cases of waste, fraud and abuse.
What?
The program is a federal-state-community partnership to combat provider fraud and abuse in the Medicare and Medicaid programs.
Where?
The anti-fraud initiative began in 1995 as a 2 - year pilot called Operation Restore Trust (ORT) in five states: Florida, California, Texas, Illinois and New York. The Health Insurance Portability and Accountability Act of 1996 calls for creation of a nationwide health care fraud and abuse control program and establishes a Medicare Integrity Program funded from the Hospital Insurance Trust Fund. Medicare F.Y.I. results from this federal effort.
When?
Legislation called for the effort to begin in 1997 - the point at which this program originated. Volunteers participate in the training element which precedes the implementation of community education and interaction.
Why?
Vigorous action is needed NOW to ensure public health dollars are spent for essential goods and services, and not for unethical business practices.
Statistic: The US General Accounting Office [GAO] estimates that $1 out of every $10 spent for Medicare and Medicaid is lost to fraud.
Medicare Fraud And Abuse Overview: Medicare Fraud Is a Federal Crime!
Fraud happens when someone knowingly and willfully lies in order to get paid. Fraud usually involves careful planning. It happens when a provider misrepresents on the claim form what was furnished.
Medicare Fraud And Abuse Overview: Who pays?
You pay! Costs to Medicare are used to figure the annual deductible and the amount of your monthly premium. Fraud causes these amounts to be higher than they need to be. Therefore, you pay more "out-of-your-pocket".
After you pay your monthly premium and the annual deductible, you still owe a share of the Medicare-approved amount for most supplies and services. This share is called coinsurance, and is usually 20% of the Medicare-approved amount.
If you receive a medical service or item that is not medically necessary, you or your insurance company pay the 20%. These medical costs contribute to higher premiums.
Medicare fraud causes you to pay more in insurance premiums, coinsurance and deductibles. By working together to stop fraud, you will be saving money.
Medicare Fraud And Abuse Overview: Many offices must work together to fight fraud!
CMS administers the Medicare program and uses health insurance companies to process bills for Medicare-covered items and services. These companies have their private business but the part that processes Medicare claims is a separate operation that ensure claims are paid correctly. The companies have Medicare fraud units whose job it is to catch people who steal from Medicare.
The Office of Inspector General [OIG], of the Department of Health and Human Services, is the law enforcement agency that investigates and prosecutes people who steal from Medicare. The OIG works closely with Medicare insurance companies, as well as with the FBI, Postal Inspection Service and other federal law enforcement agencies.
Medicare Fraud And Abuse Overview: What can you do?
When you suspect that Medicare has improperly paid a claim, or you have been billed for a service you did not receive, use the Medicare F.Y.I. reporting mechanism. If it proves to be an honest mistake, it can be corrected and resubmitted. If the provider told you and you signed a paper stating you understood Medicare would not pay, you may have to pay for the service. It is very important to review your Explanation of Medicare Benefits/Medicare Summary Notice to see what was billed; what Medicare paid; and what you owe.
Definition: Medicare Fraud
AN INTENTIONAL DECEPTION OR MISREPRESENTATION WHICH COULD RESULT IN AN UNAUTHORIZED BENEFIT.
The intentional deception or misrepresentation which an individual knows to be false or does not believe to be true, and makes knowing that the deception could result in some unauthorized benefit to himself/herself or some other person.
The most frequent kind of fraud arises from a false statement or misrepresentation that is material to entitlement or payment under the Medicare program.
Outcome of fraud: We all suffer since fraud creates higher out-of pocket costs, higher taxes, reduced wages and lay-offs due to the higher costs of health care.
Health Insurance Portability and Accountability Act of 1996 [HIPPA] created the following new crimes:
- health care fraud
- theft or embezzlement in connection with health care fraud
- false statements related to health care matters
- obstruction of the criminal investigation of health care offenses
- disposal of assets to obtain medical coverage
- changes in mandatory and permissive exclusion of professionals from health care programs
- anti-kickback provisions
- civil monetary penalties
Sanctions for health care fraud include:
- criminal prosecution
- civil suits
- exclusion from government programs or practice groups
- license revocation
- loss of hospital staff privileges
Where do we see fraud? Fraud is everywhere and it takes on many different forms.........
- Part A - hospitals, long-term care, home health, hospices
- Part B - physician services
- DME - durable medical equipment, supplies
We see it in billings for:
- institutional facilities; nursing homes, residential facilities, hospitals and hospices
- physicians services, visits to physicians
- durable medical equipment; such as wheelchairs, walkers, hospital beds, incontinence supplies
Examples: Medicare Fraud
- Billing for services not rendered
- Unnecessary lab services/"battery of tests"
- Nursing home "gang visits"
- Altering claims to receive a higher payment amount/fee-for-service claims
- Deliberate request for duplicate payment
- Soliciting, offering or receiving a kickback, bribe
- Billing for equipment not delivered
- Billing for rental equipment after date of return
- Billing non-covered services as covered services
- Improper billing of psychological services
- Unnecessary or substandard health services
- Fraud rings/kick-back for referrals
- Sharing beneficiaries
- Unnecessary orthopedic devices
- Misrepresentation of patient's diagnosis to receive payment
- Unnecessary ambulance transport
- Providers completing Certificates of Medical Necessity (CMN) for patients not professionally known by the provider
- Suppliers completing a CMN for the physician
- Using another person's Medicare card to obtain medical care
- Repeatedly violating the participation agreement, assignment agreement or limiting charge
- Misrepresentation of services provided
- Inadequate licensing and supervision of providers/"quackery"
- Submission of false data for higher capitation rate
- Failure to provide necessary services
- Upcoding and upgrading services
- "Patient-dumping" compliance
- Waivers of co-insurance and deductibles
Definition: Medicare Abuse
INCIDENTS OR PRACTICES INCONSISTENT WITH SOUND MEDICAL OR BUSINESS PROCEDURES.
Incidents or practices of providers that are inconsistent with accepted sound medical, business, or fiscal practices. These practices may directly or indirectly result in unnecessary costs to the program; improper payment; payment for services that fail to meet professionally recognized standards of care; or that are medically unnecessary.
Abuse involves payment for items or services when there is no legal entitlement to that payment and the provider has not knowingly intentionally misrepresented the facts to obtain payment.
Examples: Medicare Abuse
- Excessive charges for services or supplies
- Claims for services that lack documentation to support medical necessity
- Breach of Medicare assignment and/or participation agreements
- Billing client in excess of limiting charges for specific services
- Billing Medicare at a higher fee schedule rate than for non-Medicare clients
- Inappropriate billing of claims to Medicare when Medicare is deemed the secondary payer [MSP]
Examples: Fraudulent & Abusive Practices
There are a variety of issues to deal with involving fraud and abuse in the health care setting.
The following limited examples will address only a few of many examples designed to assist in a better understanding of the magnitude of this concern.
Ambulance
Concerns:
- Medicare coverage issues are very complicated and often not understood by patients, nursing staff or hospital discharge planners.
Example of some schemes:
- Billing the patients for advanced life support [ALS] when basic life support [BLS] was provided
- Falsification of documentation to support increased dollar amounts to be billed [example: indicating patient needed oxygen to qualify for ALS]
- Charges are made for miles in excess of the actual miles traveled
What to look for:
- Review EOMBs/MSNs to insure services billed were provided.
- Review the Medicare Handbook for update on coverage and requirements for benefits.
Clinical Labs
Concerns:
- Medicare pays 100% so beneficiaries do not always review their EOMBs/MSNs
- Health care providers do not see what is billed to Medicare by the labs
Examples of some Schemes:
- More tests are added than the physician ordered
- More tests are billed for than provided
- Billing separately for lab tests that could have been included in a 'panel of tests' resulting in higher reimbursement
What to look for:
- "Free" services billed to Medicare or other insurance coverage
- Dates of service that coordinate with visit for tests
- Review EOMBs/MSNs to insure services billed were provided
Durable Medical Equipment [DME] Suppliers
Concerns:
- Professional licensing is not required
- Potential for quick profits
- Obtaining Medicare number under false pretense
Example of some schemes:
- Obtaining Medicare numbers under false pretense by offering a "free health service", "free supplies", "new" Medicare benefits to nursing homes to obtain residents numbers, conducting a "health survey" by phone and asking for patients number
- Misrepresentation of item being submitted for billing by entering diagnosis code that does not support the true condition of the patient [example: adult diapers as "female urinary collection systems"]
- Falsification of oximetry test results and/or diagnosis to support reimbursement for oxygen concentrators
- Supplying and billing for equipment that has not been prior authorized or prescribed by a physician and is not medically necessary [example: lymphedema pumps]
- Supplying and billing patient for unnecessary equipment such as canes, walkers and shower seats but the medical need is not documented and ordered by a physician [example: "laundry list" is generated by the hospital discharge planner]
- Providing the patient with a scooter and billing for an electric wheelchair
- Ordering and billing of excess repair for equipment
- Some vendors offer "free" case of milk supplements and groceries and bill for costly enteral/parenteral supplies
What to look for:
- Be aware of telemarketing schemes to obtain Medicare number
- Be alert for "free" offers in exchange for Medicare number
- Observe if all patients in a health care facility have same DME equipment
- Watch for relinquishment of deductibles and copayments
- Recognize "free" services that are billed to Medicare or other insurers
- Review EOMBs/MNSs to insure service billed were provided
Home Health Agencies [HHA] And Hospices
Concerns:
- Requirements for coverage are not understood by the beneficiary
Example of some schemes:
- Billing for patients that do not meet the requirements of "homebound" status
- Billing for services never or partially received by patient
- Billing housekeeping/custodial services as skilled nursing or therapy services
- Shifting patients from one agency to another
- Altering claims, duplicate billing or violating assignment agreement with Medicare
- Issuing of unethical certificate of medical necessity for home care services
- Unethical/unfair marketing strategies [example: offering incentives such as free groceries or transportation]
- Duplicate billing of services or not billing under current Hospice regulations
- Billing for services at a site other than where the home care service was provided
- Utilization of venipuncture/blood draw as criteria to qualify for services not medically necessary [note: currently in dispute]
What to look for:
- Beneficiaries who are not homebound but are receiving home care
- Hospice clients who are not meeting the regulatory guidelines
- Review EOMBs/MSNs to insure services billed were provided
Hospital Services
Concerns:
- Patients may not be aware of services they are receiving
- Rules for hospital billing are very complex
Example of some schemes:
- Posting inappropriate date for discharge
- Misrepresentation of DRGs [diagnostic related groups] to enhance reimbursement by Medicare
- Improper billing of observation status which results in a higher payment under Part B [observation status is the setting where patient is NOT an inpatient but is supervised and has periodical assessments by provider; Medicare payment is usually higher than what it would be through DRG category]
What to look for:
- Review EOMBs/MSNs to insure services billed were provided
- Request itemized statements for review and consideration
Kickbacks
Definition:
- A kickback is a money/business agreement for one party to pay another for some type of business referral or unnecessary services for the patient and most often are very hard to prove
- Health care providers engaging in these activities can be subject to criminal prosecution and exclusion from Medicare and Medicaid programs
Examples:
- Providing discharge planners to hospitals and nursing homes to induce referrals
- Paying physician fee for care plan certification on behalf of a home health agency
- Offering "free" services to beneficiaries, including meals and transportation, if they switch home health providers
Mental Health Services
Concerns:
- Patients tend to trust their therapist and/or counselors
- Claims may not be questioned because of the stigma associated with mental health services
Examples of some schemes:
- Billing for unlicensed personnel to administer care to patients
- Inappropriate or non-covered services are provided and processed for reimbursement
- Submitting a bill for social gatherings as therapy sessions or group sessions as individual counseling sessions
- Community mental health centers that advertise a social gathering to seniors and received EOMBs indicating psychotherapy services
What to look for:
- Group therapy sessions where recreational activities are provided
- Mental health providers with clients who are non-communicative
- Review EOMBs/MSNs to insure services billed were provided
Nursing Facilities
Concerns:
- Staff at nursing facility may not be aware of scams that defraud Medicare
- Beneficiaries do not know when items have been billed under their Medicare number
- Supply inventory/stockpiling is overlooked
- Beneficiaries cannot always be involved with decision-making for medical treatment or supplies
Example of some schemes:
- Billing social activities or life services as psychotherapy
- Billing for medical supplies the patient has not received
- Billing for custom fitted body jacket while being provided with wrap around corsets secured by Velcro straps
- Providing group therapies such as physical, occupational and speech, and billing 30 minutes of therapy for each patient as if provided individually [note: therapy must be medically necessary and ordered by health care provider]
- Billing for ostomy supplies in quantities that exceed what is required and using the unused components for central supply
- "Gang visits" [such as optometrist, podiatrists, etc.] to many patients in a facility, most who do not have any prior symptom or medical condition documented in their chart to warrant billing and reimbursement
What to look for:
- Therapies provided to groups of patients [PT/OT/ST]
- Therapies provided to patients who cannot benefit from the services [example: in a coma or Alzheimer's]
- Notation that all patients have the same medical equipment
- Indication that special supplies are not individually labeled
- Easy access to patient files to persons other than medical practitioners
Physicians/Practitioners [Medical Doctors, Optometrists, Chiropractors, Podiatrists, Physical Therapists, etc.]
Concerns:
- Medical care givers are trusted by their patients
- Patients hesitate to ask questions fearing a negative impact on their care or that physician will discharge them from his/her care
Example of some schemes:
- Misrepresentation of diagnoses on billing to obtain payment [examples: toe nail clipping for routine foot care, comprehensive levels of eye care when lower level exam is performed, chiropractor billing for three visits and patient is seen twice, ophthalmologist falsifies documentation to support cataract surgery, billing acupuncture as physical therapy]
- Not charging the 20% copayment for Medicare services
- Billing for experimental medical services not approved by Medicare
- Billing for Home Health Care chart review when that documentation does not support reimbursement
- Inappropriate procedural and/or diagnostic coding [example: screening vs. diagnostic]
- Upcoding or upgrading of medical services/procedures that were provided to the patient for financial reimbursement without chart documentation to support coding
What to look for:
- Patients alluding to never being seen by the physician/practitioner
- Patients obtaining payments [cash or in-kind] for using a clinic and providing Medicare number
- Compare statements with date and services received as well as comparison with EOMB/MSN
- Review EOMBs/MSNs to insure services billed were provided
Examples: Medicaid Fraud and Abuse
- Anything fraudulent in Medicare is considered fraudulent in Medicaid.
- Bills cross over from MC to MA thus enhancing the process to screen for fraud.
- Misrepresentation or billing for services not performed
- Double billing [sometimes human or computer error]
- Billing for service already reimbursed by another insurance provider
- Billing for service that cannot be supported by chart documentation
- Unnecessary services or equipment
- Billing for a different level of service than that actually provided the client
- Kickbacks
- Unbundling.....billing smaller parts vs. the whole
- MFIP-S [MN Family Investment Program-Statewide]: disqualification and sanctions
- Fraud schemes that exist in Medicare system are the same ones to be utilized to defraud Medicaid
- Improper billing of Medicaid recipients; charging client additional sums for those covered
- Managed Care underutilization issues: failure to provide the patient needed services
What May Not Be Considered Fraud and Abuse
Question: What should be done if beneficiary is being billed for services he/she did not receive?
Answer: This could be a keying error in the billing/processing . Contact the office that processed the claim and request the error be corrected. It could be a service by a provider the client did not see [lab, pathology, radiology, anesthesiology]. The services were provided by a nurse practitioner, physician assistant or physical therapist who is billing under the physicians provider number.
Question: The client interprets his/her billings to be high or in duplicate. What should be done?
Answer: This is usually found on hospital inpatient billing where it could be a simple billing or charging error. [Since IP claims are paid under DRG system, the duplicate charge does not usually affect what MC allows to be paid] Contact the hospital to have incorrect charges removed.Contact the fiscal intermediary if the charges seem extreme or very unusual.
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