Healthcare fraud is a serious issue. It is estimated to cost more than $100
billion annually nationwide.
Federal Law related to Insurance Fraud
U.S. Code, Title 18, Chapter 63, Section 1347 contains a federal statutory
definition of health fraud.
You can link to the U.S. Code at
http://uscode.house.gov.
Examples of fraud include:
- Providers submitting claims for medical services that were not actually
performed.
- Members letting another person use their medical identification card
to obtain medical services.
 How to identify Health Care Fraud
The number of Health Care Fraud schemes is limited only by the imagination of
the criminal mind. As a consumer, however, you can help us identify possible
fraudulent situations by monitoring your claims and Explanations of Benefits. If
you see any of the schemes listed below, or have any questions, please contact
our office as instructed in the "Reporting Fraud" link.
False Claims
False claims can be created by policy holders or medical care providers. The
suspect deliberately submits false information to an insurer to obtain
reimbursement on a claim or series of claims.
False claims can include the following:
1. Billing for services not received.
2. Misrepresentation of services. This usually involves billing for a more
complex procedure to receive higher reimbursement.
3. Misrepresentation of the dates of service. This may be done to receive
benefits for services rendered to a patient during a period they were not
covered.
4. Misrepresentation of the patient's condition. This usually involves
billing a non-covered condition with a covered diagnosis code.
5. Misrepresentation of the charge for a service. This can be accomplished by
not reporting discounts given to the patient, or by physically altering the
charge on a claim to be greater than what the provider actually charged.
6. Misrepresentation of identity. The identity of a patient or provider can
be changed in this scheme. A patient's identity may be misrepresented to cover
services for a patient without coverage under a person's name who does have
coverage. A provider's identity may be misrepresented to obtain or increase
benefits that may not have been available otherwise.
Falsifying Other Insurance Related Information
1. Applications for coverage. The intentional omission or misrepresentation
of information (including previous medical treatment) on an application could be
considered fraudulent.
2. Accident reports. This usually involves providing false information to
increase reimbursement under a contract's accident benefit.
3. Coordination of Benefits. This may involve withholding information about
another insurance coverage in an effort to obtain duplicate payments.
Eligibility Fraud
Eligibility fraud is often a misrepresentation made by a group, an
individual, an agent, or a combination of these entities.
1. Group Fraud. This usually involves a misrepresentation to obtain coverage
for a non-employee, by representing them as an employee of the group.
2. Individual Fraud. This could happen if someone living outside of the state
misrepresented their residency to obtain or maintain coverage.
3. Agent Fraud. This can involve the sale of nonexistent policies,
misrepresentation of information to the insurer, alteration of documents, etc.
Health Care Fraud Questions and Answers
Q -I know other people sometimes cheat a little on insurance claims or allow
their doctor to cheat if it results in less out of pocket expense for them. Why
shouldn't I?
A -People who cheat are a small and criminal minority - - and more and more
of these cheaters are being caught. Insurance fraud can jeopardize your
employment or cause you to lose your health care coverage. Most importantly,
insurance fraud is a crime, and you can face criminal charges for committing
fraud. The risk isn't worth it.
Q - I noticed an error on a recent bill from my provider. I contacted their
billing office and was told the mistake would be corrected. Did I do enough?
A - Not always. A medical care provider may adjust a charge on a patient's
account but will fail to inform your insurance company about the change in your
bill. You should receive an adjusted Explanation of Benefits from your carrier
with the correct charges.
Q - I know my medical care provider is submitting false charges to my
insurance company, but I don't want to be the only person pointing a finger at
them. What's your advice?
A - You should call your insurance company or a law enforcement agency about
the fraud. A fraud scheme usually involves a pattern of false billings. If your
bills are being falsified, it's likely that charges for other patients are also
being falsified. The fraud investigation will identify other patients willing to
share information. Current or former employees of the medical care provider can
also be used as sources of information. Chances are you're not the only person
who knows the story.
Q - My doctor charges a lot of money for a routine office visit. Is this
fraud?
A - By itself, a high price for a service doesn't mean that fraud is
involved. Fraud may be involved if the charge is "up coded". An example of
up coded occurs when a routine service is falsely described and billed as an
extensive or complex service. One example of up coded is when a doctor or other
health care provider bills an hour's worth of treatment for a fifteen-minute
session. Standard codes have been established and are used throughout the health
care industry to describe specific medical services, supplies, and equipment.
Call your insurance company if you believe your services are being up coded.
Q - My insurance coverage was cancelled six months ago, but my medical care
providers continue to bill my insurance for services I am currently receiving.
Is this fraud?
A - Insurance claim processing system contains specific instructions to deny
claims for members if the service is rendered after the coverage was cancelled.
Let your providers know that your coverage is not valid, or you will continue to
receive denial notices from your insurance. If the provider is billing altered
dates of service that indicate services were received when the coverage was
still effective, then contact our Special Investigation Unit to have them
investigate the claims.
Q - My medical care provider's statement doesn't give enough information to
tell if the charges are accurate. How am I supposed to know if there's fraud
involved?
A - Ask the provider for a detailed itemization of the charges. If the
provider can't or won't give you an itemization, contact your insurance company
to have them review the claim. Make sure you actually received everything that
was charged. If you suspect the itemization contains false or misleading
information, report the situation.
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