Why Should You Care About Health Insurance Fraud

Fight Medical Fraud Why Should You Care About Health Insurance Fraud

Why You Should Care About Healthcare Insurance Fraud

Healthcare insurance fraud affects everyone. The Centers for Medicare and Medicaid Services (CMS) spent $1.1 trillion in one year on health coverage for 145 million Americans, according to the American Medical Association (AMA). The most shocking revelation though comes with the fact that $95 billion of that was made in payments dealing with abuse or fraud.

Improper and fraudulent billing impacts everyone resulting in higher insurance premiums and taxes, more expensive tests, and exposure to unnecessary services. It can happen with private insurance, Medicare, or Medicaid. How should you deal with healthcare fraud? Let's delve even deeper and see how DoNotPay can help.

What Constitutes Healthcare Insurance Fraud?

CMS divides integrity issues and healthcare fraud into four categories:

  • Incorrect billing errors
  • Ordering excessive diagnostic testing
  • Abusing the system through deliberate inappropriate billing practices
  • Intentional fraudulent billing practices

Let us look at these in more detail.

Incorrect Billing Errors

Everyone makes mistakes now and then. Incorrect billing errors may not be intentional but happen nonetheless. While an occasional incorrect billing error may end up costing as much as an intentional fraudulent one, it is considered an error and there is nothing illegal about it.

Ordering Excessive Diagnostic Testing

Ordering additional diagnostic testing over what may be needed to make a diagnosis is an example of padding a bill. The patient receives the test, and no harm comes from it, but it could be considered unnecessary. The purpose was really to charge the insurance company for an additional test.

It can be hard to prove, as a doctor could produce an argument as to why the test was required. It does end up costing insurance providers extra money as well as the patient who may end up with a partial payment due out-of-pocket and an increase in their insurance premium.

Abusing the System Through Deliberate Inappropriate Billing Practices

Here is where things start to get really shady, and downright unlawful. The most common forms of system abuse come through upcoding and unbundling.

  • Upcoding is a result of using a higher-priced CPT (current procedural terminology) code for a test or procedure than what the patient truly had. An example could be that you saw your psychiatrist for a quick 15-minute prescription review and refill, but the doctor charges for a regular, 45-minute office visit at three times the cost.
  • Unbundling, also known as fragmented billing, is the fraudulent practice of taking apart a procedure and charging for each aspect rather than in its entirety. For example, instead of a laboratory charging for a basic metabolic panel, the lab instead charges for each aspect as separate tests including:
  1. Glucose level
  2. Calcium level
  3. Sodium, potassium, carbon dioxide, and chloride levels
  4. Blood urea nitrogen (BUN) and creatinine

Four units could have been billed as one test. Again, the intent is to up the pay level.

Intentional fraudulent billing practices

These fraudulent practices include billing for services that were never provided or ordering an unnecessary medical service that could even be harmful to the patient. They are not only illegal but ordering an unnecessary service could lead to losing one's medical license.

Why Should You Report Healthcare Fraud?

Criminal healthcare fraud such as upcoding and unbundling attracts charges in the form of civil monetary penalties. You may be liable for restitution and damages if you get charged under criminal and civil law provisions.

ViolationJail TimeFines and Other Penalties
Federal Health Care Fraud Law10-20 years in prison
  • Substantial fines
  • Loss of Medicare eligibility
False Claims Act5 years for each violation
  • $21,000 per claim, triple damages, and overbilled amount recoupment
  • Loss of hospital privileges, program exclusion, and non-payment of future claims
Anti-Kickback Statute5 years for each violation
  • $25,000 per claim
  • Program exclusion, triple damages, and recoupment
Stark Law5 years for each violation
  • Similar to penalties provided under Anti-Kickback Statute and False Claims Act

Besides these statutes applying to payments from the federal governments and healthcare providers, the US DOJ can charge multiple other offenses as a result of Medicare fraud investigation. These include conspiracy charges, mail fraud, wire fraud, money laundering, and other white-collar federal crimes.

What to Do if You Suspect Healthcare Insurance Fraud

Whether you have private insurance, Medicare, or Medicaid, if you suspect medical billing fraud practices are afoot, you should report it to your insurance company.

In addition, whether it was a clerical error or a fraudulent one, you can send a letter to the medical practice involved demanding the billing problem be corrected. You will need to not only include the CPT billing code(s) that was used but look up the proper one(s). Your letter should be professionally written and factual to get the best results.

While this can be time-consuming, it is necessary to not only get the billing problem correct but to assure it does not happen again – to you and potentially to others. If the thought of writing such a letter is giving you a headache, there is a much easier way. Use the DoNotPay app.

Have DoNotPay Deal with Healthcare Insurance Fraud by Writing Your Demand Letter

Using DoNotPay is a snap. It was designed to handle legal problems such as general healthcare insurance or Medicare medical fraud and more. You just need to provide a little information and ask the app to write your demand letter.

  1. Search Fight Medical Fraud on DoNotPay.

     

  2. Tell us the date of your visit, what you were treated for, and where you were treated.

     

  3. Let us know what CPT code your visit was filed under. If you don't know, we'll generate a letter for you to send to your physician to request the code.

     

  4. Choose the correct CPT code or let us know if you want us to find it for you.

     

  5. And that's it! DoNotPay will automatically find the correct CPT code for your visit if you don't know it and then generate a demand letter on your behalf to send to your physician for a bill correction.

     

If you decide to take it even a step further, choose the Sue Now option, and DoNotPay will get to work starting to prepare a small claims case for you. Pretty cool, eh?

Are There Other Issues DoNotPay Can Handle?

You bet! DoNotPay abilities go way beyond your concern about healthcare insurance fraud. It will:

DoNotPay is an app you need for everyday life! Put it to work for you.

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