18 October 2013

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US Explained 11 types of Medicare Fraud Schemes How to prevent them

US Explained 11 types of Medicare Fraud Schemes How to prevent them

Following are the 11 examples of Medicare fraud schemes

Fraud Scheme 1

Skilled Nursing Facility Fraud

Skilled nursing facilities play a crucial role in providing therapy and rehabilitation after you or a loved one has suffered a debilitating illness or stroke. After a qualifying stay in the hospital, Medicare beneficiaries frequently need some time in a rehabilitation center to regain their strength.

However, some unscrupulous facilities (even some associated with national chains) have taken to fraudulent billing.

How the Scam Works

Fraudulent skilled nursing facilities (SNFs) typically engage in a type of billing fraud called “upcoding.” Upcoding is a misrepresentation of services rendered by using procedure codes not appropriate for the item or service actually furnished. The procedure codes that are used are reimbursed at a higher rate.

Another typical scheme used by fraudulent SNFs is where the patient is placed into the highest Resource Utilization Group (RUG) category. This category reimburses the rehab center the most Medicare money. The beneficiary receives excessive therapy time that is billed to the government. This excessive therapy is generally medically unnecessary and could be dangerous to the patient. In addition to physical and occupational therapy, the patient may receive podiatry foot care that may not have been indicated.

How to Fight Back

Remember, patients have a right to refuse unwanted and excessive therapy.
If you or a loved one is being threatened or coerced by staff to participate in therapy, report this conduct immediately.

Fraud Type 2

Home Health Care Fraud

For Medicare beneficiaries to be eligible for home health care services, they must be under the care of a physician. The physician must certify that the beneficiary needs one or more of the following: physical therapy, occupational therapy, speech language therapy or intermittent skilled nursing care. Additionally, beneficiaries must be “home bound.” which means that due to their condition, leaving them home is not recommended and requires special transportation, or can only be done with a taxing effort.
How the Scam Works

In the common home health care fraud scheme, no actual home health therapy is provided. The beneficiary is asked to sign forms that verify a nurse or therapist showed up at her home and provided services.

To justify charging for a nurse, a fraudulent physician who is not the beneficiary’s primary doctor may falsely certify that the beneficiary is an insulin-dependent diabetic and cannot inject himself.

Unscrupulous physicians may also fraudulently certify that a beneficiary is home bound. In exchange, the beneficiary will be offered cash on a monthly basis or provided a home health aide that only prepares meals or cleans.

How to Fight Back

Billing Medicare for services not provided is highly illegal and you should report this immediately if you are approached for this scam.

Be cautious when you are offered money or "free" services in exchange for your Medicare card number.

Reject the services of unscrupulous Medicare providers that use these fraudulent tactics to obtain your Medicare number and personal information. They intend to use it for fraudulent billing.

Fraud type 3

Durable Medical Equipment Fraud

Durable medical equipment (DME) companies offer a valuable service by providing wheelchairs, surgical supplies, catheters and respiratory nebulizers as well as nutrition and tube feeding supplies and other health care equipment. However, many fraudulent DME companies have appeared all across the country.
How the Scam Works

A fraudulent DME company approaches a fraudulent physician, or uses an unsuspecting physician’s stolen identity, to medically certify that a beneficiary needs supplies.

This same fraudulent DME company may also have stolen, or otherwise purchased, Medicare beneficiary numbers and begin to fraudulently bill Medicare for goods.

Typically no actual equipment is delivered to the beneficiary. He may not know equipment is being billed in his name but not delivered.

In other schemes, a fraudulent DME company may offer the Medicare beneficiary meals or food in exchange for her Medicare number. The DME company may also provide the beneficiary with nutritional supplements. (Be aware that Medicare only pays for nutritional support when the beneficiary has a feeding tube in place.)

Other common costly DME items that are offered include “custom” diabetic shoes, oxygen, nebulizers and therapeutic mattresses.

Sometimes the beneficiary is aware of the fraud and is paid a “kickback” in cash for selling his Medicare information.

How to Fight Back

Do not let anyone except your physician’s office handle your Medicare card. If anyone other than your physician's office requests you to provide your Medicare information, do not provide it.

Never accept “free” medical equipment or services in exchange for your Medicare number. Nothing is ever free.

Review your Explanation of Benefits paperwork for items that appear that you did not order or receive and report any discrepancies immediately.

Fraud Type 4 –

Wheelchair Scams

Wheelchair scams are another very common type of durable medical equipment (DME) fraud. Mechanical and motorized wheelchairs can assist a beneficiary who has a chronic ailment or disability that prevents her from freely ambulating. The power wheelchair industry has grown into an almost billion dollar per year industry. You’ve probably seen commercials on TV offering wheelchairs at “little or no cost to you.” Be aware, the Medicare rules stipulate that you must have a legitimate need before obtaining these devices, and a Certificate of Medical Necessity must be signed by your doctor.

How the Scam Works

DME street scammers may approach you to offer a power wheelchair that is a “free benefit” for having Medicare. This is not the case. The beneficiary must have a legitimate need, co-pays and/or deductibles may have to be met and the physician prescribing the device must have examined the patient. The cost of these power devices runs from $1,500 to $6,000, depending upon the model. In addition, accessories may be ordered that are not needed, driving the cost up higher by several thousand dollars.

Often a scam artist will contact the beneficiary and use scare tactics. This includes telling the beneficiary that Medicare is running out of money so the beneficiary better get his wheelchair now even though it’s not needed at this time. Getting equipment now for possible future needs does not adhere to the Medicare rules and is therefore illegal.

How to Fight Back

    Do not let anyone talk you into stockpiling equipment for later use. If you do need the equipment, it should only be ordered only through your regular family physician.

If someone calls and tries to threaten or pressure you into something, simply hang up the phone.

Be aware that you are responsible for 20 percent of the final amount, including potentially unnecessary add-ons and accessories, for the device ordered. Frequently the scammers do not explain this.

Fraud Type 5 –

Pain Management Clinics

Pain management clinics specialize in several methods of treating chronic pain patients. This may involve therapy, injections, implantable devices or oral pain medications. Most legitimate pain clinics have a clinician who is trained or certified in the treatment of chronic pain. However, now multiple fraudulent pain management clinics have sprung up all across the country and in some areas have become a tremendous problem.

How the Scam Works

Pain management clinics will recruit Medicare beneficiaries in a nearby neighborhood and provide van transportation to clinics to treat their “pain.” Once there, the beneficiary will typically receive the following unwarranted and unnecessary services: a consultation by a chiropractor, physical therapy, back adjustments by a chiropractor, injections by a physician or physician assistant and oftentimes x-rays.

Sometimes these fraudulent pain clinics will bill for a traction device called a Vax-D, which is not paid for under Medicare rules. In addition, Medicare beneficiaries will receive trigger point injections in their backs, but Medicare will get billed for a much more expensive procedure called a facet injection. After all this fraudulent therapy, the “patient” is taken by van again, treated to lunch and driven home. The whole process begins again in a few days, and the fraudulent billing continues.

How to Fight Back

 Be careful in accepting medical services that are proactively offered by a health care professional you do not know.

If someone comes to your door and says he is from Medicare or some other health care company simply shut the door.

Be suspicious if you are told that Medicare wants you to have this item or service and claim that, “We know how to get Medicare to pay for it.”

Fraud Type 6 –

Behavioral Health (Community Mental Health Centers)

Community mental health centers (CMHCs) treat mentally ill Medicare beneficiaries in outpatient centers. This type of treatment keeps beneficiaries out of the hospital and allows them to go home at night. CMHCs are mandated to provide intensive psychotherapy to their patients.

How the Scam Works

Instead of providing professional mental health services, fraudulent CMHCs provide nothing more than adult day care, where patients merely watch television all day and Medicare is billed for expensive mental health treatments.

Fraudulent CMHCs will also proactively recruit beneficiaries and offer spa treatments and vacations for the use of their Medicare card to bill Medicare for mental health care that was never rendered.
Another scheme includes billing for group therapy as individual therapy or van shopping trips to the mall that are billed as mental health care.

How to Fight Back

Reject offers of money or gifts in exchange for your Medicare number, Medicare card or statements containing your medical information and identity.

Don’t give out any of your personal information to these unscrupulous persons. The next victim of medical identity theft could be you.

Fraud Type 7 –

Medicare Advantage/Managed Care Fraud

Medicare Advantage plans save money by providing services that are monitored by the plan. This method is similar to the older version of health maintenance prganizations (HMOs) but with much tighter rules that the plans must follow. Approximately 20 percent of Medicare recipients choose the Advantage Plan option.

How the Scam Works

One method is for a fraudulent physician to begin increasing the number of diagnoses on the chart. These inflated diagnoses are then submitted to Medicare, which pays a higher monthly fee to the physician (capitated payment) because the patient appears sicker on paper.

Another method involves a sales representative who wants to talk to you about her version of the Medicare Advantage plan. The beneficiary may give some information such as name, address and Medicare card. Without realizing it, the fraudulent sales representative has signed up the beneficiary for her plan without his knowledge or consent.

Another tactic involves a sales representative offering incentives such as food, trips or “free” items in return for signing up for his program. Medicare prohibits these kinds of sales tactics, and they are illegal marketing schemes.

How to Fight Back

Make sure your diagnoses in your records are accurate. Question a sudden rise in the number or severity of diagnoses that are in your medical records.

Feel free to talk to vendors about the Medicare Advantage plans they have to offer. You might find a good deal for you. However, during the talk with the sales representative, make sure you do not give any personal information. She absolutely does not need this in order to tell you about the plan.

Make sure you do not receive any gifts or services in return for signing up for any Medicare plan. These are an illegal marketing and incentive plan and are considered “kickbacks.”

Fraud Type 8

Prescription Drug Fraud

Beneficiaries have the option of the Part D prescription drug benefit. This has been a wonderful advantage for seniors to help in their medication needs. However, this has also opened the door for new and unprecedented fraud attempts.

How the Scam Works

One area of concern in Part D fraud is prescription shorting. This is where a fraudulent pharmacy routinely dispenses prescriptions a few pills short. In a large prescription the pharmacist hopes the beneficiary will not notice. If the pharmacist does this repeatedly, the pharmacy can steal a lot of money from Medicare because Medicare is billed for the full amount.

In a similar scheme, a fraudulent pharmacy may fill a partial month’s drug supply and ask the beneficiary to come back for the rest. The pharmacist then bills Medicare twice in one month for the full amount.

A new prescription drug diversion tactic is to talk a beneficiary into getting a prescription from his physician for a narcotic. It is then filled and billed to Medicare. The beneficiary is then paid cash for the script and the drugs are cycled back through the pharmacy or sold on the street.

How to Fight Back

Although time-consuming, consider counting your pills when you first get the prescription filled to make sure you were not shorted on the amount.

Do not participate in prescription drug diversion fraud. It is highly illegal and criminal behavior and can get the participating beneficiary into severe legal trouble as well.

Fraud Type 9

Telemarketing Fraud

Telemarketing in general is legal and can be a useful method of soliciting people for services they may need. However, many telemarketing agencies push what is legally acceptable and may even be an outright hoax.
How the Scam Works

Often the scam involves a diabetic supply company. In this scenario, the supply company contacts the Medicare beneficiary and offers a new glucose test monitor. The supply company then obtains a “lifetime” certification from the beneficiary’s family physician. It will then begin to automatically ship test strips and other approved supplies to your home. The volume of strips may exceed what the beneficiary can possibly use, and she will get billed a co-pay each time as well. Also, it may be difficult to switch to another company because the company has a “lifetime” certification on file.

One new phone fraud involves contacting the beneficiary and saying he has won a $5,000.00 Health & Human Services “grant”. This is despite the fact that the beneficiary never applied for a grant. All the beneficiary has to do is wire money to India to secure the grant. This is not a legitimate service. If it were, you wouldn’t have to remit money to receive it, and it certainly would not be sent to India. Do not fall for this scam.

How to Fight Back

Never give out your Medicare number over the phone unless you initiated the call.

Never send personal information such as your Medicare number, credit card number or banking information over the web or over the telephone to these solicitors.

Fraud Type 10 –

Medical Identity Theft

Medical identity theft occurs when someone steals your personal information (like your name, Social Security number or Medicare number) to obtain medical care, buy drugs or submit fraudulent billings to Medicare in your name. It is the nation’s fastest-growing form of identity theft and is contributing to the rising cost of health care and, in some instances, diminishing the quality of care provided.

How the Scam Works

Medical identity thieves will steal your information, then create large lists of patients and sell them multiple times to fraudulent companies. In addition to the street-scam methods of stealing your information, we are also seeing individuals who have been planted as employees inside health care clinics, offices and hospitals to steal patient information out of the computers. And it’s not just patients getting their data stolen: Physicians are getting their data stolen in record numbers as well.

Unfortunately, there are always new and inventive ways medical identity thieves will try to steal your Medicare number and personal information. They may meet you outside the supermarket and offer you free vitamins or groceries courtesy of Medicare. But before you receive the vitamins, they must verify you are with Medicare by making a copy of your Medicare card. Alternatively, street scammers may set up as temporary vendors in shopping plazas and the like. They will offer free screening such as blood pressure, cholesterol and glucose checks. They will ask you to fill out a survey and provide protected information such as name, address, Social Security number and Medicare number. They have just stolen your information.

In another scenario, you may receive a phone call from someone pretending to be from a government agency wanting to verify your eligibility. She will try to talk you into giving her the numbers she needs right over the phone.

Another method of obtaining your personal information is under the pretext of computer repair. An unscrupulous computer repair shop can copy your hard drive while repairing your computer. Only use very reputable computer shops.

How to Fight Back

Safeguard your information and take steps to reduce your risk. Never provide any protected information over the phone unless you are absolutely sure of who is on the other end.

Monitor your personal financial accounts and billing statements. If you receive an Explanation of Benefits form from Medicare for a service you never received, or it supposedly occurred in an out-of-town or out-of-state clinic you’ve never heard of, then you may have been a victim of medical identity theft.

Act quickly when you suspect identity theft. To help protect yourself and Medicare, you should report all suspected instances of health care fraud and medical identity theft.

Fraud Type 11

Beneficiary Fraud

Unfortunately, we are seeing geographic pockets of Medicare beneficiaries who are participating as co-conspirators in fraud schemes.

How the Scam Works

The beneficiary will be asked to “sell” his Medicare card information or to sign weekly or monthly papers to verify that fake services were rendered. This is in exchange for a one-time payment or a monthly “kickback” amount. The scammers will target financially needy Medicare beneficiaries to persuade them to participate.

How to Fight Back

Be Advised. Receiving payment, free goods or services in exchange for your Medicare information is considered a crime that can result in jail time. This type of fraud also jeopardizes everyone’s health care benefits through higher costs and potentially diminished services.

If you are approached by someone who is offering money, free services, free groceries, free transportation or free clothing in exchange for your Medicare number, don’t do it. Just simply walk away!

Report any individual who engages in such behavior to Senior Medicare Patrol and law enforcement immediately.

Report Fraud –

If you suspect errors, fraud or abuse, report it immediately! You will protect other people from becoming victims and help to save your Medicare benefits.

Here are the steps you should take to report your concerns and abuse:

If you have questions about information on your Medicare Summary Notice or Part D Explanation of Benefits, call your provider or plan first.

If you are not comfortable calling your provider or plan or you are not satisfied with the response you get, call your local SMP.

Reality views by sm –

Friday, October 18, 2013

Tags - Medicare Fraud Schemes


DWei October 19, 2013  

Hilarious how only in the US would something like this need to be shared.

deeps October 20, 2013  

i m just wondering and waiting to see the day when there will be frauds in frauds... hmmmm