Healthcare Fraud and Abuse

Healthcare Fraud and Abuse As we head into the next four years under the Obama administration, many Americans are hearing more and more about healthcare reform and what needs to be done to fix the ailing healthcare system. Part of the dramatic increase in healthcare costs is due to Medicare fraud abuse. Healthcare fraud is defined as making false statements or representations of material facts in order to obtain benefits or payment. Healthcare abuse is defined as practices involving the overuse or misuse of services, either accidentally or intentionally, for various reasons that results in overpayment. These acts may be committed by an individual person or an entity. Fraud and abuse exposes a person, provider, or entity to criminal and civil liability (CMS, 2012). Healthcare fraud and abuse costs taxpayers billions of dollars each year, causing an increased strain on state and federal budgets, and puts a beneficiary’s health and welfare at risk. The HIM professional plays an important role in controlling this type of fraud and abuse. Examples of healthcare fraud include billing for services or supplies that were not provided, or billing Medicare for missed patient appointments, and altering CMS claim forms for higher payment amounts (CMS, 2012). In Florida, it was reported that a physician was sentenced to 24 months incarceration and ordered to pay $727,000 in restitution fees for signing blank prescriptions and certificates of medical necessity for patients he never saw (Rudman, 2009). This is an example of the criminal liability that can result from healthcare fraud.
Examples of healthcare abuse include the misuse of CPT codes on a claim form, charging excessively for services or supplies, billing for services that were not medically necessary, and accepting kick-backs for Medicare patient referrals (CMS, 2012). A common type of abuse is upcoding – giving a patient a more serious diagnosis, in order to receive higher reimbursement. Upcoding made