Telehealth Fraud: Sham Encounters and Downstream Ordering
Telehealth fraud typically involves brief or fictitious encounters used to generate orders for durable medical equipment, genetic testing, or medications, with the telehealth company paid per order rather than for care. The resulting claims are false and the arrangements usually violate the Anti-Kickback Statute.
The ordering scheme, not the visit, is the fraud
Telehealth itself is legitimate and permanently expanded. The enforcement cases are not about care delivered remotely. They are about a business model where the encounter exists to justify an order.
The structure recurs: a marketer generates leads, a telehealth entity conducts a brief call, a clinician signs an order, and a supplier bills Medicare for equipment or testing the patient did not need and sometimes did not want.
What investigators look for
The tells are about time, choice, and money flow.
- Encounters lasting a few minutes, or documented encounters that never occurred
- Clinicians signing large volumes of orders for patients they did not meaningfully evaluate
- Payment to the telehealth entity per order or per completed lead rather than per encounter
- Patients contacted by marketers before any clinical relationship existed
- Orders concentrated in a narrow set of high-reimbursement products
- Clinicians licensed in many states signing for patients they never see again
Genetic testing and equipment are the usual products
Cancer genomic testing, pharmacogenomic panels, orthotic braces, and continuous glucose monitors recur because reimbursement is high and medical necessity is documented rather than observed.
A pattern of orders for the same expensive item across unrelated patients, all originating from the same telehealth entity, is the signature investigators look for.
Frequently asked questions
I am a clinician who signed some of these orders. Am I a target?
Clinicians have been defendants in these cases, and clinicians who stopped and reported have been relators. Your exposure depends on what you knew and how you responded. Discuss it candidly and early.
Is paying a telehealth company per encounter illegal?
Fair market value payment for a legitimate service is lawful. Payment tied to the volume or value of orders generated implicates the Anti-Kickback Statute.
Does this apply outside Medicare?
The False Claims Act reaches federal programs including Medicare, Medicaid, and TRICARE. Purely commercial arrangements fall outside it, though most of these schemes target federal beneficiaries because the reimbursement is reliable.
The attorneys who handle these cases
Related reading
Talk to a whistleblower attorney before you report
A conversation costs nothing and is confidential. We will tell you honestly whether what you have describes a case, and what the first-to-file rule means for your timing.