Hospital Fraud

Hospital Fraud

Hospitals are also a significant source of fraud, waste, and abuse, and whistleblowers have assisted the federal government in pursuing such conduct through the false claims act. In many cases, fraud committed by hospitals is targeted at Medicare Part A, which generally covers inpatient hospital services, as well as Medicaid.
Some of the more common types of hospital fraud pursued under the False Claims Act includes:

  • Billing for Nonservices: This type of fraud involves billing for services that were not performed. For instance, some medical providers may bill for services for a non-existing patient. And, some medical providers bill twice for the same service provided to the patient.
  • Billing for Unnecessary and/or Unreasonable Services: This type of fraud involves billing for services that were actually provided, however, the patient did not need the service provided. In other words, the services were only provided even though the services were not medically necessary so the hospital could bill the government for providing them.
  • Upcoding: Hospitals bill using codes which are typically tied to either the patient’s condition or the nature of the service being provided. For example, very sick patients require more care, and therefore hospitals receive more money for treating them. Similarly, procedures performed by hospitals can be more or less complicated, with higher payment provided for more complicated procedures. Hospitals (or any healthcare provider) commits fraud when it bills at a higher patient or procedure code than is warranted.
  • Fraudulent cost reporting: federal reimbursement to hospitals for treating Medicare patients is based, in part, on how much it costs the hospital to provide care to those patients. Hospitals commit fraud when the inflate their “cost reports,” which are submitted to the federal government to determine payment, in order to unlawfully receive higher payment than they deserve.

Numerous False Claims Act actions alleging the above schemes have resulted in the federal government and whistleblowers recovering hundreds of millions of dollars.

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