The National Consumer Protection Technical Resource Center: The Center of Service & Information for SMPs

Health Care Fraud

Medicare Fraud

Medicare Basics

 Part A

 Part B

 Part C

 Part D

The types of schemes that can and are being perpetrated against the health care system are as complex as the system itself. Common fraud schemes include efforts to fraudulently obtain and use a person’s Medicare number as well as scams that target Medicare services and plans. “Scam artists have treated Medicare like an automated teller machine, drawing money out of the government’s account with little fear of getting caught,” said former Sen. Norm Coleman of Minnesota.

Medicare Fraud

Medicare fraud is defined as knowingly and willfully executing, or attempting to execute, a scheme or ploy to defraud the Medicare program or obtaining information by means of false pretenses, deception, or misrepresentation in order to receive inappropriate payment from the Medicare program.

Click here for examples of Medicare fraud. Click here for Medicare fraud schemes from the Office of Inspector General.

Medicare Abuse

Medicare abuse is defined as incidents or practices of providers that are inconsistent with accepted sound medical, business, or fiscal practices. These practices result in unnecessary costs to the program, improper payments, payment for services that fail to meet professionally recognized standards of care, or conducting procedures that are medically unnecessary.

Abuse involves improper payments where the provider has not knowingly and intentionally misrepresented the facts to obtain payment. Abuse still needs to be reported and corrected. Inappropriate practices that start as abuse, if unchecked, can evolve into fraud.

Click here for specific examples of Medicare abuse.

Errors & Other Situations That May Not Be Fraud

Providing and billing for health care services involves a lot of complicated steps, which may lead to errors or other situations that may not be fraud. Most Medicare payment errors are simply mistakes and are not the result of physicians, providers, or suppliers trying to take advantage of the Medicare system. Also, people often have trouble understanding their bills.

Click here for examples of errors and other situations that may not be fraud.

How SMPs Help

SMPs play a unique role in the fight against fraud, abuse, and errors. They help beneficiaries when they are unable to resolve concerns on their own. Volunteers and staff also serve as “eyes and ears” in their communities, helping to uncover potential problems.

Because of their training and experience, SMP staff and volunteers have more insight than the average Medicare consumer into the issues of fraud, abuse, and error. SMPs also have a formal relationship with Medicare Program Integrity Contractors for the Centers for Medicare & Medicaid Services (CMS). SMPs are able to quickly and efficiently refer beneficiary complaints of potential fraud and abuse directly to these contractors for investigation and resolution.

To find the SMP in your state, click here.

Tools

  • Medicare Summary Notice decoders from AARP help you understand how to understand your Medicare statement, out-of-pocket expenses, and how to spot potentially suspicious charges.

Articles

For More Information

  • Brochure: Help Prevent Fraud. Simple ways you can protect yourself and Medicare from fraud.
  • Centers for Medicare & Medicaid Services. CMS is the United States Department of Health & Human Services agency responsible for administering the Medicare, Medicaid, SCHIP (State Children's Health Insurance) and several other health-related programs
  • Fact Sheet: You Can Help Protect Yourself and Medicare from Fraud Committed by Dishonest Suppliers. Includes information on how to spot fraud and abuse and what to do if you suspect it.
  • Kaiser Website with Health Policy Analyses. A leader in health policy and communications, the Kaiser Family Foundation is a nonprofit, private operating foundation focusing on the major health care issues facing the United States as well as the U.S. role in global health policy.
  • Medicare: A Primer. From the Henry J. Kaiser Family Foundation, this primer explains key elements of the Medicare program. It looks at the characteristics of the Medicare population, what benefits are covered, how much people with Medicare pay for their benefits and the program’s overall costs and future financing challenges.
  • Medicare, The Official U.S. Government Site for People with Medicare. Comprehensive information on Medicare and related issues, including prescription drugs, billing, appeals, long-term care, and enrollment
  • Medicare Imposes Stronger Protections on Medical Equipment Suppliers. New rule strengthens supplier enrollment standards to help prevent fraud.
  • QIOs (Quality Improvement Organizations). To find a state QIO, click here. For the CMS webpage about QIOs, click here.
  • Social Security Online  is the official website of the U.S. Social Security Administration
  • State Attorney General. Contact your state attorney general’s office to report scams. The attorneys general serve as counselors to state government agencies and legislatures and as representatives of the public interest.
  • State Insurance Department. Contact your state insurance department for insurance company or insurance agent licensing information or to file a complaint against a company or agent.
  • Stop Medicare Fraud. The U.S. Department of Health & Human Services and U.S. Department of Justice offer information and resources on an initiative, HEAT, that is designed to stop Medicare and Medicaid fraud.
  • Who Cares offers reliable sources of information on a variety of health topics, including Medicare fraud, medical ID theft, generic drugs, and assisted living.

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