From the Office of Inspector General (OIG), U.S. Department of Health & Human Services

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.”

Report Suspected Fraud

To report suspected fraud, click here.