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
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
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.”