From the Office of Inspector General (OIG), U.S. Department of
Health & Human Services
Skilled Nursing Facility Fraud
Skilled nursing facilities play a crucial role in providing therapy
and rehabilitation after you or a loved one has suffered a debilitating
illness or stroke. After a qualifying stay in the hospital,
Medicare beneficiaries frequently need some time in a rehabilitation
center to regain their strength. However, some unscrupulous
facilities (even some associated with national chains) have taken to
How the Scam Works
Fraudulent skilled nursing facilities (SNFs) typically engage in a
type of billing fraud called “upcoding.” Upcoding is a
misrepresentation of services rendered by using procedure codes not
appropriate for the item or service actually furnished. The
procedure codes that are used are reimbursed at a higher rate.
Another typical scheme used by fraudulent SNFs is where the patient
is placed into the highest Resource Utilization Group (RUG) category.
This category reimburses the rehab center the most Medicare
money. The beneficiary receives excessive therapy time that is
billed to the government. This excessive therapy is generally
medically unnecessary and could be dangerous to the patient. In
addition to physical and occupational therapy, the patient may receive
podiatry foot care that may not have been indicated.
How to Fight Back
Remember, patients have a right to refuse unwanted and excessive
If you or a loved one is being threatened or coerced by staff to
participate in therapy, report this conduct immediately.