Perpetrators of Medicaid fraud run the gamut from the solo practitioner who submits claims for services never rendered to large institutions that exaggerate the level of care provided to their patients and then alter patient records to conceal the resulting lack of care. Although recipients also commit Medicaid fraud, the jurisdiction of the Medicaid Fraud Control Units (MFCUs) is limited to investigating and prosecuting Medicaid provider fraud.
The MFCUs have prosecuted individual providers such as physicians, dentists, and mental health professionals. In addition, the Units have also prosecuted fraud in numerous segments of the health care industry, such as:
- Nursing homes
- Home health care agencies
- Medical transportation companies
- Durable medical equipment companies
- Pharmaceutical manufacturers
- Medical clinics
The following are typical schemes that providers use to defraud the Medicaid program:
- Billing for Services Not Provided – A provider bills for services not performed, such as blood tests or x-rays that were not taken, full denture plates when only partial ones are supplied, or a nursing home or hospital that continues to bill for services rendered to a resident who is no longer at the facility.
- Double Billing – A provider bills both Medicaid and a private insurance company for treatment, or two providers request payment for the same recipient for the same procedure on the same date.
- Billing for Phantom Visits – A provider falsely bills the Medicaid program for patient visits that never take place.
- Billing for More Hours than there are in a Day – Inflating the amount of time a provider spends with patients, for example a psychiatrist that bills for more than 24 hours of psychotherapy treatment in a day.
- Falsifying Credentials – Mispresenting the qualifications of a licensed provider in order to defraud Medicaid. For example, a physician who allows a non-physician to impersonate a licensed doctor who medically treats patients and prescribes drugs and then bills the Medicaid program.
- Substitution of Generic Drugs – A pharmacy bills Medicaid for the cost of a brand-name prescription when, in fact, a generic substitute was supplied to the recipient at a substantially lower cost to the pharmacy.
- Billing for Unnecessary Services or Tests – A provider falsifies the diagnosis and symptoms on recipient records and billings to obtain payments for unnecessary laboratory tests or equipment.
- Billing for More Expensive Procedures than Performed – A provider bills for a comprehensive procedure when only a limited one was administered or billing for expensive equipment and actually furnishing cheap substitutes.
- Kickbacks – A nursing home owner or operator requires another provider, such as a laboratory, ambulance company, or pharmacy, to pay owner/operator a certain portion of the money received for rendering services to residents in the nursing home. Examples of this type of payment include vacation trips, personal services and merchandise, leased vehicles, and cost payments. This practice usually results in unnecessary services being performed to generate additional income to pay the kickbacks.
- False Cost Reports – A nursing home owner or operator includes personal expenses in its Medicaid claims. These expenses often include the cost of personal items.