It was estimated by a report from federal health care inspectors in 2012 that the U.S nursing home industry overbills Medicare $1.5 billion a year for treatments patients either don't need or never recieve. This problem is even worse for for-profit homes, who on average have 30 percent improper claims, while non-profit homes average 12 percent. Of the $105 billion dollars in revenue the industry gained in 2010, 78% percent went to for-profits, which is a trend that continues to rise. As healthcare costs and the elderly population grow in the coming years this problem will only seem to esculate, and its effects will become ever more painful to an already stretched federal budget.
ATTEMPTS TO COMBAT IT
Federal prosecutors brought 120 now-resolved civil and criminal cases against nursing homes and related individuals from 2008 to 2012. Many more are currently pending or under consideration by the US Justice Department. Such suits not only punish the wrong doers, but also restore millions of dollars to the taxpayers. These suits can be brought through two seperate mechanisms: direct FBI investigations into suspected fraud or whistle-blower cases from private citizens. Both mechanisms rely on private citizens first recognzing fraud and abuse, and then bringing it to either the District Attorney or FBI's attention. The first step to recognzing fraud and abuse is knowing what it is and its definition in regards to nursing home medicare procedures.
Nursing homes that make false claims for federal reimbursement are liable under the Federal False Claims Act. Types of fraud in a nursing home include:
1. Billing for Unnecessary Services or Items- To be covered by Medicare or Medicaid, services must be medically necessary, where medical necessity is determined by Physicians, who must ensure that authorized services meet the definition of medical necessity in the States in which they practice. Signs of fraud include but are not limited to adminstrators, rather than Physicians making treatment decisions, exagerated diagnoses, and excessive testing.
2. Billing for Services Not Rendered- To be covered by Medicaid, the billed service or supply must in fact be provided. Some fraudulent providers bill Medicaid for a covered service or item that was never provided. Signs include but are not limited to pattern of false or missing records of services rendered, and patients claiming or exhibiting signs of lack of treatment.
3. Upcoding- to bill for services at a level of complexity that is higher than the service actually provided or documented in the file like billing for 45 minute session when the actual session was 30 minutes.
4. Unbundling- when multiple procedure codes are billed for a group of procedures that are covered by a single comprehensive code. For example, a laboratory might receive an order for a panel of tests on a patient. Instead ofappropriately bundling the tests and billing for them together, the laboratory might attempt to increase itsincome by billing for each test separately.
5. Kickbacks- the knowing, soliciting, receiving, offering, or paying of remuneration(in kind or in cash) to induce or in return for the referral of individuals for any item or service for whichpayment may be made under Federal health care programs.
6. Medical Identity Theft- the appropriation or misuse of a patient’s or [provider’s] unique medical identifyinginformation to obtain or bill public or private payers for fraudulent medical goods or services.