In 2007, $2.26 trillion dollars was spent on healthcare. The National Healthcare AntiFraud Association (NHCAA) estimates that about 3% of all health care spending, or $68 billion is lost to healthcare fraud.
Estimates by the FBI place the loss due to healthcare fraud as high as 10% of our nation’s annual healthcare expenditure, a staggering $226 billion each year.
Health Care Insight (HCI), provides private and public health sector claims payors with clinically validated fraud and abuse surveillance systems. HCI reported, “In 2009, health care fraud will cost Americans with health care coverage and average of between $200 to $800 per person.” For a family of four, that could be $3200 of your money.
The impact of fraud manifests itself in higher premiums, lost benefits, inaccurate medical records and increased out-of-pocket health spending. These wasted dollars are just not figures on paper. They are real dollars, your hard earned dollars, taken from you, just as if they were stolen from your wallet.
The Perfect Fraud Storm is Brewing
The Bureau of Labor Statistics found that average physician incomes decreased by over 7% between 1995 and 2003. (Bureau Labor Statistics, Community Tracking Study Physician Survey) This trend has continued, particularly within the primary care physician ranks. At the same time physicians struggle to maintain their income, other factors serve to foster a climate to promote a fraudulent activity. Healthcare costs are uncontrollably escalating and this trend will likely continue.
As unemployment rises and more people lose their health insurance coverage, there is an increase in the number of the uninsured. Families are under pressure to somehow obtain and afford health insurance.
Given the opportunity, and a way to rationalize wrongful behavior, these pressures can make it easier for a person to cross the line, and engage in fraudulent activity.
All About Healthcare Fraud
Healthcare fraud is defined as “A representation about a material point, which is false and made intentionally or recklessly and believed, resulting in damage to the victim.”
Some of the typical false claims commonly seen are:
Upcoding of services, billing for a more extensive service than one that was provided. e.g.) The doctor bills for a comprehensive examination when he/she only sees you for two minutes and does not examine you.
Billing for services not rendered e.g.) The hospital adds lab services or x-rays on your bill that you did not receive.
Misrepresenting services to obtain payment e.g. Your doctor submitted claims that indicated you received a nerve block injection for back pain, when you had Botox.
Medically Unnecessary services. e.g.) The healthcare provider treats the patient with services they patient did not need for the purpose of generating insurance reimbursement,
The insurance company is often the victim in healthcare fraud cases. Many times, the patient is also a victim. The patient of a fraudulent doctor may not receive the healthcare they need or they may receive healthcare they do not need. The fraudster may saddle the patient with erroneous diagnoses and fraudulent claims for services. This false information may remain a part of the patient’s medical history and could affect the patient’s insurability in the future.
How to Fight Healthcare Fraud?
Examine your Explanation of Benefit statements for the healthcare services you and your family receive. Make sure the services listed are accurate. Investigate discrepancies and report what you consider to be fraud/abuse to your insurance company.
Each private payor has a telephone fraud hot-line for reporting suspected problems. Referrals can be anonymous. It isn’t just the insurance company’s money, it’s yours too.
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