Fraud: An Issue in Healthcare and Beyond

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Fraud: An Issue in Healthcare and Beyond

On June 22, 2016, The U.S. Department of Justice (DOJ) and Department of Health and Human Services (HHS) announced a massive national healthcare fraud takedown.  With the coordinated efforts of the Medicare Fraud Strike Force, twenty-three Medicaid Fraud Control Units, and the HHS Centers for Medicare and Medicaid Services (CMS), 301 individuals were brought in to face charges for falsely billing approximately $900 million.  It was considered the largest fraud takedown in national history, both in terms of the number of individuals charged as well as the loss amount.


In cases such as this, what does it mean when someone is charged with fraud?  According to Black’s Law Dictionary, fraud is a “deceitful practice or willful device, resorted to with intent to deprive another of [their] right…it is always positive, intentional.”  Within healthcare, fraud is defined even more precisely.  For example, CMS defines healthcare fraud as “to purposely bill for services that were never given or to bill for a service that has a higher reimbursement than the service produced.”  They note that fraud and abuse are two different issues, with abuse being “payment for items or services that are billed by mistake by providers, but should not be paid for by Medicare.”  The main difference to note between fraud and abuse is that fraud is committed with intent and purpose, while abuse is committed by mistake.


Fraud is an issue that affects organizations across the globe in almost every field and profession, and results in huge financial costs.  According to the Association of Certified Fraud Examiners’ 2016 Report to the Nations on Occupational Fraud and Abuse, organizations worldwide lose approximately 5% of their annual revenue to fraud.  Whether you work in a small or large organization, that 5% can have far-reaching consequences.  For the average healthcare facility, the median amount lost for just one single fraud case is about $120,000.


What Can Your Organization Do to Combat Fraud and Abuse?

Conduct internal investigative audits when suspected fraud and/or abuse is detected.  This type of audit goes beyond a routine audit.  Consider providing specialized training for your elite auditors, such as attending an AIHC Internal Forensic Healthcare Auditor Training Camp followed by certification to obtain their Certified Internal Forensic Healthcare Auditor (CIFHA) credential!


International Fraud Awareness Week

This week, November 13-18, 2017, is International Fraud Awareness Week.  It was established by the Association of Certified Fraud Examiners (ACFE) over a decade ago, and takes place every year during the third week of November.  The goal?  To encourage business leaders and employees to proactively minimize the impact of fraud through the promotion of anti-fraud awareness and education.


This week, take the opportunity to:

  • Discuss fraud prevention in your office meetings
  • Review your organization’s fraud policy
  • Hold a talk or seminar at your organization about how to detect scams and fraudulent billing, and where to report your concerns
  • If you are already a certified healthcare auditor, begin to expand your training to include fraud investigation

Even after International Fraud Awareness Week comes to a close, you can continue these practices to prevent and detect healthcare fraud before it grows into a larger problem.


Government Programs at Work to Combat Medicare & Medicaid Fraud and Abuse

There are a number of government programs which work tirelessly to uncover Medicare and Medicaid fraud schemes.  These programs are able to provide valuable assistance and resources when potential fraud is detected:

  • The CMS Center for Program Integrity  –   This program brings the oversight of Medicare and Medicaid program integrity together to coordinate resources and best practices for program improvement.  The Center also provides a number of resources for preventing and detecting Medicare and Medicaid fraud, such as:
  • Medicaid Fraud Control Units –  These units are typically part of the State Attorney General’s office and employ teams of investigators, attorneys, and auditors which act as separate investigative entities from the State Medicaid Agency
  • The Medicare Fraud Strike Force – A key component of HEAT, the Medicare Fraud Strike Force includes analysts, investigators, and prosecutors from the Office of the Inspector General (OIG) and DOJ who focus on targeting emerging or migrating fraud schemes, such as fraud perpetrated by criminals pretending to be healthcare providers.
  • The Healthcare Fraud Prevention and Enforcement Action Team (HEAT) – This team was formed as a joint initiative between HHS, the OIG, and the DOJ.  The Medicare Fraud Strike Force is a key component of HEAT.

Please note: This list is not comprehensive and does not include all of the government programs currently working to combat Medicare & Medicaid fraud and abuse.


CEU Tracking Number: FRBLG1117.4

How to Earn 0.5 Continuing Education Units from This Article for CHA, CHBS, CHCM, CIFHA, and OHCC Certified Professionals

  • Print and/or save a copy of this article for your records.
  • Document your answers to the following in case you are selected for a CEU audit:
    • What did you learn by reading this article?
    • How does the information in this article apply to your job or organization?
    • How did you use this information in your current job position or within your organization?
  • Supply the CEU tracking number in the description box of your online CEU Tracker.

You will need to produce this information if you are selected for a CEU audit or if you are late in renewing. You may use this article for continuing education units once every 24 months or every other renewal year.


| Categories: Compliance, AIHC Professional Articles, AIHC Free CEU Articles | Tags: CMS, HHS, DOJ, Medicare and Medicaid, Compliance, Audit, Forensic Audit, Health Care Fraud, Continuing Education, CMS Center for Program Integrity | View Count: (1442) | Return

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