Next Wave of Medicare Fraud Will Likely Be Telemedicine Fraud (also Called Telehealth Fraud)
Many hospitals and physicians are now using telemedicine. Doctors hope to reduce the number of sick patients in their waiting areas. Hospitals are now turning to telehealth to keep patients worried that they may have coronavirus from clogging emergency rooms. Unfortunately, newly loosened rules spurred by the coronavirus pandemic have also attracted fraudsters.
Today millions of Americans are turning to telemedicine. (We use telemedicine, telehealth, tele-a-doc interchangeably however our favorite term remains “doc in a box”!) Many patients are using the technology for the first time. Hospitals, physicians and insurance companies love it because it is the best way to maintain social distancing.
To protect both healthcare workers and patients from coronavirus, Medicare and many insurance companies have increased payments for those providers using telemedicine. Previously providers received about half the rates as traditional in-office visits.
So many providers and insurance companies are rushing to promote telehealth that some predict over one billion visits this year.
The federal government also know says that doctors don’t have to be licensed in the same state as the patient if using telemedicine. The federal governments actions only affect Medicare but several states including California and Florida have also relaxed their practice rules.
The new Medicare rules say:
“Medicare has temporarily expanded its coverage of telehealth services to respond to the current Public Health Emergency. During this time, you will be able to receive a specific set of services through telehealth including evaluation and management visits (common office visits), mental health counseling and preventive health screenings without a copayment if you have Original Medicare. This will help ensure you are able to visit with your doctor from your home, without having to go to a doctor’s office or hospital, which puts you and others at risk of exposure to COVID-19.
- You may be able to communicate with your doctors or certain other practitioners without necessarily going to the doctor’s office in person for a full visit. Medicare pays for “virtual check-ins”—brief, virtual services with your physician or certain practitioners where the communication isn’t related to a medical visit within the previous 7 days and doesn’t lead to a medical visit within the next 24 hours (or soonest appointment available).
- You need to consent verbally to using virtual check-ins and your doctor must document that consent in your medical record before you use this service. You pay your usual Medicare coinsurance and deductible for these services.
- Medicare also pays for you to communicate with your doctors using online patient portals without going to the doctor’s office. Like the virtual check-ins, you must initiate these individual communications.
- If you live in a rural area, you may use communication technology to have full visits with your doctors. The law requires that these visits take place at specified sites of service known as telehealth originating sites, and get services using a real-time audio and video communication system at the site to communicate with a remotely located doctor or certain other types of practitioners. Medicare pays for many medical visits through this telehealth benefit.”
Now that several zoo animals and two house cats have tested positive for coronavirus, many veterinarians are also turning to telemedicine.
Will the Rush to Telehealth Mean More Medicare Fraud?
The Inspector General of Health And Human Services is worried that the suddenly relaxed rules will usher in a new wave of Medicare fraud. (The Inspector General serves as the law enforcement agency for Medicare. Each state also has a Medicaid Fraud Control Unit that investigates Medicaid fraud.)
HHS spokesperson Michael Cohen says, “There are unscrupulous providers out there, and they have much greater reach with telehealth. Just a few can do a whole lot of damage.”
Biggest Telemedicine Fraud Targets?
We think the next wave of Medicare fraud involving telemedicine will involve genetic testing, durable medical equipment, coronavirus “emergency kits” and expensive pain creams by compounding pharmacies. Traditionally, these services or products would be prescribed after a patient visited their physician.
With telehealth, we worry dubious call centers will bombard seniors and others offering “free” products and services. When a patient agrees, a telemedicine doctor 1000 miles away will issue the prescription.
Feds Bust $2 Billion Genetic Testing Fraud Ring
Last September federal law enforcement officers busted a fraud ring responsible for $2.1 billion dollars in losses to Medicare. 35 people were arrested from all over the United States. The common theme was providers that were offering genetic testing. And most of these scams involved corrupt telehealth doctors.
Medicare rarely pays for genetic testing. It considers these tests to be “predictive” or useful for screening, something not covered by Medicare. These tests are reimbursable, however, to predict optimal chemotherapy regimens and to avoid exposing patients to ineffective or overly toxic treatment regimens.
According to the Justice Department, participants in the fraud ring were often not providing test results to the beneficiaries or the results were worthless to their actual doctors. Some of the defendants allegedly controlled a telemarketing network that lured hundreds of thousands of elderly and/or disabled patients into a criminal scheme.
And how did they generate the prescriptions necessary to order these tests? By using corrupt doctors who screened patients via a short phone call if at all (telemedicine fraud). The genetic testing company defendants allegedly paid doctors to prescribe the tests, either without any patient interaction or with only a brief telephonic conversation with patients they had never met or seen.
An HHS spokesperson said, “Unfortunately, audacious schemes such as those alleged in the indictments are pervasive and exploit the promise of new medical technologies such as genetic testing and telemedicine for financial gain, not patient care.”
Georgia Telemedicine Company Charged in $60 Million Fraud Scheme
Health and Human Services agents teamed up with the Secret Service and FBI in Savannah to lock up a Georgia woman who operated two telemedicine companies, Royal Physician Network, LLC and Envision It Perfect, LLC. Prosecutors say the companies conspired to pay medical providers, like physicians and nurse practitioners, in exchange for obtaining orders for durable medical equipment (DME).
Durable Medical Equipment scams cost taxpayers billions of dollars each year. Common covered durable medical equipment includes:
- Air purifiers
- Blood sugar monitors and test strips
- Canes, crutches and walkers
- Commode chairs
- Continuous Positive Airway Pressure (CPAP) devices
- Hospital beds
- Infusion pumps & supplies
- Knee, shoulder, wrist and back braces
- Nebulizers & nebulizer medications
- Oxygen equipment & accessories
- Patient lifts
- Pressure-reducing beds, mattresses, and mattress overlays
- Suction pumps
- Traction equipment
- Wheelchairs and scooters (Do you remember the Scooter Store ads?)
You must have a prescription if you need durable medical equipment and want Medicare to pay for it. That’s where doc-in-the-box schemes into play. The DME companies pay doctors and nurse practitioners to spend a few second online or on video chat with patients and then write the necessary prescription.
After the arrest was announced, prosecutors asked anyone with information about other telemedicine fraud schemes to come forward. “This investigation is ongoing. As telemedicine becomes an increasing part of our healthcare system, vigilance in ensuring that fraud and kickbacks do not usurp the legitimate practice of medicine by electronic means is more important than ever.”
How Do I Report Telemedicine Fraud (and Collect a Reward)?
A Civil War era law allows whistleblowers with inside information about fraud involving federal funds or federal programs to collect a reward for reporting the fraud. The federal False Claims Act pays rewards of between 15% and 30% of whatever the government recovers from wrongdoers. Each year the government pays hundreds of millions of dollars in rewards.
The coronavirus pandemic has ushered in a new era of telemedicine. We believe if used appropriately, telehealth makes seeing a doctor safer and easier for many patients. Unfortunately, it is also an invitation for abuse.
As noted earlier we expect most telehealth fraud will be in connection with phony pain creams, durable medical equipment, orthotic braces, genetic testing, and coronavirus testing. We also expect to see a few bad mental health providers engage in classic overbilling schemes. They provide their patient with 15 minutes of counseling but bill for a 60 minute session.
Medicare fraud hurts all taxpayers. Never more in modern history will the United States government be strapped for cash. We will be paying the tab for the coronavirus pandemic response for years. By reporting fraud, you not only earn a reward, you also help fight greed and corruption.
To learn more, visit our Medicare fraud information page. We also invite you to our genetic testing (CGX testing) and DME pages (links above). Ready to see if you have a case? Contact attorney Brian Mahany online, by email brian@mahanylaw.com or by phone, 202-800-9791. Cases accepted nationwide. All inquiries protected by the attorney – client privilege and kept strictly confidential.
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