Potential factor of rising health care cost. Presentation will drive around introduction,facts, statistics, tactics and solutions regarding fraud & abuse. I would like to thank Imran Bhai for his suggestions

1. MEDICAL BILLING FRAUD “NIGHTMARE” FOR PATIENTS Milon Shah009326404/28/2010

2. What is “Medical Billing”? Medical billing is a complex procedure of billing and collecting professional fees for medical and healthcare services rendered by health care providers to patients.

3. Overview of Medical Billing Process http://www.outsource2india.com/services/medical_billing_process.asp

4. Flow Chart of Medical Billing

5. What is “Medical Billing Fraud”? Committing Fraud means “intentional deception” or “misrepresentation” of data in medical bills made by a person with the knowledge that the deception could result in some unauthorized benefit to him/her or other person.

6. Facts & Statistics http://www.healthcareproblems.org/health-care-statistics.htm

7. Facts & Statistics

8. Medical billing fraud has its significant effect on the private and public health care system. Fraud & Abuse accounts for total 3% of the total health care cost Taxpayers are enforced to pay higher taxes in public programs such as Medicare & Medicaid. Because of fraud in private sector, employers and individual pay higher private health insurance premiums. Health Care expenditure in United States exceed $2 trillion a year, in comparison to federal budget which is $3 trillion a year. (Source: Centers for Medicare & Medicaid Services, Office of Actuary, National Health Statistics Group) Effect on U.S. Health Care System

9. Types of Medical Billing Frauds Upcoding It assigns a diagnosis that warrants a higher reimbursement than medically necessary 2) Downcoding Opposite of upcoding Inaccurately reports a lesser diagnosis to show fraudulent patient improvement

10. Tactics of Fraud

11. Potential Indicators of Fraud Double Billing Personal Injury Mills Quackery – Related Miscoding Viatical Fraud Bogus Health Insurance Companies Miscellaneous http://www.quackwatch.org/02ConsumerProtection/insfraud.html

12. Double Billing Most common error found in medical bills Health Care Providers tend to charge twice for the services they rendered to the patients Due to Complexity of medical billing system, it goes unnoticed by thepatients and they end up paying higher medical bills.

13. Personal Injury Mills What is an Insurance mill? A conspiracy in which unnecessary care is provided in order to create large insurance claims. Objective: To maximize medical expenses to get the potential benefit through large insurance claims. The potential players are Health Care Providers Attorneys

14. Scenarios of Personal Injury Mills People with minor accidents are advised that they are injured seriously than they think Set up diagnostic evaluation process in which it involves multiple practitioners Patients get same treatment on a similar schedule irrespective of clinical need Multiple diagnostic tests are recommended with no explanation, no discussion of results

15. Quackery Related Miscoding Non Standard Practitioners (Health Care Practitioners) misrepresent diagnostic and procedural codes. They also misrepresent their diagnosis. Because Insurance companies rely mainly on codes recorded on the claim forms. Based on miscoding for services rendered, practitioners boost their income

16. Examples of miscoding Brief or intermediate-length visits may be coded as lengthy or comprehensive visits. Patients receiving chelation therapy may be falsely diagnosed as lead poisoning and it may be billed as “Infusion Therapy”. Non standard allergy tests may be represented as standard ones. Diagnosis of cancer may be coded as “Chemotherapy”.

17. Viatical Settlement A “Viatical Settlement” is an act by person who is terminally ill of cashing in a life insurance policy to pay for the necessary associated illness, medical expenses, and final wishes. Viatical settlement companies who have assigned policies of terminally ill may sell the policy to third party investor. The company or the investor becomes the beneficiary to the policy, pays the premiums , and collect the face value of the policy after the original policyholder dies.

18. How does Viatical Fraud occur? Agents recruit terminally ill people to apply for multiple policies. They misrepresent truth and answer “no” to all of the medical questions. The insurance agent who issues the policy is a party to the scheme. The agent or one applicant may even submit the same application to many insurance companies. They purchase the policies and sell them to unsuspecting third-party investors

19. Bogus Health Insurance Companies Many of fraudulent insurers tend to bore names similar to those of legitimate companies. Health Insurance plans from such companies place the buyer at risk for financial disaster due to expensive medical bills that they need to pay for serious illness. By this way patients may end up paying premiums without any coverage on expensive medical bills.

20. Cont. E.g. From 2000 to 2002, 144 unauthorized entities enrolled at least 15,000 employers and more than 200,000 policyholders who got stuck for over $200 million in unpaid claims

21. Miscellaneous Tactics Not offering charity care Offering Expensive Credit Card Underprovision of care, High numbers of referrals to emergency rooms, Inadequate treatment plan

22. Prevent Fraud

23. Understand Explanation Of Benefits (EOB) Checking the Explanation Of Benefits (EOB) can be considered as first option to look for the probable billing fraud. The EOB lists The medical provider, Date of service, Claim identifier, What was billed to insurance, What insurance company paid, what costs were disallowed and why, and Finally , what patient owes.

24. EOB Cont. If bill matches the EOB that doesn’t mean it is correct, but it only means that insurance company had verified what amount you owe to the medical provider. Patients need to be persistent to report suspicious error. Patients need to learn how their care coded and how codes correspond to respective charges.

25. Review the Bills Patients should review their medical bills with a close look. They should compare the list of procedure with records that they had. They should ask for explanation if they have any question about an item on a bill. The things that patients can’t decipher, they can ask the medical records department for a copy of their doctor’s orders and nursing notes.

26. Look for Billing Errors Incorrect data E.g. Length of Stay Advise patients to Refer to log for the time patients admitted. Duplicate orders Check out for the services that are charged in the bill Also check the number of lab tests or procedures that had.

27. Cont… Unbundled fees Patients need to make sure that they are not charged for the service whose charges should have been bundled with another charge. Operating-room times Important for patients undergone surgery Patients should make sure that they are not charged for items that should be included in the operating-room fee, such as gloves, linens, or light covers.

28. Cont.. Upcoding This practice inflates the patient's diagnosis code to a more serious condition that requires more costly procedures, To spot it, compare the diagnosis on doctors’ orders and nursing notes with the charges on medical bill. Upselling A charge can be needlessly inflated. Patients should not be charged for that increased charges as they are not responsible for it.

29. Laws that Regulate Fraud & Abuse False Claims Act (FCA) Stark Law Anti-Kickback Statute HIPAA Criminal Penalties for Acts involving Federal Health Care Programs

30. Conclusion Rising health care expenditures became the burning issues for economy of government of United States. Health care frauds, especially fraud associated with medical billing undoubtedly one of the major reason behind this rising health care costs Patients may end up filing bankruptcies due to their inability to pay medical bills.

31. Cont.. These issues of fraud need to be look with accurate precision and try to solve them with corrective actions. If it would not be address as early as possible, it will end up being true “Nightmare for the patients” who will find their selves under debt that they can’t think of getting out.

32. Questions