How to Prevent Medicare Fraud in the Medical Office

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The Medicare program relies heavily on a number of sources to assist them in the detection and prevention of Medicare fraud including professionals of the healthcare industry. These include those who work in medical offices—physicians, nurses, front desk staff, medical billing staff, and others. Without our help, those individuals that are guilty of fraudulent behavior continue to get away with it.

Over the years, the Centers for Medicare and Medicaid Services (CMS) has been proactive in its efforts to bring awareness to Medicare fraud, a national problem that costs the program millions of dollars each year.


Medicare fraud generally refers to willfully and knowingly billing medical claims in an attempt to defraud the Medicare program for money. Anyone found guilty of Medicare fraud is subject to exclusion from participation in the Medicare program, in addition to fines and possibly imprisonment. Most Medicare fraud occurs in these areas:

  • Billing for DME
  • Billing for physicians services
  • Billing for institutional services such as nursing homes, hospitals, hospice, etc.

Be Aware of Common Medicare Fraud Schemes

There are four Medicare fraud schemes and practices that may be seen in the medical office setting.

  1. Medical Equipment Never Provided: The most common area of Medicare fraud is billing for Durable Medical Equipment (DME). DME refers to any medical equipment necessary for a patient's medical or physical condition. It includes wheelchairs, hospital beds, and other equipment of that nature. The provider will bill Medicare for equipment that the patient never received. Mobility scooters have been particularly popular for Medicare fraud schemes.
  2. Services Never Performed: In this instance, the provider bills for tests, treatment or procedures never performed. This can be added to the list of tests a patient has actually received and never be noticed. A provider may also falsify diagnosis codes in order to add on unnecessary tests or services.
  3. Upcoding Charges: Misrepresenting a level of service or procedure performed in order to charge more or receive a higher reimbursement rate is considered upcoding. Upcoding also occurs when a service performed is not covered by Medicare but the provider bills a covered service in its place.
  4. Unbundling Charges: Some services are considered all-inclusive. Unbundling is billing for procedures separately that are normally billed as a single charge. For example, a provider bills for two unilateral screening mammograms, instead of billing for one bilateral screening mammogram.

Medicare Fraud Indicators

There are certain indicators that are common in the detection of Medicare fraud. Is your practice:

  • Does your medical office routinely waive copayments and deductibles for Medicare patients without checking for their ability to pay?
  • Does your medical office charge higher rates to Medicare patients compared to other persons for similar services?
  • Is your medical office often missing treatment documentation, such as physician or nurses notes?

What to Do If You Suspect Fraud

If you work in a medical office, you are at the front line in detecting and reporting suspicious billing activity. It is your responsibility as a representative of the healthcare industry to be aware of and report any fraudulent activity that is suspected. If you would like to report suspected Medicare fraud, contact the Department of Health and Human Services or the Office of Inspector General for further assistance.

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