Healthcare Revenue Cycle Management, ICD-10, Claims Reimbursement, Medicare, Medicaid


Various Forms of Fraud Hurting Hospital Revenue

By Ryan Mcaskill

Whether internal or by patients, fraud is causing problems for hospital revenue cycles.

- Regular readers are aware of the different ways that a healthcare provider or practitioner can see its revenue cycle manipulated because of internal fraud and patient dishonesty. Each of these happen in different ways.

Internal fraud is just that, practitioners intentionally trying to pull one over on the Medicare, Medicaid or general health insurance community as a way to make more money. The most common occurrence is when a healthcare provider charges the payer for services that are either not medically necessary, are coded to be more expensive or never happened at all. In many cases, these schemes also include the guilty parties paying kickbacks to patient recruiters, in order to get beneficiaries that can more easily be scammed.

These schemes can net millions of dollars and last for years before they are ever discovered, which often happens through an audit or whistleblower. They result in prison terms, restitution and the closure of the business.

Patient dishonesty can happen in several different ways. There are the simple schemes, like lying about insurance or refusing to pay bills after service has been rendered. This obviously hurts a hospital or provider because of the wasted time and resources to handle the care and then failure to be reimbursed.

There is another version of patient dishonesty that is more severe and harder to stop. According to a recent article from Bankrate, medical identity theft is a growing concern that hurts both patients and hospitals.

This scheme is exactly what it sounds like, someone steals a patient’s identity and uses that stolen information, including medical records and health insurance to have procedures done, get prescriptions for medication and more under the false identity. All of this is then charged and logged into the records of the victim whose information was stolen, which can have devastating consequences.

“If someone uses your health insurance to get services, you can end up getting improper care because the thief’s medical information becomes mixed with yours,” Eva Velasquez, president and CEO of the Identity Theft Resource Center in San Diego, told the news source. “If the thief uses your insurance to get access to prescription drugs, you can end up with a flag in the system that could trigger regulators or even law enforcement to track you down.”

A survey from the Medical Identity Fraud Alliance found that in 2013, 1.84 million Americans were victims of this theft. That is up 19 percent in 2012. This has resulted in an average cost of $22,000 per victim.

Hospitals can fall victim to having claims denied after care has been rendered or dealing with a loss of patient volume because of a damaged reputation or patients who can no longer afford care because of damaged credit. There are some steps that providers can take, which include additional steps to verify a patient’s identity early in the process.


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