Those who take on Medicare fraud by filing a lawsuit on behalf of the federal government stand to earn a substantial reward for their efforts if the suit is successful.

Whistleblowers are a first line of defense in the ongoing battle against fraud against U.S. taxpayers; the law not only offers remuneration for those who are willing to come forward and report fraud against the government, it also provides protection from retaliation by employers and others.

What Is Medicare Fraud?

According to a recent report from the Department of Justice, Medicare fraud accounts for nearly 87 percent of all money recovered as a result of whistleblower, or qui tam lawsuits brought by average citizens under the False Claims Act.

These fraudulent activities take numerous forms, including:

• false billing for services not covered
• illicit kickbacks (such as paying physicians to prescribe a certain product)
• deliberately providing false information
• phantom billing (i.e., for patients who have died or have discontinued treatment)
• upcoding (assigning an inaccurate billing code in order to increase reimbursement)
• unbundling (billing separately for procedures covered by a single code)
• billing for unnecessary procedures
• prescription scams (fake rebates, threatening loss of coverage, etc.)

2019 marked the tenth year that recoveries from Medicare fraud cases have totaled $2 billion or more.

It is worth noting that health care fraud is not unique to the U.S. Medicare program; a 2015 study from the U.K. found that almost 6.2 percent of the money spent on health care around the world is lost to fraud. Nor is Medicare the only federal health care program targeted by fraudsters; Medicaid and Tricare fraud is also rampant.

Who Are the Perpetrators?

Much of the fraud related to Medicare has been committed by pharmaceutical companies. However, while drug manufacturers are often at the top of the list, they are far from alone; other perpetrators named in fraud reporting include:

• HMOs
• hospices
• hospitals
• laboratories (including those at public universities)
• medical device manufacturers
• pharmacies
• individual physicians and private practices

Medicare Fraud Cases

One of the largest fraud cases settled last year involved Reckitt Benckiser Group, manufacturer of Suboxone, a medication used for the treatment of opioid addiction. The company’s subsidiary, Invidior, was accused of illegally marketing the product to physicians in attempts to increase the number of prescriptions.

Another major case involved Insys Therapeutics, which was accused of paying illegal kickbacks to physicians and nurse practitioners so as to get them to write more prescriptions for Subsys, a potent synthetic opioid. The company also faces charges of off-label marketing (advertising a medication for unapproved indications) and providing false information to insurers in order to obtain payments from federal health care programs.

Drug companies were not the only ones named; Encompass Health Corporation, an operator of inpatient rehabilitation facilities, has been accused of lying to Medicare in order to get higher reimbursements and providing treatments deemed to be unnecessary.

What’s In it For You

Those who bring health care fraud cases under the FCA can receive up to 25 percent of any recovery when the lawsuit is successful; this can amount to several million dollars in some cases.

This article is not legal advice. It is presented
for informational purposes only.