The common medical billing mistake that can lead to fraud charges

On Behalf of | Apr 20, 2023 | White Collar Crimes |

Medical billing is a complicated and often stressful profession. Individuals who work in a medical billing center may have to decipher illegible handwriting or impossibly complicated shorthand entered into a digital system. Their role is a crucial one, as it helps ensure that the physicians providing care receive compensation for the services that they provide to the public.

Unfortunately, those who work in billing are among those who are most at risk for criminal prosecution in the medical industry. Allegations of healthcare fraud often implicate those who enter billing codes or handle the process of transcribing medical notes for a digital system. Company practices and also personal mistakes can contribute to the likelihood of a billing professional facing criminal charges. One particular billing practice may put someone at elevated risk of facing insurance fraud allegations.

Unbundling seems smart but breaks the law

Medicine is a very competitive industry, and providers often want to accept as many kinds of insurance as possible in order to attract as many patients as possible. Especially when a practice or medical facility accepts government insurance like Medicare and Medicaid, adherence to best practices regarding billing is crucial. Otherwise, allegations of healthcare fraud may eventually arise.

Individual physicians, hospitals or practices will negotiate specific contracts with insurance providers or accept the terms set by government insurance programs. These terms typically include bundled or discounted services that physicians typically provide together, such as local anesthetic administered prior to stitching a wound closed. Bundled services are cheaper for the insurance company, which means they generate less profit for a medical practice.

While it may seem like a savvy move to unbundle the services and enter the billing code for each one separately, doing so is actually a common form of healthcare fraud. Violating the agreement with an insurance company or government insurance program could lead to criminal prosecution in some cases. Even if the billing specialist doesn’t personally profit from the fraud, the state could still hold them accountable for their actions that violate insurance rules and billing law.

Healthcare fraud allegations could lead to incarceration and could also potentially freeze someone out of their profession for years after a guilty plea or conviction. Recognizing and avoiding actions that may look like intentional fraud can help protect professionals from white-collar criminal charges like healthcare fraud.


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