This week I’d like to write about a problem that costs taxpayers billions of dollars each year – Medicare fraud and abuse.  Medicare paid out $702 billion in payments for services and medications in 2017, accounting for 15% of the federal budget.  The Office of Management and Budget (OMB) reports that 4.5% of those payments were “improper,” meaning the services were not necessary, did not meet Medicare guidelines, or were downright fraudulent (a slight decrease from 2016).
Medicare fraud refers to individuals or companies who obtain payments from Medicare under false or illegal pretenses. The OMB has been making a concerted effort to limit Medicare fraud, but Medicare is an easy target since it is such a complex program. It’s like playing the lottery for those who are intent on defrauding the government, but with a much higher chance of a payoff.
There are three major categories of Medicare fraud: phantom billing, false patient billing, and upcoding, also known as upbilling.
Phantom billing involves a provider billing Medicare for equipment or procedures that were not necessary or were never provided. Billing for medical equipment falls under this category. I see this type of fraud frequently when companies bill Medicare for equipment or services for my patients that they never requested or that I did not prescribe.
The most common thing I see is medical equipment companies (usually based in Florida) calling my patients at home to offer a service or medical device, then fishing for information from the patient in order to provide additional services. I still have not figured out how these companies obtain my patients’ telephone numbers.
For example, a patient may have diabetes. The company calls the patient, offering to provide diabetes supplies that can be billed to Medicare. The agent of the company may then ask another question such as, “do you suffer from back pain?”  The patient frequently answers yes (since most seniors suffer from back pain) and thinks nothing of it. 
The equipment company then faxes a certificate of medical necessity to me asking me to approve the diabetic supplies (appropriate) and a heating pad for the patient’s back pain. These pads, when billed to Medicare, may cost hundreds of dollars when a $17 one from Walmart would do the same thing. The equipment providers are counting on busy physicians to sign the form without investigating if their patients actually requested/need these items. If the doctor investigates and refuses to sign, the company will often continue to fax requests or call the physician badgering him or her to approve the service.
The second category of fraud is false patient billing. This involves providers billing for services that were never provided or that were not necessary. Sometimes Medicare patients will even participate in this scam by receiving monetary kickbacks from companies by providing their personal Medicare numbers so the companies can bill for services that were never performed.
The last major fraud category is upcoding or upbilling. This occurs when a provider of services uses a billing code that will result in a higher level of payment from Medicare for the service provided or may lead to the need for additional services.
So, what should you do if you suspect Medicare fraud? If it’s a billing issue from your doctor’s office or hospital, it’s best to check with the billing office first. It’s not unusual, due to the complexity of the Medicare rules, for physician offices to make billing mistakes. If you note a repeated pattern of inappropriate billing, you should contact the Medicare company that paid the claim. The contact information should be on the Medicare Summary Notice (MSN).  You can also contact the Medicare fraud hotline at 1-800-HHS-TIPS or e-mail them at
If a company contacts you to offer services, make sure you ask them specifically what the services are and always get the name of the company and specific contact information for the person calling you – full name, complete address and telephone number. Don’t answer any questions that are not directly related to your primary medical problem and never give out personal information. You may want to give your doctor a heads up to be looking for a request for approval for services that you requested.
I would suggest you visit where you can learn more about how to fight Medicare fraud. 
- Dr. John Roberts is a licensed medical physician. He writes a weekly column exclusively for Sagamore News Media publications.