When a provider treats a Medicare patient, the provider must tell Medicare what services were provided so that Medicare can reimburse the doctor the correct amount. Certain services have higher reimbursement amounts than others –a more serious condition will generally be more expensive for the provider to treat and thus, the provider receives additional reimbursement from Medicare.
By Berger Montague Attorneys.
Unethical providers may tell Medicare that they provided a more expensive service than they actually did, which results in the provider receiving more money from Medicare than they should. This is known as “upcoding” and is a violation of the federal False Claims Act (“FCA”).
Medicare Billing Claims
Medicare provides healthcare coverage to millions of Americans. When a medical provider provides services to a Medicare beneficiary, the provider submits a bill to Medicare to get paid. Generally speaking, providers submit an electronic claim form to Medicare that uses procedure codes, known as HCPCS or CPT codes, to tell Medicare what services were provided. Providers must certify that the information on the reimbursement form is true, accurate, and complete.
After receiving the reimbursement claim, Medicare reviews the claim based on the information submitted by the provider, and if Medicare determines that a claim is covered, it reimburses the provider. During this process, Medicare must rely on the information submitted by the provider, including that the services the providers says were performed were actually performed and that the provider used the correct procedure code. Medicare does not have the resources to scrutinize every claim submitted by a provider, and thus, it is critically important that providers submit accurate information when making reimbursement claims.
False Claims Act Liability for Upcoding Fraud
Under the FCA, it is illegal for anyone to submit “a false or fraudulent claim” for Medicare reimbursement. Additionally, the FCA allows individuals with knowledge of Medicare fraud to sue on the Government’s behalf to recover the fraudulently obtained funds and, as an incentive for bringing the claims, to keep a portion of the recovery.
What is Upcoding?
“Upcoding” is “a common form of Medicare fraud” and “is the practice of billing Medicare for medical services or equipment designated under a code that is more expensive than what a patient actually needed or was provided.” Put differently, a provider commits upcoding fraud if he or she “submit[s] claims with CPT codes that represented a level of care higher than the [provider] actually provided.”
For example, if a doctor performs a minor chest procedure but bills Medicare using the billing code for open-heart surgery, the doctor has engaged in upcoding fraud because the open heart surgery billing code provides a higher reimbursement than the minor chest procedure billing code. Put differently, the doctor will receive more money than he or she should have for the services actually provided.
Upcoded claims are false claims within the meaning of the FCA because a provider is billing Medicare for a service that has not actually been provided and is asking Medicare to provide a higher reimbursement than the provider is entitled to.
As Medicare explains to medical providers, “[w]hen you submit a claim for services performed for a Medicare patient, you are filing a bill with the Federal Government and certifying you earned the payment requested and complied with the billing requirements.” A provider who bills Medicare for upcoded services breaches this certification and thus is liable under the FCA.