Insurance Fraud Rises As Telemedicine Becomes More Prevalent.

There is little doubt that the role of telemedicine in the healthcare system will continue to grow. However, there is a risk of abuse of these telemedicine services, and there are legal, administrative, and civil repercussions that practitioners and insurers should be aware of.

 

Since the start of the COVID-19 pandemic, telemedicine has grown significantly with the strong backing of regulators, including in New York. See, for instance, Governor Hochul’s announcement of $3 million in new grants to expand access to telehealth across all of New York’s regions and the New York State Department of Health’s Comprehensive Guidance Regarding Use of Telehealth, Including Telephonic Services.

The potential for fraud has grown at the same time. Numerous dishonest local and international telemarketing contact centers, staffing firms, marketers, brokers, and practitioners, among other people and organizations, have seen an opportunity to increase their profits and are still doing so.

Consider the accusations made a few months ago against an orthopedic surgeon who was charged with operating a $10 million telemedicine health care fraud in federal court in Brooklyn. The surgeon allegedly practiced telemedicine with companies that paid him $25 or $30 for each consultation he had with a Medicare or Medicare Part D beneficiary, according to the authorities. The doctor allegedly approved prescriptions and order forms for durable medical equipment (DME), such as orthotic braces, even though they were not medically required, according to the prosecution. The government argued that the physician was responsible for submitting these claims on behalf of beneficiaries based simply on a brief telephone discussion for whom he had not conducted a medical examination or evaluation, and who were motivated in part by the payment of bribes and kickbacks.

The government asserted that the surgeon, together with others, submitted or caused the submission of approximately $10 million in false and fraudulent claims to Medicare for DME on behalf of beneficiaries who were residents of the Eastern District of New York. The surgeon may spend up to 10 years in prison if found guilty. Physician Charged in $10 Million Telemedicine Health Care Fraud Scheme by Department of Justice (April 21, 2022).

Telemedicine will undoubtedly continue to play a bigger part in the healthcare system in the future. However, there is a risk of abuse of these telemedicine services, and there are legal, administrative, and civil repercussions that practitioners and insurers should be aware of.

In keeping with this, this column discusses a nationwide coordinated law enforcement initiative that the United States announced in late July. a specific telemedicine fraud alert (the Alert) released on the same day by the U.S. Department of Justice (DOJ), and The Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) advises practitioners to use caution when making agreements with alleged telemedicine enterprises.

 

Enforcement procedures

Operation Brace Yourself, Operation Double Helix, Operation Rubber Stamp, and the telemedicine portion of the 2021 National Health Care Fraud Enforcement Action are just a few of the DOJ’s recent telemedicine enforcement efforts.

The DOJ’s law enforcement action in July was also noteworthy. For more than $1.2 billion in alleged fraudulent telemedicine, cardiovascular and cancer genetic testing, and DME schemes, the DOJ filed criminal charges against 36 defendants in 13 federal districts across the United States, with the alleged telemedicine schemes accounting for more than $1 billion of the total alleged intended losses. A telemedicine company executive, owners and executives of clinical laboratories, DME businesses, marketing organizations, and medical professionals were all charged criminally as part of the enforcement action.

The law enforcement action, according to the government, was primarily focused on alleged schemes involving the payment of illegal kickbacks and bribes by laboratory owners and operators in exchange for the referral of patients by medical professionals working with shady telemedicine and digital medical technology companies. According to court documents, medical professionals made referrals for pricey and medically unnecessary cardiovascular and cancer genetic tests, as well as DME. The charges included some of the first prosecutions in the country related to allegedly fraudulent cardiovascular genetic testing, which the DOJ described as “a burgeoning scheme.” For instance, Medicare did not approve the use of cardiovascular genetic testing as a general screening test for identifying an elevated risk of developing cardiovascular conditions in the future or as a method of diagnosing whether a person had a cardiac condition at the time.

A telemarketing network that operated both nationally and abroad and reportedly managed by several of the individuals charged in the enforcement action is accused of luring thousands of elderly and/or disabled patients into a criminal scheme. In order to get Medicare beneficiaries to consent to cardiovascular genetic testing as well as other genetic tests and equipment, the proprietors of marketing businesses allegedly instructed telemarketers to utilize fraudulent methods.

In one example, the owner of numerous clinical laboratories was accused of participating in a plan to funnel over $16 million in kickback payments to marketers, who then reportedly paid kickbacks to call centers and telemedicine firms in exchange for doctors’ orders. According to court documents, this defendant and others used orders for genetic testing for cancer and cardiovascular disease to submit more than $174 million in erroneous and fraudulent claims to Medicare, but the test results weren’t used to treat patients.

Allegations made by the DOJ, alleged frauds that the DOJ is said to have targeted, and characteristics of the defendants all point to the kinds of cases that the government is likely to pursue in the future. In this aspect, the OIG’s Notice—the first specific fraud alert it has sent in nearly two years—is also very instructive.

 

OIG’s warning

The OIG stated that it investigated numerous fraud schemes involving businesses that claimed to offer telehealth, telemedicine, or telemarketing services as it prepared to release its Alert (collectively, Telemedicine Companies). The OIG discovered that some of these frauds involved Telemedicine Companies paying physicians and nonphysician practitioners kickbacks in order to generate orders or prescriptions for medically unnecessary DME, genetic testing, wound care products, or prescription medications. As a result, false claims were submitted to Medicare, Medicaid, and other federal health insurance programs.

The OIG discovered that these schemes shared the practice of using kickbacks by Telemedicine Companies to “aggressively recruit and reward” practitioners. Typically, Telemedicine Companies solicited and recruited individuals (referred to by the OIG as “purported patients”) and then made arrangements with doctors to order or prescribe medically unnecessary goods and services for them. Many of these agreements involved the payment of practitioners by Telemedicine Companies in exchange for placing orders or writing prescriptions for fictitious patients with whom the practitioners had little to no interaction and without taking medical necessity into account. According to the OIG, these payments were occasionally described as payments per review, audit, consultation, or evaluation of medical records, and Telemedicine Companies frequently advised practitioners that they did not need to personally interact with the alleged patients and that they only needed to speak with them on the phone.

The Telemedicine Companies instructed practitioners to order or prescribe a preselected item or service, regardless of medical necessity or clinical appropriateness, the OIG continued, and practitioners were not given the opportunity to review the real medical records of the purported patient. The OIG discovered that the Telemedicine Companies frequently sold the orders or prescriptions created by practitioners to other people or organizations, who subsequently falsely invoiced for the extraneous goods and services.

According to the OIG, these schemes raised fraud concerns because of the potential for harm to federal health insurance programs and their beneficiaries through inappropriately increasing costs to the federal programs for medically unnecessary items and services and, in some cases, items and services a beneficiary never received; harm to beneficiaries through, for example, providing medically unnecessary care, items that could harm a patient, or improperly delaying needed care; a potential for fraud; and a potential for a breach of federal law.

 

A significant section of the OIG’s Alert outlines a list of seven “suspect characteristics” pertaining to practitioner agreements with Telemedicine Companies that, according to the OIG, could indicate an arrangement that poses a higher risk of fraud and abuse, whether considered individually or collectively. Importantly, the OIG emphasized that the list is not all-inclusive and that the existence or absence of any one factor does not determine whether a specific arrangement with a Telemedicine Company would give rise to legal consequences.

The seven suspect characteristics are:

• The Telemedicine Company, Telemarketing Company, Sales Agent, Recruiter, Call Center, Health Fair, and/or through Internet, Television, or Social Media Advertising for Free or Low Out-of-Pocket Cost Items or Services identified or recruited the purported patients for whom the Practitioner orders or prescribes items or services.
• The practitioner lacks sufficient contact with or knowledge of the alleged patient to accurately determine whether the goods or services they have ordered or prescribed are medically necessary.
• The Telemedicine Company pays the practitioner according to the quantity of goods or services requested or recommended, which the practitioner may interpret as payment based on the number of supposed medical records examined.
• The Telemedicine Company does not accept insurance from any other payors and only provides goods and services to participants in government health insurance programs.
• The Telemedicine Company may actually bill government health care programs despite its assertions that it solely provides goods and services to people who are not participants in federal health insurance programs.
• The Telemedicine Company may actually bill government health care programs despite its assertions that it solely provides goods and services to people who are not participants in federal health insurance programs.
• The Telemedicine Company neither requests nor provides the information needed for practitioners to follow up with alleged patients, nor does it expect them to do so (e.g., the Telemedicine Company does not require practitioners to discuss genetic testing results with each purported patient).

 

Conclusion

It is evident that telemedicine is swiftly gaining acceptance throughout the healthcare system, and the OIG made clear in its Alert that it did not seek to discourage legitimate telehealth arrangements. However, the numerous dishonest people who are continuously looking for novel methods to unlawfully exploit insurance benefits for their own financial gain are not ignorant of this rising acceptability. With stronger government oversight of telemedicine, it is hoped that the inevitable fraud and misuse may be curbed and the advantages of telemedicine fully realized.

 

 

 

 

Source: https://www.benefitspro.com/2022/09/02/as-telemedicine-expands-insurance-fraud-grows-412-135548/