Nursing Home Medicare Fraud: How to Report Upcoding, Ghost Patients, and Quality Care Violations Post-COVID

Exposing Nursing Home Medicare Fraud: Your Guide to Protecting Vulnerable Patients and Taxpayer Dollars in the Post-COVID Era

The COVID-19 pandemic exposed widespread vulnerabilities in America’s nursing home system, creating new opportunities for Medicare fraud that continue to drain billions from taxpayer-funded programs. Unfortunately, during the COVID-19 pandemic, we have seen a spike in the number of reports of elder harm and neglect. As we continue to aggressively investigate those who cheat our programs or hurt beneficiaries, understanding how to identify and report these schemes has never been more critical.

The COVID-19 Effect: New Opportunities for Fraud

The pandemic fundamentally changed how nursing homes operate and bill Medicare, creating unprecedented opportunities for fraud. The CARES Act provided hospitals with an increased payment for COVID-19 patients through a Medicare hospital inpatient prospective payment system adjustment. The increase was accomplished through a 20% increase in the diagnosis-related group (DRG) weighting factor for patients with a COVID-19 diagnosis.

As a result, the potential for a wave of hospital upcoding for inpatient admissions resulting from false COVID-19 diagnoses are not surprising. Some facilities exploited these emergency provisions by converting residents to Medicare Part A coverage simply for COVID exposure. A former employee of a company acquired by PACS told Hindenburg, “When [PACS] took over, they had a much more aggressive view of things, where you could have, let’s say that same nurse that was sick got COVID, you would end up picking up every single patient who has [Medicare Part A] in the entire building… we’d go from like 20 Medicare patients to 70 or 80 overnight.”

Common Types of Nursing Home Medicare Fraud

Upcoding Schemes

Upcoding: This type of medical billing fraud inflates bills by using billing codes that indicate the patient needed more expensive services than were actually provided. In nursing homes, this often involves manipulating RUG scores (Resource Utilization Groups). This RUG score determines reimbursement rates for the resident. Nursing home chains are notorious for upcoding RUG scores to ‘ultra high’ in an effort to maximize profits.

Ghost Patients and Phantom Services

Billing for Non-Existent Services: In some instances, nursing homes might bill Medicare for services that were never provided to the patients. This includes billing for therapy sessions that never occurred, medical supplies never delivered, or services provided by healthcare professionals who weren’t present.

Quality Care Violations

Many facilities cut corners on actual care while continuing to bill Medicare at premium rates. Some facilities may fail to maintain adequate staffing levels, which can contribute to the delivery of substandard care to nursing home patients. These violations often involve inadequate staffing, poor infection control, and failure to provide medically necessary services while still billing for them.

Red Flags to Watch For

Healthcare workers and family members should be alert to several warning signs:

  • Discrepancies in Billing: If you notice discrepancies between the services billed to Medicare and the services actually received by the patient, it could indicate fraudulent billing.
  • Excessive Services: A sudden increase in the frequency of services or tests that don’t align with the patient’s medical needs may indicate unnecessary billing.
  • Look for corporate memos from management on which billing codes to use for which services. If they do not match the actual service provided, chances are it is a form of Medicare upcoding.
  • Patient Complaints: If patients or their families voice concerns regarding unnecessary treatments or tests, take these complaints seriously, as they could indicate Medicare fraud.

How to Report Medicare Fraud

If you suspect nursing home Medicare fraud, there are several reporting channels available:

  • If a senior is not in urgent danger, but you suspect fraud, abuse, or neglect has or is occurring, please report your complaint to local law enforcement, state agencies, including your state Medicaid Fraud Control Unit (MFCU), or to HHS OIG at tips.hhs.gov.
  • If You’d Like Assistance Reporting Suspected Fraud, the Senior Medicare Patrol (SMP) is Here to Help. Call or Locate Your Local SMP Online.
  • Contact your state’s Attorney General office, which often has dedicated Medicaid fraud divisions

Whistleblower Protections and Rewards

For healthcare workers who witness fraud, becoming a medicare fraud whistleblower can be both financially rewarding and legally protected. Every year, the government pays hundreds of millions of dollars to whistleblowers who help stop fraud, waste, and abuse in the Medicare and Medicaid programs. Whistleblowers are also entitled to significant legal protections.

State and Federal laws provide protection to employees who report fraud or abuse. Any employee who is discharged, demoted, suspended, threatened, harassed, or discriminated against by his or her employer for reporting fraud is entitled to relief, including job reinstatement, twice the amount of back pay, and compensation for any court costs and attorneys’ fees.

The Importance of Expert Legal Representation

Navigating Medicare fraud cases requires specialized legal expertise. The Howley Law Firm, located in Manhattan, New York, brings decades of experience to whistleblower cases. We focus on representing individuals in the areas of employment rights in New York and whistleblower rewards nationwide. With two experienced attorneys and a keen eye for quality, our small law firm is able to dedicate more one-on-one time to our hand-picked clients.

For 20 years, we’ve represented companies such as Pfizer, Texaco, Citibank, and Sony as a partner in a large corporate law firm. We worked with the smartest lawyers in the country and argued in the U.S. Supreme Court. This corporate law background provides unique insight into how to effectively challenge healthcare fraud schemes.

We understand that more than your legal rights are at stake. You also need to protect your reputation and your career. We help you understand your rights and all of your options.

Taking Action

Nursing home Medicare fraud is a grave issue that drains government resources and jeopardizes the well-being of vulnerable patients. By understanding the various aspects of nursing home Medicare fraud, whistleblowers possess the power to effect change.

If you suspect Medicare fraud in a nursing home setting, don’t wait. Document what you observe, preserve relevant records, and consult with experienced whistleblower attorneys who understand both the legal protections available and the complex healthcare regulations involved. Your actions could not only result in significant financial recovery for taxpayers but also improve care for some of society’s most vulnerable members.

The post-COVID era has created new challenges and opportunities in nursing home oversight. By staying vigilant and knowing how to report suspected fraud, healthcare workers and family members can play a crucial role in protecting both patient welfare and public resources.