Happy Eclipse Monday! The post title is meant as a bit of fun but there is a bit of relevancy as well. Billing fraud occurs via a process of hiding what actually has transpired (or should have) with the care of a patient. The most typical fraud is overbilling or charging the government for care not necessary or not actually provided.
Recently, the case of Phillip Esformes reached final settlement. He must pay $5.5 million in restitution to the Medicare program. Additionally, he must pledge at least $14 million in assets towards an outstanding forfeiture penalty of $38.7 million. This represents the amount received from Medicare through fraudulent billing at his Miami-Dade chain of assisted-living and skilled-nursing facilities between 2010 and 2016. Esformes co-owned numerous skilled nursing facilities and assisted living facilities in Illinois, Missouri, and Florida. He also owned a hospital in the Miami area, which he strategically utilized to meet the hospital stay (3 overnights for SNF coverage) requirement.
Esformes was previously convicted in 2019 for his involvement in a billion-dollar Medicare fraud scheme. He had his 20-year prison sentence commuted by former President Donald Trump in 2020 but did not receive a full pardon.
In pursuit of sustaining occupancy at 100%, Esformes ignored the coverage criteria for Medicare-covered SNF stays, including the 100 consecutive days coverage limit, specific discharge regulations, and the prior requirement of a three-day hospital stay. He often circumvented these regulations by offering bribes to doctors for their approval. A good background piece from Law 360 is here: Nursing Facilities and DOJ Fraud Settlement
For years now, a dozen plus, I have written about various issues regarding Medicare fraud. I’ve connected below, a number of relevant posts on this topic.
What I see routinely, are two types of possible sources of fraud. One I attribute to laziness or ineptitude (inadequate systems) and the other, to a desire to push the envelope for increased revenue, sometimes under the guise of revenue maximization via enhanced coding, etc. Since RUGS ended, the latter category seems less prevalent, though it still exists. Remember, for Medicare, fraud can exist without specific intent if the same occurred as a result of non-compliance or systemic failure. Providers today are expected to have compliance programs that mitigate billing abnormalities, etc.
- Failure to properly audit claims and train staff members in assessment and documentation practices that mitigate claim inaccuracy. The number one Medicare claim problem is care that is provided or not provided, according to an assessment and/or care plan. The source of this issue is typically less about the actual care delivery but more about documentation which does not demonstrate the proper level and amount of care as assessed. In other words, for an SNF, the MDS, the care plans, and the patient record don’t jive. MAC engagement on these claims can turn the same to errors, eliminating the presumption of payment (clean claim), and push a provider into a probe.
- Every provider seeks to maximize revenue. I’ve helped providers with this process. The correct way to do this is to understand how the Medicare program pays, for what, under what conditions, and then make certain that assessment and coding, paint a complete picture of the care the patient requires (and then of course, provide the care). Really good MDS people can make sure a facility captures all of the revenue available. Upcoding however, is not the same and can lead to probes which, can lead to a fraud situation. Upcoding means painting a picture of a patient as more complex and billing categories for care that compensate the provider for the complexity. The disconnect occurs when the patient does not actually require the care (not necessary), or the care isn’t provided as it wasn’t necessary to begin with.
More posts on fraud, Medicare, and the laws pertaining to fraud are below.
- https://rhislop3.com/2012/01/05/medicare-fraud-and-why-perspectives-on-the-post-acute-industry/
- https://rhislop3.com/2012/01/14/medicare-fraud-and-why-part-ii/
- https://rhislop3.com/2014/11/12/therapy-medicare-fraud-extendicare-lessons-for-snfs/
- https://rhislop3.com/2015/03/05/snfs-therapy-contracts-and-fraud-another-warning-and-example/
- https://rhislop3.com/2015/04/07/snfs-therapy-contracts-and-fraud-redux/
- https://rhislop3.com/2016/01/17/rehabcare-therapy-fraud-and-lessons-not-quite-learned/
- https://rhislop3.com/2023/11/20/compliance-update-fraud-and-abuse/