Identifying and Addressing Upcoding

Identifying and Addressing Upcoding

Category of Health Care Fraud and Abuse	Description of Category and Example from Authoritative Source*
False claims	False claims include all cases of a person or an entity knowingly presenting a fraudulent claim for payment requesting approval for false payment, or using false records to make fraudulent claims for payment (Govinfo.gov, n.d.). It can also be described as a case where an individual falsifies details of treatment and presents them to an insurance company or to Medicaid or Medicare to benefit from such claims. An example of a false claim is when an individual or a service provider provides false or inflated bills to Medicare, Medicaid, or health insurers for payment.
Kickbacks	Kickbacks involve payments made to an individual or an organization either as a result of providing a health organization with a client, referring patients to a certain health facility or health insurer, or facilitating a false claim and payments that lead to Medicaid or Medicare, or other health organizations making a payment as a result of such false claims (Centers for Medicare & Medicaid Services, 2021). An example of a kickbacks fraud is the case of when Walgreen developed a scheme to have all healthcare beneficiaries funded by the federal health programs fill for and collect all their government-paid prescriptions from Walgreens outlets across the country.
self-referrals	Self-referral occurs when physicians refer patients to get specific health care services in which Medicaid or Medicare are primary payers, from service providers that the physician has a financial relationship with or gains financially (Wendzel et al., 2019). An example is that of a physician working for a government health facility; instead of treating a patient, the facility refers them to a private facility for the same services in which the physician has direct or indirect financial benefits from the private health facility.
Upcoding  of services and items	It occurs when a health service procedure or a service diagnosis or procedure is charged with a higher cost than the service or the procedure costs in real sense claims (Centers for Medicare & Medicaid Services, 2021). Upcoding is, therefore, the use of a different billing code on a service rather than its own to get a higher reimbursement for services than the actual cost of such a service. An example of an upcoming fraud case is when a physician indicates that they offered a service that costs more than what they have offered. For instance, billing Medicaid or Medicare for a broken leg while the patient only had a sprained ankle.
Unbundling	According to the Federal Bureau of Investigations (FBI) (2011), unbundling occurs in a case whereby an individual, service provider, or health insurance company provides Medicaid or Medicare with fragmented bills. The fragmented bill charges services provided individually rather than bill them collectively to maximize from the government payer. Fraudsters, in this case, may also use one single service code repeatedly to gain an increased reimbursement. The occurrence of unbundling can be intentional or unintentional; however, it is still illegal. An example of unbundling is when a health service provider is requested to provide services, for instance, at a school as a whole, but charges the payers per student tested.

Five Health Care Fraud and Abuse Laws

	Health Care Fraud and Abuse Law	Description of Law	Rationale: How Does This Law Apply to Health Care and Why I Have Included It Here
1.	Federal Civil False Claims Act (FCA)	The FCA was formulated to ensure that government-sponsored programs like Medicaid and Medicare are not taken advantage of. It also ensures that the government does not get overcharged for substandard services and items. The law defines false claims and the liability of people who violate the law.	The FCA is applicable in healthcare, especially in managing health costs. The law has been included in this list as it can help understand how false claims occur and how they impact the cost of health care in the long run.
2.	Anti-Kickback Statute (AKS)	The Anti-Kickback Statute (AKS) is a law aimed at ensuring that health professionals, health organizations, and other health care service providers do not engage in acts related to soliciting payments or favors from patients or health organizations for referring patients for treatment in which the federal care programs such as Medicaid or Medicare are the payers. The law also defines the course of action for individuals and organizations who pay or make offers to get pay for patient referrals and provide health care services where Medicaid, Medicare, or any other government program is a primary payer.	Referrals are important in health care and occur regularly. The AKS is important as it defines what is considered as illegal in such referrals and the associated fines and penalties obtaining or soliciting for kickbacks in a way that violates the Anti-kickback Statute.
3.	Civil Monetary Penalties Law (CMPL)	The CMPL was formulated to act as the authority from which individuals, physicians, and other health organizations may be excluded from Medicaid and Medicare programs due to fraud and abuse cases. The law defines the assessment criteria for violations and related penalties.	The law applies to health care as it protects the government, service providers, and other consumers from dealing with healthcare criminals.
4.	Exclusion Statute	The exclusion statute is used to exclude already convicted individuals and entities from offenses related to healthcare fraud and abuse and healthcare felonies.	The law is important in healthcare as it protects users and the government from engaging with health criminals. It also ensures that the quality standards of health care are maintained.
5.	Social Security Act (the Act) (42 USC 1395nn) (Physician self-referral/ “Stark Law”)	The Stark Law deals with cases related to physicians referring patients to receive services reimbursed by Medicare or Medicaid to providers the physician has a financial relationship. It defines the nature of referrals, violations, penalties, and exceptions that may be applied.	Sometimes it may be important to refer a patient to a health facility with designated services. The Stark Law may prove important to health care as it may offer exceptions that shield the physician from fraud and abuse laws in such a case.

Upcoding and the Law

Law Pertaining to Upcoding	Explanation of Upcoding and How the Law Applies to It	Case Example of Upcoding
Federal Civil False Claims Act (FCA)	Upcoding involves modifying costs for medical services or items or including false services in the bill to maximize reimbursements. This amounts to making false claims to obtain inflated payments from Medicaid, Medicare, or any other payer. The FCA applies to upcoding by establishing a base for reference under which a violation can be determined to have occurred and the course of action in such a case.	An example of upcoding is the exclusion of the actual price of services rendered and entering a higher price for a service not rendered instead in order to get higher reimbursement from the government or the health insurer.

Evidence-Based Recommendations to Address Upcoding

Recommendation*	Source
Use of data mining techniques to detect upcoding and fraud.	(Ai et al., 2022)
Continuously training healthcare providers to avoid engaging in upcoding.	(Coustasse et al., 2021)
The development of a system based on a public-private partnership among the federal government, State agencies, law enforcement, and private health insurance plans to share information on the price of services and medication in real-time.	(Centers for Medicare and Medicaid Services, 2021).
Application of weighted risk models that incorporate potential fraud and risky provider behavior.	(Rolfe, 2021).
Use of AI data mining systems.	(Gill, 2020).

 References

Ai, J., Russomanno, J., Guigou, S., & Allan, R. (2022). A Systematic Review and Qualitative Assessment of Fraud Detection Methodologies in Health Care. North American Actuarial Journal, 26(1), 1-26.

Centers for Medicare & Medicaid Services. (2021). Common Types of Health Care Fraud. [ebook] Medicare Learning Network. Retrieved 29 April from https://www.cms.gov/files/document/overviewfwacommonfraudtypesfactsheet072616pdf

Centers for Medicare and Medicaid Services. (2021). Medicare Fraud & Abuse: Prevent, Detect, Report. [online] Cms.gov. Retrieved 29 April from https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/Fraud-Abuse-MLN4649244.pdf

Coustasse, A., Layton, W., Nelson, L., & Walker, V. (2021). Upcoding Medicare: Is Healthcare Fraud and Abuse Increasing?. Perspectives in Health Information Management, 18(4).

Gill, J. K. (2020). Health insurance fraud detection.

Govinfo.gov. (n.d.). False claims. [online] Govinfo.gov. Retrieved 29 April from https://www.govinfo.gov/content/pkg/USCODE-2011-title31/pdf/USCODE-2011-title31-subtitleIII-chap37-subchapIII-sec3729.pdf

Rolfe, A. J. (2021). Weighted risk models for dynamic healthcare fraud detection. Risk Management and Insurance Review, 24(2), 143-150.

Wendzel, B., Deitz, I., Engle, N., Favre, D., Fenster, A., Foran, N., & Gehring, A. (2019). Health care fraud. Am. Crim. L. Rev., 56, 1033.

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