Felony Fraud, a Criminal Conviction, and License Revocation

Artifice and fraud schemes are rampant in healthcare and insurance. Typical insurance fraud criminal charges will result in licensee disciplinary action. By typical I mean submitting claims for unemployment benefits while working another job or failing to report accurately income amounts to qualify for child and other state Medicare/ Medicaid benefits.

 

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Healthcare professionals also engage in insurance billings fraud schemes. Submitting health insurance claims for medical services not therapeutically necessary is fraud. This is typical a conspiracy. It is perpetuated knowingly by the physician but unknowingly by an entire medical office or hospital medical practice. Another scheme is a billing for every individual procedure code associated with a patient's surgical procedure, whether the patient received the service or product. This fraud is very hard to find without computers.

In September 2018 the Social Workers and Professional Counselors Board issued a disciplinary decision against a sole practitioner who billed an insurance company for her services. This case sheds light on a new scheme involving an old type of fraud. The professional counselor would see a patient four or five times. Thereafter, her husband, who was running the office, billed the patient's insurance company for 400 or 500 visits. The scheme stretched between 2011-2015. The licensee allowed her husband to engage in this $600,000 billing fraud with her license.

After several years the insurance company's fraud detection service was alerted. Fraud detection techniques include computer algorithms searching for outlier billing codes, procedures, excessive procedures, highest payee, or excessive patient visits. The insurance company referred the case to the Attorney General's Insurance Fraud Division. After a simple and brief investigation, the licensee was charged with felony insurance fraud, felony theft, felony unlawful use of a computer, and felony receiving stolen property.

The professional was convicted and sentenced 6 to 23 months in jail, 5 years probation, and $600,000 of restitution.  She was immediately stripped of her ability to participate in the private health insurance program. After her conviction, discipline was commenced. A 5 count disciplinary action that is based upon the felony conviction engaged in the course utilizing the license.  A fraud conviction is a moral turpitude violation.

A fraud perpetrated utilizing a professional license typically results in probation or a brief license suspension. This licensee engaged in fraudulent billing of fabricated office visits of this manner for 22 different patients. This rampant fraud, the Board determined, required license revocation. One patient's insurance company was billed for 906 office visits where only 56 visits were real. Another patient was charged 806 office visits but only was seen 55 times. One patient visited the office only twice, but was billed for 585 office visits.

This Board emphasizes insurance fraud related to the professional practice is an aggravating factor in diciplinary cases. The Board exclaims the four years of excessive fraud began immediately upon opening her private practice. The Board is disgusted with the licensee's deceptive statements to her patients who questioned explanation of benefit forms.

 

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Respondent's mitigation did not move the Board to reduce the license revocation exposure. She claimed spousal abuse, her husband made her do it, their family debts were excessive. The licensee's husband's spousal infidelity, and her attempts to stop His fraud were similarly disregarded. Computers are the investigators now. Abnormal billing, patient billing complaints, and engaging in other outlier type behavior is easier to detect. Call me to discuss any criminal investigation or disciplinary action.

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