How to Report Your Clinic for Healthcare Fraud

In the realm of healthcare, the United States government allocates significant taxpayer funds for programs like Medicare and Medicaid, and thus the responsibility of clinics, companies, and individuals to comply with the law and submit accurate reimbursement requests is of utmost importance. However, an alarming trend of submitting false or fraudulent claims has surfaced, resulting in the loss of billions of taxpayer dollars annually and consequently jeopardizing patient safety. This dire situation brings us to questions about how to recognize and report healthcare fraud, which has spurred the emergence of healthcare fraud attorneys who assist in reporting healthcare fraud and valiant qui tam relators who blow the whistle on wrongdoings.

Understanding Healthcare Fraud and Kickbacks

At the heart of this issue is greed and actions taken consistent with greed that chip away at the honesty of the healthcare system. One of these wrongful actions, known as a “kickback in healthcare,” involves the sneaky exchange of rewards for sending patients or making certain purchases like pharmaceutical products. If someone obtained a secret incentive for sending you to a specific doctor or buying a particular medicine, would you trust that they are doing it for your best interest or for the incentive?

Kickbacks mess up the quality of care patients receive, by first destroying the perspective of impartiality and sometimes in turn actually killing that impartiality. If a doctor is paid a certain kickback to prescribe a certain medicine versus then there’s a perception that he or she is steering you towards that medicine for the purpose of that reward and it’s hard to overcome that perception, even if the doctor is only putting the patient on it for the patient’s best interest. In the more egregious and slippery slope paradigm, the doctor may internally reconcile that the incentivized product is the better one because it aligns with their own economic interests and thus lose their objectivity about the product. Kickbacks can be reported and addressed through the False Claims Act and via the Anti-Kickback Statute (AKS)  which if done promptly and properly could trigger a whistleblower reward.

Recognizing Healthcare Fraud

Healthcare fraud comes in various forms other than kickbacks. Healthcare providers often try to game the system to recover monies they’re not entitled to. One scam is called “upcoding,” where the seriousness of a patient’s condition is exaggerated just to code at a higher level of reimbursement. Or the time spent with an encounter is exaggerated. Sometimes these are routinely done or reflexively billed, to receive more money back. In 2012, the Office of Inspector General (OIG) reported an estimate that coders incorrectly reported 3 percent of 5,941 present on admission indicators, which has resulted in upcoding due at least one incorrect indicator on each of the claims. However, this may be just attributable to error unless there’s a discernable pattern.

If the staff is instructed to bill at a Level 4 reimbursement regardless of the actual time spent with the encounter (unless it’s more when they would bill more) it is a reflexive upcoding situation. That is, since Level 4 provides a higher level of reimbursement than level 2. More common is to upcode just one level.

Another trick is “unbundling,” where services that should be grouped and billed together as one bundle are artificially separated, leading to higher charges. Imagine ordering a meal deal at a restaurant, but then being charged for each part separately.

The Role of Healthcare Whistleblowers

In the complicated world of healthcare, there are everyday heroes who double down on doing something really important. First they help their patients and then they help stop fraud. These are healthcare whistleblowers, and they play a big role in stopping bad things from happening. They expose dishonest things in their workplaces to help hold the company accountable and save the taxpayers money and sometimes help address patient health issues.

Different Ways to Report Healthcare Fraud

• Telling Someone at Work: A Tricky Choice- NOT RECOMMENDED

Consider what would happen if you discovered unethical behavior in your healthcare clinic. You might want to inform someone, such as your boss or a special phone line, about it. But it’s not easy; you must decide if it’s safe, and you must understand the rules at your clinic. From our experience, using  an internal reporting mechanism often results in trouble for the reporting person who then defensively reaches out for a healthcare whistleblower lawyer since the company views them as part of the problem or looks to blame them for the conduct that they are nobly reporting.

• Telling the Government: Letting Them Know

Another option is to notify the government. But it is important to note that if you go directly to the government without filing a False Claims Act lawsuit, you may not be eligible for a whistleblower award. We have seen many cases where whistleblowers will contact law firms later in the process after learning that they will not receive a whistleblower award, especially after reading that the government settled with the health care provider for many millions.

• Choosing a Whistleblower Law Firm

The best and safest thing to do is to contact a whistleblower law firm that is experienced in handling healthcare fraud cases and learn about your rights. When we have plumbing problems, we call plumbers. We call roofers when we have problems with our roof. Similarly, we have healthcare fraud whistleblower law firms who can advise you on the best course of action.

Under the False Claims Act, whistleblowers can receive up to 30% of what the government recovers, but the facts of the case must be presented in such a way that the government will investigate further. Because they receive so many complaints, they will prioritize the ones that appear promising. Also, if the qui tam lawsuit is not filed in the right way it is over before it begins.

Emerging Healthcare Fraud Trends to Look Out For

The healthcare industry is always evolving, with changes in payment mechanisms and new technology. As a result, the government and potential whistleblowers must remain vigilant to monitor emerging healthcare fraud schemes. Some notable emerging healthcare fraud trends include:

• Telehealth Fraud: Following the COVID-19 Pandemic, patients and healthcare providers became more comfortable with remote appointments and care received via telehealth. While convenient, this also exposes health plans to increased fraud for appointments or services that never actually occurred. For example, thirty-six defendants were charged with submitting $1.1 billion in fraudulent telemedicine schemes in 2024.
• Medical Equipment: Durable medical equipment is essential for some patients in the recovery and healing process. Unfortunately, many healthcare entities and professionals try to take advantage of this by ordering equipment that is not medically necessary. An example is an alleged $110 million Medicare fraud scheme in which unnecessary back and knee braces were ordered via telemedicine.
• Cybersecurity Certifications: Health systems and electronic health records (EHRs) must pass stringent cybersecurity requirements outlined by the government. Patient health information is some of the most sensitive personal information is proper care is taken seriously by the government. For example, a federal healthcare administrative company settled claims for $11 million that the company falsely certified compliance with cybersecurity requirements to administer TRICARE health benefits.

Whistleblower Protection from Retaliation

The federal government has introduced plenty of protections to ensure healthcare workers are protected from retaliation and encourage potential whistleblowers to come forward. Potential retaliation can come in many forms, such as termination, reduction in pay, harassment, negative performance reviews, and denial of promotions. All of these activities in response to whistleblowing activity are deemed illegal under the False Claims Act if properly reporting fraud against the government and that’s the key the reporting must be proper which underscores the value of retaining a whistleblower law firm early in the process.

The protection against whistleblowers is specifically outlined in 31 U.S.C. § 3730(h):

“(1) In general.— Any employee, contractor, or agent shall be entitled to all relief necessary to make that employee, contractor, or agent whole, if that employee, contractor, or agent is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment because of lawful acts done by the employee, contractor, agent or associated others in furtherance of an action under this section or other efforts to stop 1 or more violations of this subchapter. (2) Relief. Relief under paragraph (1) shall include reinstatement with the same seniority status that employee, contractor, or agent would have had but for the discrimination, 2 times the amount of back pay, interest on the back pay, and compensation for any special damages sustained as a result of the discrimination, including litigation costs and reasonable attorneys’ fees. An action under this subsection may be brought in the appropriate district court of the United States for the relief provided in this subsection.”

An entity who threatens an individual bringing a False Claims Act lawsuit may be found liable for committing an impermissible retaliatory action. These whistleblower protections will apply regardless of job title and who filed the suit, as long as the matter implicates federal funds. Potential protections include reinstatement, double back pay for lost wages, and additional compensation.  Some state laws may have additional protections as well.

Choosing the Best Whistleblower Law Firm

Some of the best whistleblower law firms have a team of lawyers working for you. Look for a firm that has a track record of success in handling qui tam cases from start to finish, like Brown, LLC and also has members that were former Department of Justice or FBI lawyers as they can seamlessly interface with the prosecuting agency. Also, it’s important that the False Claims Act lawyers are able to articulate the case and explain how they can assist you. Most accomplished whistleblower law firms will take cases purely on a contingency basis, meaning they’re only paid if they win and offer free, confidential consultations. Firms like Brown, LLC who in 2024 had the whistleblower settlement of the year, have a track record of success, and if you think you want to report healthcare fraud, you should take them up on their offer for a free confidential consultation.