Telemedicine Fraud Increases

Telemedicine FraudAccess to telehealth has grown rapidly since the start of the COVID-19 public health emergency. As the access to telehealth has increased, so has telemedicine fraud. Telemedicine fraud is discussed below.

In March, Attorney General William Barr called on U.S. Attorneys to focus on detecting, investigating, and prosecuting COVID-19 related fraud. In addition, he asked for hospitals and the general public to aid in the detection of telehealth fraud by reporting suspicious activities.

The False Claims Act (FCA) created guidance for fraudulent activities including telemedicine fraud. Common fraud activities include:

  • Billing fraud including billing for:
    • Unnecessary medical services
    • Services that were not provided
    • Phantom patients
    • Virtual appointments at a higher than the normal reimbursement rate
  • Up-coding by:
    • Falsely extending the length of an appointment that is billed hourly
    • Exaggerating the complexity of a visit
  • Unbundling grouped or global procedures to file separate claims
  • Illegal kickbacks

Department of Justice and Fraud

On April 23, 2020, the DOJ charged Charlene Frame, the operator of Royal Physician Network, LLC, and Envision It Perfect, for telemedicine fraud. The fraudulent activities included illegal kickbacks paid to physicians and nurse practitioners, persuading them to order durable medical equipment (DME) and billing the DME to Medicare. The scheme billed Medicare beneficiaries more than $60 million.

“Our prosecutors and law enforcement partners will continue to use all available resources to dismantle networks engaging in unlawful schemes that place profit over legitimate medical treatment,” said U.S. Attorney Bobby L. Christine.

On May 15, 2020, Ashley Hoobler Parris was arrested for her part in defrauding Medicare. “The defendant allegedly sought to pay and receive illegal kickbacks in exchange for referring Medicare beneficiaries for expensive genetic screening tests and COVID-19 tests,” said Assistant Attorney General Brian A. Benczkowski of the Justice Department’s Criminal Division.  “The department will continue to work with our law enforcement partners to protect the public from those who defraud our government health care programs, especially those who exploit the COVID-19 pandemic for personal gain.”

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