What Are Medicare Errors, Abuse, & Fraud?
The types of schemes that can and are being perpetrated against the health care system are as complex as the system itself. Common fraud schemes include efforts to fraudulently obtain and use a person’s Medicare number as well as scams that target Medicare services and plans. “Scam artists have treated Medicare like an automated teller machine, drawing money out of the government’s account with little fear of getting caught,” said former Sen. Norm Coleman of Minnesota.

What is Medicare Fraud?

Medicare fraud is defined as knowingly and willfully executing, or attempting to execute, a scheme or ploy to defraud the Medicare program or obtaining information by means of false pretenses, deception, or misrepresentation in order to receive inappropriate payment from the Medicare program.

What is Medicare Abuse?

Medicare abuse is defined as incidents or practices of providers that are inconsistent with accepted sound medical, business, or fiscal practices. These practices result in unnecessary costs to the program, improper payments, payment for services that fail to meet professionally recognized standards of care, or conducting procedures that are medically unnecessary.

Abuse involves improper payments where the provider has not knowingly and intentionally misrepresented the facts to obtain payment. Abuse still needs to be reported and corrected. Inappropriate practices that start as abuse, if unchecked, can evolve into fraud.

Errors & Other Situations that May Not Be Fraud

Providing and billing for health care services involves a lot of complicated steps, which may lead to errors or other situations that may not be fraud. Most Medicare payment errors are simply mistakes and are not the result of physicians, providers, or suppliers trying to take advantage of the Medicare system. Also, people often have trouble understanding their bills.