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Overview

In general, fraud is defined as making false statements or representations of material facts to obtain some benefit or payment for which no entitlement would otherwise exist. These acts may be committed either for the person’s own benefit or for the benefit of some other party. In other words, fraud includes the obtaining of something of value through misrepresentation or concealment of material facts.

Policy

Fraud schemes range from solo to broad-based operations by an institution or group. Anyone can commit health care fraud. Organized crime also is infiltrating the Medicare Program and masquerading as Medicare providers and suppliers. Examples of Medicare fraud may include: • Knowingly billing for services that were not furnished and/or supplies not provided, including billing Medicare for appointments that the patient failed to keep; and • Knowingly altering claims forms and/or receipts to receive a higher payment amount.

It is a crime to defraud the Federal Government and its programs. Punishment may involve imprisonment, significant fines, or both. Criminal penalties for health care fraud reflect the serious harms associated with health care fraud and the need for aggressive and appropriate fraud prevention. In some states, providers and health care organizations may lose their licenses. Convictions also may result in exclusion from Medicare participation for a specified length of time. Medicare fraud may also result in civil liability.

Authority

The False Claims Act, Anti-Kickback Statute, Physician Self-Referral Law (Stark Law), Social Security Act, and the U.S. Criminal Code are used to address fraud and abuse. Violations of these laws may result in nonpayment of claims, Civil Monetary Penalties (CMPs), exclusion from the Medicare Program, and criminal and civil liability.

From Centers for Medicare & Medicaid Services, Medicare Fraud & Abuse Prevention, Detection and Reporting, Medicare Learning Network Fact Sheet, available at http://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/downloads/Fraud_and_Abuse.pdf.