Screening for Scams: Telehealth, Medicare Fraud, and Patient Protection

October 1, 2019

        Telehealth is the use of electronic information and telecommunications technologies for long-distance clinical health care (telemedicine), health-related education, and health administration. Often praised for its convenience and affordability, telehealth is a popular venue for the treatment of chronic conditions and mental health disorders. 

        Increasingly utilized to provide health services to rural Americans, telehealth also delivers care that would likely require a great amount of travel and expense. While Medicare beneficiaries in all 50 states and the District of Columbia (D.C.) have utilized telehealth services, the majority of the claims are concentrated in states with expansive rural areas. In fact, Medicare only covers telehealth services for patients living in a “county outside a Metropolitan Statistical Area (MSA) or rural Health Professional Shortage Area (HPSA) in a rural census tract.”  HPSA designations indicate health care provider shortages in primary care, dental health, or mental health. 

         Telemedicine clearly has the potential to bridge many gaps in care. However, numerous vulnerabilities exist for telehealth consumers, providers, insurers, and administrators. Credentialing and privileging, online prescribing, privacy, security, abuse, and fraud are all issues associated with telehealth. Given that many telehealth users are members of vulnerable populations, such as the elderly or disabled, ensuring they are educated about the technology and its risks should be an essential part of telehealth policy and implementation. These risks have become increasingly evident in recent years as numerous cases of Medicare fraud by telehealth companies and associated laboratories and supply companies have emerged. Patient recruiters, doctors, nurses, and clinic executives have all been prosecuted for fraudulent Medicare claims related to telehealth services, with charges rising to the billions. Just last week, in one of the largest health fraud schemes ever charged, 35 individuals associated with telemedicine companies and cancer genetic testing (CGx) laboratories, nine of whom are doctors, were charged in five federal districts for Medicare fraud amounting to over two billion dollars.  

         Over 26 million people have submitted their DNA for testing to leading commercial ancestry and health databases. Payouts for genetic tests for Medicare patients nearly doubled from 2015 to 2018, increasing from $480 million in to $1.1 billion. Capitalizing on the genetic testing craze, laboratories provided kickbacks to fraudulent telemedicine companies who were referring the CGx tests to Medicare beneficiaries. However, the recommended CGx tests were not medically necessary, and the test results were never provided to patients. Additionally, doctors were paid to prescribe testing without patient interaction or after only brief telephonic conversations with patients, some of whom they had never seen or met previously. 

         In addition to the recent Department of Justice (DOJ) lawsuits, the Centers for Medicare & Medicaid Services (CMS) and the Center for Program Integrity (CPI), took “adverse administrative action against cancer genetic testing companies and medical professionals who submitted more than $1.7 billion in claims to the Medicare program.” One Florida Medicare patient was stunned to discover that after participating in a cheek swabbing event hosted by her condo building’s social committee in 2018, her Medicare insurance plan was billed more than $30,000 by the testing lab. More astonishingly, the lab was paid more than $12,000.  Fraudulent genetic testing, especially of the elderly, has been referred to as “the next big frontier in federal healthcare fraud enforcement.”

         So how do consumers and providers recognize and protect themselves from telehealth fraud? For patients, education is key. Knowing what to ask a doctor, what is appropriate to be asked to do as a patient, and what one should receive as part of care are essential pieces of health information. Pamphlets, flyers, and home health visits are all educational avenues for health organizations seeking to educate telehealth patients about the potential risks and benefits of telehealth. However, it is essential to ensure this information stems from reliable sources and licensed practitioners to combat the spread of misinformation or encourage further fraudulent actions by sanctioned telehealth companies. Clinical education programs to inform patients and providers may require more time or travel, but would provide both meaningful information and connection between the two groups. 

         Education and accountability are essential for providers. The American Medical Association (AMA) is best positioned to offer certifications and educational programs specific to telehealth. As the largest association of physicians in the United States, the AMA is able to understand the nuances and difficulties of the profession and its role in providing telehealth services to patients across the United States. As telehealth continues to bridge gaps in healthcare, it is imperative that providers, insurers, administrators, and patients are appropriately educated to minimize fraudulent claims against the federal government.

Lily Faulconer and Christine Xiao

October 1, 2019