Penalties for healthcare fraud

Healthcare fraud is an intentional false claim about a healthcare service or procedure that results in payments. It is most often committed by physicians. 

Individuals or groups commit healthcare fraud when they reap financial gain from an insurer or government program like Medicare and Medicaid through deceptive practices. 

Common types of healthcare fraud

There are a few common types of healthcare fraud committed by physicians who take advantage of their patients and insurers in order to gain personally, financially or professionally. 

  • Billing for services that were never rendered 
  • Billing for procedures more expensive than those performed 
  • Performing medical procedures that are not medically necessary 
  • Falsifying diagnoses to bill for unnecessary tests and procedures 
  • Receiving kick-backs 
  • Compromising confidential medical records 
  • Falsely issuing or selling prescription drugs 

Penalties for healthcare fraud

Steep fines, loss of medical license, sanctions, exclusions from Federal healthcare programs and even jail time are all possible penalties for physicians who commit different types of healthcare fraud. The penalties compound if multiple frauds occur at once. For example, if a physician files a false claim to Medicare or Medicaid, penalties include up to three times the loss, plus $11,000 per claim filed. Each item or service billed counts as a claim. If you have ever seen an itemized medical bill, you can imagine how quickly the penalties for false claims can add up. 

Healthcare fraud is a federal crime with stiff penalties. The severity of the penalty is dependent upon the type of healthcare fraud committed and the total losses. As part of the Health Insurance Portability and Accountability Act of 1996 (HIPAA), healthcare fraud became a criminal offense that could carry a federal prison term of up to 10 years in addition to other penalties. Healthcare fraud could not only drastically affect your professional career, but have lasting effects on the rest of your life.