January 04, 2022

While the expansion of telehealth during the pandemic benefits patients, the current situation is ripe for fraud

By Raymond M. Sarola and Regina D. Poserina, Cohen Milstein Sellers & Toll PLLC

The Covid-19 pandemic has caused a dramatic increase in the use of telehealth services, and this higher usage is likely to continue in the future.  At the start of the pandemic, Medicare and Medicaid acted quickly to increase the range of healthcare services that are covered when provided though telehealth technology, and this expansion has allowed patients to receive safe and secure healthcare from the convenience of their own homes. Private markets responded by investing billions of dollars into telehealth companies. As whistleblower lawyers, we know from our experience that the combination of expanded coverage and increased private investment creates a situation that is ripe for fraud. 

Prior to the pandemic, Medicare imposed strict limitations on when telehealth services were covered. Historically, Medicare would only cover telehealth services that were provided in certain designated geographical areas, at certain types of provider locations (such as a hospital or doctor’s office), using certain types of telehealth technology, or a narrow set of “virtual check-ins” used solely for the purpose of determining whether an in-person visit was necessary. Due to these limitations, as of February 2020, only 0.1% of all Medicare healthcare services were provided via telehealth technology.

Beginning in March 2020, Medicare and Medicaid widened the scope of covered telehealth services, including services that may be provided remotely to a patient’s home. This expansion of healthcare services has benefitted both patients and providers during the pandemic. The dramatic increase in private capital investments in telehealth companies reflects a strong belief that this expansion of telehealth is here to stay.

While a broader range and type of telehealth services are now covered by Medicare and Medicaid, Medicare's core requirement that services be reasonable and necessary remains in force. The unique nature of telehealth services presents a high risk that providers may bill Medicare or Medicaid for unreasonable, unnecessary, or otherwise non-covered services. 

For instance, if a doctor billed for in-office visits that he or she did not actually perform, it would be likely that nurses or other staff would see that fraud was being committed. But if a doctor is billing for telehealth services that were not performed, other staff may not learn about the fraud since they would not observe a patient entering or leaving the office.

Other examples of telehealth fraud may include when a provider:

  • bills for more services than were actually provided, i.e., billing for a 25-minute service when the service was only 5 minutes long.  
  • bills for a medically unnecessary service or product that was provided or ordered using telehealth technology;
  • receives or offers any kind of kickback in exchange for referring or providing a telehealth service to a patient; or
  • bills for telehealth services that do not occur using an interactive audio and video telecommunications system that permits real-time communications to occur.     

The United States Department of Justice and the Centers for Medicare and Medicaid Services are concerned about misuse of telehealth services, and actively investigate and pursue those who abuse the programs.

An individual who learns of telehealth fraud should speak with an experienced whistleblower attorney to analyze the situation and consider whether his or her information would support a whistleblower lawsuit under the False Claims Act.

Access the complete Taxpayers Against Fraud (TAF) Education Fund article here.