4 Types Of Unethical Medical Billing Practices You Should Know About
As a healthcare provider, you likely already know how integral it is for your business’s success to maintain some ethical billing practices. Not only does this protect your patients, but it’ll also help you swerve any possible legal complications that may have existential consequences for your medical practice.
As a patient, you’re in a place of vulnerability when it comes to medical procedures, and all you can do is blindly trust the good nature of healthcare providers to provide accurate and transparent billing practices. Let’s be honest – a patient is always going to be more keen to seek care from medical providers who are transparent and ethical in their billing practices.
Unfortunately though, it’s certainly not uncommon for medical billing fraud and other types of sneaky tricks to be rife in this industry. Whether they’re good or bad, the bottom line is that your billing practices have significant impacts on your reputation, financial stability, and patient satisfaction.
So, it goes without saying that health care providers must adhere to these basic ethical standards when writing a medical bill.
In this article, we’ll go over the top four unethical medical billing practices that you should steer your practice clear of.
Top Unethical Medical Billing Practices
1. Upcoding Fraud
To kick things off, we have upcoding. This is similar to upselling in any other industry, but instead of actually receiving a more expensive/higher quality service, you’re just being charged for a medical procedure you haven’t actually had.
As an example, a medical provider in your practice may bill their patients for a comprehensive exam when they only performed a basic exam in reality. Obviously, the idea here is to pocket a bit of extra cash by exploiting the patients comparative lack of understanding in the industry, but this is clear health care fraud.
Anyone caught fraudulent billing in this way faces serious consequences if they’re caught without a good explanation, and you can typically expect hefty fines and exclusion from insurance programs too.
Aside from fines and whatnot, it perhaps hurts the relationship you had with your patients the most. Unless they’re assured this incident was an anomaly and they were accidentally charged more, most patients are probably going to lose trust in your practice and seek care elsewhere.
2. Double Billing
This is fairly simple but equally as damaging when it comes to unethical medical billing practices, involving billing two separate insurance companies for the exact same service or procedure so that your practice can be reimbursed twice instead of once.
For example, you might not only bill Medicare for your services provided, but also another private health insurance provider. It goes without saying that this is highly illegal and can have all the same consequences as upcoding.
Similarly, it also harms your patients, as they may not be able to afford the care that they need if they’ve been overcharged unfairly.
3. Unbundling Fraud
This is where you bill a patient for each single component of a bundled service as separate procedures, rather than just charging them for the bundled service as a whole.
Let’s say hypothetically that you’re performing a blood panel test for your patient, but instead of wrapping the blood panel up as one entire service like it’s intended to be, you start charging them for each individual part of the test so you can make more money.
This kind of fraud is sneaky as it’s not always clear what should be charged as a bundled service or not, but ultimately it’s the responsibility of your healthcare providers to avoid this at all cost so you don’t face any legal consequences.
4. Balance Billing
Next up we have balance billing, a practice in which providers charge patients for whatever the difference is between what the insurance company pays and what the provider charges for treatment.
These kinds of illegal billing practices are a bit easier to spot, and you can normally work out whether or not you’ve been overcharged if you know how much of the total cost that your insurance company was meant to cover.
As an example, if a patient’s insurance only covers around 85% of the cost for any given procedure, healthcare providers may bill the patient directly for the remaining 15%. While this isn’t necessarily legal in every state, it is illegal in California under both federal and state law.
Even if it’s not illegal in your state, your patients may still be forced to delay or entirely forgo a necessary medical treatment as they might not be able to (or had expected to) pay the remaining cost of the bill.
Avoiding Unethical Medical Billing Practices With PMN
Even with the best intentions in mind, it can still be slightly difficult to adhere to high ethical standards when it comes to medical billing, even if you’re staunchly against any kind of maligned attitude towards your patient.
Fortunately though, there’s always the option to outsource the tasks that are open to manipulation to trusted experts that can ensure your billing practices stay compliant.
PMN is one such example, with highly experienced staff that know all about the importance of ethical medical billing. Not only that, but they’re determined to meet all the relevant operating standards set by the healthcare industry, including following guidelines from HIPAA.
In addition, you can expect a comprehensive suite of services provided by them that are designed solely for streamlining your practices’ workflow. This includes getting access to coding audits, having your accounts receivable and collections managed, and various other physician services.
What Are The Penalties For Fraudulent Medical Billing?
Naturally, this is going to be decided on a case by case basis, but oftentimes medical providers can face various civil or criminal penalties, with some cases even causing them to be excluded from health care programs. Perhaps worst of all, your practice would also be liable to pay a range of fines and any of the overpayments they’ve received back.
Why Would Medical Providers Engage In Unethical Billing Practices?
Again, this’ll depend on the specific practice in questions, but sometimes it can be because they simply want to maximize their profits, satisfy quotas, or even compensate for any unrelated financial losses. Others may simply lack the knowledge or resources to manage medical billing properly.