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Skilled Nursing Facility Medicare Fraud

When admission to a skilled nursing facility is medically necessary, Medicare covers at least a portion of the services, as long as certain requirements are met. For starters, admission to the facility must come on the heels of a covered inpatient hospital stay of at least three days. When a skilled nursing facility bills Medicare for medically unnecessary services, the facility may be guilty of Medicare fraud.

RUG Upcoding

Fraud in skilled nursing facilities most commonly involves something called a Resource Utilization Group (RUG) code. Every patient is assigned a code, which is used to evaluate the patient’s needs. These codes are weighted, and directly impact the per diem paid to the facility by Medicare. When the wrong code is purposely used to obtain higher payment, this is known as RUG upcoding, and it occurs with shocking frequency. Patients are categorized into seven main categories. These are:

  • Behavior problems
  • Clinically complex
  • Extensive services
  • Impaired cognition
  • Reduced physical function
  • Rehabilitation
  • Special care

Each of the above categories is further divided into specific RUG codes. A MA whistleblower attorney can help you determine how to proceed if you have information about RUG upcoding at a skilled nursing facility.

Skilled Care vs. Custodial Care

Care that occurs in a skilled nursing facility “requires the involvement of skilled nursing or rehabilitative staff in order to be given safely and effectively.” Custodial care, on the other hand, is non-medical care, such as assistance with bathing and eating. Skilled care involves physical therapy, intravenous injections, and the like. If the facility bills for skilled care when the patient only needs custodial care, this is Medicare fraud. It can also be fraud if a patient who previously needed skilled care gets better, but the facility continues to provide unnecessary skilled services. If a whistleblower provides information about this type of fraud to the government, the skilled nursing facility may be required to pay back every cent obtained in this manner.

What is a Whistleblower?

A whistleblower is someone who reports illegal or fraudulent activities committed against the U.S. government. To incentivize people to report such activity, whistleblower rewards are often substantial. Take the following scenario, for example. Gretchen works for a skilled nursing facility. She notices that patients are being given RUG codes that are inconsistent with their actual needs. Gretchen reports this activity, and the resulting investigation uncovers millions in Medicare payments received based on fraudulent charges. When those funds are repaid by the facility, Gretchen may receive a reward of up to 25 percent of the total recovered.

The reality is, blowing the whistle can be extremely lucrative. Rewards may be in the hundreds of thousands or millions of dollars. In addition to helping the government agency in question, whistleblowers often protect innocent people. In many cases, fraudulent or illegal activity uses tax payer dollars, and can even harm the safety, health, or well-being of the general public. Whistleblowers are often reticent to report fraud and illegal activity for fear of retaliation. Fortunately, multiple legal protections exist to prevent this type of backlash.

In order to report skilled nursing facility fraud, you must hire an attorney. That attorney will file something known as a False Claims Act qui tam action against the facility. You will then be asked to identify specific examples of Medicare fraud that you witnessed. A Boston whistleblower attorney can help you determine if the information you have warrants a qui tam lawsuit.

Altman & Altman, LLP – Whistleblower Attorneys Serving Boston and the Surrounding Areas

If you are aware of fraudulent or illegal activity against a government agency, the skilled legal team at Altman & Altman, LLP can help. Our experienced whistleblower attorneys will thoroughly analyze the details of your case to determine the most appropriate legal strategy for moving forward. We will ensure that you fully understand your rights and options, and will remain by your side throughout the entire case. Contact Altman & Altman, LLP today for a free and confidential consultation about your case.

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