Date: Wednesday, June 5, 1996
FOR IMMEDIATE RELEASE
Contact: OIG Press Office(202)619-1142

HHS Releases Special Fraud Alert on Fraud and Abuse in the Provision of Services in Nursing Facilities

HHS Secretary Donna E. Shalala today released the third in a series of "Special Fraud Alerts" to help health care providers and consumers identify and report illegal practices. Today's alert, issued by the HHS inspector general, focuses on problems that have been uncovered in the provision of health care services to residents of nursing facilities.

Special Fraud Alerts are being issued as part of the Clinton Administration's anti-fraud initiative, Operation Restore Trust. The initiative is aimed at developing cooperative efforts to combat fraud, waste and abuse in areas of high spending growth in the Medicare and Medicaid programs.

"Fraudulent activity aimed at nursing facilities and nursing home residents is one of the special targets in President Clinton's anti-fraud initiative," Secretary Shalala said. "This fraud alert is one more way for us to enlist the help of nursing facility staff, beneficiaries and honest health care providers, so that together we can put a stop to fraud in our Medicare and Medicaid programs."

Nursing facilities and their residents have become common targets for fraudulent schemes, the alert says. Nursing facilities represent convenient beneficiary "pools" and make it lucrative for unscrupulous persons to carry out fraudulent schemes. "The need to eliminate fraud, waste and abuse from nursing homes and to make nursing homes better for their residents, is of prime concern to us all," said Secretary Shalala.

The alert highlights a number of fraudulent arrangements by which health care providers, including medical professionals, inappropriately bill Medicare and Medicaid. It points out various types of schemes, including:

- Claims for services not rendered or not provided as claimed;

-- One physician improperly billed $350,000 over a two-year period for comprehensive physical examinations of residents, without ever seeing a single resident. The physician went so far as to falsify medical records to indicate that nonexistent services were rendered.

- Claims falsified to circumvent coverage limitations on medical specialties.

-- An optometrist claimed reimbursement for covered eye care consultations when he, in fact, performed routine exams and other non-covered services. A review of his billing history indicated he claimed to have performed as many as 25 consultations in one day at a nursing home. This is an unreasonably high number, given the nature of a Medicare-covered consultation.

The Special Fraud Alert also provides a number of situations that may suggest fraudulent or abusive activities. Such as:

- "Gang Visits" by one or more medical professionals where large numbers of residents are seen in a single day. The practitioner may be providing medically unnecessary services or the level of service provided may not be of a sufficient duration or scope to be consistent with the service billed to Medicare or Medicaid.

"Special Fraud Alerts allow us to notify the industry that we are aware of certain abusive practices and that the government intends to investigate and will vigorously seek prosecution," said Inspector General June Gibbs Brown. "These special alerts have had a positive impact on industry behavior and furnishes the industry an opportunity to do a self-examination of its own practices."

Operation Restore Trust, the Administration's special initiative to detect fraud and abuse in Medicare and Medicaid, was launched by President Clinton and Vice President Gore last year. Nursing facilities services constitute one of the areas covered in particular under the "Restore Trust" effort.

NOTE: Copies of the "Special Fraud Alert" are available from the OIG Press Office, (202) 619- 1142.