Learning how to report Medicare, Medicaid, TRICARE, FEHB, and VA health fraud, and other false claims involving federal funds is crucial when it comes to protecting patients as well as taxpayers and keeping these healthcare programs solvent. Most whistleblowers are ordinary workers who are just doing their job when they come across fraudulent practices of their employer. Acting as a healthcare whistleblower ensures that the U.S. healthcare industry prioritizes patients over profit.
What Is a Whistleblower?
A whistleblower is someone who reports evidence of fraud, waste, abuse, or other wrongdoing within an organization. In healthcare, whistleblowers are often nurses, doctors, medical office staff, pharmaceutical or EHR sales representatives, or other employees of healthcare organizations. To protect these taxpayer-funded health care programs, organizational insiders or whistleblowers (known as relators) can help.
Individuals who wish to report their employer for defrauding one or more of these government healthcare programs can do so by obtaining an experienced qui tam attorney. Under the False Claims Act, healthcare whistleblowers may be eligible to receive a financial reward and certain protection against retaliation when they report their employers for defrauding a government healthcare program. By reporting through a False Claims Act qui tam suit, they may be able to receive from 10% to 30% percent of the government’s total recovery when successful.
What Are the Most Common Types of Healthcare Fraud?
Some of the most common kinds of healthcare fraud include:
- Medicare Advantage fraud: Medicare Advantage (Medicare Part C), an insurance program funded by taxpayers, has been enormously popular with seniors but is also subject to being defrauded. One common fraud by healthcare organizations and plans has been to make their patients appear sicker than they are to submit false and inflated claims for payment to the government program. Medicare Advantage insurers have paid settlements for such violations under the False Claims Act thanks to whistleblowers (individuals who reported their employer for defrauding the government).
- Kickback schemes: Under the Stark Law, physicians are prohibited from making referrals that are connected to their own financial interests. However, many nursing homes, home healthcare providers, hospitals, provider groups, managed care organizations, pharmacies, drug manufacturers, laboratories, durable medical equipment (DME) providers, and other health care organizations have unlawfully offered financial incentives to induce referrals to obtain new Medicare, Medicaid, TRICARE and VA Health insured patients. Pharmaceutical companies have been held accountable under the False Claims Act when they provide doctors and their staff speaking fees, expensive dinners, sporting event tickets, airfare, and other benefits to physicians to induce them to prescribe their drugs and products. All of these are examples of kickbacks, which are illegal in government healthcare programs and can lead to the payment of damages and civil penalties and a reward for whistleblowers.
- Upcoding and billing for services not rendered: Upcoding is fraudulent medical billing in which a government-insured claim is submitted for payment regarding a service that is more expensive than the service that was actually performed. Billing for services not rendered is just that: billing the government for services that were never provided to the patient. Both are illegal under the False Claims Act.
- Billing for unnecessary services: Health care fraud is a leading source of False Claims Act qui tam settlements and judgments. These recoveries restore funds to federal programs such as Medicare, Medicaid, and TRICARE, the health care program for service members and their families. But just as important, in many cases, enforcement of the False Claims Act also protects patients from medically unnecessary or potentially harmful actions.
- Pharmaceutical fraud: Pharmaceutical companies have unprecedented power in the American economy to set prices for lifesaving drugs and treatments. False Claims Act qui tam suits have involved allegations that drug companies conspired to fix the price of various generic drugs, which led to higher drug prices for federal health care programs. Other schemes involve underpaying rebates under the Medicaid fraud rebate program.
- At home healthcare fraud: At home healthcare is a booming industry, with over 3 million Americans receiving skilled nursing or long-term care at home. However, approximately 84% of home health agencies are for-profit corporations, according to the CDC. Home health care is rife with opportunities for fraud as well as patient abuse. Examples include falsely certifying to the government the number of actual hours or care provided, claiming care was provided by qualified staff when it was done by unskilled individuals, billing for unnecessary services, upcoding and billing for services not rendered.
The Department of Justice recovered over $1.67 billion in the last fiscal year that was lost to healthcare fraud. This was in no small part to the actions healthcare whistleblowers who simply wanted to do the right thing. Over the course of the last fiscal year 2024, false claims from managed care providers, hospitals, pharmacies, pharmaceutical companies, laboratories, and physicians accounted for over half of the total federal fraud reported and recovered through qui tam lawsuits. During the same period, the relator shares for the individuals who exposed fraud and false claims by filing qui tam actions exceeded $400 million paid directly to these individuals who stepped up and did the right thing.
Why Is Whistleblowing Important in Healthcare?
Blowing the whistle on healthcare fraud protects patients and prevents the government health care programs (Medicare, Medicaid, FEHB, VA health, and TRICARE) from becoming insolvent. Whistleblowing can help to deter conduct whereby healthcare providers are influenced by improper financial considerations over providing patients the right care at the right time. Other conduct such as those identified here can put patients at risk of harm.
There is simply no reason why taxpayers should pay higher costs to line the pockets of fraudulent health care organizations or providers. Whistleblowers can also help government enforcement agencies to get rid of the bad apples in the health care industry, a goal the entire industry should be able to get behind. Reporting medical fraud allows patients to get the care they deserve and deter future misconduct of organizations and providers that attempt to take advantage of the system. Federally funded healthcare is in place to protect those who need and deserve a safety net for their care, including seniors (who will be all of us one day), U.S. military veterans, U.S. active duty military members and their families, lower-income Americans including children. Those who perpetrate healthcare fraud schemes take advantage of vulnerable populations and also reduce the pool of healthcare funds available for us all. Healthcare organizations and providers should not get to enrich themselves at the expense of patients and taxpayers.
What Is Qui Tam in Healthcare?
Qui tam is a provision of law that allows whistleblowers the opportunity to sue on behalf of the government and collect rewards. Whistleblowers are known as relators under the False Claims Act, which is the most powerful enforcement tool to recover misspent taxpayer funds. Qui tam suits in the healthcare space rest upon allegations involving healthcare organizations that submit or cause another organization to submit false claims to the government in order to wrongfully claim or keep funds under the Medicare, Medicaid, TRICARE, VA Health or FEHB programs. If you have information relating to Medicare Advantage fraud, health care kickback schemes, Stark violations, upcoding or billing for services not rendered, billing for unnecessary services, drug price-fixing or Medicaid best price or rebate violations, home health fraud, or any other kind of health care fraud committed by your employer or a competitor in your space, you may be able to become a qui tam relator and be eligible for a reward.
What Protections Do Healthcare Whistleblowers Receive?
If you report fraudulent practices such as these under the False Claims Act, you can receive protections if your employer retaliates or discriminates against you due to your disclosure. With a federal right of action, your qui tam attorney can sue on your behalf in order to receive:
- Reinstatement at prior seniority level
- Up to double back pay with interest
- Front pay, in cases where reinstatement is not possible
- Additional damages
- Attorneys fees and costs
However, reporting as soon as possible is advisable in order to ensure that this statute applies. If you are fired before you are able to report fraud to the government, you may not only lose access to valuable information that can contribute to your claim, but you also may not be able to sue for FCA whistleblower protections.