Health Care Fraud

The U.S. Federal Bureau of Investigation (FBI) estimates the annual cost to American taxpayers due to health care fraud is tens of billions of dollars.[1]  Most  physicians, other health care providers, medical equipment suppliers, and others who work with health care programs are honest. In some circumstances, however, certain individuals and organizations are willing to take advantage of the health care system through dishonesty or bending the rules.

The health care system, when attacked by those who abuse it, loses crucial resources that contribute to the rising costs of health care for Americans.  Fortunately, programs exist to help facilitate the prevention of fraud and recovery of lost assets. The False Claim Act (FCA), enacted by Congress in 1863, has recovered more than $59 billion over 1986 to 2018. More recently, in 2016, 2017, and 2018, total recoveries from FCA cases amounted to $4.7 billion, $3.1 billion, and $2.8 billion, respectively.  Of these totals, recoveries for health care fraud were $2.5 billion (53.1% of the total recoveries), $2.4 billion (64.9%), and $2.5 billion (89.2%), respectively.[2][3][4]

The U.S. government’s FCA program is a successful program.  However, a limitation is it operates after a fraud has occurred. Prevention is preferable to chasing a recovery through the courts. The first way to reduce health care fraud is for beneficiaries of health care benefits to be aware and alert to possible fraudulent activities.

According to the National Health Care Anti-Fraud Association (NHCAA), some of the common and prevalent schemes used by health care providers to commit fraud are:[5]

  • Performing unnecessary procedures on patients.
  • Billing Medicare or insurance companies for services not performed.
  • Duplicating claims for reimbursement.
  • Misrepresenting non-covered treatments as medically necessary.
  • Billing a more advanced procedure than the one actually performed (called upcoding).
  • Accepting kickbacks for making patient referrals.
  • Failing to provide pre-paid services included in an insurance plan.
  • Billing patients more than the co-pay amount for services already paid by the insurance company.
  • Medical identity theft.

Reducing health care fraud requires an effort by many people, including patients. The act of reviewing your medical bills, even if paid entirely or in part by an insurance company or Medicare, and protecting your health insurance information can have an impact on reducing health care fraud.

It is unlikely you will find yourself in a position like the ones above. If you do, however, being aware of the signs can be helpful. If you believe you are a victim of health care fraud, there are actions you can take:

  • Contact your insurance company.
  • Contact your state insurance fraud bureau.
  • File a complaint with your state medical board.
  • Contact your local FBI field office or Department of Health and Human Services-Office of Inspector General.


[1] Federal Bureau of Investigation (FBI) website. Health Care Fraud section. Retrieved on October 23, 2018, from

[2] Department of Justice, OPA. (2018, December 21). Justice Department Recovers Over $2.8 Billion From False Claims Act Cases in Fiscal Year 2018. Retrieved on January 28, 2019, from

[3] Ibid. (2017, December 21). Justice Department Recovers Over $3.7 Billion From False Claims Act Cases in Fiscal Year 2017.  Retrieved on October 23, 2018, from

[4] Ibid. (2016, December 14). Justice Department Recovers Over $4.7 Billion From False Claims Act Cases in Fiscal Year 2016: Third Highest Annual Recovery in FCA History.  Retrieved January 28, 2019, from

[5] National Health Care Anti-Fraud Association (NHCAA). (2017, September). The U.S. Health Care System and the Challenges of Fraud (p.11). Retrieved on November 13, 2018, from