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Your health and retirement savings may be at risk from Medicare scams.
Health care fraud, including Medicare scams, costs the United States about $68 billion annually, according to The National Heath Care Anti-Fraud Association. Medicare is U.S. federal health insurance that covers Americans 65 years and older. It provides critical health care services that seniors rely on for nearly all their health needs.
Medical Identity Theft
Medicare fraud happens when someone – an individual, group, or institution – intentionally tries to get payments from the Medicare program when they are not entitled to them.
Medical identity theft occurs when someone steals personal information such as your name and Medicare number. This also includes any Medicare Advantage, Medigap or supplemental, prescription drug, or other health ID numbers. Subsequently, they use it to bill your insurance for supplies or services you did not receive.
In 2022, the Medicare program expenditure was $767 billion. The vast amount of money involved makes it a prime arena for getting money from false claims.
Scammers target seniors because they are often less familiar with technology and have the magic Medicare account. Additionally, seniors also have a high incentive to find new, discounted, or free medical services as they try to make their retirement savings go further.
More than 4.5 million claims are received each day. For this reason, it is difficult to sort through all the claims to figure out which ones are Medicare scams.
The American Association of Retired Persons (AARP) fraud help hotline gets about 500 phone calls a day from people experiencing or reporting fraud, including for Medicare. Therefore, the sheer magnitude of scam activity makes it hard to eliminate.
Medicare Scams Can Affect Your Medicare Coverage
Medicare scams are enormously expensive for the U.S. government, but individuals’ benefit coverage are harmed as well. As a result of inaccurate Medicare claims, you could later be denied needed Medicare benefits. For example, some services have limits. If Medicare has documentation that a service was already provided, they may deny payment if the service is billed a second time.
If you get, for example, a cardiovascular genetic test offered by a scammer, Medicare could deny coverage. This means that you could be responsible for the entire cost of the test that you may not have needed. The average cost of this test is $9,000 to $11,000.
Medicare Scams Can Harm Your Health
If you rely on an unproven product for your illness, it can lead to delays in getting the proper treatment and can cause serious or fatal injuries. In addition, products for weight loss, sexual performance, and body building may contain harmful drugs or chemicals not listed on the label.
If you are scammed into receiving health care from a fraudulent provider, you could receive poor quality care, or endure unnecessary procedures or interventions.
Importantly, inaccurate medical records created by a fraudulent provider can hurt you for years. Legitimate providers can be misled about what care you need or have previously received.
Inaccurate or fraudulent records may contain false diagnoses, records showing treatments that never occurred, misinformation about allergies, and incorrect lab results.
The Emotional Pitch
Scammers use the term ‘Medicare’ to their advantage. When you hear there is a problem with your Medicare benefits, you want to make sure you listen and act.
When someone is making concerning claims about your health benefits, or promising a cure for a serious condition, you can lose your ability to remain calm and think clearly. Clearly, health and well-being issues can activate emotions and fears that can make you grasp for possible solutions.
For this reason, ads can offer simple solutions to complex problems, like Miraculous Cure, Quick Fix, Ancient Remedy, Scientific Breakthrough, or Quick and Painless Cure.
Recognize How Scammers Make Contact
A Medicare scam can be presented in several different ways. For example, it could come through a phone call, an ad on social media or any internet site, a TV ad, an in-person visit, an email, or even a friendly community health fair or market.
First and foremost, be wary of people other than your doctor making health recommendations in exchange for your personal information. Medicare’s website warns people not to allow “anyone, except your doctor or other Medicare providers, to review your medical records or recommend services.”
Be wary of emails claiming to be from Medicare. It is not typical for Medicare to email beneficiaries. Most communication takes place through your Medicare.gov account, where you can view your personal claims and coverage.
Ultimately, beware of offers for free medical supplies and other freebies trying to attract you in exchange for your Medicare number.
Know their scripts
It is wise to learn and remember the following methods that are used to initiate a conversation about your health needs that could be a scam:
- An unsolicited phone call from someone or a company with whom you have had no prior relationship
- A caller or emailer saying they are from Medicare, Social Security, or Medicaid
- A caller saying that you are eligible for a refund due to a change in coverage
- An unsolicited home visit – i.e., “door-to-door cold call”
- Information such as leaflets, flyers, or door hangers, on your car or at your residence, from a company you have had no contact with before
- Emails from sources you don’t know
- Word-of-mouth marketing about products from people you may know who have been recruited to spread the word
- Personal testimonials by “real” people or “doctors” played by actors claiming amazing results
Furthermore, the caller may not say, “Can I have your Medicare number (or Social Security number)?” Alternately, they will say, “Can I confirm it?”. You could assume that since they are confirming it, your doctor must have already given it to them.
The Fine Lines of Medicare Marketing Violations
None of the following are legal ways to suggest or sell products to you:
- An agent initiates a discussion about other insurance products, such as life insurance or annuities, during a visit or meeting about a Part C or Part D Medicare product
- An agent returns, uninvited, to your home after missing an earlier appointment
- Requiring you to provide your contact information as a prerequisite for attending a marketing event
- You receive a call without permission after attending an event
- You receive a call and they ask to confirm receipt of mailed information
The FBI is Going After Scammers
The Federal Bureau of Investigation (FBI) is the primary agency for investigating health care fraud, for both Medicare scams and private insurance programs.
The FBI investigates these crimes in partnership with Federal, state, and local agencies, the Healthcare Fraud Prevention Partnership, and insurance groups such as the National Health Care Anti-Fraud Association, the National Insurance Crime Bureau, and insurance investigative units.
Free Supplies Are Used to Entice People
The most common fraudulent offer is for free medical supplies or a medical checkup at no cost. Another popular scam is when a caller claims they are from a pharmacy network and offers to mail you over-the-counter vitamins and ointments at no cost.
Similarly, be cautious of anyone offering free testing, treatments, or supplies for genetic diseases, cancer, or the coronavirus.
One example of an FBI indictment, Operation Brace Yourself, is one of the largest Medicare scams in U.S. history. In this scheme, an international fraud ring allegedly scammed Medicare out of more than $1 billion by billing for unnecessary medical equipment — mainly back, shoulder, wrist, and knee braces.
Medical equipment companies often charge Medicare directly for providing equipment to Medicare patients. Ordinarily, this practice alone is not illegal, the alleged illegal activity occurred when the medical equipment companies paid a firm in the Philippines to recruit Medicare recipients, through advertising on television or online, who may or may not have had a medical need for the braces.
Meanwhile, the companies then allegedly paid doctors kickbacks to prescribe unnecessary braces without any patient interaction or with only a brief telephone conversation with patients they had never met or seen. The equipment companies encouraged patients to use telemedicine doctors – who could not physically examine them – for maximum efficiency. More than 100 equipment companies will have their Medicare payments cut off as part of the operation.
Newer technologies used to attract people
The FBI reported on other cases, including Operation Double Helix and Operation Happy Clickers, where company representatives offered free genetic tests to Medicare beneficiaries.
These tests are also called DNA screenings, cancer screenings, and hereditary testing, to name a few. The representatives went to senior centers, senior housing, health fairs, and even parking lots. There, they tried to convince people to let them take a cheek swab for testing. Meanwhile, they also advertised on TV and online.
They promised that the results would help recipients avoid diseases or find the right medications. All they asked in return was the person’s Medicare number.
These companies can steal peoples’ medical identities and falsely bill Medicare, draining the system of needed funds. Additionally, tests ordered under these circumstances are medically unnecessary and could lead to confusion about someone’s health condition.
Other areas of popular Medicare scams include cardiovascular testing, home health care, nursing home care, hospice care, pharmacy and prescription drugs, mental health care, and more.
Don’t Be a Victim of Medicare Scam
Understand that Medicare and Social Security already have your Medicare and Social Security numbers. So, if someone calls, emails, or texts claiming they need it, don’t give it to them. Instead, find the organization’s contact information on your own (don’t use caller ID). Call or email them directly to discuss the situation.
As the Federal Communication Commission (FCC) website states, “Medicare will never call you uninvited and ask you to give us personal or private information.” Protect your Medicare, Medicaid, and Social Security cards just like your credit cards.
There are only two reasons someone from Medicare would call you. Firstly, if you called the official 1-800-MEDICARE line and asked for someone to call you back. Secondly, if you are already a member of a health or drug plan with Medicare. In that case the agent who helped you join a Medicare plan can call you.
Check Your Bill
Read your Medicare Summary Notice and Explanation of Benefits. Look for services or equipment you didn’t receive, double charges, or things your doctor didn’t order. Ask questions and report problems. Call your doctor or company and ask them about mistakes. Similarly, call the insurance company if you still have questions.
How to report a suspicious contact
Now you’ll recognize the signs when someone calls and asks for your personal information, or threatens your Medicare coverage. Immediately hang up and call the official Medicare number 1-800-MEDICARE (1-800-633-4227) to report it.
You’ll find more information at the Medicare.gov website.
See also: Financial Scams Rise as People Aim to Prop Up Retirement Funds
The views expressed in this article are not to be construed as personal advice. You should contact a qualified and ideally regulated adviser in order to obtain up-to-date personal advice with regard to your own personal circumstances. If you do not then you are acting under your own authority and deemed “execution only”. The author does not accept any liability for people acting without personalised advice, who base a decision on views expressed in this generic article. Where this article is dated then it is based on legislation as of the date. Legislation changes but articles are rarely updated, although sometimes a new article is written; so, please check for later articles or changes in legislation on official government websites, as this article should not be relied on in isolation.
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