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Telemedicine Fraud: How Are Doctors Affected?

Telemedicine Fraud: How Are Doctors Affected?
Hendershot Cowart , P.C.

The ever-expanding world of technology continues to open doors we thought would forever remain closed, including the new affordable, nearly instantaneous, at-home medical care: telemedicine.

Through telemedicine, patients can place a simple phone call to medical professionals for an evaluation, diagnosis, and even, in some cases, treatment. Some ailments still require in-person appointments, of course, but this form of health and medical advice can help in a pinch and it saves countless patients an unnecessary trip to the doctor’s office. Doctors are also taking advantage of the growing trend by expanding their practices to include digital services, often through third-party telemedicine companies.

However, this revolutionary healthcare option isn’t all roses—some have taken it upon themselves to use this new service to generate damaging schemes, many of which affect doctors.

Feds Are Taking Action

In the past year, the Federal Government has taken down at least five telemedicine providers for fraudulent behavior. Healthcare fraud schemes aren’t at all unheard of, but this new form of fraud has been catching medical professionals off-guard, which is why it’s important to find out more about what types of fraud schemes have occurred, and the damage that follows.

The United States Department of Justice has filed charges against several telehealth providers and associated companies for their various schemes in the past year. These charges are anything but cheap— one such scheme involving Medicare fraud resulted in more than $1 billion in losses. And, unfortunately, the doctors associated with these telemedicine companies often feel the sting as well—especially if they provided medical service under their banners. Doctors working for fraudulent or dishonest providers could be caught in the crossfire, which may result in criminal penalties, costly legal fees, and even the loss of their professional license.

In 2019 alone, the federal government caught 5 major telehealth schemes, and it continues to investigate fraudulent activity on a regular basis.

It seems the telehealth trend is growing, and the associated fraud schemes along with it. Anyone associated with these dishonest companies, (patients, doctors, associates) could suffer by association, but doctors often have the most to lose. If you are a medical professional considering the telehealth field, make sure you know what’s at stake.

Common types of telemedicine fraud include:

  • Payment in exchange for the referral of business (“kickbacks”)
  • Incorrect medical billing or coding
  • Excessive remote prescriptions
  • Medicare scams

How Does Telemedicine Fraud Affect Doctors?

Although patients are the most obvious victims of telemedicine fraud, doctors and other medical professionals can face serious consequences as well. Patients could lose money, their medical records could be illegally shared with third parties, or their information could be used to obtain unnecessary medical services through government-funded programs, like Medicare. Doctors, on the other hand, can be penalized for providing telemedicine services to patients in states in which the doctor is not licensed to practice, which can endanger their right to practice at all. Additionally, some telemedicine frauds have pushed for excessive prescriptions (especially opioids), which could naturally affect the doctors making those prescriptions, however well-intentioned. As a result, the doctor could face criminal charges, expensive fees, or

Licensing Limitations Put Doctors At Risk

As previously mentioned, doctors who practice telemedicine are limited in where they can treat patients. If a doctor treats a patient in Florida, but she is only licensed to treat patients in California, she could face serious repercussions for practicing outside of her state, even if she only did so digitally. Other similar licensing limitations include issues with FDA medical app guidelines, as well as regulatory compliance with both federal and state laws. To ensure you protect your medical license, make sure the standard practices within your telemedicine company are above-board.

Example: Telemedicine Scheme Makes Unnecessary Prescriptions for Illegal Kickbacks

Earlier this year, in August of 2019, the U.S. Attorney’s Office issued a press release about another telemedicine case involving a scheme involving illegal kickbacks from pharmacies for unnecessary prescriptions.

Several telemedicine companies were accused of violating the False Claims Act by gathering insurance coverage information illegally to create prescriptions for consumers across the country. The press release also claims there were no doctor-patient relationships present when the false prescriptions were generated, and, lastly, the telemedicine company sold prescriptions to pharmacies illegally.

Not only did this scheme violate the False Claims Act, it also went against the Anti-Kickback Statute. Medical professionals could find themselves in hot water in these types of situations, especially where the credibility of the doctor-patient relationship is concerned. Additionally, the illegal use of medical prescriptions could significantly harm a doctor’s credibility, even if he or she had no knowledge of the telemedicine company’s use of their professional details. This case serves as an example of the many ways in which telemedicine can harm physicians and other medical professionals.

Example: Elderly Medicare Patients & Telehealth Fraud

Another similar scam involved prying phone calls where the caller would ask patients if they’d like to receive free, albeit unnecessary, knee braces, ankle braces, and the like. If the patient said yes, a virtual doctor (or a scammer with stolen credentials) would send a prescription, without ever seeing the patient, to a medical device company, who would then place an order through Medicare for a brace. Although this scam typically didn’t cost the patient a dime (due to their Medicare benefits), those involved in the scheme would receive a kickback for funneling business to the medical device company.

Were You the Victim of Telemedicine Fraud?

As a doctor, it’s important to keep an eye out for these types of fraudulent schemes filtering through your emails and online messages. If you receive any fishy request via a telemedicine service, be sure to follow the correct protocol before you put your name behind anything. Be especially cautious when helping elderly patients, and pay special attention to their prescriptions or other medical activity that could point to a scam. If your patients are victims of telemedicine fraud, it could put your medical license at risk by default.

Telemedicine fraud is still a relatively new issue, which is why it’s important to stay vigilant and informed. If you are a medical professional, make sure you know how these fraud schemes work, where they’re striking, and how to protect yourself.

Contact Hendershot Cowart, P.C. today to speak with one of our experienced attorneys.

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