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New York Nursing Homes Beware – Medicaid Fraud Under Fire

New York’s Attorney General, Eric Schneiderman, unveiled a sweeping Fraud Control Unit designed to target healthcare providers who abuse the Medicaid system. According to the AG’s website, they are continuing to add dozens of prosecutors and investigators to keep up with reports and investigations. Nursing homes throughout the country are largely paid by Medicaid funds. To stay profitable, nursing homes must remain at near full occupancy. This often means cutting corners, refusing to transfer residents who need critical care or higher levels of care, and even billing for services that are not (or cannot be) provided. Below are just three simple examples of Medicaid fraud in nursing homes.

Billing for Services Not Rendered
When a resident goes to a skilled nursing facility, the resident and his or her family typically sign a contract and apply for Medicaid. At times, the application takes some time to be approved, but once it is, the money begins flowing to the nursing home, paying for whatever services are billed. There are fairly strict rules on what the facility can bill for and how much they are paid.

Nursing homes are only paid a fraction of their regular charges. Say the actual room charge is $8,000 per month, Medicaid may pay only about $1,500 to $3,000. Usually it is only a small fraction. So, nursing homes do anything they can to ensure they get every penny. Some will bill for a private room, when in truth the resident shares a room with 4 other residents who themselves all pay for private room as well. Nursing homes may also report that a resident is receiving a gait belt to help with mobility or other assistive devices, when in reality such devices are being share among an entire floor of residents, each being billed as having the same expensive device.

Medications Not Being Administered

As horrible as it sounds, some nursing homes have even stooped so low as to report the administration of medications to residents when no such medications are given. The way this little scheme is done is the nursing home will “ration” meds by giving patients less critical medications every other day instead of daily. Or, perhaps that does that requires 3 times per day will become 2 times per day. When spread over time, they save a lot of medicine by again sharing the same medication across the population and yet still billing as though all patients received appropriate doses.

Physician Extenders Being Overused

In the past 10-15 years, we have seen a real surge in the use of nurse practitioners and physician’s assistants. And for the most part this is a cost savings for the public. However, some nursing homes use these “physician extenders” to bill as though the physician had actually visited. To explain this a little better, each nursing home must have a medical director – a doctor who oversees care. That doctor does not typically stay on the premises but is required to visit and see patients at certain intervals, and he or she also consults with the nursing staff to ensure more critical issues are properly addressed. However, some facilities will allow the nurse practitioner to fax treatment records and orders to the physician, who in turn signs them without ever seeing the patient. Then, since the care appears to have been provided by a physician, Medicaid is billed at a different rate than if billed for just the nurse practitioner’s bill was generated.

Given the recent attention paid to fraud by New York’s Attorney General, nursing homes should be careful. When selecting a nursing home, be sure to do your homework and review state complaints and investigations. You can also discuss the decision with an elder law attorney to learn more about quality homes in your state.

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