Beneficiary Penalties in the Health Care Reform Legislation

I was recently talking to one of Medicare’s fraud fighters, and she brought my attention to a little noticed provision in the Affordable Care Act which gives the Government the authority to impose administrative penalties on Medicare beneficiaries who participate in Federal health care fraud, or who conspire to commit it. (It’s in section 6402, and it also applies to Medicaid and the Children’s Health Insurance Program (CHIP) beneficiaries.) Apparently this was enacted because of persistent if not increasing participation by Medicare beneficiaries in fraud schemes. While criminals often steal Medicare numbers (In fact, I have heard that they are available for sale “on the street.”), unfortunately some Medicare beneficiaries actually sell their numbers. Indeed, so many Medicare numbers have been involved in fraudulent activities that the Centers for Medicare & Medicaid Services hired a contractor just to keep track of them!

And while I have not heard of any penalties actually being imposed of yet, it probably will eventually occur, so be warned! Don’t sell your number, or take kickbacks for services you do not need, or are not even given to you, or recruit friends or neighbors for scams for a “finder’s fee.”


Originally Posted 09-30-11

Keywords: Beneficiary Penalties Affordable Care Act Health Insurance Claim Numbers Beneficiary Fraud