When an inpatient in a hospital requires specialized medical treatment, he or she may be transferred to a skilled nursing facility (SNF). In order to obtain insurance coverage for skilled nursing care, however, strict admission guidelines must be followed. For example, the inpatient must have been hospitalized for no less than three consecutive days prior to being admitted to the SNF. Further, the patient must require more than just custodial treatment (help with bathing, eating, and daily tasks). If medical care is not required, Medicare and other government health care programs will not cover the SNF stay.

While you might have done your homework on insurance coverage and be confident in the care your loved one is receiving, you should still be wary of potential fraud. There are skilled nursing facilities that engage in fraudulent billing practices to obtain insurance payments when none are owed. You can report suspected fraud on the Senior Meidcare Patrols website. If you were defrauded, you should contact a qualified attorney right away. 

RUG upcoding


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One of the most common forms of SNF billing fraud involves a practice known as RUG upcoding. The Resource Utilization Group (RUG) III grouper is a computer program that classifies patients based on their clinical characteristics. The codes are weighted based on the severity of the patient’s condition. Thus, a more serious condition results in a higher payout. When skilled nursing facilities fraudulently categorize a patient to obtain more money, they are engaging in RUG upcoding.

According to a study conducted by the National Center for Biotechnology Information (NCBI), results suggest that skilled nursing facilities often engage in upcoding for the sole purpose of increasing revenue. The study found that although these facilities were providing additional therapy, there was no evidence of improved patient functionality. The NCBI believes that if the financial incentive to upcode was removed, Medicare could see significant savings.

Whistleblowers and qui tam lawsuits

Another common form of SNF billing fraud involves providing unnecessary medical care to a patient who only requires custodial care. SNF billing fraud is often reported by a whistleblower and frequently leads to a qui tam lawsuit. When funds are recovered through qui tam lawsuits, the whistleblower is typically entitled to a percentage of the recovered funds. These awards are meant to incentivize individuals to come forward with information about fraudulent activity against the U.S. government, and they can be quite lucrative.

If you suspect that a skilled nursing facility is engaged in billing fraud, consider asking yourself the following questions:

  • Does the facility provide only medically necessary services?
  • Are the services provided as ordered and billed?
  • Does the facility bill for services on the patient’s day of discharge?
  • Does the facility fail to submit no-pay bills?

Consult with an attorney

According to Christopher Sallay, a partner at NYC-based Queller, Fisher, Washor, Fuchs & Kool, LLP, Medicare and Medicaid fraud in nursing homes is a serious matter that has become more pronounced in recent years. It is often suspected by nursing home residents, families, and even former nursing home employees. There are legal provisions which prevent nursing homes from charging for products and services not provided, or overcharging for those products or services.

“Sometimes a resident or family members will have unnecessary services and treatments suggested to them whose sole purpose is to generate revenue for the nursing home,” Sallay says. “If a resident, or more typically their family, becomes aware of questionable conduct in that regard, it is imperative that they contact an attorney immediately. There are laws that provide for lawsuits and rewards under whistleblower laws such as the False Claims Act. In situations where fraud is suspected, an experienced attorney should be immediately retained to investigate and obtain proof of the actual fraud.”

If you believe you have been defrauded, an attorney is essential in recovering damages. 

“The federal government, requires specific and detailed evidence of nursing home fraud and an attorney practicing in this field will have intimate knowledge of the proof required and the best methods to obtain such proof.”

If answers to any of the above questions indicate possible billing fraud, you may want to seek legal counsel. Medicare fraud hurts more than just the government. Patients who are forced to undergo unnecessary treatments can suffer immensely. A skilled whistleblower or medical malpractice attorney can help you protect your rights and determine how to proceed if you have information about SNF billing fraud.