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Red Flags for Potential Healthcare Fraud When Assessing a New Side Gig or Business Model

Physicians searching for side gigs are often excited to be pitched opportunities, especially ones that seem passive and low stress. However, there are unfortunately many companies that take advantage of this enthusiasm to enlist physicians into questionable practices. This has led to the government investigating and prosecuting some doctors for what the doctors believed were legitimate side jobs but were actually connected to broader health fraud schemes, such as fraudulent Medicare billing. As a general rule, if something sounds too good to be true, it may be. All physicians seeking side gigs should be aware of red flags that could indicate that the job is connected to a healthcare fraud scheme. Before signing on for a new opportunity, you’ll want to understand what to look out for to help protect your reputation, your livelihood, and your license.


The information for this article has been derived from material originally contributed by Stephen Lee, a former federal prosecutor, who has defended physicians who are being investigated or prosecuted for health care fraud or violations of the Anti-Kickback Statute. Stephen is a paid advertiser on our attorney database for physicians.


Disclaimer: Our content is for generalized educational purposes. Please do your own due diligence before making decisions based on this page. Nothing on this page constitutes formal or personalized legal or financial advice. While this information is accurate to the best of our knowledge, it may not be up to date or apply in your location or personal situation. We are not formal financial, legal, or tax professionals, and you should consult these as appropriate. To learn more, visit our disclaimers and disclosures.

5 red flags physicians should look for in a side gig opportunity that raise concern for potential healthcare fraud

Potential implications of healthcare fraud with a side gig


Physicians are generally rule-followers and believers in good patient care. The idea of being associated with fraud and the associated harm to their reputation is incentive enough for most physicians to steer clear of these schemes.


In case anybody needed more reasons, healthcare fraud, even if done unknowingly, can lead to:

  • Loss of your medical license

  • Hefty civil monetary penalties and fines

  • Exclusion from federal programs, such as Medicare

  • Criminal charges

  • Imprisonment


The severity of repercussions for fraudulent activities, even without intent, highlights the importance of performing due diligence and vetting every opportunity you consider before accepting a position.


Knowingly submitting improper claims for payment to Medicare, Medicaid or private insurance is a crime, as is knowingly helping others submit improper claims. And even if you do not have intent to defraud and were misled, you could be held civilly liable if you should have known better.


Unfortunately, in many cases, physicians charged with these crimes genuinely don’t know that they were involved in something illegal until it’s too late. This is a situation where our altruism and trust (and general business naivete) can definitely work against us, and counting on the government to believe you when you say that you didn’t know something constituted fraud is not a great plan. 



Questions to ask when assessing a physician side gig to avoid or identify risks for healthcare fraud


Do I understand how the patient is being billed, and is that billing appropriate?


One important question to ask is what kind of patients are involved with the job. Side jobs involving patients who pay out of pocket or have subscribed to a telemedicine network do not generally implicate federal health care laws or the federal Anti-Kickback Statute. 


But remember that every time you sign an order for a Medicare patient, someone is likely going to bill Medicare based on that order. These orders can add up to millions of dollars quickly, and the government may blame you if those orders are not appropriate. Unfortunately, some doctors have been charged, convicted, and sentenced to prison for jobs that they believed at the time were legitimate. 


How to look up Medicare requirements when assessing a side gig


Home health requirements are located in the Medicare Benefit Policy Manual, Chapter 7. In particular, the definition of “confined to the home” has multiple parts and does not cover many Medicare patients. The definition is as follows:

  • Part One: The patient must either: because of illness or injury, need the aid of supportive devices such as crutches, canes, wheelchairs, and walkers; the use of special transportation; or the assistance of another person in order to leave their place of residence -OR- have a condition such that leaving his or her home is medically contraindicated

  • Part Two: There must exist a normal inability to leave home -AND- leaving home must require a considerable and taxing effort.


To look up Medicare requirements for other items or services, go to the Medicare Coverage Database. Type in the subject area and select your state, and search. This will pull up local coverage determinations (LCDs), national coverage determinations (NCDs), and articles that should relate to your subject area. LCDs and NCDs are guidance from Medicare (and the contractors that it operates through) about coverage and about documentation requirements.  These articles provide context. 



Do I have the appropriate expertise to provide this care?


While your medical license technically allows you to do a lot, that doesn’t necessarily mean that you should. You will be held responsible for anything that you do under your license (or allow anybody else to do under your license).


Consider your medical expertise and experience as it relates to a side gig opportunity you’re offered. Fraudsters sometimes try to hire doctors who have no experience in a high-risk area and give false or misleading information about Medicare’s requirements because those doctors do not know better. If you’re taking a job in an area where you don't have much experience, look up Medicare’s requirements. 



Who is practicing under my license, and what am I giving the company or individual permission to do under my name?


You’ll want to know what things you will be liable for - both professionally under your license as well as legally. Remember, you spent many years acquiring the skills necessary to become a licensed physician, and took an oath about how you would practice medicine. This is not something you should take lightly or allow others to rent without fully understanding the implications of someone being able to make orders or give care under your name.



Red flags for side gig opportunities for doctors


Be aware that there are fraud schemes that involve misleading doctors into thinking that they are doing legitimate jobs, such as chart review, when the jobs actually result in massive amounts of fraud. Here are some red flags to consider: 


  • Jobs involving high-risk areas for Medicare. Durable medical equipment (DME), genetic tests, compounded medications, home health, and hospice are areas where there has been a lot of Medicare fraud. If someone is looking to hire you to order such services or items for Medicare patients, this could be a red flag. 


  • Limited contact with Medicare patients. Medicare expects that you have a physician-patient relationship before ordering an item or service. A single phone call may not be enough to form such a relationship in the eyes of the federal government before ordering a service or item, especially if you do not plan to follow up with the patients.


  • Patients who have been solicited by marketers. Fraudsters often use marketers to cold-call patients and get them to accept items or services that they do not really want or need and sometimes lie to doctors about this. If you talk with a patient about a specific item or service, consider asking them why they are interested in this item or service and why they are coming to you. If they tell you that they do not really want or need the item or service, this is a major red flag.


  • Payments from someone other than the patient or the patient’s insurance. If you’re being paid by a Medicare provider, either directly or indirectly, this could raise red flags.  The government may view payments to you by a Medicare provider – such as payments on a per-chart basis – as a “kickback” in violation of the Anti-Kickback Statute.


  • Pre-filled charts. Fraudsters sometimes tell doctors that charts have been filled out by medical professionals and just need approval by the doctors, when the charts were actually filled out by marketers and sometimes were completely made up. If you are given charts, you should review the language of the chart very carefully and sign only if it is actually true. Also, review the final versions of the charts with your signature and keep copies for your own files. Some fraudsters have modified charts afterwards, such as by making it appear that a doctor ordered more than they actually did. 



How to protect yourself if you suspect health care fraud with your side gig


Do some research on the company during the interview process before you accept any role. Any pattern of legal issues, such as lawsuits, can be a red flag. You can search the Medicare exclusions database to see if they’ve had any previous investigations.


If you suspect that there are red flags with a side job that you have been offered, one easy way to protect yourself is to not take the job in the first place. 


If you later come to suspect that there are red flags with a side job that you have already been doing, consult a lawyer who will look out for your interests and your interests alone. Your employer may have deceived you, or your employer may have been deceived themselves.  In any event, consult a lawyer who can help you navigate this area. Simply quitting may not be enough to protect your interests in the long run. 




What to do if you are contacted in conjunction with a healthcare fraud matter


If investigators come to your home or office to talk with you, remember that you don’t have to talk with them at that time. You can always say that you would like to arrange for another time when you can have a lawyer present.


You should then consult a lawyer, and the lawyer will likely follow up with the investigators about whether they view you just as a witness or as someone whom they suspect of participating in a crime. 



How do I find an attorney for a healthcare fraud related issue?


In terms of hiring a lawyer, you should consider asking colleagues, lawyers you know, or local bar associations for referrals. You can also use our attorney database as a starting point for your research.


Don’t just consider one attorney. Look into multiple options during your initial search. Hiring the wrong lawyer can make a bad situation even worse, so treat hiring a lawyer like making a very important purchase.



Conclusion


Fraud doesn’t always mean intentional wrongdoing. A side gig on the surface may look like a genuine opportunity. Red flags can be subtle. Before signing on, it’s important to understand what constitutes fraud and to ensure that any work you perform through this opportunity follows guidelines and regulations. 



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