Health Insurance Fraud Issue 2022

Running head: HEALTH INSURANCE FRAUD
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HEALTH INSURANCE FRAUD
Student’s Name
University Affiliation
Author’s Note

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Health Insurance Fraud
Introduction
Health insurance has always been a victim of issues related to fraud. Fraud in healthcare
has recently been on the rise. Insurance fraud is often overlooked as the simple act of
misinterpreting facts or deliberately receiving insurance payout from dishonest claims. While
healthcare fraud varies, it involves fraudulent claims related to profit. For a business to start up in
healthcare, they have to follow the state and federal laws, which help in curbing fraud (Faseela,
& Thangam, 2015). Additionally, the laws help in monitoring staff and ensuring more
comprehensive compliance by each member. In healthcare insurance, there are different types,
which involve patient, doctor, billing, and drug fraud. This article describes each type of fraud in
a healthcare system, as well as ways they can be avoided.
Billing fraud is the most common practiced fraud in healthcare insurance. In the health
sector, billing fraud continues to be one of the biggest challenges yet to be solved. In most cases,
institutions, which use the paper-based or small setting, exhibit high rates if billing fraud
(Abdallah, Maarof, & Zainal, 2016). However, in large hospitals, there are technological
advancements, which ensure there are minimal fraud cases. First, patients might be wrongly
billed for services, which they are yet to receive. For instance, while a patient might be treated b
a nurse, the bill might be billed using the doctor's rate (Verma, Taneja, & Arora, 2017). Also, the
institution might charge extra costs more than the service provided.
Doctor fraud is also common in a healthcare institution. Today, the cost of healthcare has
dramatically increased due to technological advancements. As such, unethical doctors take
advantage of the situation and overcharge their clients (Faseela, & Thangam, 2015). For
instance, they would increase their revenues claiming the diagnoses were complex. Instead, other

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doctors instigate unnecessary surgeries, which increase the cost of healthcare (Thornton et al.,
2015). This makes an insurance company to carry the baggage of paying for the treatment.
Thirdly, there is patient fraud, also while administering healthcare service. In conjunction
with the medical provider, the patient will perform fraud to extort funds from their insurance
cover (Abdallah, Maarof, & Zainal, 2016). Patients can also defraud insurance companies by
faking sickness as a cover for a friend or relative. Besides, they can lie about their conditions to
get certain benefits.
Lastly, the medical team can involve themselves in drug fraud. Using their positions,
medical caregivers can steal drugs for personal purposes. While this problem is significant n
healthcare, the fraud is secondary theft of drugs (Abdallah, Maarof, & Zainal, 2016). The worker
obtains subsidized drugs from the healthcare organizations and later resells to the black-market
to gain profits.
Mainly, patients and insured individuals are uncomplicated while performing fraud
activities. In most cases, fraud involves undisclosed conditions, which initially existed (Dora &
Sekharan, 2015). Also, by being dishonest about an injury to receive a payout is a form of fraud.
Situations of completely fabricating a case are common to ensure physicians shop multiple
prescriptions, which they use for personal benefits. As such, this exacerbates the challenge of
fraud in the healthcare sector.
The Effects Of Medical Fraud
In the entire world, errors are increasing in the medical sector due to fraud. While those
hidden costs are evident, everyone using the healthcare system bears the consequences. First, the
healthcare system has been overburdened (Kirlidog & Asuk, 2012). Medical practitioners have
taken essential services from those who need them most as a form of over-treating. In the United