A new report brings telehealth fraud risk into focus

WASHINGTON — Washington’s attempts to permanently lock in telehealth coverage have been hobbled by a fear that virtual care could drive up Medicare fraud and spending. But a new watchdog report offers early evidence that only a small portion of providers are billing for virtual care in a potentially fraudulent way, suggesting that targeted interventions could crack down on abuse.

Some Medicare-certified providers — just about 1,714 out of 742,000 — billed for telehealth in a way indicating high risk of fraud, waste or abuse during the pandemic’s first year, according to the Department of Health and Human Services’ Office of the Inspector General’s analysis of fee-for-service Medicare claims. Those providers billed roughly half a million Medicare beneficiaries for almost $130 million. The analysis doesn’t account for the dollar amount of Medicare Advantage claims, but does include encounter data.

While the scale of the concerning billing is relatively small compared to total Medicare spending  — hundreds of billions a year — the analysis sheds light on buckets of patterns, such as providers charging location-based fees erroneously. And taken in conjunction with another recent OIG analysis which found that urban Medicare beneficiaries were more likely than rural ones to use telehealth, lawmakers are getting a clearer picture of who uses telehealth and what risks the billing process poses, OIG staffers told STAT.


“Congress and CMS have to look at what the future of telehealth looks like holistically,” said Andrew VanLandingham, a senior counselor for policy at OIG. The office’s goal, he said, is to “make sure we maximize the benefits and minimize the risks.”

Some early trends emerged in the data: About 672 providers billed both a site fee and a telehealth service fee for more than 75% of their visits, a practice that Medicare coverage prohibits. While some of those bills could be in error, “others may be billing this way to inappropriately maximize their Medicare payments for each visit,” the report found. Just 41 of the providers billing in a potentially fraudulent way seemed to be linked to telehealth companies, though OIG could not identify those companies from Medicare claims information.


Though it can’t establish the offending providers’ intent, the report could help lawmakers conceptualize the risks associated with virtual care as they debate what services Medicare should permanently cover. It also offers a roadmap for specific steps the Centers for Medicare & Medicaid Services can take to guard against misuse, VanLandingham said.

OIG recommended that CMS closely monitor the risky providers, make billing more transparent in instances in which clinicians might bill under another supervisor’s authority, and generally strengthen its efforts to track these concerning billing practices.

The findings were largely welcomed by lobbyists who have long urged OIG to be more measured in its messaging about telehealth fraud by emphasizing that there’s little evidence suggesting telehealth introduces vastly new opportunities for fraud compared to in-person care.

The American Telemedicine Association emphasized the report’s suggestion that a relatively small group of telehealth providers were responsible for concerning billing.

“These reports add to the growing body of evidence showing that telehealth meaningfully expands access to care, and that long-term telehealth expansion is feasible with some limited steps to ensure continued oversight and evaluation,” the Alliance for Connected Care said in a statement.

Source: STAT