You expect medical billing to reflect the care that patients actually receive. But what happens when doctors or clinics stretch the truth or lie to increase their pay? Upcoding and unbundling are two ways dishonest providers overcharge Medicare and other government healthcare programs. This is often done without patients ever knowing.
You may wonder when suspicious billing practices cross the line into fraud. This guide explains upcoding, how unbundling fraud works, and what to watch for if you suspect illegal billing behavior.
What Is Upcoding?
Medical providers use codes to tell Medicare or Medicaid which services they provided and how much they should receive in payment. Upcoding in medical billing occurs when a healthcare provider submits a bill using a code for a more serious or expensive service than what was actually performed. For example, if a doctor performs a basic exam but bills it as complex, that’s upcoding.
What Is Unbundling?
Unbundling in medical billing is when a provider charges separately for services that should be grouped together under one code. Medicare often pays less for a bundled procedure because it includes multiple steps in a single payment. Unbundling breaks those services apart to bill each individually at a higher total cost.
Upcoding and Unbundling As Fraud
Upcoding and unbundling are forms of billing fraud when done purposely to get higher payments from government healthcare programs. These practices violate the False Claims Act (FCA), which makes it illegal to submit false claims for payment to the federal government. They waste taxpayer money and can lead to severe legal consequences under the FCA.
Here’s why these forms of fraud are serious:
- They divert funds away from patient care;
- They waste taxpayer money;
- They inflate healthcare costs for all; and
- They undermine trust in healthcare providers and billing systems.
While not every billing mistake is fraud, repeated or deliberate misuse of billing codes, especially when tied to profits, can lead to civil or criminal penalties.
Common Examples of Upcoding
Knowing how this fraud appears in real life can help you identify it.
Below are several examples of upcoding in healthcare that often lead to whistleblower reports:
- Billing a basic office visit as a comprehensive consultation;
- Charging for a complex procedure when the provider only performed a basic one;
- Reporting treatment of multiple conditions when only one was addressed;
- Using high-level emergency codes for routine visits; and
- Billing for services provided by a licensed physician when they are actually performed by a less experienced professional (like a nurse or physician’s assistant)
These patterns of upcoding fraud may be hard to spot from the outside, but employees who handle billing, coding, or records often see them up close.
Even if the fraud seems small, repeated false billing can cost taxpayers millions over time. Taking action can stop fraud, protect patient care, and lead to financial recovery for you and the government.
What to Do If You Suspect Fraud
You don’t have to keep quiet if you’ve seen upcoding in medical billing, unbundling fraud, or other suspicious billing practices. You may be eligible for a whistleblower reward, and more importantly, you can help stop fraud that hurts patients and taxpayers.
At Reese Marketos LLP, we help whistleblowers expose fraud that others are afraid to confront. Our team includes former federal prosecutors and experienced trial lawyers who have helped recover hundreds of millions of dollars in FCA cases.
Recognized by The National Law Journal, Litigation Daily, and Law360 for our work in high-stakes litigation, we understand what’s at risk when you speak up. We’re committed to protecting your future while helping you report wrongdoing correctly.
Contact our firm online or call (214) 382-9810 today for a confidential consultation. We’ll review the details of your case, answer your questions, and explain your options for moving forward with a whistleblower case.