Fraud in Health Care: FinCEN Report Reveals the Top Seven Pandemic-Related Scams

Law enforcement and financial institutions have detected several instances of potential fraud activity related to health care benefit programs, health insurance and COVID-19 health care relief funds. Earlier this year, the Financial Crimes Enforcement Center (FinCEN) released an advisory report regarding new scams involving health care and health insurance during the pandemic. In it, FinCEN notes that criminals are actively adapting known health insurance and health care fraud activities to take advantage of the pandemic. According to the report, the following represent the top seven types of scams the insurance and financial industry is seeing today.

Ordering or submitting claims for expensive and unnecessary tests or services that do not test for COVID-19. The insurance industry is finding that an overabundance of medically unnecessary and expensive respiratory, allergy and genetic testing, along with whole-body health assessments and other screening services, are being performed.

Submission of expensive billing claims for services not provided. The Department of Justice has uncovered numerous overbilling schemes involving upcoding or unbundling when administering or processing COVID-19 testing and treatments.

Illegal kickbacks to providers. Becoming more prevalent are illegal payments to service providers involving kickbacks or bribes in exchange for ordering, or arranging for the ordering of, excessive or unnecessary COVID-19 services and testing.

Health care technology schemes to defraud insurance benefit programs. False and fraudulent representations about COVID-19 testing, treatments or cures are used to defraud insurance carriers and to perpetrate fraud on the financial markets by defrauding investors.

Telefraud and telehealth schemes. Fraudulent solicitations to collect beneficiaries’ personally identifiable information(PII), including Medicare information, are being linked to patient requests for information on COVID-19 treatment and prevention, such as for testing or when inquiring about personal protective equipment. Fraudsters then submit bogus claims for payment from health care benefit programs. In addition, fraudsters are using stolen PII to submit false telehealth services claims.

Fraudulently obtaining COVID-19 health care relief funds. Numerous false claims and applications are being filed for specific COVID-19 federal relief funds provided under the Coronavirus Aid, Relief, and Economic Security Act’s Provider Relief Fund, the PPP-HCEA or the Economic Impact Disaster Loan program, whereas the claim or application is connected to health care benefit programs.

Identity theft leading to additional fraud. Beneficiaries are specifically targeted to obtain their PII to be used to commit COVID-19-related fraud against health care benefit programs.   


According to the report, fraudsters have been targeting a number of health care-related sources that include Medicare, Medicaid/Children’s Health Insurance Program, and health care programs provided through the Departments of Labor and Veterans Affairs and private health insurance companies.

As the nation continues to battle COVID-19 and more Americans seek care related to the virus, including vaccination services, insurance carriers will likely see more fraudulent activity over the next several months.

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