The Gravity of Ethical Medical Billing Practices

The Hypothetical Case of Dr. Michael Stevens’ Unethical Medical Billing Behavior

The case of Dr. Michael Stevens is an illustration of the worst-case scenario when unethical behavior impacts medical billing.

An anesthesiologist and owner of a pain management clinic, Dr. Stevens was obliged to relinquish his medical license when it was uncovered that his in-house medical biller was committing fraud. The biller, Edward Bailey, a family member with no experience or proficiency in medical billing, had met with a Medicare contract provider to ask for counseling on which CPT codes to use for a new treatment the practice had begun to make available. Soon, claims that had formerly been denied by payors began to come back approved.

However, when the state licensure board initiated an investigation of Dr. Stevens, they detected that the practice routinely billed the same five CPT codes for the treatment, one of which was not a standard test. Turns out that Mr. Bailey had taken it upon himself to find the grouping of CPT codes that would guarantee payment for the new treatment, whether or not those services were performed. When questioned, Dr. Stevens acknowledged that he did not review the claims that his biller submitted and that he was unacquainted with the exact CPT codes that were being billed on the claims. Dr. Stevens said he assumed that Mr. Bailey was applying the correct CPT codes as instructed by the Medicare contract provider. While Mr. Bailey pleaded guilty to healthcare fraud, the medical licensure board ultimately determined that Dr. Stevens “engaged in dishonorable, unethical or unprofessional conduct,” and he surrendered his medical license, effectively ending his medical career.

True, this is a worst-case scenario, but should serve as a cautionary tale for those medical practices that do their medical billing in-house. Truth is, it’s now easier than ever before for the appropriate government agencies to detect unethical medical practices via the use of algorithms that monitor and analyze incoming claims and payments and then flag suspicious patterns of behavior. Practices and providers who are identified through these systems can be investigated and if found to have a pattern or history of billing mistakes, may face steep fines or other penalties.

Why is ethical medical billing crucial?

Inaccurate medical billing leads to several issues. Whether inadvertently or deliberately, at times billing may be performed in a flawed manner, resulting in claims rejections, unsatisfied patients or even legal liability. Moreover, inaccurate billing practices can lead to serious financial consequence for your practice. Often, it will result in your practice not receiving the full amount it is entitled to from the patient and/or the insurance company. Therefore, a higher accuracy of medical claims saves revenue.

Unfortunately, the use of inaccurate billing for the purpose of increased profits is found to be on the rise. This necessitates safeguarding patients from insurance and healthcare fraud and related issues. The first step in fighting such challenges is assuring that medical billing processes are performed ethically and in a flawless manner.

Generally speaking, there are several types of unethical medical billing practices that healthcare providers need be aware of that can result in prosecution. Since we’ve discussed such unethical practices in a previous blog, we can summarize them here as total neglect, or no services provided; worthless, unnecessary or inadequate services; and improper coding and billing.

So, what can healthcare providers do to assure they can detect and avoid unethical billing practices?

  1. Be informed
    The best advice we can provide is to arm yourself with knowledge of the healthcare laws as well as become familiar with your billing statement and CPT codes. This would help you ensure that every billing statement you generate is always accurate and free from any errors.
  2. Maintain updated and proper documentation
    Healthcare providers should always strive their best to provide the most updated and recent documentation. This would not only ensure that all information in the billing statement is correct, but it would also help medical practitioners in providing the best treatments and services. Always keep in mind, too, that this documentation remains a part of the patient’s medical record, so it’s important for the protection of your patient that it’s absolutely accurate. Inaccurate information can harm the patient and can harm the quality and accuracy of future care. It’s irresponsible, if not downright reckless, to put patient health at risk because of something like inaccurate billing.
  3. Ensure transparency
    Healthcare providers must immediately handle concerns regarding their employees’ or colleagues’ unethical billing practices. They must be transparent and facilitate interdisciplinary collaborations in making sure that the employees’ unethical behavior is dealt with accordingly. In line with this, all healthcare providers must be knowledgeable of the current mandated coding and classification system. Failure to research or state the appropriate code should be dealt with immediately.
  4. Monitor the system
    A healthcare provider must always strive to improve the accuracy of their billing process. They must ensure that both healthcare and billing professionals are aware of the ethics and standards that they must follow. The AHIMA Standards of Ethical Coding should always be followed and implemented in the workplace. This would help ensure that the expectation for making ethical decisions in the workplace and commitment to integrity during the billing process is always reflected in the employees’ work.
  5. How to achieve strong ethical behavior in your billing process
    Changes in healthcare related laws and regulations and increased legal needs make it essential for medical professionals and healthcare facilities to keep themselves regularly updated. Let’s face it, proper medical billing can be achieved only by keeping up to date with prevailing billing standards and the most recent practices. This is where professional medical billing companies come to help healthcare practices.


Medwave, one of the leading medical billing service providers in the industry, is equipped with a team of knowledgeable and experienced medical billing specialists. Moreover, our qualified billing professionals are provided regular training to stay abreast on the most recent changes and requirements in the medical billing process. Our medical billing solutions are efficient and timely. We ensure error-free and reliable billing that leads to proper reimbursements for your practice.

tags: Basics of Medical BillingEthical Medical BillingMedical BillingMedical Billing Ethicsmedical billing fraud

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