Is That Lucrative Telemedicine Arrangement Actually a Scam?

Massive telemedicine fraud cases show how easily clinicians can be drawn into risky arrangements. Here’s what to watch for and why it matters.

In recent years, the U.S. Department of Justice (DOJ) has brought numerous high-profile cases involving telemedicine fraud, totaling billions of dollars in alleged losses to Medicare and other federal healthcare programs. While each case varies, they typically center around clinicians signing off on unnecessary or sham orders in exchange for kickbacks.

These cases highlight the serious legal and professional risks for healthcare professionals, especially when telemedicine companies or marketing firms promise easy revenue or guaranteed patient volume.

How Do These Telemarketing Scams Work?

In these cases, telemedicine companies and healthcare professionals receive kickbacks from laboratories in exchange for ordering unnecessary tests, medications, or equipment, such as cancer genetic tests, cardiovascular and diabetes testing, orthotic knee braces, or compounded medications. Practitioners often order items without having a prior relationship with the patient or after only a brief phone call. Sometimes, patients never receive test results, or the results are meaningless.

Clinicians Are a Key Focus

The DOJ does not limit its charges to the operators of the labs, pharmacies, or durable medical equipment companies that billed Medicare. Physicians, advanced practice nurses, physician associates, and other healthcare professionals have also been indicted. The charges have included counts of conspiracy to commit healthcare fraud and to pay and receive kickbacks, as well as substantive counts of healthcare fraud and receiving kickbacks.

These schemes depend on clinicians signing off on orders. Without their approvals, no claims could be submitted to Medicare. By targeting practitioners, the DOJ is sending a clear signal: clinicians are accountable for the orders they sign, even if they rely on information from telemedicine or marketing companies.

How Can You Protect Yourself?

Even unintentional involvement can carry serious legal and professional risks, including criminal charges, civil fines, exclusion from federal healthcare programs, and loss of licensure. To avoid getting caught up in one of these schemes:

• Review your telemedicine relationships carefully. Ensure that services are medically necessary and based on genuine patient-provider relationships.
• Avoid arrangements involving payments tied to patient referrals or orders. This may violate federal anti-kickback statutes.
• Verify marketing practices. Be wary of companies offering to “source” patients or promising high volumes of orders in exchange for compensation.
• Seek legal guidance. If you’re unsure whether a telemedicine or lab arrangement is compliant, a healthcare attorney can help analyze risks before you sign.