Types of Medicare Fraud Targeting Seniors: What Every Adult Child Needs to Know

Medicare fraud is not just a government accounting problem—it directly harms your elderly parent. When providers bill Medicare for services that were never delivered, your parent's coverage record gets contaminated with false claims, which can affect future eligibility, complicate legitimate care, and expose personal information to further scams.

The FBI estimates that healthcare fraud costs the U.S. over $100 billion annually, with Medicare and Medicaid accounting for a significant share. Seniors are targeted both as unwitting participants (when fraudulent providers use their Medicare number without their knowledge) and as active victims of scams designed to steal that number in the first place.

Understanding the specific types of Medicare fraud helps you catch problems on your parent's Explanation of Benefits (EOB) before they compound.

What an Explanation of Benefits (EOB) Is and Why You Should Read It

Every time a Medicare claim is processed, your parent receives a document called the Summary of Benefits—sometimes still referred to by beneficiaries as an Explanation of Benefits. It is not a bill. It is a record of what was claimed, what Medicare paid, and what your parent may owe.

Most families ignore these. That is exactly what fraudulent providers count on.

Get in the habit of reviewing your parent's EOBs as soon as they arrive. You can also access them digitally at MyMedicare.gov. When you review one, you are looking for:

• Services listed that your parent does not remember receiving
• Equipment delivered that your parent did not request or does not own
• Dates of service when your parent was elsewhere (traveling, hospitalized elsewhere, or deceased)
• Multiple claims from providers your parent has never heard of

Any of these is a flag. Here is what you may be looking at.

Billing for Services Never Rendered

This is the most common form of Medicare fraud. A provider—a physician, laboratory, home health agency, or medical equipment supplier—simply bills Medicare for services, tests, or visits that never happened.

Your parent may never know because the EOB often gets lost in the mail or ignored. The provider collects the Medicare payment. Your parent's claim record now shows a condition or procedure they never had, which can create problems if they later apply for life insurance or supplemental coverage that asks about medical history.

What to look for: Claims from providers your parent has seen only once (or never), for services on dates that don't match known appointments, or for procedures that seem medically inappropriate given your parent's actual health status.

Upcoding

Upcoding means billing for a more expensive service than was actually provided. A standard office visit gets billed as a complex consultation. A generic drug gets billed as a brand-name medication. A routine blood draw gets billed as an elaborate diagnostic panel.

Because the service did occur—just at a lower level—upcoding is harder to detect from the EOB alone. The red flag is usually a mismatch between what your parent describes happening during an appointment and the complexity of the code billed.

What to look for: If your parent says "the doctor just checked my blood pressure and refilled a prescription," but the EOB shows a billing code for a comprehensive evaluation and management visit lasting 40–60 minutes, that warrants a call to the provider for an itemized explanation.

Unbundling

Providers are sometimes required to bill certain groups of services together as a single package (called a "bundle"), which Medicare reimburses at a set rate. Unbundling means billing each component of that package separately—at higher individual rates—to inflate the total payment.

This is a purely financial manipulation invisible to the patient. It shows up in the EOB as an unusually large number of line items for what should have been a single, straightforward procedure.

Durable Medical Equipment (DME) Fraud

This is one of the most prevalent fraud categories targeting seniors and one where your parent is most likely to be approached directly.

The Unsolicited Equipment Scheme

Your parent receives a phone call from someone claiming to be from their doctor's office, Medicare, or a "Medicare-approved supplier." They are told they qualify for free equipment—a back brace, a knee brace, a power wheelchair, diabetic testing supplies—and that Medicare will cover it entirely. All they need to do is confirm their Medicare number.

The "supplier" then bills Medicare for equipment that may be:

• Shipped to your parent but never ordered by their actual physician
• Never shipped at all (phantom billing)
• Medically unnecessary (billed under a false diagnosis)

Medicare requires a physician's order and a finding of medical necessity for durable medical equipment. If no doctor ordered it, it is fraud—even if your parent accepted the equipment.

Warning sign: Your parent mentions receiving an unexpected brace, wheelchair, or supply shipment they "didn't really need" but accepted because "Medicare was paying for it anyway."

Power Wheelchair Fraud

This is a specific, high-dollar variant of DME fraud. Medicare pays several thousand dollars for power wheelchairs. Fraudulent suppliers target seniors who can still walk, get a complicit physician to sign off on a fraudulent order, and bill Medicare. The senior gets a chair they don't need; Medicare pays; the supplier and the physician split the proceeds.

What to look for: A power wheelchair claim on the EOB for a parent who is ambulatory.

Home Health Fraud

Medicare covers legitimate home health services—nursing visits, physical therapy, occupational therapy—for homebound patients. Fraudulent home health agencies bill for:

• Visits that never occurred
• Visits that were shorter than billed
• Patients who do not meet Medicare's "homebound" criteria
• Skilled services that were actually performed (or not performed) by unqualified staff

Home health agencies sometimes recruit seniors from churches, senior centers, and community events by offering free meals, rides, or other inducements in exchange for signing forms that allow the agency to bill Medicare in their name.

Warning sign: Your parent mentions an agency representative visiting frequently and offering gifts or services, or EOB records show home health visits on days when your parent was clearly elsewhere.

Hospice Fraud

Medicare's hospice benefit is designed for patients with a terminal illness who have elected to forgo curative treatment and focus on comfort care. Some hospice agencies fraudulently enroll patients who are not terminally ill, do not qualify, or—in some cases—do not know they have been enrolled at all.

Enrolling in hospice without actually needing it can prevent your parent from accessing Medicare Part A coverage for hospital stays or curative treatments during that period. It also generates fraudulent per-day payments to the agency.

Warning sign: Your parent is enrolled in "hospice services" but has not been told by their own physician that they have a terminal illness.

Prescription Drug (Part D) Fraud

Part D fraud takes several forms:

• Billing for drugs not dispensed: The pharmacy bills for a prescription but provides a smaller quantity, a cheaper substitution, or nothing at all.
• Pill mill schemes: A physician or clinic generates excessive opioid or controlled substance prescriptions and bills Part D. Your parent may be recruited as a patient without needing the medication.
• Therapeutic substitution without consent: Dispensing a different (often cheaper) drug than prescribed but billing for the prescribed drug.

What to look for: Part D Explanation of Benefits showing drugs your parent never received or does not recognize, particularly controlled substances.

Medicare Number Theft

This is not a billing fraud type per se—it is the precursor to most of the above. Once a scammer has your parent's Medicare number (the Medicare Beneficiary Identifier, or MBI), they can:

• Bill Medicare for services under your parent's identity
• Sell the number to fraudulent providers
• Use it to create synthetic medical identities

Medicare numbers are stolen through phishing calls (someone claiming to be "from Medicare" offering to "update" the card), phishing emails, fake sweepstakes entry forms, and data breaches.

What to protect: Your parent's red, white, and blue Medicare card. The MBI is as sensitive as a Social Security number. Your parent should only share it with their actual treating providers.

How to Report Medicare Fraud

If you spot a suspicious claim on your parent's EOB, here is what to do:

1. Call the provider first, if you believe it may be a billing error. Ask for an itemized explanation. Errors do occur.
2. Call 1-800-MEDICARE (1-800-633-4227) to report suspected fraud directly to Medicare.
3. File a report with the HHS Office of Inspector General at oig.hhs.gov. Their hotline is 1-800-HHS-TIPS.
4. Contact your State Health Insurance Assistance Program (SHIP) for free personalized help reviewing your parent's benefits and identifying problems. Find your SHIP at shiphelp.org.

Keep copies of the EOBs in question and write down every conversation: date, name of the person you spoke with, and what was said.

Protecting the Medicare Number Is Step One

Most Medicare billing fraud starts with the card number. Scammers who successfully steal your parent's MBI can generate months of false claims before anyone notices—and your parent's medical record is damaged in the process.

The Elder Scam Shield guide covers exactly how Medicare impersonation scams work, the specific scripts fraudsters use on the phone, and the concrete steps to take right now to make your parent an unlikely target. It also includes a monitoring checklist your parent can use to spot suspicious EOB activity each month.

Get the Elder Scam Shield Guide