Common Unethical Medical Billing Practices and How to Report Them?

The world of medical and health is just like any other sector where people come together to work and serve. Like every other sector, this world also has its black sheep, its malpractices, and other unethical means of practice.

It has been noticed that a lot of health care providers make unethical medical billing practices which at times go unnoticed but sometimes it can literally plague the whole system. Now the question isn’t whether the said unethical medical billing practices are intentional or unintentional, the question is can they be rectified before they make life difficult for both the patients and the job providers?

Like any other field, mistakes take place now and then but there is a big difference between mistake and sin. Unethical practice if done intentionally is no less than a sin. There are crooked individuals in every field and as we said earlier, the medical and health field is no exception. Because of these handfuls of creeps, the healthcare system and the patients suffer from their malicious practices.

For instance, the patients might be paying overly priced bills for the medical service they got and on the other hand, the physician or the medical professionals most probably will be facing severe criminal charges against him for unethical practice or in severe cases end up in jail.

To avoid such circumstances and to educate the patients and the medical professionals, we have come up with some very common and general unethical medical billing practices that you should identify immediately after reading this article so that you can avoid such a situation and not end up in paying lengthy litigations and heavy fees.

Most common unethical medical billing practices

Most common unethical medical billing practices

Let’s discuss some of the most common unethical medical billing practices that might cause a dent in the pockets of the patients and on the other hand risks the license of the practice of the doctor or physician.

Under coding

Before discussing the common problems let us tell you that every medical practice or procedure has a billing code corresponding to it.

Healthcare officials use these specific codes whenever they want to submit a certain claim. These codes actually determine how much payment is made against a medical service or a specific medical procedure.

Under coding is an unethical billing method that often goes unnoticed. Under coding is a scheme that occurs when usually the codes which are mentioned on the medical bill are not completely calculated against the medical procedures or the services availed by the patient.

Well, usually this seems like a harmless practice but in reality, in the long run, this can be very dangerous and can backfire.

For instance, if you are a medical service provider then authorities might call you any time to conduct an audit and if you have been under coding, you will try to avoid it because these things cannot be hidden in a thorough audit of the company or the organization. A lot of crooked individuals use under coding schemes to avoid audits of the company as that will not expose their other wrongdoings.

Under coding is considered a medical fraud and this may result in charges against the medical practitioner which are crime-based. The health provider will be considered a partner in this scheme even if he hired someone or outsourced the medical billing of his organization.

Another aspect of under coding is that this practice does not give any kind of benefit to the coding professionals or the medical practitioner. This becomes a fraud in the long run.

The under coding malicious practice may result in substantial loss of revenue and of course lower rates of reimbursement for the healthcare provider. So in short, this will only continue to create havoc and hazards for the healthcare system and burden the organization in the long run.


Upcoding is another way of releasing a medical bill that is both unethical and untrue.  It is a term that describes a situation where a medical provider misuses the codes against specific medical procedures and services.

For instance, a doctor supposedly provided a medical service that is simple and brief. So, the trick is that instead of coding it just the way it is, they code it according to any other specialized medical service which is extensive in many ways. This would definitely result in more revenue and more payment. In short, upcoding allows the medical practitioners to increase the amount to be received from the patient.

This kind of malpractice again remains unnoticed as patients do not know about these codes and they cannot dissect these minute details therefore they happily pay for the amount they are charged without getting into details.

It is very important to look out for these kinds of fraudulent and malicious practices that can affect your bill and cause a dent in your pocket without you knowing. Once you diligently check your bill and find this error, it is advised to contact the healthcare provider immediately and ask them to correct the bill.


This unethical medical billing practice is very similar to another scheme discussed above that is coding.

In unbundling, the crooked healthcare providers are experts in manipulating the codes used in the billing system of the medical services so that they can get higher reimbursements without alerting the patient.

Unbundling is defined as;

a practice of submitting bills in a fragmented fashion in order to maximize the reimbursement for various tests or procedures that are required to be billed together at a reduced cost”

by the Federal Bureau of Investigation.

Unbundling is often referred to as “fragmentation” as this is how the billing is presented according to a single code only to the patient. When there are multiple codes added to the bill then it is often referred to as “fragment” which means more ways of getting higher payments or reimbursements from the patients.

Unbundling is said to be very difficult to decipher without the help of a whistleblower. Patients who get treated from medical services are often unaware of these bundled-up codes of medical billing which are made available by the medical authority for their ease only.

To deal with unbundling, the patients and the healthcare practitioners are supposed to be aware of the medical codes in bundles that are available to counter such malpractices by the crooks in the industry.

Double billing

The term double-billing says it all. This means that the same bill is continuously submitted a lot of times despite the medical procedure or the service has been provided only once and that too in the past.

Unfortunately, double billing is a common trait in the health and medical field. As the billing and the claim of billing are never said to be a smooth procedure among the patients and the healthcare system, it is prone to have some errors and flaws in it, from which the malpractitioners get benefited.

Health providers if proven that they had been intentionally double billing for a single medical procedure multiple times can face civil or criminal penalties.

If you find out that your healthcare provider has double-billed, you then you can politely ask them to rectify it if it occurs for the first time as it will impact your cash flow but if it is a practice of the medical practitioner to double charge it clients then he needs to be reported.

If someone gets double-billed from a certain healthcare provider, they will not return to him again no matter how well reputed he is.

Apart from the above-mentioned case scenario, the patients have the right to call their insurance company in order to come up with a solution if they are certain that they have been double charged. Involving insurance companies in short means that stricter audits and scrutiny will be conducted which will eventually result in a strained and sour relationship between the healthcare provider and the insurance company.

Therefore, being a patient, it is your responsibility to diligently check your bill to identify any kind of double billing and if you are a healthcare provider then do not practice double billing and do not resubmit duplicates of a certain medical service without thoroughly studying them.


Before we talk further about corruption in medical billing it is very important to keep in mind that the medical providers are often entitled to receive reimbursement for referrals.

This has actually become an abuse which means that several healthcare and medical professionals refer to certain other professionals who provide medical services or procedures even when they are not needed.

In simple words, a medical practitioner is given payment by other service providers for every reference that they will make. This becomes like a side business as the medical health provider will claim and receive higher amounts of payments when they will make unnecessary procedures or services.

This is another unethical way of medical billing which makes the healthcare beneficiaries suffer immensely. As people get charged for the services or procedures which were not needed at all.

This vicious cycle brings higher revenue and premiums into the picture which makes the situation worse. The patient will lose trust in the doctor and the medical procedure and services applied to him as they did not help him from a health perspective.



Misrepresentation in the billing practice can be done in different ways. Some of the most common ones are listed below.

Date Misrepresentation

The date on which the service provided is rendered. The claims made by the service and aid providers are generally incoherent and inconsistent.

For instance, a healthcare provider visited a patient for a day but misrepresented the billing that the healthcare provider visited for more than a day.

Location Misrepresentation

Often the patients are billed for services that were never consistent and they did not receive them at their mentioned locations.

For instance, a clinic worker might give a patient a syringe to administer a certain injection on his own in this place. However, the bill of the patients tells a different story. It says that the injection was administered at the clinic under the supervision of the doctor and this administration at the clinic has its own separate charges.

Service Provider Misrepresentation

This is one of the most far-fetched types of misrepresentation as often to save extra money, different clinics or health care facilities hire unqualified, unprofessional, and totally untrained staff to conduct medical services and procedures.

This happens when an assistant or a PA performs surgery on the main surgeon or gives a consultation instead of the doctor himself. These are not allowed under government regulation and come under malpractice.

Phantom charges

The most fraudulent practice in medical billing is called phantom charges and the worst part is that it is the most established one as well because it is the quickest and easiest to be carried out.

Phantom charges also known as phantom invoicing is another kind of unethical medical billing for any medical procedure or service that is actually never given.

For instance, a medical practitioner submits a complaint that any of the medical services or a procedure is not necessary and should not be conducted. It means that all the treatment that was done was only to gain profit.

A healthcare provider submits a request for a wheelchair but it is not needed by the patient and was also never received by him.

Phantom billing is actually the real burden over the healthcare system as this is where the resources are relinquished because of being spent fraudulently or overly utilized when it is not even required.

Phantom billing is also a result of backlogs. People who might require those certain services or procedures in real life may find great difficult to receive or obtain them when needed because the resources have been depleted or drained completely.

It is very worthy to note that the healthcare providers do not only commit this type of heinous fraud but at times partner up with the patients to conduct such malpractice. They might give payment or compensation to those patients for teaming up with them and cooperating with them to make their fraudulent scheme successful.


Hopefully, the above-mentioned unethical medical billing practices would be an eye-opener for you, and you will be vigilant enough to avoid them and report them immediately without becoming a victim of the malpractice crooks of the medical and healthcare system. Read out your bill carefully and avoid getting scammed by these fraudulent people.