Medical Billing Scams

Medical billing can be a fulfilling home-based business, but not all options are equal. The Federal Trade Commission (FTC) has prosecuted promoters of medical billing opportunities for misleading people looking to start a home billing business by misrepresenting the earnings potential and failing to disclose certain information required by law.

You've probably seen the ads in newspapers, magazines or online. They claim that you can rake in big money working from home as a medical biller -- no experience required.

When you call the toll-free number, the sales representative lures you in by reinforcing how much money you can make -- even part time -- and how desperate doctors are to find people to fill these positions. The rep promises that they will give you all you need to start your own lucrative medical billing business -- typically some software, a book and a list of potential clients. The cost to you is usually several hundred dollars, but, as the rep explains, what's that in comparison to the loads of money you'll be earning once your business is up and running?

The truth is that you will probably make no money with these "quick fix" businesses. The software provided is often useless, as are the potential leads, and the prospects for a brand new biller with no formal training or certification are slim. The medical billing field is a competitive one, especially for those who work from home rather than in an established company. Even a money-back guarantee doesn't mean you'll get a refund when you realize that you've been scammed.

How to Protect Yourself

The FTC has established guidelines to help you protect yourself against medical billing scams:

• Ask the promoter to give you the names of many previous purchasers so that you can pick and choose who to call for references. Make sure you get many names from which to choose. If the promoter provides only one or two names, be careful: The contacts may be "shills," people hired to give favorable testimonials. Interview the references, preferably where the business operates, to get a better sense of how the business works. Ask for the names of their clients and a description of their operation.
• Consult with organizations for medical claims processors or medical billing businesses and with doctors in your community. Ask them about the medical billing field: How much of a need is there for this type of work? How much work does medical billing entail? What kind of training is required? Do they know anything about the promotion or promoter you're interested in?
• Check with the state Attorney General's office, consumer protection agency and the Better Business Bureau in your area and the area where the promoter is based to learn whether there are any unresolved complaints about the business opportunity or the promoter. While complaints may alert you to problems, the absence of complaints does not necessarily mean the company is legitimate. Unscrupulous companies may settle complaints, change their names or move to hide a history of complaints.
• If the medical billing opportunity sells another company's software, check with the software company to find out whether company representatives know of any problems with the medical billing promoter.
• Consult an attorney, accountant or other business advisor before you sign any agreement or make any payments up front. An attorney can review the promoter's contract and advise you on how best to proceed.

Where to Complain

If you think you've been defrauded in a medical billing business opportunity scheme, contact the company and ask for your money back. Let the company representatives know that you plan to notify law enforcement and other officials about your experience. Keep a record of your conversations and correspondence. If you send documents to the company, send copies, not originals. Send correspondence by certified mail and request a return receipt to document what the company received.

If you can't resolve the dispute with the company, file a complaint with:

• The Federal Trade Commission. Call 1-877-FTC-HELP (1-877-382-4357) or log on to www.ftc.gov.
• The Attorney General's office in your state or in the state where the company is located. The office will be able to tell you whether you're protected by any state law to regulate work-at-home programs.
• Your local consumer protection offices.
• Your local Better Business Bureau.
• Your local postmaster. The U.S. Postal Service investigates fraudulent mail practices.
• The advertising manager of the publication that ran the ad. The manager may be interested to learn about the problems you've had.