New Rev. Rec. Standard May Open New Opportunities for Healthcare Fraud

By:
Chris Gaetano
Published Date:
Sep 1, 2017
HealthBenefits

The FASB's new revenue recognition standard, set to go into effect at the end of the year, will collide with new value-based Medicaid reimbursement rules, potentially creating new avenues for healthcare fraud, according to Accounting Today. The new standard, developed as part of the convergence project with the International Accounting Standards Board, collapses the myriad industry-specific revenue guidance in the current literature with a unified standard based around the identification and fulfillment of contract-based performance obligations. This, however, complicates things in the wake of Medicaid's new reimbursement rules, which are based partially on clinical and quality metrics. This means that finance and operational staff will need to collaborate to determine when performance obligations have been fulfilled. If finance staff alone determine this, Accounting Today said they will likely lack the medical knowledge necessary to know when revenue can be booked, which opens up the potential for fraud (for example, false claims). It was also noted that the general complexity of the new standard may also lead to a slight rise in fraud as entities react to the learning curve. 

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