How Jerry, George and Elaine Committed Health Care Fraud

Lessons for doctors (and patients) from a classic Seinfeld episode

The Seinfeld episode “The Note” (third season, episode 1) is probably best remembered for George’s line “it moved,” but it helps explain some aspects of health care fraud in the real world, something that I’m very familiar with from my work prosecuting and defending such cases.

As you might recall, the episode involves Jerry, George and Elaine getting notes from Jerry’s dentist and Elaine’s gynecologist to have their insurance cover massages.  Jerry’s dentist gets investigated for insurance fraud and ultimately gets put on probation.

Let’s unpack this.

First, a crime really was committed. 

When you get treated by a doctor or health care provider, your provider generally can bill your insurer for all services that are medically necessary.  This is usually straight-forward, but it can become problematic for massages, dermatological procedures and other procedures which sometimes are medically necessary but sometimes are done just for patient preference or ease.

Here, Jerry, George and Elaine were getting massages out of personal choice and had paid for them out of their own pocket, but they wanted to pass on the costs to their insurer.  They did not need the massages for medical reasons but got notes to make the massages falsely appear to be medically necessary.  They then apparently submitted claims for reimbursement from their insurance along with the notes.

Billing for medically unnecessary services is one of the main types of health care fraud.  Other types include upcoding (when someone bills for services that were more complicated than they actually were so that they can get paid more) and what I call “ghost services” (when someone bills for services that were not actually performed).

Second, this crime involved many people, not just Jerry’s friend Roy, the dentist.

Roy committed health care fraud by writing notes that contained false information that was used to justify billing insurance.  His notes for Jerry, George and Elaine are false insofar as he claimed that the massages were medically necessary and that Jerry, George and Elaine were patients under his care.  The notes were probably backdated as well.

Elaine’s gynecologist may also have committed fraud by providing Elaine with another inappropriate note. 

And Jerry, George and Elaine committed health care fraud themselves by submitting those fake notes to their insurers, seeking reimbursement for the costs they incurred for the massages.

Third, in helping Jerry out, Roy made a big mistake that I’ve seen in many health care fraud cases – stepping out of his field.  A dentist writing an order for physical therapy would be unusual, and it might be a red flag for an auditor or algorithm.  Doctors should be careful when going outside their specialty – this has led to some huge problems in areas such as home health, hospice, and durable medical equipment. 

Fourth, while everyone might have gotten away with the crime if they were careful or had competent lawyers, Roy makes a second mistake that I’ve seen happen in real life multiple times. 

When Roy finds himself under investigation, he tells Jerry that he’ll be okay “as long as we get the physical therapist to go along with our story,” if she says “that the complaint was related to a dental problem.”

This sounds like trying to tamper with a witness or to obstruct an investigation.  This sometimes works, but it often backfires because it can make it easier for the government to prove criminal intent or “willfulness,” something the government often has difficulty proving.  Better for Roy to stand by his notes and maybe concede that he may have made a mistake.

For what it’s worth, if the government had gone after Jerry, George and Elaine themselves, they probably could have avoided prosecution by cooperating against Roy.  I once prosecuted a fraud case where a patient admitted knowing that her doctor was improperly charging insurance for cosmetic procedures, which made her criminally responsible in addition to the doctor.  We immunized her so she would testify against her doctor, who was found guilty after a trial.

Fifth, Roy ends up in much worse shape than Elaine thinks.  At the end of the episode, Elaine says that Roy got six months’ probation and that it’s a “slap on the wrist.”  Roy probably does not view it that way.

If Roy was convicted for health care fraud, he would face devastating consequences to his career even if he got no jail time.  His professional license would probably be suspended, and he probably would be barred from being a provider for government healthcare programs such as Medicaid, which does cover dental costs.  His career would basically be over.

Overall, fraud costs our health care system huge amounts of money.  What Jerry, George and Elaine did is a very small example of the problem, but it’s an example nonetheless.

I was a federal prosecutor in Chicago for 11 years and was senior counsel to the Chicago U.S. Attorney Office’s health care fraud unit.  I worked at two large law firms and recently started a solo practice focused on health care fraud and data analytics. I also used to be a newspaper reporter and was the creator of a news site that reverse-engineered TV shows that ripped from the headlines. Hope you enjoyed!