Final answer:
The unlawful act of increasing reimbursement amount from a third-party payer is known as fraud, often involving unnecessary and expensive tests to defraud Medicaid.
Step-by-step explanation:
The act of unlawfully increasing reimbursement amount from a third-party payer is known as fraud. In the context of healthcare, this may involve medical providers performing unnecessary and expensive tests on patients covered by Medicaid to receive higher reimbursements from the government. The scenario described highlights a situation in which a handful of doctors established clinics in poor neighborhoods, where they conducted excessive and costly procedures to defraud government healthcare programs. Such actions lead to increased healthcare costs and misuse of resources, ultimately harming patients and taxpayers.