In this type of fraud‚ false or misleading information is provided to a health insurance company in an attempt to have them pay unauthorized benefits to the policy holder‚ another party‚ or the entity providing services. The offense can be committed by the insured individual or the provider of health services.
An individual subscriber can commit health insurance fraud by:
- allowing someone else to use his or her identity and insurance information to obtain health care services
- using benefits to pay for prescriptions that were not prescribed by his or
Health care providers can commit fraudulent acts by:
- billing for services‚ procedures and/or supplies that were never rendered
- charging for more expensive services than those actually provided
- performing unnecessary services for the purpose of financial gain
- misrepresenting non–covered treatments as a medical necessity
- falsifying a patient’s diagnosis to justify tests‚ surgeries‚ or other procedures
- billing each step of a single procedure as if it were a separate procedure
- charging a patient more than the co–pay agreed to under the insurer’s terms
- paying “kickbacks” for referral of motor vehicle accident victims for treatment
Here are a few typical scenarios to illustrate some of the different ways health insurance fraud can be committed:
Chris was the only one in his family with health insurance, but he let his brother and cousin use his card to receive health care benefits.
A nurse in Dr. Smith’s office became addicted to painkillers and with access to patient records she called in forged prescriptions to a local pharmacist and posed as a family member of the patient when she picked up the drugs.
Devon was addicted to painkillers, stole and forged prescription forms from his doctor’s office, passed them at a local pharmacy, and used his health care insurance to pay for the drugs.
Dr. Talbot billed his patients’ health insurance for both the services he actually provided and for services that were not provided. He falsified his patients’ medical records to reflect office visits and treatments that never occurred.
Dr. O’Neill received the results of medical testing performed by a diagnostic firm for her interpretation of the results. She billed the patients’ health insurance as though she performed both the testing and interpretation
of the tests.
Dr. Salazar was employed by a medical center where low-income and indigent patients were recruited to undergo unnecessary exams. While Dr. Salazar saw few patients, medical records were falsified by a physician’s assistant to support the billing of insurance programs for procedures that were never performed.
In 2011, crimes involving life and health insurance accounted for nine percent of referrals received about suspected fraud. Life and health insurance-related crimes also accounted for eight percent of arrests in 2011. The following cases show how this crime is committed – and prosecuted – in real life.
PRISON TIME IS BITTER PILL TO SWALLOW
On June 15, 2010, a Lancaster doctor was sentenced in U.S. District Court to imprisonment of 96 months with three years supervised release, and payment of $7,116,423 in restitution. In April 2009, the doctor was arrested by agents of the Pennsylvania Attorney General’s Office for having fraudulently billed public and private health insurers over a five year period. Investigative auditors with Blue Cross Blue Shield health insurers, detecting irregularities in billing, brought the case to the attention of state investigators. Complaints alleged that the doctor, in diagnosing infant sleep disorders from sleep studies sent him by other physicians, had intentionally misrepresented to health insurers that he had personally conducted the studies and had also billed for medical services that had never been provided. State charges led to prosecution by federal authorities as frauds extended beyond private health insurers, victimizing taxpayer funded federal health programs.
IT'S CALLED "CARD SHARING" AND IT'S A CRIME!
In April 20, 2010, a 22-year-old Bucks County man was arrested by special agents of the Attorney General’s Office for having used his cousin’s identity and United Concordia dental insurance to pay for dental work he’d received from two different dentists. Pleading guilty in August 2010, he was sentenced to serve three years probation and perform 200 hours of community service, and pay restitution of $5,985 to United Concordia and all court costs.
CHIROPRACTOR USES COLLEAGUES' IDENTITY TO DEFRAUD!
In August 2009,
detectives of the Northeastern Regional Insurance Fraud Task Force charged a 41-year-old Nanticoke, PA chiropractor with having made numerous
false insurance claims to defraud Blue Cross of Northeastern Pennsylvania. Between September 2004 and April 2007, he’d
used a colleague's signature stamp and Provider Identification Number to submit claim forms to Blue Cross
fraudulently showing that he been provided medical treatment by his colleague. In April 2010, he entered a Guilty Plea to
Insurance Fraud, was sentenced to serve four years probation and perform 200
hours community service, and was ordered to pay restitution of $83,980 to Blue
Cross of Northeastern Pennsylvania.
Most health insurance includes a lifetime maximum of benefits‚ and health insurance fraud practices such as overbilling for the type of services received robs consumers of these benefits.
This is why health insurance fraud is such a serious crime. As with all other types of insurance fraud‚ Pennsylvania considers it a felony. Violators can spend up to seven years in prison and spend up to $15‚000 in fines. There are also many other associated expenses such as court costs and legal fees. Plus‚ those found guilty of insurance fraud have the stigmas and limitations of being a convicted felon to carry with them for life.
Individuals who subscribe to health insurance can avoid facing situations where there’s an opportunity for you to commit fraud and at the same time be observant for instances of any providers’ fraudulent acts.
First‚ understand your policy and what it covers‚ such as amounts of your co–pay and other details. Understand that this policy is specific about who it covers as well – never attempt to use it to get medical services for someone who is not authorized to receive them.
Each time you are billed for a visit‚ check your statement to ensure that the type and number of services provided are correct – and that each has been rendered. Make sure that details such as the date of service are accurate and the proper copayment amount was charged or collected.
Learning all you can about health insurance fraud will help you avoid costly and life–changing situations. And in all aspects of your dealings with health insurance‚ make sure the information you provide is truthful and accurate.
To help all Pennsylvanians better understand health and other types of insurance fraud‚ the Pennsylvania Insurance Fraud Prevention Authority (IFPA) in 2009 embarked on a new statewide public education and prevention campaign which continues to inform consumers of the risks and penalties of insurance fraud through a variety of channels.
Click here to learn more about the IFPA Prevention Campaign.