Claims and Underutilization connection in California

Workers’ compensation insurance fraud is most commonly associated with false claims; scams made by patients claiming mythical injuries or unethical medical providers inflating their treatment costs or billing insurers for services that were never actually provided. False claims in insurance fraud is a problem that can occur at any layer of the health care system, including provider organizations, purchasing cooperatives, employers, HMOs and indemnity health insurers. 

False claims insurance fraud encompasses a wide range of deceitful activity; such as an employer lying on an application to get better insurance rates, misrepresentation by purchasing cooperatives to guide buyers to inferior plans, insurance company salesmen promising benefits that a coverage plan doesn’t include and a patient lying about his medical condition to get prescription drugs that are then sold on the black market. 

While claims fraud attracts the most attention of all types of false statement insurance fraud, there are multiple types of false claims and other false statement techniques, as follows: 

• Unbundling - In this type of fraud the medical provider submits separate claims for a single treatment, raising his profit for the procedure.

• Upcoding - A provider sends in a bill to the insurer for a procedure that is much more expensive than the one actually performed.

• Billing for Services Not Provided - Fraud that goes a step further than upcoding, a provider submits a claim for a treatment that the patient never received.

• Exclusion of Covered Benefits - This is a scheme by unscrupulous providers, who tell a patient that the treatment they need isn’t covered by their insurance when it actually is. The provider then offers to provide the services at a discount if the patient pays directly.

• False Coverage - False coverage fraud is a scam run by “fly-by-night” insurance companies that take an employee's premium payments but then fail to pay legitimate claims, leaving the patient on the hook with the medical provider.

• Credentials Falsification - The false credentials ruse occurs when a medical provider or facility presents credentials that they haven’t earned and provide services they’re not qualified to perform, putting the patient’s health and life at risk.

One of the most egregious cases of false claim insurance fraud was perpetrated by Hospital Corporation of America (HCA), the largest private operator of health care facilities in the world. Following FBI investigations HCA pleaded guilty to fourteen felonies, including systematically overcharging the government, filing false statements, fraudulently billing Medicare and providing kickbacks to doctors who referred patients to HCA facilities. The company ended up paying the federal government $631 million, plus interest, in addition to $250 million in restitution on fraudulent Medicare claims. The insurance fraud also cost HCA more than $2 billion to settle civil claims.

A key tool in combating false statement insurance fraud is for workers’ compensation patients to seek out highly reputable providers. The best approach to navigating the fray of health insurance or workers’ compensation red tape is to play it straight down the line, provide the highest level of patient care, while strictly adhering to ethical guidelines for workers’ compensation cases.