INTER-FACTS Blog : Insurance, Medical, Fraud and more
Medical Fraud is on the Rise
Following an undercover operation by police, three men, including a doctor, were arrested in Miami for illegally billing an insurance company for patients who never were treated. “This goes on all the time,” the individual working undercover as the patient explained. “To be honest, this type of behavior has reached epidemic proportions. It’s happening all over the country and affecting everybody and everything, including insurance rates.” While there are many types of insurance fraud—ranging from the above example to staged car accidents—there’s a more subtle type of fraud occuring. Failure to divulge prior injuries and repeated claims for the same injury cost insurance companies millions of dollars every year. It also raises the rates as much as the more blatant cases previously mentioned.
Bogus Background Investigations
This blog article gives you the lay of the land regarding fraudulent efforts. The term “Background Investigations” is probably one of the most misunderstood phrases since the emergence of the Internet. Just type it into any search engine and see what comes up. Paid ads top the list. Some say you can have a background investigation performed for $20. Others claim to rate background investigation sites. While many of these sites are legitimate, others perpetuate the myth that there’s a crystal ball in cyber space with all the information you need to know about anyone—all for $20! Some boast flashing colors, sliding graphics and warnings about the “confidential” information you’re about to receive or even claim to reveal arrest records.
Fraud costs $32B Annually
In March 2015, the Insurance Information Institute announced that industry-wide fraud has an annual price tag of $32 billion. That’s right! Billion with a “B.” Reports confirm that insurance fraud accounts for roughly 10 percent of all property/casualty losses and it can get as high as 20 percent for auto insurers. Proper background investigations could save the insurance industry one billion of that, if not more. Not an investigation conducted by a Special Investigations Unit (SIU) but rather by a bonafide background investigator. That’s because quite often the SIUs aren’t aware of the various avenues available to assist in mitigating claims.