Page 361 - Ebook health insurance IC27

Sashi Publications

with sound fiscal, business, or medical practices, and result in an unnecessary cost to
Health programs, or in reimbursement for services that are not medically necessary or
fail to meet professionally recognized standards for health care.

It also includes recipient practices that result in unnecessary costs to the Health
program. The main purpose of fraud or abuse is financial gain. Fraud and abuse
are widespread and very costly to the health-care system. It is not only creating
a hole in the insurance companies pocket but affects all the stakeholders and our
healthcare system. It not only invites higher premiums but leads to restricted
benefits, higher insurance co-payments, potential of denial for future coverage,
higher service taxes and also impact the quality of care.

Classification of Frauds
Healthcare claim fraud has both financial and medical aspects. It has been observed
that the growth rate of fraud claims is higher than the advances in healthcare delivery
system. Fraud claims are wide-ranging, from misrepresented services, services not
rendered and services rendered to "rented" patients, to a broad spectrum of
revenue-enhancement mechanisms.

A) Internal and External
Internal frauds are those perpetrated against an insurance company or its
policyholders by agents, managers, executives, or other employees.

External fraud schemes, on the other hand, are directed against a company by

Website : www.bimabazaar.com, PH: 033 22184184/40078428 365