Page 40 - Insurance Times Octoberr 2022

Healthcare fraud employers also apply for coverage under different names to
foil attempts to recover monies owed on previous policies
Although healthcare insurance is generally outside the
or to avoid detection of their poor claim record. Fraud by
purview of property/casualty insurance, healthcare fraud
medical care providers includes upcoding or billing for
affects all types of property/casualty insurance coverage that
procedures that were never performed. Examples of
include a medical care component, such as medical
claimant fraud include over-utilizing medical care to keep
payments for auto accident victims or workers injured in the
receiving lost income (indemnity) benefits, exaggeration of
workplace. Fraud and abuse take place at many points in
symptoms, working while allegedly disabled and not
the healthcare system. Doctors, hospitals, nursing homes,
reporting income, claiming a job-related injury that never
diagnostic facilities, medical equipment suppliers and
occurred. or claiming a non-work-related injury as a work-
attorneys have been cited in scams to defraud the system.
related injury.
The most prevalent types of healthcare fraud are:
Billing for services not rendered;
Catastrophe-related property fraud
Upcoding services and medical items (the provider
When disasters strike some individuals or groups see an
submits a bill using a code that yields a higher payment
opportunity to file claims that are either exaggerated or
than for the service or item that was actually rendered);
completely false. Some even intentionally damage property
Filing duplicate claims;
after a disaster to receive a higher payout. Another example
Unbundling (billing in a fragmented fashion for tests or of opportunistic fraud following natural catastrophes is
procedures that are required to be billed together at contractor fraud. A handful of states have attempted to
reduced cost); and protect homeowners from contractor fraud by enacting
laws that provide for notices and contract termination rights
Performing excessive services; performing unnecessary
and prohibiting rebating or other compensation to induce
services; and offering kickbacks.
homeowners to sign contracts.
Claims fraud is a threat to the viability of the health insurance
In recent years, the increase in billion-dollar weather
business. Although health insurers regularly crack down on
catastrophes and the propensity of claimants to commit
unscrupulous healthcare providers, fraudsters continually
opportunistic fraud has resulted in some insurers turning to
exploit any new loopholes with forged documents purporting
forensic meteorologists. These experts can accurately verify
to be from leading hospitals. Medical ID theft is one of the
weather conditions for an exact location and time, allowing
most common techniques adopted by fraudsters. Due to this,
claims adjusters to validate claims and determine whether
claim funds are paid into their bank accounts, through
more than one type of weather element is responsible for
identity theft.
damage. Since they use certifiable weather records, their
findings are admissible in court.
The insurer's procedures allows for the policyholder to send
a scanned image of his/her cheque, with the bank account
details for ID purposes, which is then manipulated by the How Insurers fight frauds
fraudsters. Besides forged documents, other common The legal options of an insurance company that suspects
sources of fraud come from healthcare providers themselves, fraud are limited. An insurer can inform law enforcement
with cases of 'upgrading' (billing for more expensive
agencies of suspicious claims, withhold payment, and collect
treatments than those provided), 'phantom billing' and evidence for use in a court. Insurers are turning their
'ganging' (billing for services provided to family members or attention towards big data and analytics solutions to help
other individuals accompanying the patient, but not check fraud, recognize misrepresentation and prevent
delivered). identity theft. With the government's recent push to adopt
digitization, the Aadhaar card plays a crucial role, linking
Compensation fraud income tax permanent account numbers (PANs), banks,
Employers who misrepresent their payroll or the type of credit bureaus, telecoms and utilities and providing a unified
work carried out by their workers to pay lower premiums and centralized data registry that profiles an individual's
are committing workers' compensation fraud. Some economic behaviour. The e-commerce boom provides

40 The Insurance Times, October 2022