Fraud involves lying about something or deceiving someone for gain. The gain is usually financial. Health insurance is a complex system that opens the door for many types of fraud. Anyone who defrauds an insurance company is subject to a wide range of penalties, from charges under federal health care statutes to embezzlement and theft. The U.S. Attorney's Office prosecutes insurance fraud crimes.
Patient Fraud May Seem Innocent
A patient can commit insurance fraud without understanding its seriousness. For example, a person might give an insurance card to an uninsured friend or relative because that person badly needs to see a doctor, but can't afford it. Although it might seem like a kind thing to do, it's still fraud committed against the insurance company, and both the insured and the friend would be liable. Health insurance fraud also occurs when a patient uses benefits to fill forged prescriptions.
Providers Can Be Guilty of Fraud
Health care providers are also a source of fraud in the insurance industry. Providers commit fraud when they bill patients' insurance companies for services not actually performed, or that the patient doesn't really need. The latter often takes the form of unnecessary tests or diagnostic procedures. Providers might also increase their fees when they know a company, not the patient, is paying the bill and can theoretically afford more. In the case of Medicare or Medicaid fraud, this can result in the government barring a practitioner from participating in these programs.
Insurers Can Be Guilty of Fraud
Most states require that insurers have licenses in order to do business, but occasionally unscrupulous insurers can slip around the licensing process. When they do, they may collect your premiums but be unable to pay your claims. This is consumer fraud. You could find yourself responsible for significant medical bills. If this happens to you, speak with an attorney to explore your options.
Insurance Fraud Increases Premiums
Fraud committed by insured individuals and providers results in increased premiums to all consumers. When insurers have to pay out more in fraudulent claims, they compensate by charging customers more to balance their losses.
An Insurance Lawyer Can Help
The law surrounding health insurance fraud is complicated. Plus, the facts of each case are unique. This article provides a brief, general introduction to the topic. For more detailed, specific information, please contact an insurance lawyer.