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Author: Mark

Healthcare fraud action highlights ongoing problem

The sweep of healthcare fraud cases announced by the Justice Department is sweeping and vast. Over $2 billion in fraud was identified by 600 defendants charged across the nation, defrauding health insurance for opiods that were re-sold as well as general services.

A stunning $350 million of that fraud comes from South Florida alone. Those charged come from all over the state, too. Prosecutors make it clear that this is only the tip of the iceberg, however, and there is much more that they have not yet uncovered.

The enforcement operation

It appears to be the largest operation ever undertaken against healthcare fraud. The press often highlights the abuse of Medicaid reimbursements, but private insurance companies were caught up in it as well.

Like much of the fraud today, it involved a vast network of doctors, clinics, patients, and services all working together. It even connected the opiods obtained with false prescriptions to a drug cartel that is traffic in them.

Much is South Florida based

Fully 20% of the defendants ensnared are from South Florida. In the Tampa area alone, 13 defendants including four doctors have been charged. The network of fraud reached out all across the nation but was clearly centered here.

The $350 million in fraud in South Florida came from nearly every aspect of the healthcare industry, too. All insurers in the state have probably been defrauded, at least in part, by this operation. And officials are stressing that this is only what is known at this time, there is likely to be more.

What can be done?

Fraud that is identified by the Justice Department can be recovered. It takes experience in insurance fraud to navigate a case like this, especially when the operation is so vast and criminal charges are involved. More importantly, there may be evidence in the criminal trial which highlights other fraud not currently charged.

Insurance fraud is so common in South Florida that vigorously pursuing it is critical for any insurer. A legal team with a proven track record pursuing every case to full recovery can make a large difference in the bottom line for any insurer operating in Florida.

Over-payments: getting the advantage for the insurer

Overpayments to providers by insurers happen all the time. It’s not a matter of fraud but the complexities of the system. Medical providers rarely have fixed tables of cost for any given services and the actual price for any given treatment is often negotiable.

Insurers have a disadvantage in this system. The position is made even weaker by Florida law. The only way to regain the advantage, when necessary, is to be prepared for civil litigation.

The law in Florida

Insurance payments to providers are covered in Florida statute 627.6131, Payment of claims. The exact dates and methods for all claims are spelled out in great detail. Section (6)(a) covers overpayments discovered as part of a review or audit and not related to fraud.

1. All claims for overpayment must be submitted to a provider within 30 months after the health insurer’s payment of the claim. A provider must pay, deny, or contest the health insurer’s claim for overpayment within 40 days after the receipt of the claim. All contested claims for overpayment must be paid or denied within 120 days after receipt of the claim. Failure to pay or deny overpayment and claim within 140 days after receipt creates an uncontestable obligation to pay the claim.

This establishes the procedures and the clock for payments. Further, in section 3 it is made clear that insurers cannot take any action on their own including reducing payment for other services as part of an overpayment claim.

What this means

If a provider simply ignores the overpayment request, it can be enforced after 140 days. But it often takes the threat of civil action in order to have that reimbursement occur.

It is often in the best interests of any provider to simply deny the overpayment as a matter of course. This leaves them in the even stronger position, given that it is not legal to reduce any payments to the provider. There is no recourse for hte insurer other than to threaten to sue.

How to proceed

For this reason, all situations involving overpayment have to be considered on the basis of how the information will be presented at trial. The providers must believe that the overpayment is going to proceed to trial before they will take it seriously, based on their strong position under the law.

That is why any collection action against a provider must be undertaken with a law firm experienced in handling collection and refunds from providers. There is simply no alternative, given the position insurers are in under Florida law.

PIP fraud still rampant

As the Florida legislature considers changes to Florida’s no-fault insurance system, sentencing has begun in one of the most intricate PIP fraud conspiracies in recent years. A total of $23 million dollars in fraudulent PIP claims was racked up over seven years.

The case places in the public eye some details about how PIP fraud operates, which is educational. Without giving away too many details on how to uncover auto insurance fraud it highlights the severity of the problem and why all claims have to be diligently inspected.

The ring

The first sentences have been handed down in the ring that perpetrated the fraud for so many years. It was large, covering many different professions and defrauding several insurance carriers.

Auto accident victims were recruited by tow truck drivers and chiropractic clinics. They were referred to lawyers who filed personal injury claims. The entire scam, which was elaborate and carefully constructed, involved thousands of accident victims who were routed through this criminal enterprise.

How it was stopped

The Florida Department of Insurance Fraud noticed a pattern of billing at the very top end of PIP coverage from several chiropractic clinics. This started an investigation that involved many law enforcement entities at the local, state, and federal level.

The key takeaway is that insurance fraud information such as this is available and can be used by insurance companies which suspect fraud. Rarely are criminal enterprises as large as this one, but all of them involve patterns of fraudulent billing.

This is one of many things which need to be examined in the proves of uncovering PIP fraud. It takes experience to know what to look for in these investigations.

Far too common

As important as it is that large fraud rings like this are broken, smaller ones are operating all the time. Any insurance agency that suspects fraud needs to have it thoroughly investigated as part of any pre-trial preparation when a claim is denied.

There are many tell-tale signs, and all were present in this case. While it was big enough to gain attention, far too often smaller criminal enterprises get away with fraud.

Settling the case: mediation and arbitration

If you have an insurance claim against your company, it is definitely in your best interest to come to some kind of settlement if it is possible. Sometimes, however, that simply cannot be done and a lawsuit is the only possible option.

That does not mean that negotiation is over, however. Courts in Florida require all civil lawsuits to go through mediation before proceeding to trial. In mediation it may make sense for the case to be referred to arbitration. These alternative dispute resolution procedures are an important part of the process, especially for insurance claims.


The first step for any civil suit is always mediation. This is a process by which a court certified mediator assembles both parties and hears their sides of the story. They propose solutions and ways that the dispute can be resolved easily.

Mediation can take the form of a small, informal hearing or even look like a trial with evidence presented by both sides. It is entirely up to the mediator as to how it proceeds. The setting is informal and allows back-and-forth between the two parties.

Many cases settle in mediation, so the process is very much worth it. If they do not find a way to agree, one possible outcome is to have the parties agree to arbitration.


There are two kinds of arbitration – binding and non-binding. In a binding arbitration, both parties have signed that they will agree to the decision of the arbitrator, whatever it is. Non-binding, of course, does not have that agreement.

Arbitration is conducted by an expert in the field, or sometimes a panel of experts. It is also more relaxed than a full trial, but is more likely to have some structure and presentation of evidence.

Still preparing for trial

While the savings in time and money are very important, it is still critical to have a vigorous defense coming into mediation. You have to be prepared as if going to trial, which is the outcome if mediation and arbitration fail to produce an agreement.

That may sound like setting up for failure, but it is an important part of the process. The outcome is much more likely to be in your favor if it is clear that you are prepared to see the case through to the very end.

In all cases, it is important to have an attorney skilled in not only insurance claims but also the process of alternative dispute resolution preparing your case. Mediation and arbitration are indeed a much easier way to settle, but the outcome is always going to be more favorable the more prepared you are.

How much security is enough?

In the wake of several incidents involving mass casualties, many Americans have become concerned for their safety. Property owners of large, public spaces are increasingly being called on to tighten security and provide adequate protection to their patrons.

But what is expected? The law is open to changing conditions and times for a lot of reasons. But property owners in general are not always expected to take into account every potential risk to the public. It’s important to understand the potential liabilities all property owners have and how they can cover them.

Premises liability

Under Florida law, owners of any establishment or property that is open to the general public have an obligation to keep their patrons safe. The most common things which come under this are appropriate lighting, lack of trip hazards, and other elements of basic safety.

The general public also has a right to feel safe from criminal acts, too. Any potential threat to safety which can be “reasonably foreseen” or expected has to be addressed. This includes breaking up a fight in a bar, for example, before patrons are seriously injured.

A property owner can be held liable if three conditions are all met:

  • A person is injured or otherwise harmed on the property
  • The property owner failed to provide basic security to stop “foreseeable” incidents
  • The failure of the property owner to do so is directly related to the harm caused

Defense against charges of premises liability or “negligent security” is based on proving that just one of these conditions is not met. That is where the question as to whether a threat is “foreseeable” becomes important.

Mass casualty incidents

To date, lawsuits claiming negligent security have been unusual in the aftermath of mass casualty incidents. The defense that no one could have seen this coming is easy to make as everyone absorbs the horror of the situation. But as they become more commonplace and the public questions what security should be provided, it’s only a matter of time before a claim that such an event was “foreseeable” will arise.

One response to this is additional insurance being offered to cover these incidents. Such products are relatively new and the cost is still being weighed. Mass casualty events are indeed very expensive – the Pulse Nightclub in Orlando was destroyed and only was able to reopen in a different location.

Are other responses, such as increased armed security appropriate? Property owners need to review their situation individually as times change to determine if this is appropriate. A conversation with an attorney experienced in premises liability is certainly a good place to start if you have any concerns.

Tips for preventing insurance fraud claims against your business

According to the FBI website, insurance fraud (non-health insurance) is estimated to cost $40 billion a year. American consumers pay between $400 and $700 a year in increased premiums due to fraudulent claims.

As a business owner, you’ve worked hard to maintain a profitable and successful business. Each year employees and customers make claims for Workers’ Compensation, slip and fall accidents, product liability and more. Many people are being sincere and truthful.

Those who file fraudulent claims, however, can cost you more than just the settlement.

Making an impact on insurance fraud

Here are basic tips for preventing fraudulent claims:

  • Carefully screen job applicants – often times background checks will reveal a history of suspicious injury claims.
  • Listen to your employees – disgruntled employees who complain about conditions may be more likely to file claims. Listen to their concerns. Correct safety issues and improve working conditions.
  • Stay in close contact with injured employees – communication helps the injured person feel valued. They know their progress is being monitored and may return to work sooner.
  • Modify duties as appropriate – you can save on claims by bringing the injured employee back to work as soon as possible with modified work duties or a reduced schedule.
  • Establish consistent procedures – ensure you have policies in place to report injuries and make claims. Be consistent with your approach and document everything. Interview injured employees and any witnesses.
  • Communicate your policies – new hire orientations are a great time to make it clear what your procedures are. Reinforce the training yearly. It is an employee’s right to file claims for legitimate injuries. Make sure employees understand the consequences for filing fraudulent claims.
  • Make it easy to report fraud – establish a procedure so that employees who suspect fraud can report it. Take suspicions seriously and investigate. Report any suspicious activity to your insurance company.
  • Surveillance cameras – the use of cameras in public areas of your building may help prove or disprove claims such a slip and falls.

It may not be possible to predict every act of fraud in advance. Taking steps to mitigate your risk as a business owner will go a long way to reducing the frequency and severity of these events. If you do feel that an insurance claim made against your business is fraudulent, you will want to work with an attorney who handles insurance fraud.

No fault insurance fraud leads law makers to consider options

Lawmakers are considering replacing Florida’s no fault auto insurance law. Currently, Florida is one a dozen states with no fault insurance laws. These laws are designed to keep insurance premiums low, but Florida has the fifth highest premium rates in the nation.

As a replacement, lawmakers are considering a mandatory bodily injury (BI) coverage system. Whereas Personal Injury Protection (PIP) protects the driver, BI protects the other person injured, placing the fault on the negligent party.

A flawed system

PIP coverage requirements have not been raised since 1979. Currently the law requires drivers to carry a minimum of $10,000 of both PIP and Property Damage Liability (PDL) coverage, but the system has been criticized for problems with fraud.

Each year the Florida Department of Financial Services investigates thousands of cases of PIP fraud. Over a three year period there were more than 4,000 cases of PIP fraud. One of the reasons PIP is so easily abused is that the payouts are typically quick, and so many fabricated claims are made to quickly reach the $10,000 maximum.

A national problem

Florida is not the only state struggling with no fault auto fraud. New York State drivers are bearing the cost of higher premiums as auto insurance fraud rampages throughout the state. Staged car accident crime rings are becoming a statewide problem. Fake passengers are recruited to take part in a low speed “crash,” after which they file a claim with the insurance company.

While the costs of insurance fraud are offset with higher premiums, the overall cost is born by the insurance company. Millions are dollars are paid out annually for fraudulent claims. Whether PIP is replaced with BI or the no fault laws are updated, these steps are at least progress in the fight to stop fraudulent claims.