Raise the “Ruse” on False Health Claims and Reporting
Let's be honest—as an insurance assessor, workers' compensation claims are not always forthright. The gray areas are many, leaving you to determine what's fabricated and authenticated and what’s sandwiched in-between.
This puts you in the role of arbitrator:
- Determining what’s missing
- Asserting checks and balances
- Awarding a fair and just payout
But how exactly do you do that? By protecting yourself from a slippery slope: fraud, waste, and abuse.
Fraud
The National Association of Insurance Commissioners defines fraud as committing deliberate deception to obtain illegitimate gain. Fraud can occur in different forms throughout the insurance process, whether by individuals engaging in fraudulent activity against consumers or insurance companies.
The impacts of fraud can be substantial for insurance companies, but also for businesses and consumers. An estimated $34 billion is lost to fraud annually in the worker’s compensation arena. According to the Federal Bureau of Investigation, due to the prevalence of fraud, the average family in the United States pays between $400-$700 annually in the form of increased insurance premiums.
Types of fraud can include a false report of injury, inflated injuries, pretense of extended symptoms, and filing injuries sustained off the job site.
Waste
Insurance waste is the overutilization of services or other practices that, directly or indirectly, result in unnecessary costs to the healthcare system. Most recently, Medicare and Medicaid have become programs that are misused or overused beyond patient needs.
Insurance waste and its impacts are challenging to measure as many incidents begin with a legitimate claim, and employees simply continue to use services and/or care beyond their full recovery. The National Academy of Medicine estimates that 20-25% of national health spending can be attributed to waste.
Types of waste can include overtreatment, failures in care delivery (resulting in the need for repeated care or procedures), and care coordination failures. The last category represents patients that fall through the cracks and results in complications down the road.
Abuse
When actions are performed by physicians that are improper, inappropriate, outside acceptable standards of professional conduct, or medically unnecessary, these are forms of insurance abuse.
The impact of abuse can be felt by both the patient and the larger community around them. On the individual level, abuse can potentially endanger patients if they receive care that is unnecessary and potentially dangerous to them. On a broader spectrum, patients using resources beyond their own needs are taking the place of patients who need access to medically necessary services.
Types of abuse can include inflation of bodily injuries, claims for services that are not medically necessary, prolonged treatment for relatively simple diagnoses, and inflation or upcoding of medical procedures.
How to Detect Fraud, Waste, and Abuse to Curb Deceptive Claims
Red Flags
As you go about your assessments, here’s how to spot suspicious activity:
- Inconsistent injuries when compared with the incident
- Inconclusive or spotty recounting of the incident
- Lacks witnesses, or occurs in an area not related to job function
- Refusal of exams and/or returning to work, or unreachable while on disability
- Provider submits billing records for treatment not reported by the employee
- Medical treatment provided is inconsistent with the original injuries reported
- Patterns and/or practices of waiving cost-shares or deductibles are omnipresent
- Inadequate medical records or refusal of access to medical records
The first step when you encounter these signs is to seek more information. If a claim is determined to be fraudulent, it should be reported and investigated in tandem with a state agency and/or the appropriate governing body.
Reporting Resources
For more information about reporting, consult with consumer protection authorities:
- National Insurance Crime Bureau nicb.org
- Coalition Against Insurance Fraud insurancefraud.org
- National Association of Insurance Commissioners org
The prevalence of fraudulent, wasteful, or abusive activity in connection with Workers’ Compensation claims is concerning. However, with diligence and strong records assessment, you can reduce the financial burden of these behaviors.
Medlogix is one of the only business partners that can provide a full suite of core medical management and cost containment solutions, under one platform, said Medlogix CEO, Craig Goldstein. Our technology allows us to reprice provider, facility, and ancillary services bills while determining diagnosis relationships, medically necessary treatment and properly coded billing patterns against the corresponding covered loss, thus, maximizing efficiency for our customers.
Medlogix’s Workers’ Compensation medical management programs offer employers an integrated proactive approach to effectively manage work-related injuries and help control escalating medical and indemnity costs. Our Program monitors specific medical care provided for a given condition and ensures that unnecessary or inappropriate medical services are eliminated. However, necessary medical care will not be compromised for cost savings
Treatment is continuously monitored by the Nurse Case Manager to assure that it complies with clinical standards of care appropriate for the work injury. Standard case management plans and procedures are based on clinical criteria developed by the Medical Disability Advisor (MDA)/Presley Reed Guidelines. Case duration and length of disability outcomes are measured against national standards of care.
Rely on Medlogix for effective medical bill review, claims management, and ancillary support. Together, we can make the world safer by expecting nothing less than exceptional.