When Insurance Companies Laugh at Fraud and Make YOU Pay

Escalating health care costs are one of the greatest financial concerns in the United States and 10% of these costs are likely eaten up by fraud, likely because private health insurers preside over about $1.2 trillion in spending each year! Earlier this year, David Williams, with a PhD in Kinesiology, was sentenced to prison for scamming insurance companies including giants industry giants Aetna, Cigna and United Healthcare and reaping $4 million in cash, billing for services as a personal trainer, and was only caught after 4 years! Despite being a two-time felon, in-total he obtained 20 NPI’s by falsifying application to Medicare, which doesn’t check them for accuracy! As he continued to falsely bill no one would verify whether he was a doctor and that when he billed insurers as an out-of-network “doctor”, they wouldn’t check either and would keep paying him even long after they learned of his fraud! These losses are ultimately passed onto patients through higher premiums and out-of-pocket fees or reduced coverage for medical services.

The federal department of justice and state Medicaid Fraud Control Units file thousands of criminal and civil cases a year, but we rarely hear about the fraud enforcement efforts of private health insurers, which manage plans of about 150 million Americans who get their health benefits through their employers. Because the pot of money is in the billions, the private insurers’ pick and choose their battles not making fraud a top priority.

So here’s what William did and here was the response from the private insurance giants. Williams, or rather “Dr. Dave”, built a Get Fit With Dave website, built a team, soliciting trainers from the strength and conditioning department at universities and sold his services as covered personal training sessions, but then falsely billing for medical services such as lumbago and sciatica with his favorite billing code of 99215! Even after United was provided all it needed to start a fraud investigation, it moved very slowly, possibly because Southwest self-funds its benefits and pays United to administer the company’s plan and ensure the claims it covered were legitimate. Despite the two-time felony charges and exorbitant bills, United ignored calls or reports of Williams for over two years! And to no one’s surprise, this case was closed in 2016 without any additional information provided. Even after he was found out by United, Aetna and Cigna and was asked to pay back the money he was given, he refused to do so and continued billing them with different NPI’s, never changing his name or address on any of them! In-all Aetna paid Williams over $608,000 and United more than $3.2million! It wasn’t until 4 years later, United, finally brought Williams to the attention of FBI’s health care fraud squad and Williams was finally arrested. His sentence for defrauding the system? A little more than 9 years in federal prison and pay $3.9 million in restitution to United, Aetna and Cigna.

Assuming he pays back the money successfully, how should the people whose health-care premiums, out-of-pocket costs have increased and those whom have been denied treatments be compensated? What do these insurance companies do? Nothing. Nada. They keep making their billions and we keep paying with no end in sight.

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  1 comment for “When Insurance Companies Laugh at Fraud and Make YOU Pay

  1. Leslie Pace
    October 19, 2019 at 9:20 am

    I worked for a major healthcare insurance company and noticed fraud with claim dispute and preauthorization. Yes, the forms were filled out the appropriate check marks, but it didn’t match the member’s diagnosis or procedures noted in their individual health history.
    I was told that is was more cost effective to just authorize or pay the claim, than to investigate.

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