Surprise, uninsured medical bills drain patient bank accounts

A reporter strikes a nerve with a story that prompted hundreds of news outlets to re-post his saga of a Texas patient’s run-in with a large, uninsured bill for urine testing.

The phone rang. A reporter wanted to interview the Coalition about a problem that’s been vexing medical patients with growing frequency: surprise jack-in-the-box bills for urine drug testing that patients assume their health policy covers.

The investigative story by the respected Kaiser Health News posted a couple of weeks later. A fine reporting job that featured Elizabeth Moreno. The Texas woman was handed a whopping $17,850 lab bill for a routine urine drug test her health insurer refused to pay because the lab was out of her health plan’s network.

In the story, experts described the lab’s bill as “real fishy,” “outrageous” and a “misplaced decimal point.”

The story took off. CNN posted it. So did the Washington Post, NPR and Money Magazine. Soon an avalanche of news outlets re-posted it — more than 420 at last count.

Longtime reporter Fred Schulte had struck a journalistic and human nerve.

Stunned patients with growing frequency are stuck with ruinously large bills when they’re shuttled to medical providers outside their own health- insurance networks.

Their health policy thus won’t pay up, so the patients have to drain their bank accounts or face collections, suits and wrecked credit ratings.

Surprise out-of-network bills are bedeviling patients around the U.S. Moreno’s lab bill is just one signpost of a larger billing problem that can invade almost any medical procedure.

The bills often straddle a fine line from large to abusively large to criminally inflated.

News outlets everywhere wanted to report on a spreading abuse that could land hard on any of their readers’ doorsteps — and bank accounts. Fred Schulte gave them another chance to alert readers.

The Kaiser story isn’t the first, and likely many more news outlets will pull the lid off unexpected and onerous medical charges until reforms lay this problem to rest.

A bill in Congress would prevent surprise bills for patients treated in a hospital.

As for consumer action:

  • Check with your insurer, doctor and hospital before getting treatment if possible. Ask for projected range of costs for planned medical procedures;
  • Ask what provider and work your health plan will cover, and what’s out of network. Anesthesiologists, radiologists and pathologists are common examples of out-of-network providers who may be called into your case without your knowing.; and
  • Afterward, get an itemized bill. Read it carefully, and check for procedures you didn’t receive. Your insurer also may help if you see surprise bills, so contact your insurer before writing any checks. Also see if the hospital has a patient advocate who can help.

There’s no bullet-proof answer, especially if you need fast emergency treatment. Still, any preventive steps might save thousands.

And as for Elizabeth Moreno, her father settled the lab’s bill for $5,000, which he now regrets.

About the author: Jim Quiggle is director of communications for the Coalition Against Insurance Fraud

The march of Millennials: More likely to scam insurers?

Younger consumers are more-likely to tolerate padding claims. Will America’s largest generation grow more honest as they age?

The insurance world is captivated by the rising use of Big Data and artificial intelligence. A technological revolution is upon us, from underwriting to claims to fraud investigations.

In our rush to understand and use these breakthroughs to discover and combat insurance scams, we also must ask how much are we forgetting about the human element that motivates insurance fraud?

Many think the Baby Boomer generation was our nation’s largest population change. That’s correct, as a population surge. Yet in raw numbers, the 75.4 million Millennials have surpassed the 74.9 million Boomers as the nation’s largest generation. As Boomers age and die off, Millennials as a percent of the U.S. population will continue rising in the coming decades.

How does this emerging generation view insurance fraud? The answers may surprise you! An older, though still often-cited, Accenture study of people’s attitudes toward insurance fraud gives some telling insights.

Consumers were asked how acceptable they found it to make claims for phantom lost or damaged goods, or for phantom injury treatment.

Older Boomers almost unanimously (97 percent) found this blatant fraud unacceptable. Fewer consumers found the scams unacceptable among younger age groups until we reached consumers aged 18-24 years of age. Fully 16 percent found those false claims to be completely acceptable! Given the size of the Millennial generation, that suggests 12 million future U.S. insurance fraudsters. Other fraud questions revealed a similar acceptance of insurance fraud by America’s youth.

Will Millennials grow less tolerant of fraud as they age? That’s certainly the question. Current trends don’t seem to point in that direction. A more-recent study found:

Younger respondents, especially young men, were much more likely to view claim padding as acceptable. For example, among males age 18-34, 23 percent agree it is all right to increase claim amounts to make up for premiums, compared with just 5 percent of their older male counterparts and just 8 percent of females aged 18-34.”

The idea that nearly a quarter of Millennial-age males are perfectly fine with inflating a claim should cause concern.

Why should we care? Startups and traditional insurers are looking at “peer-to-peer” models. These app-based insurers often rely on speed more than thorough review of underwriting and claims handling.

One such insurer boasts it paid a claim in a world-record 3 seconds. These new insurers often claim they’ll rely on the “inherent honesty” and “moral attitudes” of Millennials to be honest with insurance dealings — especially if the insurer donates a percent of profits to charity.

More-seasoned fraud investigators may counter: “True, unless the fraudsters view themselves as the more-deserving charity!” 

But perhaps most important, we need newer consumer-attitude studies to best grasp Millennial attitudes about fraud. A study by the Coalition will be released later this year. It will provide much of that needed guidance.

Millennials are the future policyholders in America. They’ll form the largest block of insurance buyers in our nation’s history. While Big Data and AI are important to fighting insurance scams, let’s remember that it’s we humans — based on our morals and values — who decide whether to commit insurance fraud.

About the author: Matthew J. Smith serves as general counsel and director of government affairs for the Coalition Against Insurance Fraud.

Fraud of the Month: Pro athletes enmeshed in scams as victims, perpetrators

Marcus Buckley had a decent NFL career as a linebacker who made his living from helmet-jarring collisions with running backs. His seven-year stint came mostly with the New York Giants.

Yet perhaps Buckley’s biggest and baddest opponent double-teamed him the hardest — federal prosecutors. The Texas man inflated workers-compensation claims for lingering injuries that dogged him for years after he retired following the 2000 season. Buckley’s now benched, spending two years in federal prison.

Insurance fraud is hardly a contact sport, yet pro athletes can be enmeshed in scams — unwisely as perpetrators, sometimes regretfully as victims. They’re the tiny minority of pro athletes, though their high public profile attracts unusually high attention to their fraud crimes.

Claimed built-up stress injuries

As for Buckley … he sought money from the Giants’ workers-compensation insurer for built-up stress injuries — including memory loss — from all the seasons of head-knocking. He settled for $300,000 in 2010, and the case seemed closed.

Not quite. Buckley dipped back into the well, demanding more insurance money. He handed the insurer nearly $1.6 million of forged medical invoices and statements from medical providers for treatment he never received. Buckley also created false collection notices from credit-collection agencies that supposedly were chasing past-due medical bills.

Buckley had a crooked Sacramento adjuster on the take; she issued him the insurance checks. The feds issued Buckley two years in prison in January 2018, and ordered him to repay the stolen insurance money.

Paid kickbacks in $20-million con

Monty Grow played linebacker briefly for the Kansas City Chiefs and Jacksonville Jaguars. His post-NFL career was far more lucrative, until the feds tackled him for a loss.

Grow made millions by paying illegal kickbacks to associates who recruited hundreds of patients to a Pompano Beach pharmacy. That outfit allegedly bilked the federal military health insurer out of $20 million by charging for expensive compound creams that patients typically didn’t need.

Grow was convicted of fraud and kickbacks. He could spend up to 20 years in federal prison when convicted. Former NFL journeyman quarterback Shane Matthews received three months in federal prison for a smaller role as one of Grow’s associates.

Altered date of uninsured collision

Former Major League Baseball pitcher Ted Lilly made a phony damage claim for his RV.

The Edna Valley, Calif. man pitched for six Major League teams over 15 years. Lilly finished up with the Los Angeles Dodgers after signing a 3-year, $33 million contract in 2010.

Lilly damaged his uninsured RV in a collision and obtained a $4,600 repair estimate from a body shop. He bought a policy from Progressive Insurance five days later, then lied that the wreck happened after he bought the insurance. Lilly pleaded no contest and lucked out with two years of probation plus 200 hours of community service.

Falsely claimed jeweled ring stolen

Brent Dwayne Griffith had a brief NFL career as an offensive lineman with the Buffalo Bills. His post-football antics proved offensive as well.

The Benson, Minn. man earned a jewel-encrusted ring when the Bills won the divisional title in 1990. Years later, Griffith claimed someone stole the ring from his home. His homeowner policy covered the seeming theft, paying him $4,780 in 2013.

Griffith and his wife then split up. None too pleased, she told the insurer that Griffith still had the ring. He also cashed the insurance check, which was made out to them both, without telling her. The Minnesota state fraud bureau took over, and helped convict Benson. He earned a lifetime criminal record, plus a tiny two days in county jail, and a hefty fine.

Trusting athletes defrauded

Sometimes insurance thievery happens in reverse — athletes are soaked by people they allow into their inner circle.

The nanny of a star left winger for the NHL’s Pittsburgh Penguins looted his family jewelry then filed loss claims for the stuff after setting her home on fire. Andrea Forsythe stole $12,000 diamond earrings that Chris Kunitz gave to his wife Maureen for a wedding anniversary.

Forsythe had the jewelry appraised, then made the insurance claims after her arson fire. She also double-dipped, selling a loose diamond from one earring to a jewelry store. Forsythe was handed five years in federal prison for these and other thefts.

Insurance agent Keven D. Webster took premiums from NFL and NBA players, promising to buy them umbrella policies worth $1 million-$5 million. Except the Pensacola, Fla. agent pocketed their money and never bought the promised insurance. A federal judge promised Webster 21 months in prison, and ordered him to repay $144,229.

Lilly, at least, says he plans to go straight. “My actions do not reflect the way I choose to live,” he told the court after being sentenced. “I am very much determined to earn back a reputation of trust and transparency.”

Reward shareholders? Cut premiums? Here’s another idea

Trump’s corporate tax cut should leave businesses in America — including insurers — with a little extra cash in their pockets. Some companies are buying back stock, and others are handing out bonuses to their workers.

Consumer advocates are calling on state regulators to force insurers to cut rates so their insureds can benefit from the windfall as well. As an insurance consumer, I love the idea of paying less for my insurance.

But here’s another idea for insurers: Take some of that money and invest it in anti-fraud efforts. In the end, it likely will result in even greater savings for consumers.

Insurers and insurance associations have long touted that anti-fraud investments have ROIs of as much as eight to one. That’s $8 in savings for every dollar invested. So why not hire more investigators, buy upgraded anti-fraud technology or start a fraud deterrence program.

For every insurer that has a well-funded, state-of-the-art anti-fraud program, there’s another insurer that lacks the staffing, training and tools to fully detect and investigate fraud. More and more organized rings are targeting these insurers — word leaks out within the criminal underworld. Use that tax cut cash to earn a tough reputation on the streets.

Another idea: Many state fraud bureaus are woefully underfunded. Let’s increase annual insurer fraud assessments so our partners in government have the tools they need to be more-effective fraud fighters.

I’m not advocating throwing money at anti-fraud programs for the sake of just increasing budgets. But managed well, these wise investments can reward insurers and their customers many times over.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.