Last month, the fraud unit of the Arizona Department of Insurance (DOI) busted a couple of crooks for medical insurance fraud, medical identity theft, and other crimes that netted them almost $670,000. The pair stole the identitites of 128 patients and tax IDs from a dozen doctors.
The pair was caught when a Scottsdale geriatrician alerted the DOI about a suspicious contacts from them and filed a complaint for a false claim.
What's interesting is that any of those 128 patients could have easily figured out that something was up with their medical insurance if they had reviewed the Explanation of Benefits (EOBs) sent to every insured person shortly after every medical visit.
EOBs have been greatly simplified over the years. They list the name of the insured patient, the date of the medical visit, and the name of the business--hospital, clinic, physician office, etc.--and the reason for the visit. It's pretty easy to check a calendar and see if you did go to Dr. Wilson and you will probably remember why.
If the date and place add up but the EOB mentions something unusual--say, a charge for a prostate exam and you're a woman--your antennae should go up and you should contact your insurance provider.
Ignore your EOB and you risk becoming a passive victim of fraud. Even if nothing comes out of your pocket today, fraud can affect you later on. For example, if there was payment for a condition you don't have, that goes on your medical records as a pre-existing condition that can leave you uninsurable if you have to buy insurance on your own. In today's economy, this is a reality for many of us.
Let's say you lose your job and can't afford COBRA payments. You apply for an individual policy and a bad PSA test result shows up on your medical history. You can be denied coverage because of a pre-existing condition, at least until 2014 if "Obamacare" is repealed. This really stinks, especially if there's no reason for you to have a PSA test to begin with because you're a woman.
In addition, expensive treatment contributes toward the lifetime maximum costs a health plan will cover for each patient, regardless of whether the treatment was provided. If it was paid for, it counts as being provided.
The indictment papers listed on the Attorney General's Web site says the two conducted their fraud for about 16 months. In addition to a litany of money laundering, identity theft, and fraud charges, the two are also charged with fraudulently scheming to collect money from the usual insurance companies: Blue Cross, HealthNet, PacifiCare, Aetna, and Humana. They even defrauded government-funded carriers, including TRICARE, which covers the families of military dependents, and the National Association of Letter Carriers Benefit Plan.
That adds up to a lot of plans whose members didn't check their EOBs.
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