Insurance fraud has consistently been a significant issue globally, affecting not only governments and insurance companies but also private individuals and businesses. Premiums continue to rise along with an increase in taxation. The scale of the issue has been partially attributed to the significant size of the insurance industry, allowing for more opportunities and increased incentives for committing illegal activities, according to the Federal Bureau of Investigation.
Insurance fraud covers a broad spectrum of fraudulent activity, including property and casualty insurance, auto insurance, workers’ compensation, and other. Healthcare fraud was identified by the FBI as the leading source of False Claims Act settlements and judgments in the fiscal year that ended September 30, 2022, with a total of $1.7 billion in claims, according to a Department of Justice (DOJ) announcement from February 7, 2023. The False Claims Act restores funds to federal programs such as Medicare, Medicaid, and TRICARE.
Healthcare fraud can be committed not only by patients but can also include actions taken by medical providers and other practitioners, who use a variety of schemes to deceive the system and receive unjustified benefits. On March 30, 2023, it was announced by the US Attorney’s Office Northern District of Georgia that, Nagaindra Srivastav of Tampa, Florida was sentenced with conspiracy and kickback charges for his role in selling fraudulent doctors’ orders to his co-conspirators who, in turn, used the orders to obtain more than $48 million in fraudulent payments from Medicare.
The case of Nagaindra Srivastav is just one example from many depicting this rapidly expanding fraudulent activity, highlighting that healthcare fraud in the US is not as rare as one might believe. In fact, insurance frauds are the second largest economic crime in the United States, closely following tax evasion. These frauds can take on many different looks and it is vital for an insurance company’s survival and growth to be aware of them. Techniques such as misrepresenting facts on insurance applications, medical identity theft as well as submitting false claims and staging accidents, are common practices.
As such, the FCA remains one of the most important tools the federal government has to tackle fraud. Considering the numbers, it is safe to assume that healthcare fraud will continue to be a leading source of FCA settlements and judgments. Even though the DOJ’s report focuses on federal programs, the latest fraud schemes highlighted are similar in methodology to those almost every private insurer faces. One of the various topics GlobalSource specializes in is insurance and financial fraud not only in the US but globally. With offices in Washington, D.C., Nicosia, Dubai, Athens, and Cape Town, our team of investigators can assist clients in gathering evidence and identifying fraudulent claims, from verification of death certificates to police reports, and medical records.
