A new partnership

BLOG_summer Fraud fighters and consumers should be energized by a bold new partnership that was announced this afternoon in Washington.

The Fraud Prevention Partnership links public and private insurers, anti-fraud groups and federal healthcare policymakers in a ramped-up national effort to root out insurance fraud.

The collaboration creates a force multiplier that greatly increases the pressure on insurance schemers.

HHS Secretary Kathleen Sebelius and Attorney General Eric Holder spoke forcefully at a news news conference this afternoon revealing the partnership’s details.

The Coalition is one of the initiators of this partnership and serves as co-chair of its executive board work group. We were delighted to participate in the announcement alongside our federal partners, insurers, regulators and other anti-fraud organizations.

The entire day’s events this afternoon left no doubt that the Obama Administration is dead-serious about raising its attack on fraud to a new level of commitment and impact.

The partnership members will share case leads, evidence, data and other vital information. Evidence uncovered while probing a Medicare scheme might also reveal the suspect is going after a private health, auto or workers compensation insurer.

This kind of collaboration greatly increases the chances of earlier detection and successful prosecution. The synergy also might inspire entirely new approaches to fighting this crime.

The partnership is based on a sobering truth about today’s fraud world: Many con artists bilk both public and private insurers. An Armenian ring based in California milked Medicare, but also staged crashes for bogus injury claims against auto insurers. It was an attempted $160-million scam.

Con artists who go after Medicaid also might have their clutches on private health insurers.

Such crossover cons ― whether done by a large gang or one doc ― are a growing part of today’s fraud world. This says much about their growing sophistication.

One recently busted gang made $400 million in claims against insurers. More just like them have surfaced in recent months. How many more are plundering, undetected? Organized crime also is infiltrating insurance, applying advanced skills to penetrate insurers.

The partnership itself was the product of the same kind of synergy it will generate.

The Coalition reached out to HHS in 2010, offering to help coordinate a planned healthcare fraud summit the following January. We helped plan the summit, and then several regional summits. That idea grew to become the permanent partnership rolled out this week.

This exciting new collaboration will help energize the fraud fight, inject new ideas, and better harden America’s insurance system against cheaters. They’ll be surprised to find that their easy ticket to the good life is a one-way trip to jail.



Baseball, BBQs & fraud legislation

BLOG_summer“Summertime, and the living is easy,” so the song goes. And in many ways that is true. Things seem calmer and more relaxed as the summer meanders along like a slow country river. This might be psychological, dating back to our childhoods with all the summer pleasures and none of the school burdens.

But there is more than swimming, barbecues and baseball when it comes to anti-fraud legislation. Most state legislatures have a short session. Some shut down in the spring, and others by mid-year. So those of us working to pass stronger state fraud laws use summers for active planning. July is hardly too early; it’s now prime time.

For example, several major national organizations of state legislators, regulators and governors meet in the summer to discuss pressing issues.

I regularly attend the large gatherings of the National Conference of Insurance Legislatures (NCOIL) and the NAIC. Anti-fraud issues are reviewed in depth for possible action during the rest of this year, and possibly the following year.

For example, I just returned from the NCOIL meeting. A legislator raised the issue of shady, storm-chasing contractors in a committee meeting, and as a result, NCOIL likely will include the contractor issue on its agenda for its annual meeting later this year.

NCOIL also started looking at diversion of insurer-paid addictive prescription drugs. What started out as a simple report by insurers about opioid abuse in workers comp has morphed into a larger institutional interest. More action will follow soon.

The Coalition and other anti-fraud organizations are hard at work planning for what’s likely to be a very busy year in 2013. Our job is more complicated since this is an election year. Governors and legislators may change, so the entire dynamic could shift in 2013. But the anti-fraud community will work to strengthen state laws no matter who’s in office.

We’ll hit the ground running the moment the statehouse doors re-open. Those short sessions give us a limited window of opportunity.


So I’ll throw this out to readers: Let me know your ideas about fraud issues and target states for 2013. The Coalition’s government affairs committee meets later this summer to discuss a robust anti-fraud agenda. I’m an easy reach: 202-393-7332 or howard@InsuranceFraud.org.

Be heard, and potentially increase your impact on the costly crime you’re working so hard to fight.

About the author: Howard Goldblatt is director of government affairs for the Coalition Against Insurance Fraud.

Where PIP fraud and Obamacare converge


Gov. Rick Scott of Florida was a strong supporter of the recent efforts to enact meaningful reform of PIP auto insurance. In fact, the legislation probably would’ve died if he didn’t get behind it and actively encourage its passage. Time will tell whether this latest reform will help reduce fraud and put downward pressure on the state’s high auto premiums.

Gov. Scott also is a vocal foe of healthcare reform and has vowed not to expand Medicaid or create a health care exchange, as provided for by the federal law.

What do these two programs have in common?

Not much, except that the biggest argument for creating PIP was that lower-income people lacked health insurance, and they shouldn’t have to suffer for lack of care just because they’re hurt in an auto accident. This makes sense. Under the tort system, medical providers had a disincentive to serve lower-income people because they may have to wait years to get paid while claim disputes linger in court. With PIP, at least some dollars are automatically available to pay medical expenses.

Then along comes the Affordable Care Act. Health care for everyone, or something like that.


It wasn’t long after passage that some insurers in Florida started thinking Obamacare would eliminate a major reason to keep PIP. Low-income accident victims would have access to health care. Under the law, almost everyone will be required to have insurance, whether directly through private insurers, through the exchanges, or by Medicare and Medicaid.

Some insurers that favor ending PIP coverage — even with the latest reform efforts — were eying the potential of universal health care as an incentive for politicians to axe the troubled system, and thus, stem the flow of fraud dollars to crooked clients.

But Gov. Scott has thrown a wrench into that idea. Without the expansion of Medicaid and a fully functioning insurance exchange, it’s highly unlikely legislators will consider getting rid of PIP anytime soon.

So, perhaps there’s even more reason to work together to make sure the recent state PIP reforms work as intended.

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

Model for fighting fraud

heroin oxycodone Inside a glass case lies a corpse covered by white fabric. Across the room, a glassy brown medicine bottle labeled ‘Heroin” offers to cure cough, with one or two tablets every two or three hours. The Drug Enforcement Agency’s museum’s exhibit, Good Medicine Bad Behavior describes the national epidemic of prescription addiction and will be open through 2012 in our Nation’s Capital.

A few miles away, Karen Kelly from the Kentucky-based Operation UNITE talks at a meeting on Capitol Hill about beating the medicine cabinet epidemic. Kentucky has been fighting drug diversion for the past 10 years, and Kelly has been instrumental in organizing the addiction-prevention efforts. She has seen addiction devastate entire neighborhoods, leaving 50 percent of children in some districts to grow up without parents. As the epidemic  continues spreading across the nation, we asked Kelly a few questions.

Kentucky may be the precursor to the rest of the nation in terms of prescription abuse. You‘ve been fighting it for a decade. How did this program get started?

Operation UNITE was launched in April 2003 by U.S. Congressman Hal Rogers, who called people together to brainstorm a way to fight the prescription abuse. He called judges, social workers, parents who’d lost kids, police officers and educators, and they came up with the UNITE plan. We got a call from a grandmother raising her grandkids, and she asked if we’d come visit, so we did. She had three grandkids and she couldn’t let them play in the yard because of the drug dealer next door would offer them pills and needles, often throwing them into the yard.We spent most of 2003 just getting access to funding and hiring people, then we kicked off in 2004. We started strong in newspapers with a law-enforcement front. We started organizing one of the biggest drug roundups, and arrested 200 people in one day. We didn’t want to jam up the court system, so we began creating treatment programs to give addicts the choice of rehab. Now we have at least one drug court in every single county. So if people are arrested, they have the option of drug court, where they’re drug tested regularly, they meet with a judge, and with a treatment counselor for 18 to 20 months. From there we started our hotline, town hall meetings, building a community of volunteers.

What advice would you give to other states thinking of implementing similar programs?

First, go out of your way to educate the medical profession. Most prescribers want to do the right thing but they’re not educated about addiction. We have some volunteers on the medical advisory counsel who say, “Every 10 years I get HIV training, and I haven’t seen one HIV patient yet, but today 80 addicts walked through my door and I can’t tell who’s who.”

Second, even if you can’t organize law enforcement and education, convene a meeting and to see where you can forge key alliances, to see how these different groups can work together. For example, the largest insurer in our state offers volunteers for our drug-free summer camp, that’s a tremendous resource, they also donated lock boxes for medication.

Third, get law enforcement and treatment to start working together with education; it takes all three working together to tackle this. Law enforcement runs into a lot of addicts who need help, and they refer them for treatment. Education means using creative ways to reach the public. Ask the dry cleaners to put short anti-fraud messages on coat hangers, go to civic clubs and talk to people about locking up drugs, and know the signs that your kids are starting to struggle. We go region by region targeting the biggest employers in each county, and offering free anti-fraud training lunches. We say, “Have your employees bring lunch we can spend an hour teaching them how to recognize addiction in their kids or colleagues.” Volunteers teach that class; they want to do it because they’ve been affected by the problem somehow. You have to use all your resources.

If you could go back and change something, what would you change, or warn others against?

I wish we’d gotten our healthcare providers onboard before we made a show of law enforcement, because after that happened, the doctors didn’t trust us to talk. A lot of doctors didn’t feel a need to get involved with the issue until a doctor was killed by an addicted patient.

The prescription-drug epidemic  is escalating. What would you attribute this to?

Ease of access, and pill mills. Kentucky recently passed legislation to stop pill mills. Doctors will be educated in Kentucky. New clinics will have to be doctor-owned. The problem is not socioeconomic at all; it’s affecting every family in our region no matter what their background. Prescription abuse also is a different type of investigation,― anybody could be a drug dealer, and we have many that are wearing white coats.

You got corporate funding for some of the programs, like the summer camp sponsored by Toyota. How would you advise that other states to get funding like this?

I would say don’t give up. A lot of employers have been impacted by the problem, so our state sees it as a really good benefit for its dollars because  it  costs more money to ignore the problem. Also leave no stone unturned. Even insurers are recognizing how big a deal this is, so they’ve decided to help us fund our initiatives. Even if its not their mission, it still impacts that family or that company or that organization. And there are government dollars; we had a CDC grant to implement wellness programs. Most states get CDC funds, but don’t use them to stop prescription abuse.

What can be done about the problem nationwide?

As Florida has gotten stricter on its pill mills, people are turning to Georgia and Nashville for meds. We need a pill-mill crackdown act on the federal level, because we know that what Florida did has had an impact. Kentucky and Ohio have passed laws, but how long is it going to take for every state to get onboard? There really aren’t any good reasons to have cash-only pain clinics, with bouncers, for example. We need to  educate doctors. Everybody also has a responsibility to know what they are being prescribed, and parents have a responsibility for their children, to know where they are and who they’re with. A lot of addicted teens call us and say that if they drank alcohol, their parents could smell it. So our parents have got to be educated. We have parent trainings where kids tell the parents, “This is how I duped my parents.” Many times the parents are stunned. Then we did focus groups to find out what parents wanted to learn, and made it part of the curriculum. We warn caretakers not to wait until they have evidence or proof of the problem to address it, because by that time, these kids are so far gone that we can’t get them back.