A crack in the PIP crackdown

It came as a surprise recently when a last-minute exemption to the new ordinance was awarded to the well-known chiro chain of 40 clinics


Florida has been cracking down on clinics that exploit the state’s no-fault auto insurance system with fake injury claims. These clinics are milking insurers and their customers for all they’re worth – with bogus billing right up to the $10,000 coverage maximum per claim.

The reforms intended to close down these clinics in favor of honest operations, leaving way for legitimate treatment in the case of legitimate injuries and preventing scammers from raising everyone’s premiums.

While the state passed a good moderate anti-fraud bill last year, it was a local jurisdiction — Hillsborough County — that first took action against shady clinics by setting tough licensing standards and requiring clinics to provide the county with a list of physicians they employ.

The county had become a hub of staged auto crashes. The commissioners were heralded for taking a courageous stand after the state failed to do so.

So it came as a surprise recently when a last-minute exemption to the new ordinance was awarded to the well-known chiro chain of 40 clinics known around the state as 1-800-Ask-Gary. Insurers say the Gary clinics maximize PIP payouts by ordering needless tests and treating most patients until their $10,000 benefit limit runs out.

The exemption came to light recently when a candidate running for county commissioner took her opponent to task for drafting the exemption. Commissioners say the exemption was needed to pass the ordinance, but others are doubtful.

In any event, if fraud doesn’t fall measurably, the focus likely will then be directed to the 1-800-Ask-Gary clinics, and then perhaps the county will seek to lift the exemption.

About the author: Jennifer Tchinnosian is communications specialist for the Coalition Against Insurance Fraud.

Taking the air out of airbag scams

Shady airbag traffickers don’t care if you live or die

Imagine you’re driving home after a pleasant dinner with friends one night. An oncoming vehicle veers and slams into your car. Glass flies and metal buckles in that terrifying split second, but your airbag doesn’t open.


I’ll let your imagination roam, and decide how badly injured you’ll be without this vital safety protection as the ambulance speeds your broken body to the emergency room.

But in the meantime, you might want to thank Dai Zhensong or others who traffic in cheap, knockoff airbags being installed in vehicles around the U.S. Also thank crooked body shops that knowingly install such rubbish (literally, but more on that in a minute).

The motive is cold profit. To be blunt…shady airbag traffickers don’t care if you live or die. They just want their blood money; whether you or your kids survive a horrific crash is your business.

Zhensong flooded the U.S. market with tens of thousands of counterfeit bags made at his plant in China. A suspected cohort named Igor Borodin allegedly sold 7,000 of the knockoffs. All told, some 250,000 bags could be out there, either installed or waiting to be installed, the feds say. Zhensong has 37 months in federal prison to rethink his career choice.

How big is airbag fraud nationally? That’s anybody’s guess; nobody keeps total stats.

And most body shops are honest, but some knowingly install worthless airbags after the valid original bags deploy during a crash. Buy a $50 knockoff from the internet or a shady street dealer, and charge the insurer several hundred dollars.

Body shops also shove beer cans, packing peanuts, old sneakers and other junk into the airbag compartment. Or they just leave the compartment empty.

Sometimes a body shop will even pull out an airbag that hasn’t deployed, then lie to the insurance adjuster that the bag had opened during the accident.

Used and salvaged vehicles are especially vulnerable to these scams, but so is your new car if it crashes. So let’s return to Zhensong. Alarmed carmakers have set up call centers that drivers like you can contact to see if your airbag is counterfeit.

Innocent drivers have died or been grievously injured without airbag protection. San Diego-area teenager Bobby Ellsworth died when the Dodge pickup truck in which he was riding crashed. A body shop had stuffed the airbag compartment with paper and glued it shut. Even the dashboard light was disabled so it wouldn’t flash a warning.

Nursing assistant Damaris Gatihi was driving along Interstate 5 in Seattle. Her Toyota Corolla was bumped from behind, then spun around and hit another vehicle head-on. Her airbag didn’t deploy; she died from massive bleeding in her heart. A body shop had cut out the airbags and glued the covers back on to make the bags look functional. A local TV investigation discovered numerous used cars for sale without airbags and phony compartment covers.

Laura Vega of Houston was badly injured and her mother killed when their car was hit head-on. Neither air bag worked. The passenger-side airbag had been previously deployed, then stuffed back in and the cover taped shut. There was no driver-side airbag at all.

Connie Van Slyke’s used minivan crashed. The Kansas City, Mo. woman was killed instantly, possibly after falling asleep at the wheel. Her neck was broken, relatives told reporters. Connie had bought the minivan used, just two weeks prior. The vehicle had been in an earlier crash and the airbags had deployed. Nobody reconnected the bags, and the dashboard warning light was removed. Connie was a single mother; she left behind three young sons.

Najma Ladhani was driving alone in her car outside of Vancouver, Canada. She swerved into an oncoming car. She was found dead, crushed over the steering wheel. A piece of foam filled the compartment instead of an airbag.

Ok, enough of these terrible deaths. Point made: Airbag cons are a nasty insurance ripoff, but a far worse threat to the lives of everyone in a vehicle.

You can turn the odds in your favor with by taking these life-saving steps:

  • Check the dashboard airbag safety light. It should blink for a few seconds then turn off. If the light doesn’t come on or keeps blinking, you may have a faulty airbag;
  • Have a certified mechanic you trust inspect the airbags of any used or salvaged vehicle you’re considering buying. Don’t try to take off the lid yourself; it might trigger an explosion;
  • Use a commercial service to search the history of a used vehicle you’re considering buying. See if it has been in a crash or salvaged; and

It’s time that every driver mobilizes to take the air out of airbag scams. This is one speed limit we should all break.

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

Fraud and the Presidential debate

Healthcare fraud entered the fray of Presidential politics last week

Healthcare fraud entered the fray of Presidential politics last week when President Obama took credit for his administration’s anti-fraud efforts during his debate with Gov. Romney. I’m pretty sure that was the first time any President has touted such efforts in a debate or similar forum

His exact words:

“…we went after medical fraud in Medicare and Medicaid very aggressively, more aggressively than ever before, and have saved tens of billions of dollars…”

It’s true that Obama has attacked fraud more aggressively than previous administrations. But given the many decades of paying and chasing claims half-heartedly, Obama’s boast might not be saying much.

Still, his claim was boosted this week when the U.S. Government Accountability Office (GAO) reported results of recent anti-fraud efforts. In 2010, HHS initiated 8,900 investigations − 2,800 more than five years earlier. The federal government also banned 2,200 providers from doing business with Medicare, and collected record amounts of fines and restitution.

The government also has been credited with making strides in using anti-fraud technology.

It’s a good start. But I’ll wait to celebrate any success until the GAO releases reports for 2011 and 2012.. We should expect those results to be even more promising.

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

Is the new Florida PIP law unconstitutional?

BLOG_messagebottleHaving failed to kill much-needed reform of Florida’s PIP auto-insurance system in the legislature last spring, medical providers in the Sunshine State have turned to the courts to get the new law thrown out.

A widely anticipated lawsuit was filed recently by chiropractors, massage therapists and acupuncturists — whose services either were curtailed or eliminated for PIP reimbursement. Chiropractic treatment can be reimbursed under PIP only if referred by a physician, and then only up to $2,500 unless deemed to be emergency treatment. Massage therapy and acupuncture no longer are reimbursable under PIP.

The lawsuit says the new law is unconstitutional on several fronts. By restricting reimbursement for their services, the law violates their equal protection rights and denies them due process, these providers say. Pretty standard stuff for such lawsuits.

Two provisions in the lawsuit, though, caught my eye. One is the contention that the new law isn’t needed because supporters failed to properly document the extent of fraud and abuse. Not sure what level of proof would satisfy them, but any rational person who reviews the data likely will conclude the state is a cesspool of medical fraud and abuse.

The lawsuit also suggests massage therapists should not be excluded from the system because not everyone of them has been proven to be a fraud. Great logic.

The argument that may hold some water contends that in accepting the initial no-fault law, consumers gave up their right to sue in exchange for assurances that their medical bills would be paid promptly and fully (at least up the the $10,000 limit). The suit contends the state has reneged on that promise.

While it’s doubtful this action will be deemed unconstitutional, it is a cogent argument that could hold sway in the court of public opinion.

The real test of PIP reform will not be in the courts, but whether the new law achieves its intended goal of placing downward pressure on auto premiums while providing adequate treatment to accident victims. If it fails to do those two things, the court might as well toss out the reforms.

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