Consequences of Insurance Fraud
They come from every social class and many occupations. Some wear white collars or lab coats while others wear T-shirts and work with their hands. They are the insurance fraudsters, and they take pride in getting away with something that many view as the ultimate victimless crime. Those who commit insurance fraud are attempting to cheat an insurance company. They normally do this on an application form by either entering false information or leaving out one or two vital statistics. Too often, their doctors, lawyers or repairmen are happy to cooperate. Either way, this type of fraud affects everyone. No insurance company can absorb such losses for long and remain viable. In most cases, these organizations have no choice but to raise their clients’ rates across the board.
Hard Insurance Fraud
The “hard” variety of insurance fraud is difficult to miss. It transpires when someone deliberately sets a fire, fakes an accident or goes to great lengths to claim some type of imaginary loss. Although the perpetrator often acts alone, organized crime increasingly benefits by millions of dollars from such schemes.
Soft Insurance Fraud
In the eyes of many, so-called “soft” insurance fraud isn’t dishonest at all. They truly believe that a bit of fudging here and there will cause no harm to anyone. These people couldn’t be more wrong. A soft crime is still a crime, and the damage it does has a ripple effect.
The Ultimate Cost of Insurance Fraud
Each incidence of insurance fraud sets in motion a chain of events that eventually costs the consumer in more ways than he might imagine. Higher individual premiums are just the tip of the iceberg. Businesses’ costs will also rise, and most organizations will have no choice but to pass their higher commercial and health insurance costs onto their patrons, clients and customers. The Coalition Against Insurance Fraud has estimated that on a yearly basis, insurance fraud sets every American family back to the tune of nearly $950 in the form of costlier goods and services.
Society’s Charitable Attitude
Many individuals tolerate the concept of insurance fraud. They feel justified in exaggerating the extent of their injuries or losses, and if someone they know commits this crime, over half will routinely say nothing about it. With sympathies more aligned with their friends and themselves than with the insurance companies, they believe that in committing this crime, they are getting the chance to recoup some of the premiums they’ve paid over the years. Others simply see insurance fraud as an easy way to acquire extra money with little chance of serious reprisals.
Protecting Yourself
Although you may never consider committing this type of crime yourself, the people with whom you do business could feel differently about the matter. Here are some ways to keep from serving as an unwitting accomplice.
- Insist that every bill you receive is detailed, accurate and lacking any entries for otherwise free services.
- Never publicize your insurance identification number. Crooks who specialize in this type of fraud can too easily steal it and involve you in their swindles without your knowledge. – Be particularly careful when driving. A well-known and possibly deadly dodge involves pulling in front of someone suddenly, then slamming on the brakes. Those who attempt this often have their friends pose as witnesses who insist that you caused the accident yourself. In the end, those who make a point of staying alert are in the best position to avoid involvement in these hoaxes.
Healthcare Insurance Fraud
The healthcare industry is one in which insurance fraud tends to run particularly rampant. Its most frequent forms consist of:
- Billing for services that the patient never receives.
- Performing diagnostic tests or treatments without due medical cause.
- Engaging in practices that fail to meet professional standards.
- Pricing routine procedures well above the norm.
According to some estimates, the annual costs of health insurance fraud can run as high as $100 billion. Medicare is a frequent target, and in many such cases, a deliberate intent to deceive or defraud can be difficult to prove. Fortunately, there are steps you can take to fight this epidemic. Those who choose to report suspected insurance fraud can do so easily, safely and usually anonymously while helping to lower future costs for everyone. The Coalition Against Insurance Fraud will tell you what you need to know.