Mike Causey | Health insurance fraud hurts us all

I have on many occasions lamented the effect of insurance fraud on our economy, and the effect that such fraud has on insurance premiums that we all pay.

Insurance fraud costs Americans $308.6 billion annually, according to a 2022 study conducted for the Coalition Against Insurance Fraud. That’s an average $932.63 for every American or nearly $3,800 for a family of four.

Some estimates suggest that insurance fraud costs us about 20 cents of every insurance premium dollar.

Today, I want to discuss one type of insurance fraud – health insurance fraud, including Medicare and Medicaid fraud. We’ll look at some examples of health insurance fraud and how some people use artificial intelligence (AI) to commit such fraud. We’ll also look at how AI can be used to counteract health insurance fraud.

Finally, we’ll offer some tips on what you can do to help fight health insurance fraud.

That 2022 study estimates that health insurance fraud totals $36.3 billion annually. Add $68.7 billion in the cost of Medicare and Medicaid fraud, and you’ve got a staggering $105 billion in insurance fraud within our healthcare system.

Health insurance fraud may be initiated by a provider who bills for services that were never rendered. Or, a provider may “up-code” a claim by billing for a service more complex and with a higher reimbursement rate than the service that was provided.

A patient can also commit health insurance fraud. This may occur when an uninsured or underinsured patient provides a name and health insurance information of another person to the provider. An individual may also use technology to create a fraudulent invoice to submit with a claim for services or equipment that was not provided.

That brings us to AI, which can be used for nefarious actions, but can also assist fraud fighters in curtailing this type of white-collar crime.

In an Insurance Business Magazine article published earlier this year, Karen Weintraub, president of Healthcare Fraud Shield, told the magazine that fraud perpetrators can use AI to generate false medical records to support fraudulent insurance claims. That makes it more difficult for insurance companies to review the claims to see if they are legitimate.

But there’s good news. AI can help insurance companies analyze data on a larger scale and detect nuances and patterns that may escape the human eye, Ms. Weintraub told the magazine. This could be a positive thing for insurance companies and health insurance members who pay their premiums.

Consumers can do their part at helping to fight insurance fraud by being vigilant when it comes to claims being paid by insurance companies, Medicare or Medicaid. It’s important for consumers to carefully review their Explanation of Benefit (EOB) statements that they receive from their insurer.

Sometimes EOB statements can be difficult to understand, but consumers should review it and ask their insurance company or provider questions if there’s something on the statement that isn’t clear. Also, look for red flags, such as being charged twice for the same service or being charged for medical equipment that they did not receive.

These errors may have been honest mistakes, or they may be a sign of fraud. If you’re still unsure, you may call our consumer experts at the Department of Insurance at 855-408-1212 Monday through Friday from 8 a.m. to 5 p.m. for assistance.

I’m committed to fighting insurance fraud in all forms. I hope you’ll assist me in this fight