The New York state Insurance Department is seeking to tighten regulations after nine in 10 suspected cases of health care fraud in the state last year were from no-fault auto injury claims, a burgeoning cottage industry in New York.
Investigations by the Related Fraud Bureau resulted in 159 arrests during 2010. In total, there were 12,807 no-fault claims reported as suspicious during the year.
By the terms of a 1974 law, victims of accidents can collect directly from their insurers for lost wages and medial expenses regardless of who was at fault in the incident.
The Department of Insurance is proposing a streamlining of the claims process to enable insurers to combat fraud by requiring a greater depth of medical information”
Insurance Superintendent James Wrynn said, “We want to make sure that the new rules that are put in place effectively address the no-fault issues that need to be corrected. The agency will take public comments for several weeks on the proposed changes, which have been on the table and undergoing revision since 2009.
Pursuing suspected fraud cases is a time consuming business that does not always lead to arrests. Some cases are found to be groundless, some are shuffled to other agencies, and many are found to be not worth prosecuting. Overall, tightening the claims process is a more efficient and less expensive means of fighting fraud than seeking to find and punish people who have actually committed the crime.