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Employees Caught Abusing Healthcare Insurance Plan

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A few weeks ago, what was dubbed as Sudbury’s largest fraud trial came to a close with the guilty verdict handed out to fraudsters Dirk Plate and Paul Caron. The duo helped defraud about $24million from Atlas Copco Canada. Their sentencing hearing will be on October 25. The concluding chapter to this fraud case was brought with a whistleblower’s help.

Plate was Atlas Copco’s general manager at their Sudbury office from 2001 to 2007 and Caron managed Atlas Copco’s employee benefits as a Montreal insurance broker. Their fraud covered a period of six years.

Health Benefits Fraud

The disturbing fact is that overbilling health benefits is a common occurrence in Canada. In fact, the Canadian Health Care Anti-fraud Association reported that fraudulent billing activity is responsible for a private health care plan loss of $1.2 to $6 billion dollars a year.

The issue above presents a problem for employers. Employers are concerned about keeping health insurance costs down without resorting to cutting health benefits of employees.

Health benefit plans are being abused in various ways these days. Some employees can duplicate a billing by hiding the double billing between a stash of small medical bills. Sometimes a therapist can tell someone to come in for more unnecessary appointments to bill time. Also, some doctors may over-prescribe drugs that are on the expensive side although those medications may not really be needed.

Needless to say, employee abuse of their benefits plan is very common and can be a huge financial loss to a company. Below are some ways employers can protect themselves from health benefits fraud with the help of a plan provider.

Protect Your Business from Employee Health Benefits Fraud

Oftentimes employees commit fraud because they do not understand how this affects them and the company in the long run. If you are a plan provider, you have to inform your clients that plans are composed of the risk insurance and the transactional costs.

You may need to explain the direct relationship between the annual claims and the future viability of the plan you are providing. Your client needs to look at the whole picture.

You’ll have to carefully design the plan. Adding a layer of pre-authorization such as each procedure having to undergo pre-approval prior to completion.

A tiered plan that divides drugs into groups based on costs can mitigate costs. Here’s more detail about this.

Employees and employers both benefit from fighting health benefit plan abuse and fraud. Because abuse results to increased plan premium and costs, plus causes eliminations and reductions of plan coverage to contain costs, everyone suffers a loss if abuse is allowed to continue. Add to this the fact that committing health care plan fraud is a criminal offense that can cost perpetrators their job and land them in jail, there is really no long-term gain from engaging in such a fraud.

Concerned about possible fraud in your business? Contact us for an obligation-free initial consultation. Our Toronto private investigators are here help you get to the bottom of things. Talk to us today!

 

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