Stopping bad medicine: How health insurance companies uncover fraud
By Cami Reister | The Grand Rapids Press
June 09, 2010, 12:02AM
Grand Rapids Press File PhotoFormer West Michigan dermatologist Robert Stokes is a recent infamous case of insurance fraud.On any given day, Tom Clickner could be asking a doctor about a chemical peel for his face, inquiring about a procedure from a chiropractor or podiatrist, or seeking massage therapy.
No, he is not a hypochondriac. It is all part of his job investigating insurance fraud for Blue Cross Blue Shield of Michigan.
"Some things happen over and over again," said Clickner, who has worked for the insurance company for 15 years. "You have people seeking prescription drugs or billing for services not rendered. We've also seen cosmetic procedures where the diagnosis is misrepresented to pay for an uncovered procedure."
Thanks to Clickner and others in the 38-member investigative department, Blue Cross Blue Shield of Michigan recovered or saved $15 million last year, according to its annual audit.
The nonprofit entity is the largest insurer in Michigan and also the insurer of last resort.
For Blue Cross plans nationwide, the total was more than $510 million -- $318 million in prevented payments, an increase of 62 percent from 2008, and $192 in recovered payments, up 28 percent.
"I think in the last few years the economy has contributed to fraud from a member perspective and a provider perspective," said Greg Anderson, vice president of corporate and financial investigations for Blue Cross Blue Shield of Michigan.
"Usually the provider fraud is a bigger loss to the corporation so we do focus our assets on that aspect, but we still look at all aspects."
Anderson said identity theft is playing a growing role in fraud, whether a member steals someone's identity to use their insurance, or a third party steals identities to secure prescription drugs or create fake medical files to sell to doctors.
Some doctor's offices require patients to show a photo ID when submitting insurance information, something that BCBS encourages.
A case out of St. Joseph County involved a person using someone else's Social Security number and, therefore, their insurance.
"That one started when the subscriber saw charges being billed to their contract that they weren't familiar with," Clickner said. "The investigator found there was an individual, he had come to the U.S. illegally, bought the Social Security number for $190, obtained employment and began to receive medical services."
Anderson said the explanation of benefits members receive serves as a check and balance.
"We urge all of our members to take a close look at their EOB form," he said. "If they see something they don't think is right, we want them to call our toll-free hotline.
"We're all being impacted by fraud, and it costs us every single day."
The National Health Care Anti-fraud Association conservatively estimates that fraud constitutes nearly 3 percent of all health care spending, while the federal government puts it closer to 10 percent. All projections show it rising along with health care costs.
"A lot of our groups, especially on the west side of Michigan, are self-insured groups," Clickner added. "If someone steals against an individual covered by that group, that employer loses money."
Blue Cross works in conjunction with law enforcement in its investigations, usually the state police or the FBI.
One of the more memorable cases Clickner worked on with law enforcement was that of former dermatologist Robert Stokes, who was convicted in federal court after he collected almost $2 million from Medicare and health insurers for performing unnecessary procedures on patients. He is serving a 10 1/2-year prison sentence.
"I've worked cases where more money was involved," Clickner said. "But I never saw a case where there was more disregard for the patients' safety than I did in the Stokes case."