Insurance fraud rising among young people
The rate of young people in Utah committing insurance fraud is rising rapidly, and the majority of the culprits are newly married couples who remain on their parents’ insurance.
When a couple gets married, they have until the end of the month to switch from their parents’ insurance plans to one offered through their employer or school, said LuAnne Winters, legal secretary for the Utah Insurance Fraud Division.
“[Health insurance fraud] is very, very common,” Winters said. “Even after parents inform the insurance company of the change, they neglect to do the paperwork, or sometimes the employer neglects to tell the insurer.”
While many individuals may be unaware they are committing health insurance fraud, Winters said, the majority of the fraudulent activity among young people is intentional.
Winters said the insurance fraud division knows of about 24,600 cases of health insurance fraud in Utah where individuals have remained on their parents’ insurance after getting married.
Even though there is a large amount of health insurance fraud being committed statewide, Logan insurance agent Jonathan Meatoga said he has only seen one incident in his firm, and it was an accident.
“I was signing up a new married couple, and basically what happened was the wife was actually still on her parents’ plan, and when we went to submit [her application], the [insurance] carrier caught it,” Meatoga said.
Single individuals can legally stay on their parents’ insurance until they are 26 years old, as long as they are attending college, Meatoga said.
More often than not, if there is a problem with remaining on parents’ insurance unlawfully, it is just a matter of filling out paperwork to make the switch, he said.
Winters, however, said there are many individuals who remain on their parents’ insurance and blatantly lie to healthcare providers about it.
She said the insurance fraud department prosecuted a mother and daughter for committing insurance fraud when the daughter, who had two children, made multiple visits to the doctor on her mother’s insurance without giving the healthcare provider the father’s name or her married name.
Both the mother and daughter in that case were charged with misdemeanors, Winters said, with the daughter receiving a harsher
penalty.
If someone knowingly incurs medical claims, he can be prosecuted, she said.
People found committing health insurance fraud typically have to pay back their insurance providers and compensate for investigative costs, Winters said. They are usually sentenced with probation, as well, but the severity of the sentence depends on the judge.
Married couples who are still on their parents’ insurance are encouraged to contact their insurance provider immediately to rectify the situation, Winters said.
“They can take care of it with their insurance company,” she said. “If they come to us, we may charge them.”
Winters said insurance companies may only require financial restitution from any married couples who have unlawfully remained on their parents’
insurance.
The high level of fraudulent activity in the health insurance arena is one of the major factors driving up insurance prices, said John Woroey, regional director for Intermountain Health Care health plans.
“[Insurance fraud] certainly would have an impact on insurance rates, the cost of care, all of those things,” Woroey said. “We rate based on all we know and understand a family can be.”
Woroey said he knows there have been some insurance fraud issues in the past at Logan Regional Hospital but didn’t have any specific figures, as all insurance billing for IHC is done out of Salt Lake City.
Nationwide, the largest groups of people who commit health insurance fraud are from crooked health care providers, said James Quiggle, director of insurance for the Coalition Against Insurance Fraud in Washington D.C.
“You will see crooks go into nursing homes and shine pen lights into the eyes of the elderly people and bill insurance companies for eye surgery,” Quiggle said. “You will see people perform open heart surgery on healthy people just so they can bill insurance for sizable amounts of money for heart operations.”
All types of fraud are costing American taxpayers billions of dollars, he said.
“Everyone is paying one way or the other,” Quiggle said. “These are swindled against taxpayer-funded programs. These are your tax dollars that are being flooded down the toilet.”
Quiggle said it is estimated that there are more than $54 billion in fraudulent health insurance claims every year, and that is a conservative estimate.
“Healthcare costs that businesses have to pay for in premiums go up. Healthcare premiums are going up,” he said. “You have another whole class of healthcare fraud right now.”
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