According to Benefits Canada, nearly 95% of all benefit plans have been affected by fraud. According to the Canadian Health Care Anti-Fraud Association nearly 20% of all claims are fraudulent, depending upon geographic location.
“An intentional deception or misrepresentation that the individual or entity makes knowing that the misrepresentation could result in some unauthorized benefit to the individual, or the entity or to some other party.”
Canadian Anti-Fraud Association
Fraudulent activity affects all plans. Unless detected, fraudulent claims are paid by employers – and very few are detected. This can mean the difference between maintaining or improving a plan and having to increase rates or reduce coverage. Fraudulent claiming abuse or misuse can take many forms. Sometimes, the fraud is committed by a practitioner or their staff, without the employee’s knowledge while other times, fraud has been committed with the plan member’s involvement.
Here are some typical examples:
- An employee reaches the maximum on a paramedical service such as chiropractic treatments and the practitioner continues billing the treatment as massage or bills it as another family member on the same plan.
- A spa treatment such as a facial billed to the plan as a massage
- Non-prescription sunglasses billed as prescription eye wear
- Cosmetic treatment such a teeth whitening billed as dental procedure
- Dental procedures claimed but not performed
- Individuals not covered under the plan receiving treatment, medical products or services charged to a plan member’s plan
- Services or products claimed but not paid for
How Can Employees Help?
Employees should be encouraged to take a proactive approach to monitoring their plan and claims.
Some things they can do to help reduce fraud include:
- Ensure drug card and certificate number are kept safe and private, like credit cards
- Read Explanation of Benefits each month and question any claims not recognized
- Read provider claim forms and never sign a blank form or one that includes treatment or product not yet received
- Participate in audits when asked to do so. Sign release of information authorizations or complete questionnaires
- Know up-front what will be charged for a product or service
- Ensure practitioners are properly licensed or registered as required. Contacting the customer service department of the insurer in advance may confirm that a practitioner is in good standing
- Be wary of practitioners offering incentives or asking to look at plan booklets maximum to confirm coverage
What Are Plan Carriers Doing?
Insurance carriers are putting more effort into fraud prevention than in the past. Random claim audits are done more frequently now, particularly as more employees submit claims on line. Carriers also randomly audit practitioners to be sure their credentials are accurate and that they are meeting their regulatory requirements.
Carriers may ask for additional information to help them assess the veracity of a claim or practitioner. Additional information may require the employee’s signed permission to release but the information sought will only pertain to the specific claim being reviewed.
Often, a carrier may not allow a particular practitioner to be paid direct. Rather, the employee would have to pay out of pocket and submit the claim.
Increasingly, carriers are declining to pay claims that have been paid in cash. The issue is that confirmation of a traceable and identifiable source of payment isn’t always possible. This means that the carrier requires a copy of a payment transaction to confirm full payment.
This could include:
- Cancelled cheque
- Debit card receipt
- Bank statement
Steps to reduce fraud can often be inconvenient for employees and practitioners both. However, fraud is a serious issue that impacts all benefit plans. A few extra steps can help protect your benefit plan in the long run. Don’t hesitate to contact ASSOCIUM Benefits or your carrier if you suspect fraud or just want more information on how to protect your plan.
ASSOCIUM Benefits is a very unique employee group benefits provider, focused on supporting benefits advisors and their employer clients. We provide Brokers and Plan Sponsors with a range of solutions from traditional group benefits to more customized, cost and tax effective employee compensation. Let’s connect to find out how we can help.