Author Archives: Mark J. Rose, Esq.

Special Investigation Units Learn the Latest Techniques to Stay Ahead of Fraudsters

The cost of fraud, which has an annual price tag of about $80 billion a year, is substantial to insurers as well as the general public. Special investigation units (SIU) put in place by insurers manage a multitude of ever-changing instances of suspected fraud.

The International Association of Special Investigation Units (IASIU) recently held a seminar and expo on insurance fraud to educate investigators about the latest trends and how to stop fraud by using the hottest tools available. Highlights of the conference were covered by Property Casualty 360° in a recent article.

Investigators, many of whom are former military and law enforcement professionals, learned about these newest scams and what they should look for in identifying them, places to find fraudsters, and how to conduct a thorough investigation.

Highlights in the seminar revealed:

  • Voice print” technology that tracks phone calls made by scammers: This technology can make a voice print, similar to a fingerprint, using biometrics to identify callers. Accents and other disguises to the voice will not defeat this technology.
  • A new database of voice prints: NICE Contact Center Fraud Prevention is creating a database of those voice prints to help insurers track and identify fraudsters who repeatedly file false claims.
  • Social media tools: These go beyond the traditional Google or Bing searches. Anyone using social media leaves a road map for investigators, allowing them to connect the dots between a scammer and his or her friends and associates without ever leaving their desks.
  • Information gleaned from staged car fires: A burned-out vehicle has a story to tell if you know how to read the clues. By learning about the properties of fire, ignition sources, burn patterns, what to look for at a burn scene, what types of evidence can be found, the mistakes that fraudsters frequently make, and reading air velocity and direction, investigators can gather the necessary data to rule out or make a case for fraud.

Although fraudsters often stay ahead of the game by introducing new ways to swindle insurers, investigators are now better equipped to handle what comes their way thanks to innovative technologies and techniques.

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Filed under Insurance Fraud

Accident Reconstructionists assist Insurance Adjusters in Uncovering Staged Accidents

In some cases, auto accident claims raise red flags with insurers. The damage reported may be clearly visible and no claim for injury has been made, but adjusters just can’t put their finger on it. Before insurers pay the claim, however, they can bring in an accident reconstructionist to help put the pieces of the puzzle together and hedge against fraud.

According to an article in Property Casualty 360°, accident reconstructionists are investigators familiar with questionable claims such as when the vehicle damage doesn’t match the claimant’s story. Frequently, they do their work based on the claimant’s incident description, police report, repair records, and photographs.

Accident reconstructionists delve into many different aspects of the accident including: comparing the damages to the claimant’s statement of the sequence of events; making sure damages match the police report; and verifying that the damages between the vehicles meet the shape and height of the vehicles involved.

Key to making a conclusion lies in geometry and patterns of the vehicles and the damage they sustained. Photographs of the vehicle, in addition to information about the specific make and model enable accident reconstructionists to obtain the vehicle’s specific damage dimensions for use in their analyses. Even so, every case is different and must be considered independently before reaching a conclusion.

Because the scope of assignments are very specific, accident reconstructionists often can quote a price for their work based on the nature of the claim, available evidence, and whether a verbal update or a written report is required.

Input from accident reconstructionists may be invaluable to insurers. They sift through information and provide the missing data necessary to determine whether an accident was staged or if a claim is fraudulent.

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Filed under Insurance Fraud

Court Rules for Progressive in Health Care Clinic Licensing Dispute

On July 29, 2014, the 13th Judicial Circuit Court for Hillsborough County granted final judgment in favor of Progressive Insurance in a case involving licensure violations by defendant health care clinic Best Medical. The defendant did not undertake a defense.

The following facts were undisputed:

  • Best Medical listed licensed massage therapist Jorge Romero as its 100% owner;
  • Romero did not actually own Best Medical, but was paid $2,000 a month for the right to use his credentials and claim that he was the owner;
  • Best Medical obtained a certificate from the State of Florida exempting it from licensure as a health care clinic by utilizing Romero’s credentials; and,
  • Progressive paid Best Medical PIP reimbursements in excess of $97,000 in response to bills submitted.

In his analysis of the case, Judge James Arnold noted that the Florida PIP statute requires that medical services be lawfully rendered and the corresponding bills be lawfully submitted to be valid. Additionally, the statute provides an insurer, such as Progressive, the right to challenge potential licensure violations, including the ownership of a clinic.

Florida’s Health Care Clinic Act requires that all medical clinics operating in Florida be licensed unless they are exempted. Relevant here is that a clinic “wholly owned by one or more licensed health care practitioners” is exempt from licensure.

The facts showed, however, that Romero was never the 100% owner of Best Medical. The clinic was therefore not entitled to the exemption for being wholly owned by a licensed health care practitioner.

Lacking a lawful exemption, Best Medical was required to possess valid licenses pursuant to the Health Care Clinic Act. Because it possessed no such licenses, Best Medical lacked the ability to lawfully render medical services and lawfully submit corresponding bills as required by Florida’s PIP statute.

Accordingly, Progressive was held not liable for payment of the bills rendered by Best Medical for reimbursement of purported medical services.

The case is Progressive v. Best Medical Healthcare Solution (f/k/a Tropical Healing Power), Case No. 14-CA-000327 Div. J (July 29, 2014). Click on the link to read the Final Judgment.

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Filed under Case Law

Uninsured Motorists Declining but Still a Concern in Florida, New Study Finds

A new study released by the Insurance Research Council (IRC) found that the estimated percentage of uninsured motorists has been in decline since 2010. According to the organization’s latest report, “Uninsured Motorists, 2014 Edition,” 14.9 percent of drivers were uninsured in 2003, but that figure dropped to 12.6 percent in 2012. That’s about one in eight drivers on the road who are uninsured, according to the study’s most recent data.

The study’s numbers were figured based on a ratio of insurance claims made by individuals who were injured by uninsured drivers to claims made by those who were injured by drivers who had insurance.

Although there is an overall downward trend nationwide, the IRC has broken the percentages down by numbers for each state and discovered great variation. Nationally, the number of uninsured drivers peaked at 29.9 million in 2009 and moderately declined to 29.7 million in 2012.

In terms of states, Florida ranked second in the highest total number of uninsured drivers with 3.2 million. California ranked highest with 4.1 million, while Texas followed Florida with 1.6 million, the report found.

The study also revealed that Florida ranked high in terms of the estimated percentage of uninsured motorists per state. That number is highest in Oklahoma at 26%, followed by Florida (24%) and then, Mississippi (23%).

The “Uninsured Motorists” study also analyzed the total number of uninsured motorist claim payments and found that amount has climbed drastically in spite of an overall drop in the number of uninsured drivers.

Not counting fatalities and total permanent disability claims, the IRC estimates that $2.6 billion was paid in the U.S. on 2012 uninsured motorists’ claims. This is a 75 percent increase over the past 10 years, translating to $14 per insured individual in 2012.

According to Elizabeth A. Sprinkel, CPCU, senior vice president of the IRC, these numbers show that “responsible drivers who pay for insurance end up also paying for injuries caused by uninsured drivers.”

“The declining trend in the percentage of uninsured motorists is a positive development for consumers; however, the heightened levels of uninsured motorists and the rising claim payments involved still remain a concern for insured drivers, insurers and policymakers,” she said.

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Filed under Insurance Fraud

Disbarred Florida Attorney Gets Prison Sentence in $28.3 Million Medicare Fraud

A disbarred Florida attorney who participated in a $28.3 million Medicare fraud scheme involving false claims for physical and occupational therapy services was recently sentenced in federal court in Tampa to 70 months in prison, the Justice Department announced.

Margarita Grishkoff, formerly of southwest Florida, initially pleaded guilty on January 24 to conspiracy to commit health care fraud. In addition to her prison term, U.S. District Judge Susan C. Bucklew of the Middle District of Florida sentenced the 60-year old to three years of supervised release and ordered her to pay $14,424,856 in restitution, jointly and severally with her co-conspirators.

Grishkoff, who is currently a resident of Charlotte, North Carolina, acknowledged in her guilty plea that approximately $28.3 million in fraudulent claims were submitted to Medicare by her and the scheme’s co-conspirators. Medicare paid approximately $14.4 million of those claims, which were made through physical therapy clinics throughout Florida from 2005 through 2009.

Court documents reveal that Grishkoff, who was disbarred in Florida in 1997, was vice president and director for Ulysses Acquisitions Inc., a Delaware holding company that purchased several comprehensive outpatient rehabilitation clinics and physical therapy providers to gain control of Medicare provider numbers. These clinics included: West Coast Rehab Inc. in Fort Myers; Rehab Dynamics Inc. in Venice; Polk Rehabilitation Inc. in Lake Wales; and Renew Therapy Center of Port St. Lucie LLC in Port St. Lucie.

The Justice Department also said that Grishkoff and her co-conspirators paid kickbacks to patient recruiters and clinic owners to get identifying information of Medicare beneficiaries and physicians. They subsequently took this information to create and submit false claims to Medicare through the clinics Ulysses Acquisitions owned. Claims for reimbursement were made on therapy services that were not legitimately prescribed or actually provided.

But it didn’t end there. Grishkoff and her co-conspirators used the clinics they controlled to submit false reimbursement claims on behalf of other clinics not owned by Ulysses, in exchange for a percentage of the Medicare reimbursement received.

These Miami-based therapy clinics included: Hallandale Rehabilitation Inc., Tropical Physical Therapy Corporation, American Wellness Centers Inc., and West Regional Center Inc. According to court documents, Grishkoff and her co-conspirators kept approximately 20 percent of the fraud proceeds and paid the remaining 80 percent to the co-conspirator clinic owners. Grishkoff further admitted that she arranged sham sales of her clinics to nominee or straw owners to disassociate herself and Ulysses Acquisitions from the fraudulent scheme. Those new owners were recent immigrants with no background or experience in the health care industry.

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Filed under Insurance Fraud

Allstate to Recover Almost $1 Million in PIP Case against Dr. Sara Vizcay

In a case brought by Allstate in the Florida Middle District, the court ruled on August 1st that the Defendant’s Motion for Declaration of Mistrial was denied, the Plaintiff’s Motion for Declaratory Judgment was granted in part, and the final judgment was ordered.

Dr. Sara C. Vizcay and the seven medical clinics listed below were the Defendants in the case.

  • Best Care Medical Center, Inc.
  • Caleb Health Care, Inc.
  • Florida Rehabilitation Practice, Inc.
  • Global Diagnostic Center, Inc.
  • Personal Medical Center, Inc.
  • P.V.C. Medical Center, Inc.
  • Regional Enterprises for Health Corporation

Fraudulent billing practices and failure to comply with the licensing requirements of the Florida Health Care Clinic Act (HCCA) formed the basis of Plaintiff allegations. In a jury trial earlier this year, the jury found that each Defendant misrepresented material facts.

The court noted that the “jury unanimously found Plaintiffs proved, by a preponderance of evidence, that Dr. Vizcay failed to substantially comply with her statutory medical director duties to systematically review bills … and to ensure those bills were not fraudulent or unlawful.”

The total amount to be recovered by Allstate is $942,883.41, and Plaintiff is not obligated to pay any unpaid amounts.

The case is Allstate v. Sara C. Vizcay, M.D. et al., U.S. District Court for the Middle District of Florida, Case No. 8:11-CV-804-EAK-EAJ. Click on the link to read the August 1, 2014 Order of Judgment.

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Filed under Case Law, Insurance Fraud

Defendant’s Motion to Dismiss Granted with Prejudice in PIP Benefits Case Involving Challenge to “Emergency Medical Condition” (EMC) Provision

In a second ruling within one week involving Florida’s amended PIP law, the U.S. District Court for the Southern District of Florida dismissed a case challenging reimbursement under the amended statute’s “emergency medical condition” or “EMC” provision. See our earlier post titled Court Grants Defendant’s Motion to Dismiss in Robbins v. Garrison P & C.

Sendy Enivert sued her auto insurance company, Progressive Select, alleging breach of contract for failing to pay her PIP benefits to a limit of $10,000. Enivert’s claim involved the newly added provision to Florida’s PIP law which limits PIP benefits depending on whether a claimant has suffered an emergency medical condition.

Plaintiff Enivert interpreted this language to mean that an insured is limited to $2,500 only if a medical provider determines that there is no emergency medical condition. She argued that because, in her case, no medical provider ever made such a determination, she was entitled to the full $10,000. In other words, because no medical provider determined that she did not have an emergency medical condition, she was entitled to full benefits.

Defendant Progressive read the statute to mean the opposite, i.e., that a medical provider must affirmatively determine that an emergency medical condition does exist in order for the insured to be eligible for reimbursement of the full amount.

The court agreed with Progressive, concluding that the PIP statute clearly indicates that a determination that a claimant has suffered an emergency medical condition is required in order to receive benefits in excess of the $2,500 limit. Since a medical provider did not determine that Enivert had an emergency medical condition, she was not entitled to the full $10,000 in benefits.

The court also looked to the legislative intent behind the PIP statute. It concluded that the clear legislative intent was to decrease PIP fraud by placing more stringent requirements in order to receive the maximum amount of benefits.

Based on the above, the court granted Progressive’s motion to dismiss Enivert’s case.

The case is Sendy Enivert v. Progressive Select Insurance Co., Civil Action No. 14-CV-80279-Ryskamp/Hopkins (S.D. Fla. July 23, 2014). Click on the link to read the court ruling.

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Filed under Case Law, Fla. Stat. 627.736 (2012)