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Physicians and pharmacists said to be part of insurance scam

Most employers in California know that carrying workers' compensation insurance is something they have to do, with a few exceptions based upon the nature of the company. For those companies who are required to carry this insurance, one thing they should be able to count on is that the system will be responsibly used by people who are legitimately injured or ill. Similarly, it would be wonderful if employers could trust that all other entities involved in the workers' compensation system operated honorably.

Sadly, this does not always happen and a recent case illustrates this all too well. A married couple who own a medical laboratory, medical management company and a medical billing company have been accused of spearheading a multi-million dollar workers' compensation fraud ring. In all, 23 different insurance companies were essentially swindled by the couple and the others who were recruited to be part of the plan.

Twenty-two doctors are said to have been part of the scheme that involved things like the order of unnecessary tests that could then be billed to insurers and the billing of non-approved creams at exceptionally high costs to insurers. The creams were said to be inappropriately obtained by pharmacists also involved in the scam. It is believed the operation was in full force for approximately four years resulting in $40 million of insurance claims and adding more than $20 million to the pockets of the couple.

Workers' compensation fraud may happen but employers who ever want or need to learn more about these types of problems may find it helpful to talk with an attorney about protecting their rights.

Source: Business Insurance, "Massive workers comp fraud ring uncovered in California," Louise Esola, April 21, 2017

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