This is a real to me example of an employer (because I am in benefits, I keep it benefit insurance focused) who had $27,000 of insurance fraud under the paramedical policy, spread over two years.
The first year, I didn’t catch it as anything other than an anomaly to the benefit plan usage. A spike in claim usage. But the second year, only by their prompting did I dig deeper. I had ASSUMED and truly made an ass of myself, that it was massage or chiropractic or something, the usual culprits on employee usage. But carrier on side as a partner in this endeavour, I dug deeper and found that it was for back braces, elbow braces, etc. based on two employees.
I was 100% wrong on what I had told them to expect.
Was this benefit fraud? I had no idea and didn’t really know where to begin.
In the moment, I wanted to run and hide because it’s my job to catch these things and I didn’t. As a result, their premiums were skyrocketing in that benefit line.
Instead of hiding from the error or trying to push it onto someone else, instead … I owned the mistake.
I called the carrier, reinforced that I viewed them as a partner working in the client’s best interest. Inquired how they normally handled inquiries about potential fraud and together, we took a deep dive.
I met with the client and took them through the process. Told them how this was outside of my “norm”, and it never dawned on me to consider back or knee braces. They didn’t try to “beat” me with my mistake, instead they agreed how easy it was to overlook, and they too didn’t consider such items.
It was fraud.
The provider worked with the police, kept me informed, and I in turn kept the client informed. It took close to a year to work out that it was a provider, NOT the employees who had committed the fraud and this was a small part in a large scale operation.
Because of the liaison to keep the client in the loop, our communication grew, we developed employee benefit training which we applied to the entire block without discrimination on size, location, or industry, to watch for these kinds of anomalies. We started to write about common errors in benefits, not just by plan administrators but by us as consultants and how to work to best protect clients and their benefit plan—if everyone doesn’t watch for this, everyone’s premiums increase.
This has grown our industry engagement. I wrote a book on insurance fraud and a sequel is in the making. I changed the way I look at these numbers and my reporting is significantly more in-depth. I often kid with plan administrators when going through the presentations or proposals, if there is another way to look at these numbers let me know, I’ll add it in.
That was 2017 and that client is still my client, and I would suggest one of the strongest advocates of the benefits of a benefit plan. They “trust” the benefit provider and me and are not afraid to say, because I owned my mistake and now, I sell the learnings from that mistake into a better practice.
Let’s have a conversation. Give us a call.
Note: this was written without the aid of Artificial Intelligence (AI)
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