We have to accept the truth that 1 out of 10 people today will create a plot to pull out money from another person’s pocket. This is the current reality. Scams are everywhere and are evident in fraudulent life insurance claims. This type of insurance scam is prevalent in USA and cases like this are growing in number. It affects the life of innocent people, directly—through deliberate injury or damage to the other party or to the policyholder himself—and indirectly as these crimes cause insurance premiums to be higher.

Insurance companies are susceptible to fraud because false insurance claims can be made to appear like ordinary claims. The ultimate objective for such unethical practices is financial gain. Policyholders charge bills for services and tests that weren’t even provided. Sometimes they bloat expenses incurred from medical procedures or medical diagnosis or the identity of the beneficiary. At times, to gain more money, fraudulent policy owners order unnecessary tests just to get something more out of the insurer.

Physicians also commit deception through charging higher fees to individuals with insurance policies and merely tell them that the given rate is the usual fee for all patients. This is illegal but is widespread in the USA and in third world countries. It is also illegal to exempt patients from copayments and deductibles unless they are proven to be experiencing financial hardships.

Other illegal practices that people do for money include:

• Filing a claim for services not performed or charging a patient for services that weren’t provided.
• Charging patients for different fees that were supposedly covered in one fee. This results in higher payment. Policy owners also do this when they file a claim and thus gain more reimbursement than the actual money that they should be receiving.
• Plan holders sometimes charge fees twice for the same service given to them.
• Making simple procedures complicated as well as the fees charged with these.

All these and more are schemes to get more than the actual money that the policy owner or physician has earned. Insurance companies today have come together to from a group that could protect themselves from these fraudulent individuals. They have joined forces and came up with the National Health Care Anti-Fraud Association. This corporate group has developed computer systems that can detect suspicious billing and claim patterns. The government has created departments of their own in association with the insurance companies to create legislation gearing towards the protection of these security firms.