As insurance providers, plan sponsors and plan members take strides to control the costs of their health and dental coverage, the issue of fraud and its effect has captured increasing attention. No matter what form it takes, fraud results in expense increases throughout the health care chain, so preventing and controlling abuse helps providers, consumers and carriers.

Fraudulent claims contribute to increasing health and dental benefit costs for everyone despite the fact that only a small percentage of providers and consumers deliberately engage in acts of fraud. Even a small percentage of fraudulent claims can dramatically affect private health care costs. Fraudulent health or dental claims originate with someone intentionally seeking a benefit payment based on false or misleading information. Causing someone else to submit false or misleading information for this purpose also qualifies as claims fraud.

Provider fraud schemes may include:

• waiving patient co-payment and over-billing the benefit plan for the full service
• billing for services not actually performed
• falsifying a diagnosis to justify unnecessary test, treatments or devices
• misrepresenting procedures performed to obtain payment for non-covered services
• "up-coding" - billing for a more costly service than the one performed
• "unbundling" - billing each stage of a procedure as if it were separate.

Consumer fraud schemes may include:

• Filing claims for services or medications not received
• Misrepresenting themselves to their carrier or to multiple doctors
• Forging or altering bills or receipts
• Using someone else's coverage or insurance card to obtain benefits.

WHAT PLAN SPONSORS CAN DO

1) Ensure benefit maximums are reasonable and control plan services that are prone to excess abuse.

2) Choose positive enrolment (having plan members enroll their dependents in advance of making claims) and report plan member changes to your carrier so records can be updated. Where direct enrolment (enrolling dependents when they make a claim) is preferred, report plan member changes to your carrier promptly.

3) Urge plan members to ask their health care provider about the services they receive. Are they necessary? What do they cost? Would the same treatment be used if the plan member did not have benefit coverage?

4) Urge plan members to request invoices from health care providers who bill the carrier directly for service. Plan members should compare the provider's invoices to their Explanation of Benefits forms from their carrier. Is the information correct?

5) Urge plan members to sign only one completed claim form at one time and to not pre-sign any blank forms presented by a provider. Notify your carrier if a provider has a practice of obtaining pre-signed claim forms

6) Urge plan members to be careful about disclosing insurance information to others unless required.

7) Contact your carrier if you know of a provider who regularly waives co-payments or deductibles.

8) Ask plan members to respond to audit confirmation letters. These are important assurances that billed services are correct.