Man charged after filing $20,000 insurance claim for fake dead cat

OLYMPIA, Wash. _ A Tacoma man is facing attempted theft and insurance fraud charges after filing a $20,000 claim for a fictitious dead cat, using pet photos he lifted off the internet.

“We’ve handled some pretty unusual fraud cases, but this is one of the stranger ones,” said Insurance Commissioner Mike Kreidler.

Yevgeniy M. Samsonov, 29, has been charged with first-degree attempted theft and felony insurance fraud in Pierce County Superior Court. Arraignment is set for July 11.

On March 27, 2009, Samsonov was involved in a minor traffic accident in Tacoma. A driver behind him was stopped at a traffic light when her foot slipped off the brake. Damage to both vehicles was very minor.

Samsonov filed a claim that included chiropractic treatment of soft tissue injuries. The other driver’s insurer, PEMCO, paid him $3,452.

Two and a half years later, Samsonov sought additional payment from PEMCO. He said that in addition to the vehicle damage and medical claim, his beloved cat Tom had been in the car and killed in the accident.

The company issued him a check for $50 to compensate him for the cat.

Samsonov then told PEMCO that he’d paid $1,000 for the cat, who’d been like a son to him. He wanted to be paid $20,000.

He sent the company two photos he said he’d taken of his cat. (See below.)

A PEMCO claims representative did a Google Images search and discovered identical cat images appearing on websites, blogs and Facebook pages. The two images Samsonov submitted are actually of two different cats. One is named Lacy. Neither belonged to Samsonov.

PEMCO canceled its $50 check and forwarded the case to Kreidler’s anti-fraud unit.

California Insurance Commissioner vs Blue Shield CA (Follow Up)

I wanted to post a follow up to my earlier BLOG of July 3rd concerning California Insurance Commissioner Dave Jones disapproval of the Blue Shield Life & Health CDI plan closures.

I spoke with Blue Shield today and we are pending official notification from the insurance company in regard to Mr. Jones' announcement. I will provide information via a new BLOG post once I have it.

In the meantime I wanted to provide a link to the CDI web site and Dave Jones official press release regarding this issue. The official announcement provides a more detailed explanation of the decision.

Dave Jones Blue Shield Press Release

Dave
www.an-insurance.com

CA Insurance Commissioner Disapproves Blue Shield CA Plan Closures

California Insurance Commissioner Dave Jones announced today that he has disapproved the announced health plan closures by Blue Shield Life & Health. See my previous blog "Blue Shield To Close and Replace Most Individual Health Plans in California" from April 17th.

The CDI (CA Dept of Insurance)originally disapproved the plan closures in March, 2012, and requested additional information be provided by Blue Shield by June. The CDI reviewed the information and sustained the disapproval of the plan closures citing a lack of size of the remaining open block for pooling so as not to create a "death spiral" with the closed block.

All of Blue Shield's new PPO plans are registered with the CA Dept of Managed Healthcare (DMHC) leaving only one PPO plan from Blue Shield Life & Health.

Additionally the Commissioner notes that one specific health plan, the Vital Shield 2900 PPO has insufficient provision for 20,000 members as it offers no plan transfer right without medical underwriting.

I have yet to receive anything from Blue Shield CA regarding this decision by the CDI and will advise as soon as I receive any information from them. Until then, the closed plans are not available to new health insurance purchasers in California.

Dave
www.an-insurance.com

Product Safety Commission

MSN Health recently published on their website a great article about firework safety.  We wanted to post this article as both a way to wish you a Happy Fourth of July and to make sure you keep it a safe Fourth of July.  Here is the article.  To go directly to their site click here or read below:

Fourth of July Safety Tips

By Hank Bernstein, D.O., Harvard Health Publications

Each year, especially during the early summer weeks around the Fourth of July, thousands of people are treated in emergency departments for fireworks-related injuries. While some are minor, many of these injuries are serious, for example, resulting in burns or blindness. In 2008, seven deaths from fireworks-related injuries were reported; perhaps these could have been prevented.

Children should never be allowed to use fireworks! Of the 9,800 fireworks-related injuries reported to the U.S. Consumer Products Safety Commission (CPSC) in 2007, almost half occurred in children under the age of 15.

All fireworks are dangerous—even sparklers—which cause the majority of fireworks-related injuries to children under the age of 5. Sparklers burn at very high temperatures (up to 2,000 degrees Fahrenheit), sending out sparks that can easily set clothes on fire and cause permanent eye damage.

Because the risk of injuries when using fireworks is so high, the American Academy of Pediatrics (AAP) supports a nationwide ban on the private use of any and all fireworks. Instead, families should attend public fireworks displays, which are much less dangerous.

While a few states have banned all consumer fireworks, most have not. Until every state bans fireworks, the CPSC and the National Council on Fireworks Safety recommend taking the following safety precautions to make it less likely that someone will be injured by these potentially dangerous devices:

• Never allow children to touch fireworks of any kind, including sparklers even after they have "gone off". It can be hot, or even explosive and debris from fireworks can be extremely dangerous.
• Older teens should only be allowed to use fireworks under close adult supervision.
• Fireworks must never be used while drinking alcohol or using other drugs.
• Obey all local laws.
• If allowed in your area and you choose to do so, buy fireworks only from reliable sellers.
• Store fireworks in a dry, cool place.
• Only use fireworks outdoors and always have a good amount of water close by (a garden hose and a bucket), in case of emergency.
• Read and follow label directions.
• Light only one firework at a time.
• Never hold any part of your body directly over the firework while lighting it.
• Be sure all other people are out of range before lighting fireworks.
• Never throw or point fireworks at anyone.
• Never light fireworks in a container, especially a metal or glass container.
• Never light fireworks near a house or building, dry leaves or grass, or any other materials that can catch on fire.
• Never re-light a "dud" firework. Instead, wait 15 to 20 minutes, then soak it in a bucket of water and throw it away.

Information contained in this article was adapted from the American Academy of Pediatrics and the Consumer Product Safety Commission.

Fireworks and homeowners' insurance

Yes, it's tempting to shoot off fireworks around the Fourth of July. Here are a couple of key things to know:

• If fireworks are not legal where you live, you may jeopardize your insurance coverage if someone is injured or property is damaged as a result of your shooting them off.
• On the other hand, fireworks-related damage to your property typically is covered if someone else -- not a family member -- is responsible.

Insure.com also has an article with some more scenarios and tips.

Prescription drugs and Premera

Crosscut's Harris Meyer has a story today about a clash between our office and Premera, one of the state's largest insurers:

Since 2009, Premera Blue Cross’s LifeWise unit has sold a high-deductible plan called Wise Essentials Rx, the only catastrophic-type plan in the state offering drug coverage. Its enrollment quickly zoomed to 45,000. But that plan and Lifewise’s standard plan covered only generic, not brand-name, prescriptions.

Earlier this year, Premera’s two main rivals, Regence BlueShield and Group Health Cooperative, filed requests to switch their standard plans for individuals from full to generic-only drug coverage. Group Health said it doesn’t favor a generic-only benefit but feared its plan otherwise would get swamped with sicker enrollees who couldn’t get brand-name drugs in other plans. All three insurers have reported losing money in the individual market.

Those requests prompted Insurance Commissioner Mike Kreidler to issue an emergency rule in February barring generic-only coverage. He said patients with multiple sclerosis, some types of cancer, AIDS, rheumatoid arthritis and certain forms of mental illness can’t necessarily be treated effectively with generics. The insurers’ moves, he warned, would leave most Washingtonians in the individual market without adequate drug coverage.

Click the link above for more on this situation, and why we responded the way we did.

What was at stake in the ruling for Washington state

Earlier this month, we put out a report detailing what was at stake for Washington state -- down to the county level -- if the Affordable Care Act was thrown out by the Supreme Court.

The upshot was that more than 800,000 Washingtonians stand to get coverage through the Medicaid expansion OR to get subsidies to help them and their families pay for private insurance.

In addition, the report details the reforms, most of them largely unnoticed by the average person, that have already taken effect. Among these: Young adults can now stay on their parents' health coverage up to age 26, kids can't be denied insurance because they're sick, small businesses get tax rebates if they provide health coverage for workers, no caps on lifetime benefits, etc.

The most significant reforms will take place in 2014, including the state's new health care exchange, an online marketplace to shop for and compare insurance -- as well as a way for lower- and middle-income families to get substantial help paying for it.

The full report is at http://www.insurance.wa.gov/legislative/reports/Whats-at-stake.pdf.

Kreidler reaction to Supreme Court upholding health care reform law

OLYMPIA, Wash. – Insurance Commissioner Mike Kreidler expressed great relief with the U.S. Supreme Court’s decision upholding the Affordable Care Act and said Washington state is now well ahead of most states in reforming its health care system.

 

Many reforms are currently in place, but key benefits and programs take effect in 2014, including Washington’s new Health Exchange, federal subsidies to help 477,000 people afford health insurance, an expansion of Medicaid for 328,000 poor childless adults and the ban on insurance companies from denying people coverage if they’re sick.

 

“I’m very pleased the Supreme Court chose to uphold the Affordable Care Act,” said Kreidler. “We’ve been busy for two years now implementing the reforms and have made great progress, but there’s a lot left to do before 2014. With the court decision out of the way, we can continue our focus on where it should be – bringing relief to families struggling to find quality, affordable health insurance.”

 

The millions of Washington state consumers benefitting from the Affordable Care Act’s early reforms include:

 

• More than 2.4 million people who no longer face lifetime caps on their health benefits.
• More than 52,000 young adults up to age 26 who have stayed on their parents’ health plans.
• More than 1.2 million people who now have coverage for preventive care with no co-pays or deductibles.
• More than 60,000 people in Medicare who have saved hundreds on their prescription drugs.

 

Washington state also leveraged millions in federal funds available under the Affordable Care Act to create:

 

• Public access to health insurance rate requests. 
• A new marketplace in Washington state for health insurance in 2014 – called an exchange – where people can shop for health plans, compare their options and apply for subsidies.
• A temporary health insurance program (PCIP-WA) for people with pre-existing health conditions.

 

“The Affordable Care Act is not perfect, but it moves us in the right direction and is the only meaningful reform that’s passed in decades,” said Kreidler. “The debate was clearly contentious, and I’m grateful to have it behind us. But, now it’s time to focus on the work ahead – more than a million uninsured people in our state are counting on us.”

SCOTUS on PPACA (ObamaCare) June 28, 2012

Live blog while watching the decision on Scotusblog.

PPACA (ObamaCare) is upheld and will go forward! Individual mandate deemed constitutional.

I will blog later with more details.
_______________________________________________________________________________________

Well, that was an interesting morning and for many a bit of a surprise. The Supreme Court ruled that the individual mandate to purchase health insurance coverage is considered a "tax" and not a "penalty" and, as such, falls under Congressional authority and is constitutionally legal.

Undoubtedly there will be many announcements, blogs and video responses from the various parties with regard to this decision.

Below is a link to the PDF of the court's decision (all 67 pages):

SCOTUS Decision

Dave
www.an-insurance.com

Cease and desist order issued against Lenovo

Insurance Commissioner Mike Kreidler has issued a cease-and-desist order against computer maker Lenovo, barring the company from continuing to sell illegal service contracts in Washington state.

From May 2008 to May 2012, Lenovo (United States) Inc. is believed to have sold $153,415 worth of service contracts in the state. The plans, which covered repair or replacement of damaged Lenovo products, can only be sold to Washington residents by a licensed insurer or a registered service contract provider. Lenovo is neither.

Kreidler also ordered the company to mail a copy of the cease-and-desist order to all its Washington customers within 10 days.

Nothing in the order prevents the company from fulfilling the terms of the service contracts or from issuing a refund, if requested.

The company’s unauthorized sale of service contracts was initially disclosed by Lenovo itself when it applied for registration as a service contract provider in April 2011. At that point, the company said, it had already sold 855 contracts for $90,630.

When Kreidler’s staff reviewing the application sought more information, the company failed to respond, and later withdrew its application (December 2011). Lenovo later said it had sold a total of 1,327 contracts worth $153,415 to Washingtonians (May 2012).

The company has a right to demand a hearing. The order takes effect immediately.

iPhone Apps for Insurance Companies

Over the last year mobile applications for smart phones have begun to pop up amongst the different insurance companies that Fey Insurance represents. It started with Travelers and Progressive and has expanded into Safeco, Chubb and now Cincinnati Insurance Company. The applications all allow you to view your current policies and auto ID cards. They help give you contact information to report claims as well as advice on what to do during a claim. Some of the applications actually allow you to report the claim directly from the mobile device.

So how do you get your insurance carriers mobile application? First go to your most recent insurance policy declaration page for either your home or auto insurance. Double check which company you have. Once you know which company you have your insurance with then pull up the applications icon on your iPhone. In the search box type the company name. Once you have located the insurance company's application be sure to download it to your device. Some of the applications will allow you to setup your account right in the app but others may require that you first go to the insurance companies website and create a login.

When you are all finished creating a log in you are then set to use the app and have your personal insurance information handy at any time. Each app also has a button you can press to give us a call directly for more detailed assistance. Try it out today.

Theft charges for medical worker who submitted $4 million in bogus bills, sometimes claiming to be a doc

We're going to post a news release soon about this case:


A medical worker submitted at least $4.1 million in bogus bills to insurers, sometimes while falsely claiming to be a doctor or physician’s assistant, has pleaded guilty to theft.

Kenneth R. Welling, 45, of Lake Forest Park, pleaded guilty Thursday in King County Superior Court. The charges -- all of which are felonies -- include one count of first-degree theft and six counts of second-degree theft.

“This was a pretty audacious scam,” said state Insurance Commissioner Mike Kreidler. “We were tipped off to it when a patient contacted us, saying that Welling billed her insurer $89,000 for six surgeries that never happened.”

Welling is a registered surgical technologist and sole proprietor of Shoreline, Wash.-based Alpine Surgical Services. His license allows him to perform tasks like preparing supplies and instruments, passing them to the surgeon and preparing basic sterile packs and trays. But after patients had procedures done, he would often submit large bills with codes listing himself as a doctor or physician’s assistant. He is neither.

Kreidler’s investigators also found numerous instances in which Welling billed for surgeries that never happened. Sometimes he would include post-operative reports, listing himself as the surgeon.

No evidence was found to indicate that Welling was playing an improper role in actual medical care. The fraud involved billing.

“As far as we could tell, the only time he pretended to be a doctor was when he submitted bills,” said Kreidler.

In one woman’s case, Welling billed $140,323 as assisting surgeon for nine surgeries that never took place. Over a five-year period, he billed another woman’s insurer 107 times for 51 different surgeries, listing himself as the primary doctor. Hospital records show she’d only had surgery twice.

From 2004 through 2011, according to medical records obtained by Kreidler’s Special Investigations Unit, Welling billed five insurance companies at least $4.1 million for services he did not provide. He was paid $461,000.

“Part of the reason he got away with this for so long is that he’d rarely challenge an insurer who paid little or nothing,” said Kreidler. “He’d just send them the bills and hope they’d pay.”

The investigation also showed that some patients were complaining to their insurers.

“I am angry!” one woman wrote to her insurance company in 2011. “Here is yet another fraudulent claim. Can’t you people help me to stop this? I never had surgery on Aug. 27, 2009. I never met or had anything to do with Ken Welling.”

A sentencing date is expected to be scheduled soon.

Kreidler statement on Regence's proposed 14.7 percent rate hike

Regence BlueShield, one of Washington state's largest health insurers, is proposing an average 14.7 percent hike in premiums for its customers who buy coverage on their own.

Even with that increase, the company says it would also face a loss of $4.5 million from its surplus, which currently exceeds $1 billion.

Here's state Insurance Commissioner Mike Kreidler's statement on the proposal:

“We’ve just received this request. It will undergo a rigorous review by our actuaries.

“Regence contends that even with this increase, it would lose $4.5 million from the company’s surplus. To put that in perspective, that’s less than half of 1 percent of the company’s $1 billion surplus.

“In fact, Regence could continue to lose $4.5 million annually for the next 220 years and it would still have a surplus.

“A similar request by a sister company, Regence BlueCross BlueShield of Oregon, sought a 6.4 percent increase, starting August 1, 2012. But after our review and objections, it withdrew the request today. Any future rate request will face the same thorough scrutiny.”

Martin Vs. Blue Shield CA (The Next Feller-Freed)

After the Feller-Freed and Serencsa-Lichtman class action settlements with Anthem Blue Cross (Blue Cross of California) I assumed it would simply be a matter of time before similar action was taken against Blue Shield of California. That action was announced by Consumer Watchdog last week.

Blue Shield recently announced (and I blogged) the closure of the majority of their current individual health plans to be replaced by new plans July 1,2012.

Until this case is settled there really isn't a lot to talk about. I will blog when we get information regarding any potential settlement with Blue Shield and the plan migration choices that might be available to those on closed or closing individual plans.

Dave
www.an-insurance.com

Update: Anthem Blue Cross CA Closing Clear Protection Plus 1000 PPO

Anthem Blue Cross California has announced the options available to those who are currently members of the Clear Protection Plus 1000 PPO plan.

In my prior blog (CP Plus 1000 Closing) Anthem Blue Cross CA announced the closure of the plan on June 30, 2012. Today, Anthem provided clarification on the options available to those who are enrolled on the plan or those who will enroll before the end of the month. The options are as follows:

*Members currently on the Clear Protection Plus 1000 policy may remain on their policy and add family members to the policy subject to medical underwriting. They may do so until or unless they request a plan change via current underwriting procedures.

*Members may elect to change plans during a special open enrollment period from September 1, 2012 to September 30, 2012 with no medical underwriting. Clear Protection Plus 1000 members can move to the following plans during the open enrollment period:

*CoreGuard Plus 750 (06B6)
*CoreGuard Plus 1500 (06B7)
*Clear Protection Plus 3300 (06B4)

Any other plan changes besides the three plans above would require medical underwriting. The Clear Protection Plus 3300 (06B4) is currently a plan change option under the existing plan movement matrix.

Dave
www.an-insurance.com

Insurance tips: Credit scores and insurance scores

Many insurers use a credit-based "insurance score" as a factor -- a major factor, often -- in setting your rates. It's a quick way of quoting you a price, and insurers maintain that there's a correlation between these credit-based scores and a person's claims history.

Washington state limits how insurers can use these scores, and Commissioner Kreidler has repeatedly pushed for legislation to ban their use completely.

In Washington, insurers cannot hold the following things against you:

• The number of credit inquiries
• Collection accounts identified as medical bills
• A loan if it's the initial purchase or finance of a vehicle or home.

In Washington, insurers must also tell you if you didn't get the best rate due to your score. If this happens, you're entitled to a free copy of your credit report from the credit agency that your insurer used.

What goes into an insurance score? Here's the breakdown of a score from FICO, one of the biggest companies generating these scores for insurers:

• Payment History (40%) – How well you have made payments on your outstanding debt in the past

• Outstanding Debt (30%) – How much debt you currently have

• Credit History Length (15%) – How long you have had a line of credit

• Pursuit of New Credit (10%) – If you have applied for new lines of credit recently

• Credit Mix (5%) – The types of credit you have (credit card, mortgage, auto loans, etc.)

How can you improve your score? The same way you'd improve your credit score: make payments (bills, taxes, fines, etc.) on time. Keep credit card balances as low as possible. Think carefully before opening new lines of credit, such as a department store charge card, just to get a discount.
 
You can check your credit reports from the three nationwide consumer credit reporting companies annually at http://www.annualcreditreport.com/. If you find errors, contact the credit reporting company to have them corrected.
 

Insurance and vintage or antique cars

Q: I'm rebuilding my antique car and my grandfather's one-seater vintage biplane in my garage. Will my homeowners policy cover all the parts if they are stolen?

A: Probably not. Most homeowners policies exclude autos, aircraft, other motorized vehicles and their parts. You might have coverage for, say, a riding lawn mower or golf cart, but you'd be wise to talk to your agent and insurer about separate coverage that may be available for the parts during the rebuild process and after completion. Most antique cars and planes can be covered on specialized policies designed for their generally limited and unique use.



Note: This is one of a series of common -- or in some cases, particularly unusual -- questions received by our consumer advocacy staff, who answer questions from consumers.
Got a question or insurance problem of your own? If you live in Washington, feel free to give us a call, toll-free at 1-800-562-6900. We'll do our best to help. (And if you live in another state or territory, here's a handy map that lists the contact info for your local insurance regulatory office.)

Health Insurance Portfolio – An Analysis

Few years back we were very enthusiastic about the growth of Health Insurance portfolio. This was especially true during 2007-08, when this portfolio grew from Rs 3210 Cr to Rs 5110 Cr. i.e by 59.20%. Let us look at the growth figures from 2006 to 2012:

% Growth of Health Insurance over the Years

We have drawn graph showing the % growth YOY and, it shows that figure is fluctuating and is becoming less and less attractive as years have passed by.

Graph Showing % Growth Year  Over Year

Let us try to make projections for next 6 years.
We have done this with growth rate of 12%, 20%, 30% & 60%.

Projections for Health Insurance Portfolio

If we achieve figure of 30% then the portfolio will be Rs 64414 Cr. in 2017-2018.

If some one asks me- What should be the growth with which you will be happy?- I will say it should not be 30% gross but it should be 30% net (as we have to discount for inflation of 10% per annum in normal costs and 20% per annum in health care costs). Let us not be satisfied with meager growth of 16%- let us aim for 60%.
It means we should have growth of 60% year over year and then the figure will reach Rs 223892 crores.

Coming this fall: Agents and brokers in WA can submit fingerprints electronically

In Washington, as in most states, we require insurance agents and brokers to submit their fingerprints for the required background check.

For years, this has been done on paper cards, on which a worker rolls the applicant's inked fingers. It's messy, but more importantly, it's difficult to get good, usable prints. In fact, there's a 30 percent rejection rate by the State Patrol, meaning that the applicant has to go through the whole process again. We know it can be a pain, but we haven't had a good alternative.

So, good news: Starting late this summer or early fall, we will begin accepting electronically submitted fingerprints. We strongly encourage our resident applicants to use the service.

Why?

For one thing, the rejection rate is much lower. Instead of 30 percent, it's less than 3 percent.

It will also cost less. It now costs $42.50 to submit a paper fingerprint card. It will cost $32.50 to do it electronically.

It takes less time. In fact, in some cases, it could mean getting your license issued weeks earlier than with a paper card.

And there's probably a location close to you. More than 30 locations in Washington state can provide the fingerprinting service. Pearson Vue exam centers offer the service when applicants take the insurance exam, and the company also has a third-party vendor, Morpho Trust, that offers fingerprinting at several additional locations. You can find links to both on our new web page about electronic fingerprinting for insurance licensees.

Lastly, a question I know we'll get: Are electronic fingerprints required? No, not at this point. But we intend to require them starting during the first half of 2013.

Blue Shield HIPAA Plan Update

To follow up on my May 25th blog post regarding Blue Shield of California HSA 4000 plan closure for HIPAA, I wanted to post an update.

After several days of run around and legalese, I finally was able to determine that Blue Shield of California's current HIPAA portfolio is heavily weighted on DMHC (CA Dept of Managed Health Care) registered health plans (3) with only 1 CDI-registered plan (California Dept of Insurance). A normal arrangement would be 2 plans from each registration and, in the case of Blue Shield prior to 6/1, 3 DMHC and 2 CDI registered plans.

California Health & Safety Code requires an insurance company selling individual plans in California to offer two "popularly marketed health plans" to the HIPAA risk pool for each registration. Over the last several years most insurers have registered PPO plans with the Dept of Insurance (CDI) as opposed to the DMHC.

Blue Shield of California is opening a new portfolio of plans on July 1. The entire portfolio of PPO plans (Shield Secure Plus, Shield Secure, Shield Wise and Shield Savings) are registered with the DMHC in total with no new PPO plan registered with CDI. It totally took me by surprise as I can't remember the last time a carrier in California registered a PPO plan with DMHC.

So, because Blue Shield only has one remaining PPO plan registered with the CDI, that is the plan they offer in the HIPAA portfolio (Spectrum 5000).

Until such time as Blue Shield of Californa (and Life & Health) registers a second PPO plan with CDI, there will be no additional plans for HIPAA and the portfolio will consist of:

*Access+ HMO (DMHC)
*Access+ Value HMO (DMHC)
*Spectrum PPO 5500 (DMHC)
*Spectrum PPO 5000 (CDI)

Dave
www.an-insurance.com