The health insurance industry is growing and being chanted about like the new mantra, but, still, India is facing a huge loss in this sector because of the every day increasing fraud claims. Fraudulent health insurance claim actually is a claim generated to cover or deform information which is designed to provide health care benefits. Frauds can be of many types and committed by the insurer or the insured. Let’s understand them -
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Deliberate fraud is a purposeful act of presenting accident or loss which is covered under the policy. Whereas, opportunity fraud is created by policyholders by overstressing a genuine claim or providing wrong information related to the pre-existing diseases etc. to get the underwriting done in their favour.
External fraud is claimed by either an individual or entities like policyholder, beneficiaries, medical service providers or vendors against a company. Internal fraud, on the other hand, is carried out against a policyholder or its company by other employees like a manager, executive or agents.
Nowadays, consumers have become aware of the norms, features and rules of the insurance and have started getting benefited by being involved in frauds. Policyholder frauds are divided into 3 categories - eligibility fraud, claim fraud and application fraud.
This fraud generally constitutes the falsification of the information provided about the insured’s employment status, pre-existing diseases or information concerning the dependent. Here, the beneficiary is paid benefits illicitly, for example, if a person submits a claim for the dependent or relative who is not covered under the policy. Another case is when a part-time employee is not covered under some health plan provided by the company for full-time employees but, my generating false records with any HR employee he is successful in receiving the benefits.
It is generally committed in the health insurance sector where the consumer knowingly enters forged information in its application related to the pre-existing diseases, claim or important dates. For instance, a policyholder might not enter the details related to his pre-existing diseases or serious medical conditions in order to get an extensive coverage and have problem free claim filing. Even, at times, the employer plays with the joining date of the employee by getting things approved from the insurance company.
When a consumer enters an illegal claim for whose benefit he is not entitled to, the fraud is called claim fraud. He can ask for a false claim which is especially seen under maternity covers. In such intentional cases, the provider and member are seen to go for collusion and thus, benefiting the physician. These kinds of groups are also known as fraud rings. Another case - a policyholder can even turn to create insurance speculation, wherein, he purchases several health insurance policies without letting the insurance companies know this fact and enjoys claim settlement from all.
Moreover, the agents or hospitals generate higher medical bills related to hospitalization, treatment etc. to cheer their pockets.