5 habits of highly effective criminals

Insurance fraud perpetrators usually rely on five "sneaky tricks" to carry out their scams, according to an article in Property Casualty 360. To mitigate threats arising from these strategies, internal fraud risk identification forums may help, The Inner Auditor reported.

Let's look at the tricks:

1. Criminals follow market trends.

Criminals adapt schemes to market movements. Phony pain clinics, for example, may push heroin in response to rising demand following tighter controls on OxyContin.

2. Criminals victimize the vulnerable.

Case in point: Elderly beneficiaries have lost money to scammers pretending to be Medicare or payer representatives, as FierceHealthPayer: Anti-Fraud reported.

3. Criminals "make it happen on paper."

Staged car accident fraud rings targeting private payers create fictional paper trails for their schemes, with fake passengers, fake injuries and fake treatments, Property Casualty 360 noted.

4. Criminals exploit system weaknesses.

Fraudsters know how to game the healthcare system through upcoding and overbilling, the article said. "People who perpetrate fraud ... develop ways around any obstacle or roadblock put in their way," SIU expert Jack Price told FierceHealthPayer: Anti-Fraud.

5. Criminals swing for the fence.

"Although there are plenty of instances of small-potatoes insurance fraud," the article noted, "sophisticated perpetrators adopt the adage of 'go big or go home.'" For example, one of the largest Medicare fraud schemes ever perpetrated by a single enterprise was conducted by an international organized crime group with members and associates located in the United States and Armenia. That scheme operated phantom clinics nationwide and drove more than $100 million in bogus bills to Medicare.

In response to new fraud threats multiplying from these habits, investigators may implement a "cheap and surprisingly effective" risk control and mitigation structure: The emerging risk forum. The forum's purpose is to share intelligence about new fraud risks in regular meetings with internal stakeholders and upper management, The Inner Auditor stated.

These meetings can help payers systematically gather intelligence to monitor emerging fraud more effectively. Added advantages may include improving anti-fraud communication, overcoming organizational silos, and creating safe space for employees to deliberate risk and mitigation solutions.

For more:
- read the Property Casualty 360 article
- here's The Inner Auditor blog post

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