Allstate lawsuit alleges Jersey MDs bilked insurers |
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Written by U.S. Insurance News
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Monday, 23 June 2003 |
Under the New Jersey Insurance Fraud Prevention Act, Allstate New Jersey Insurance Company (Allstate New Jersey) and Encompass Insurance, a subsidiary of Allstate Insurance Company, filed a civil complaint June 18 in the Superior Court of New Jersey in Morris County against Juan Carlos Fischberg M.D., owner of Hudson Rehabilitation Medical Center, P.A., in West New York, New Jersey, and Boris Benson M.D., owner of a pain treatment and rehabilitation center in Teaneck, New Jersey.
MORRISTOWN, N.J. — Under the New Jersey Insurance Fraud Prevention Act, Allstate New Jersey Insurance Company (Allstate New Jersey) and Encompass Insurance, a subsidiary of Allstate Insurance Company, filed a civil complaint June 18 in the Superior Court of New Jersey in Morris County against Juan Carlos Fischberg M.D., owner of Hudson Rehabilitation Medical Center, P.A., in West New York, New Jersey, and Boris Benson M.D., owner of a pain treatment and rehabilitation center in Teaneck, New Jersey.
The lawsuit alleges Fischberg and Benson individually and jointly engaged in a fraudulent scheme that has resulted in the companies being defrauded out of millions of dollars in automobile insurance medical payments. According to the suit, the fraud operation involved the misrepresentation and fraudulent documentation of injuries and complaints of injuries in more than on1,000 Allstate New Jersey and Encompass insureds and others.
Since 1996, Allstate New Jersey and Encompass have paid over $7.6 million in personal injury benefits to Fischberg and Benson, according to Allstate New Jersey officials. Under New Jersey law, the companies are seeking treble damages within the lawsuit.
In addition, the suit is aimed at securing a declaratory judgment from the State court reflecting that Allstate and Encompass are not obligated to pay medical insurance benefits to Fischberg and Benson due to fraud. The legal action additionally seeks restitution of the substantial personal injury insurance benefits that have already been paid out to these doctors. Including personal injury restitution, the costs of investigation and suit, and treble damages. The companies will demand more than $22 million from the defendants.
Edward J. Moran, assistant vice president for Allstate Insurance Company's Special Investigative Unit, said the investigation of Fischberg began when it was discovered that the medical findings and treatment regimens for virtually all his patients are remarkably similar, and because he documents a very high rate of severe injuries in his patients. Likewise, the investigation of Benson began for similar reasons, and because of the referral relationship between the two doctors.
On average, the two facilities have billed the companies over $1.0 million per year, Moran pointed out. Fischberg and Benson continue to submit bills and to pursue unpaid bills via New Jersey's personal injury arbitration system. Allstate New Jersey and Encompass are also seeking a stay of all personal injury arbitrations and State court matters that have been filed by or on behalf of Fischberg and Benson for the payment of insurance benefits.
The lawsuit alleges that an aspect of the doctors' fraudulent activities was to obtain pre-certification for medical treatment and testing through the practice of fraudulently documenting, misleading and misrepresenting its insureds' complaints and injuries, according to Moran. The fraudulent documentation increased the doctors' success at arbitration and court hearings and also increased the value of the insureds' personal injury claims.
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