I suppose it’s events like the fraud described in this New York Times article that keep us in business – the business of conducting medical evaluations on disability claims to ensure claimants are treated appropriately. But it’s hardly an event we’re celebrating at MCN: the cost of this type of fraud is staggering. From the complaint:

“And based [upon] my analysis of the data, including but not limited to the percentage of L.I.R.R. applicants handled by the three doctors discussed in this complaint and actual disability payouts to date, I further estimate that the fraudulent scheme could cause the R.R.B. to pay unwarranted occupational disability benefits exceeding $1 billion dollars if disbursed in full.”

The disability benefits are only part of the cost. The article also notes, “The doctors were paid — often in cash — between $800 to $1,200 for each fake assessment and narrative, in addition to the millions of dollars in health insurance payments they received for unnecessary medical treatments and fees for preparing false medical records to support the disability claims, the complaint said.”

Widespread fraud such as this are compounded by enormous opportunity costs in wasted physician time, increased insurance rates,  and other costs society absorbs one way or another. As the author notes, “The charges involving the railroad come at a time when public workers’ unions across the country have faced heavy criticism for negotiating pension obligations that have led many government agencies to slash services and lay off teachers, police officers and other workers.” Read more…