Press Release 2010-04 Medical Identity Theft Ring Busted

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Arizona Department of Insurance
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Phoenix, AZ  85007-2630


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Department of Insurance and Financial Institutions (DIFI).

Media Contact: Erin Klug Public Information Officer 602.364.3471 or [email protected]

For Immediate Release October 27, 2010

Phoenix - Gevorg Melkonyan and Elina Arutyunova have been criminally charged for their role in stealing the medical identity of several Arizona patients and then falsely billing insurance companies for medical services never provided. Their conduct created an inaccurate, and potentially harmful, medical history for the patients involved and an administrative headache for the doctors whose names were falsely used.

The suspects used the insurance records of 128 patients to submit phony claims totaling more than $600,000 to ten insurance companies. They also used the names and/or tax identification numbers of 12 reputable Arizona physicians, including Dr. Scott Bernstein, who reported the fraud to the Arizona Department of Insurance Fraud Unit. Dr. Bernstein became suspicious when patients he had never seen contacted him indicating their insurance statements showed he had billed their insurance for treatment.

Gevorg and Elina were indicted on charges of Conspiracy, Illegally Conducting an Enterprise, Assisting a Criminal Syndicate, Fraudulent Schemes and Artifices, Money Laundering, three counts of Theft, and Aggravated Taking the Identity of Another Person or Entity.

This case was investigated by the Arizona Department of Insurance Fraud Unit, with help from the Phoenix Police Department, Chandler Police Department, Arizona Attorney General’s Office, U.S. Department of Human and Health Services, and the National Insurance Crime Bureau. The U.S. Postal Service was integral to the success of the Insurance Department’s investigation.

Medical Identity Theft, a growing problem

Medical identity theft occurs when someone uses your personal medical benefit information without your knowledge to obtain or receive payment for medical treatment, services, or goods. This scam is on the rise and has serious ramifications for patients and the medical community. It is particularly dangerous because it puts patients at risk if their medical record contains harmful errors that could impact their future medical treatment or their ability to get insurance.

This type of fraud happens in all types of health plans, including private health insurance, as well as government benefit plans such as Medicare and Medicaid. Here are some tips to help prevent this type of identify theft:

  • √  Review your Explanation of Benefits and if you see a claim for services that you never received, immediately contact your insurance company or Medicare/Medicaid to report suspicious charges.

  • √  Never loan or “sell” your medical ID card or information to anyone.

  • √ At least once a year, request a listing of benefits paid in your name by any health insurers that made medical payments on your behalf.

  • √ Monitor your credit reports [Equifax, Experian, and TransUnion] for questionable medical debts.

Where to report

If you suspect someone may have submitted false claims using your identity, report it to the Arizona Department of Insurance Fraud Unit: (602) 364-2140.

If you receive benefits from Medicare or Medicaid, report suspicious medical bills to the Centers for Medicare/Medicaid Services www.cms.gov.

Report all types of identity theft to the Federal Trade Commission, www.ftc.gov.

About the Fraud Unit

The Arizona Department of Insurance Fraud Unit was established in 1994 to deter, investigate and facilitate convictions for insurance fraud. Fraud Unit peace officers have investigated and referred over 1,000 criminal cases of insurance fraud for successful prosecution. 

 

Period: 
2010
Priority: 
04
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Arizona's Surprise Bill Resolution Report for 2019

As shown in the attached report prepared pursuant to A.R.S. § 20-3118(A), the Department of Insurance received 91 requests for dispute resolution in Calendar Year 2019.  Of those, 53 have been resolved or closed, and health plan enrollees saved $41,538 by submitting their surprise bills for resolution.  

Not all health care bills qualify for the surprise bill resolution process.  The Department's Suprise Out-of-network Billing Dispute Resolution website (https://insurance.az.gov/soonbdr, and especially the section entitled, "I got a surprise bill. Can I submit a request for arbitration?") lists conditions when a health care bill may not qualify under Arizona law for the dispute resolution process.  But for those that do, the enrollee will only be responsible for paying the enrollee's cost-sharing amounts (copay, coinsurance and deductible) if the enrollee provides information the Department needs, and participates in an informal settlement teleconference with the health care insurer and the health care provider.

Fire Readiness and Your Insurance Coverage

Complete three steps to be prepared

STEP ONE: Inventory your contents. 
Making a record of what you have provides two major benefits.  First, it could help you estimate the cost of replacing your contents, which you could use to make sure you have enough insurance coverage.  Second, it will help you identify missing or destroyed items if you need to file an insurance claim. Keep your inventory records in a safe place outside your home, such as a safe deposit box at a bank, or in a secure online location. 

  • The National Association of Insurance Commissioners (NAIC) has a free app called, “MyHome Scr.APP.book,” available from Google Play and from the Apple App Store, which can help you keep track of your personal property. 
  • The Insurance Information Institute provides advice that can make creating a home inventory easier (https://www.iii.org/article/how-create-home-inventory).

STEP TWO: Understand what your homeowners’ insurance policy covers.
If you do not have your policy on hand, get a copy from your insurance company or insurance agent. Then, make sure your policy provides enough coverage for your dwelling, contents and additional living expenses.

  • Dwelling Coverage:  This pays to reconstruct your home, from ground up if necessary.  It does not include the cost of the land on which your home sits because you will still have that, but it should include the cost to remove a destroyed structure and replace it a home that is similar to what you had prior to the fire.
  • Contents Coverage:  This pays to repair or replace your personal belongings. Your policy may provide contents coverage based on a set percentage of your dwelling coverage, but you can pay for more contents coverage if you think you need it. 
    • Check to see if your coverage will pay “actual cash value” or “replacement cost.”  Actual cash value (ACV) means what an item was worth when it was destroyed based on its initial cost minus depreciation or loss in value due to its age, condition and wear-and-tear.  Replacement cost (RC) means the cost to replace or repair damaged or destroyed property with materials of “like kind and quality”. Claims for damaged or destroyed items will initially be paid based on the ACV of the item.  When the item is replaced, a copy of the receipt must be provided to the insurance company to obtain payment of the balance owed.  Many policies require the damaged items to be replaced within six (6) months.
    • If you have expensive items, such as artwork, jewelry or computers, you can purchase or increase “scheduled” property coverage to make sure you have sufficient coverage for those items.
  • Additional Living Expense (a.k.a. Loss of Use) Coverage. This pays additional costs you may resulting from the property damage.  For example, if you are not able to live in your home, your policy may cover the costs of lodging and food, boarding your pets, etc.

Importantly, insurance policies are often lengthy, detailed documents.  Do not hesitate to contact your agent or insurance company representative if you have any questions. 

STEP THREE: Minimize your fire risk.
Periodically inspect your home for overloaded power strips, damaged electrical cords or other potential fire hazards.  Keep vegetation and combustible materials away from your home.  If you are in an area that is at higher risk for wildfire, follow “Avoiding Wildfire Damage” guidelines published by the Federal Emergency Management Agency (https://www.fema.gov/pdf/hazard/wildfire/wdfrdam.pdf). 

Remain organized and keep good records

If you are the victim of a fire, remaining organized after an event can be difficult, but it is essential so that you can receive the benefits that your insurance coverage provides.

  • Keep all receipts for living expenses (housing, food, etc.) and for all items that you replace or repair.  Insurance companies may require that you submit original receipts. You should either copy, scan or take clear photos of receipts to provide yourself a backup. 
  • Take photos of your property and the damage.
  • Keep records of all your conversations, emails and letters about your claim with your insurance company and agent.  Take notes of conversations, documenting who you talked to, when you talked to them and what you were told. When possible, send an e-mail message to the person with whom you had the conversation to confirm your understanding of what you were told.
  • Do not throw away or destroy damaged property until your insurer inspects the property and tells you in writing/e-mail that you can do so.
  • Take an inventory of the damaged contents.  If you have an inventory from before the fire, use it to help identify items that were damaged/destroyed. 
  • When the insurer inspects the damage, do a complete walkthrough of your property and point out any issues or concerns you have.
  • When beginning the repair process, get multiple repair estimates from licensed contractors (look up records on the Arizona Registrar of Contractors “Contractor Search” page at https://roc.az.gov/contractor-search) with good reputations (look up records on the Better Business Bureau website at https://www.bbb.org).
  • Don’t delay.  Insurance policies generally have restrictions on how long after a fire you can file claims.

Persons with disabilities may request materials in an alternative format by contacting our Americans with Disabilities Act Coordinator at (602) 364-0108. 

Insurers Offering Individual Health Insurance in Arizona

Lists insurance companies that are offering health insurance to individuals and families in Arizona in 2020.  Open enrollment starts November 1st and now runs through December 17th, 2019.  Individuals can start shopping for coverage now at healthcare.gov or cuidadodesalud.gov (Spanish)

Notice of Proposed Rulemaking - Corporate Governance Annual Disclosure Model Regulation In 2019, the Arizona Legislature adopted the NAIC Corporate Governance Annual Disclosure Model Act at Arizona Revised Statutes (“ARS”) by enacting the Corporate Governance Act at Title 20, Chapter 2, Article 16 (Laws 2019, 1st Reg. Sess., Ch. 180, § 1).   The Department of Insurance (“Department”) seeks to adopt the correlate Corporate Governance Annual Disclosure Model Regulation.  ARS § 20-492.02 allows the Department to adopt rules to carry out the Act upon notice and an opportunity to be heard.  The Legislature has exempted the Department from Title 41, Chapter 6 for one year after the effective date of the Act.  (Laws 2019, 1st Reg. Sess., Ch. 180, § 2.)
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