PIANY Urges Legislative Action on Auto Insurance Fraud

The the Professional Insurance Agents of New York State Inc. (PIANY) has issued a statement urging the New York State Legislature and Gov. George Pataki to pass legislation to address auto insurance fraud.

Both the Assembly and the Senate have passed their own anti-fraud bills, but they differ in detail. PIANY is urging Assembly Speaker Sheldon Silver and Senate Majority Leader Joseph Bruno to exercise their leadership in resolving remaining differences, and Governor George Pataki to exert his influence by sponsoring three-way meetings to assure the job gets done.

“According to the Insurance Department, fraud adds more than $1 billion in costs to New York’s auto insurance system annually,” PIANY President David Isenberg said. “Since our state laws require people to buy auto insurance, lawmakers should take responsibility to ensure their premiums aren’t inflated because of dishonesty.”

Isenberg noted the Insurance Department has done its part by changing its rules governing the filing of no-fault claims. “But insurance regulations can accomplish only so much; more direct action against fraud perpetrators is needed,” Isenberg said.

PIANY recommends the criminalization of “runners”—organizers of fake accidents who also coordinate the run-up of huge medical bills with crooked clinics. More time should also be granted to insurers to challenge suspicious claims. Currently, insurers get 30 days.

In addition, PIANY advocates setting treatment standards. Approved standards could reveal unnecessary or fictitious doctor visits, treatments, tests and procedures. The association is also urging a crackdown on medical fraud. New York needs a no-fault certification system. Decertification would bar health care providers caught committing fraud from treating no-fault cases in the future.

Finally, PIANY asserts that arbitration for provider disputes should be mandated. As it stands, arbitrated decisions on disputed medical payments aren’t binding, which clogs both the arbitration and the court systems.