Allstate Seeks $3.5M in Medical Fraud Lawsuit Against Calif. Chiropractor

January 13, 2004

Allstate Insurance Company and Allstate Indemnity Company began serving summons and complaints upon an Los Angeles County chiropractor and his wife, accusing them of taking part in schemes designed to defraud the companies.

Paul Yan, DC, Winnie Yan and Paul Yan Chiropractic Corporation are accused of reportedly operating a scheme of excessive billing, fraudulent billing and billing for services that were never rendered. The lawsuit alleges that more than 150 false or inflated claims were submitted to Allstate by Yan for patient services including examinations, diagnostic testing and treatment. According to the complaint, filed in Los Angeles Superior Court, most of the patients had been involved in minor car accidents and suffered from minor soft tissue injuries.

Allstate is seeking more than $3.5 million under a California law passed to help combat insurance fraud. Five years ago, Allstate Insurance Company filed the first lawsuit under the 1995 state law designed to augment law enforcement’s efforts to prosecute defrauders and in 2001 won an $8.2 million jury award. Allstate has filed a number of similar lawsuits under this statute, emphasizing its zero tolerance for insurance fraud.

“The suit served today and similar ones filed across the country are a result of Allstate’s nationwide commitment to protect our customers and shareholders from the added expense directly linked to insurance fraud,” said Edward J. Moran, assistant vice president of the special investigative unit at Allstate. “We are committed to taking the profit out of fraud.”

The National Insurance Crime Bureau estimates that insurance fraud schemes cost consumers $20 billion a year.

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