When a benefits plan loses money to fraud, the cost of the plan increases. Employers have a limited number of levers at their disposal to keep that cost down, which may include increasing deductibles, reducing or eliminating benefits—or stopping the benefits plan altogether.

These changes can lead to unintended “consequences” for the people whose health and wellbeing are at risk and who rely on their benefit plans the most:

• the son or daughter of a work colleague that needs extensive medical care, the cost of which isn’t covered by MSP,
• the spouse that manages a debilitating chronic medical condition with an expensive drug, or
• the plan member who is struggling with a mental health issue and can’t afford the treatments they desperately need.

When we ask employees why they committed fraud or insurance abuse, they often tell us that insurance providers are considered socially acceptable targets. They say that they don’t view submitting a false claim as fraud, that insurers “have deep pockets”, and that they felt entitled because they “pay for their benefits”.

They don’t understand they were stealing from their employer; at worst, they thought they would simply have to pay the money back if caught.

Benefits fraud vs insurance abuse

Benefits fraud happens when there is an intent to obtain reimbursement for claimable goods or services that were never provided. For instance, you get a facial at a spa but you’re given a receipt for registered massage therapy, or you receive group Pilates training from a physio support person when the receipt says it’s a physiotherapist treatment, or you buy non-prescription sunglasses but your receipt says they’re prescription.

When the benefit plan is being used in a way that is contrary to the intended purpose of the benefit, that’s considered insurance abuse. Examples of this include letting someone not covered by your plan use your benefits, switching dependents after a plan maximum has been reached in the hope that the insurer doesn’t look too closely at the receipt, or buying a covered item, getting reimbursed for it, and then returning it for a full refund (that’s called “double dipping”).

Know how to refuse and report benefits fraud

Understanding how to use your benefits properly can help you guard against potential fraud.

• Familiarize yourself with your benefits plan and the limits of your coverage.
• Keep your personal benefits plan information in a safe place and don’t lend your card to anyone.
• Be sure you understand the treatments, services, and products being prescribed to you -- don’t be afraid to ask questions.
• Make sure that the explanation of benefits (EOB) and receipts provided by your insurer contain accurate information about the services or products you received.
• If you notice anything suspicious, tell your employer or insurer. You can contact our Whistleblower Hotline at 1 800 661-9675 or pbc-ethics.com – it’s completely confidential.

It should never be socially acceptable to criminally divert money away from enabling health care to people who need it most.  To learn more about benefits fraud, go to the Canadian Life and Health Industry Association’s Fraud=Fraud website.