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Insurance fraud, types and statistics for Washington residents

Insurance fraud is causing many headaches for Americans. Measuring the amount of insurance fraud can be difficult because no national agency keeps track of such crimes. The following statistics and research are the only ones available that may portray the growing national problem of insurance fraud crime.

Insurance fraud can range from auto insurance schemes to fake healthcare plans. Residents should be mindful of the potential consequences of insurance fraud allegations. A simple accusation can result in serious penalties because insurance fraud charges can be considered a federal crime. The prosecution of insurance fraud has become more stringent since 41 states implemented legislation to combat insurance schemes. Insurance fraud bureaus were also created, resulting in more data available regarding insurance scams. According to the Coalition Against Insurance Fraud, the most common insurance fraud involves auto insurance, with cases where staged accident rings stole billions of dollars a year from auto insurers by claiming insurance for treatment for fake injuries.

Another fraud problem deals with health insurance. According to the report, fraud crimes bilk $68 billion from the U.S. healthcare system every year. More than $2.4 billion dollars were recovered from fraud, waste and abuse in federal healthcare programs such as Medicare and Medicaid in the first quarter of fiscal year 2009. A total of 1,415 individuals and organizations were cut from the federal health programs due to fraud. Of these, 293 criminal cases were filed against those people involved in the crimes.

The alleged cost of insurance fraud makes the penalties for these charges more serious than many other federal crimes. Although the police, insurance fraud bureaus and other officials will do their best to investigate and obtain more evidence against a person accused of insurance fraud, an individual subject to federal charges has Constitutional rights that cannot be violated at any time.

Source: Coalition Against Insurance Fraud, "Fraud Statistics," Accessed Dec. 29, 2014

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