Allstate Insurance Wins Insurance Fraud Suit, Will Receive $3.9M in Penalties, $3.8M in Fees
Los Angeles County Superior Court has ruled in favor of Allstate Insurance Company and the State of California in a lawsuit topping $7 million that ends fraudulent business and billing schemes by unlicensed medical and chiropractic personnel.
In its lawsuit, Allstate (NYSE: ALL) alleged Maria Miranda, Frank Rivera and LA Healthcare Management, Inc. violated the state's Insurance Fraud Protection Act when they submitted to Allstate more than 390 chiropractic claims that were falsely generated by unlicensed and untrained personnel, or because the billed treatments did not reflect patients' physical needs.
Judge William Fahey agreed with Allstate and ordered Miranda and Rivera to pay Allstate $3.9 million in penalties, plus $3.8 million in assessments and fees—a $7.7 million judgment.
"Submitting even one false insurance claim is more than just a bad idea—it's fraud, and insurance fraud is a crime," said Allstate's California Field Vice President Phil Telgenhoff. "Fraud drives up the cost we all pay for insurance by stealing millions of dollars from insurers. This cannot and will not be tolerated in California or anywhere."
"Allstate will fight fraud to help protect our customers and keep insurance costs down," Telgenhoff said.