Allstate Seeks To Recover Funds From Local New York State Doctor

Based On $500,000 Fraudulent Billing Scheme

Aug 01, 2012, 18:00 ET from Allstate Insurance Company

HAUPPAUGE, N.Y., Aug. 1, 2012 /PRNewswire/ -- Allstate Insurance Company is seeking to recover $500,000 from a New York area medical doctor and his professional corporation in its 6th insurance fraud lawsuit of 2012. The complaint, filed under the Racketeer Influenced and Corrupt Organizations Act ("RICO") and principles of common law, alleges that the defendants engaged in schemes in which fraudulent and misleading bills were submitted to Allstate for services and testing that were of no diagnostic value and were not rendered as billed.

Among the allegations included in Allstate's complaint are that Nara Rehab Medical, P.C., submitted fraudulent and misleading invoices and medical records for electrodiagnostic testing to Allstate for reimbursement under New York State's No-fault law. Since 2003, Allstate has filed 42 fraud lawsuits in New York State seeking more than $228 million in damages.

According to the Insurance Information Institute, the state of New York is in an insurance fraud crisis and no-fault fraud is costing New Yorkers hundreds of millions of dollars year-after-year in higher premiums. "In essence, honest, hardworking New Yorkers are paying a "fraud tax," said Krista Conte, spokesperson for Allstate's New York office. "We need lawmakers to enact meaningful insurance reform that puts the citizens of New York first."

Allstate is joined by other insurers and many New York State leaders in its pursuit for comprehensive reform of the no-fault system.  "The no-fault system is being exploited and responsible citizens are the victims," Conte said. "Without the support of lawmakers, incidents of fraud will continue to increase. We need to work together to fix the broken no-fault system."

The lawsuit was filed following an investigation by Allstate's Special Investigative Unit and seeks to recover personal injury protection benefits Allstate paid on behalf of its customers during timeframes specified in the lawsuit.  The lawsuit is the latest in a string of actions taken by the insurer to protect consumers from these and similar activities.

For more information on the dangers of insurance fraud, and how you can help fight it, please visit Fraud Costs NY.

The Allstate Corporation (NYSE: ALL) is the nation's largest publicly held personal lines insurer known for its "You're In Good Hands With Allstate®" slogan. Now celebrating its 80th anniversary as an insurer, Allstate is reinventing protection and retirement to help nearly 16 million households insure what they have today and better prepare for tomorrow. Consumers access Allstate insurance products (auto, home, life and retirement) and services through Allstate agencies, independent agencies, and Allstate exclusive financial representatives in the U.S. and Canada, as well as via and 1-800 Allstate®.

SOURCE Allstate Insurance Company