NU Online News Service, Dec. 21 2:26 p.m. EST
Chalk up Allstate’s 34th fraud lawsuit since 2003 in the state of New York.
This time the insurer is seeking to recover $6.3 million from 83 defendants who allegedly submitted fraudulent and misleading bills to Allstate.
Allstate claims that durable medical retail equipment companies took advantage of New York’s no-fault auto insurance law to submit or facilitate the submission of fraudulent bill and documents for reimbursement.
“The no-fault system is being exploited and responsible citizens are the victims,” says Krista Conte, Allstate spokeswoman, in a statement. “Without the support of lawmakers, incidents of fraud will continue to increase.”
Allstate has joined other insurers and some state leaders in an attempt to reform the auto insurance system in New York. The Northbrook, Ill.-insurer has sued to recover more than $185 million in fraud-related damages in New York since 2003.
This year Allstate filed seven lawsuits.
In its latest, filed under the Racketeer Influenced and Corrupt Organizations Act (RICO) and other grounds under local law, Allstate names 30 durable medical retail equipment companies and 25 alleged owners of the companies, as well as 18 durable medical wholesale companies and 10 owners.
The defendants, in what Allstate calls “separate, but parallel schemes,” submitted alleged bogus bills to get paid for equipment, supplies and orthotic devices.