Fraud Costs NY

Fraud Cost Facts

Fraud Costs New Yorkers Hundreds of Millions of Dollars Each Year

Fraud and lawsuit abuse by medical providers force New Yorkers to pay significantly higher insurance rates. The state’s broken no-fault auto insurance system, which pays for auto accident injuries, is plagued by fraud, overuse of health care services and lawsuit abuse, often by health care providers. In these days of tight budgets and economic uncertainty, consumers will benefit from regulations and legislation that reign in the fraud and abuse of the no-fault system.

NICB Reports 10 Percent Rise in New York Suspicious Claims Since 2008

Faked/Exaggerated Injuries and Excessive Treatment Lead Increase

The National Insurance Crime Bureau (NICB) today released its 2010 questionable claims (QC) referral reason analysis for New York. The report examines QCs associated with New York and referred to NICB from January 1, 2008 through December 31, 2010. The full report is available at: https://www.nicb.org/File%20Library/Public%20Affairs/NY-QCs08-10.pdf

What this means to New Yorkers:

• You pay the fourth highest automobile liability premiums in the nation.
• You pay 48 percent more for auto liability insurance than the national average.
• You pay 27 percent more than drivers in other no-fault states.
• Drivers in the Bronx pay almost nine times more for no-fault auto insurance than someone living in Albany.

No-Fault costs are high:

• New York’s average no-fault claim cost is 56 percent higher than the national median of $5,135.
• The average claim has increased by $2,146, or 36.5 percent, since 2004.
• Health care charges Downstate have risen 40 percent since 2006, while charges Upstate have fallen by 16 percent. The average yearly amount charged for treating no-fault victims is roughly 3 times higher Downstate than Upstate.

Fraud Costs New York:

• These higher costs and premiums primarily impact the Downstate region of New York City, Nassau, Suffolk, Westchester Counties and Queens, Manhattan and Staten Island.
• Some unscrupulous health care providers in Downstate New York are gaming the no-fault system by encouraging often unnecessary and excessive use of health care services and abusing the legal system.

• Rampant fraud contributes to New York City’s higher-than-average medical losses per claim and higher-than-average no-fault rates.

Legislative Testimony and Educational Resources:

Fraud Costs New York Fact Sheets

New York Senate Legislative Hearing Regarding No-Fault Fraud - Feb. 4, 2010