Benefits fraud not a victimless crime: CLHIA

by Leo Almazora05 Nov 2019

It’s been roughly a year since the Canadian Life and Health Insurance Association (CLHIA) launched its Fraud=Fraud campaign, and it has been very well received by the public.

That’s according to CLHIA President and CEO Stephen Frank, who says that the association has observed a positive response in its efforts to combat health and dental benefits fraud.

“We’re getting more clickthroughs on our anti-fraud websites, and more tips coming in,” Frank told Life and Health Professional. “There have also been very positive changes in behaviour that have been good to see.”

The campaign was originally driven by an Environics Research poll, which found that 75% of Canadians were under the mistaken impression that the only consequence of benefits fraud is having to pay higher premiums or reimburse claim payments. In reality, those who commit the act stand to lose their job or face criminal charges.

According to Frank, awareness and understanding of how serious the crime truly is has grown dramatically as the campaign has achieved its desired visibility. “There’s been a material shifting in the percentage of Canadians who understand that it’s a serious crime,” he said.

Aside from running the risk of jail time and termination — many, if not all employers have a zero-tolerance approach to benefits fraud — perpetrators also put their professional reputations on the line. Frank also highlighted the negative effects on other stakeholders, as fraudulent claims inappropriately inflate costs that employers have a hard enough time containing.

“We want people to understand that this isn’t victimless,” he said. “It’s not like there’s a big backstop of money that will ensure these benefits continue to exist in the future. There are broader impacts on your colleagues at work and their dependents; there are broader impacts on society as well if we don’t get this right.”

The motivations behind benefits fraud can be hard to pinpoint: some may see it as a crime of opportunity, while others could be driven by financial duress. The temptation to commit the act also tends to grow leading up to the end of the year, Frank said, as a “use it or lose it” mentality on benefits takes hold of plan members.

“We want people to be using their benefits for services and products that are medically necessary,” he said. “When you’re ill and you need to get better, absolutely use your benefits. But to use them when they’re not medically required is just an additional strain on plans.”

The initial phase of the campaign has been successful not just in improving people’s understanding of the issue, but also in educating them on how to recognize it. More Canadians are recognizing the red flags: intentional falsifying of claims, claiming for services that are not provided, changing amounts to be reimbursed, and pressure from colleagues or service providers to participate in such schemes.

“We’re also providing them some easy ways to report it and be part of the solution,” Frank said, citing the association’s website, “Combating fraud is going to require a partnership between insurers, providers, individual Canadians, and regulators. We want to take the lead on this, and we look forward to working with all stakeholders to address this issue.”


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