Allstate Seeks to Recover $1.1 Million from New York State Medical Clinic and Doctor

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Allstate Insurance Company is seeking to recover $1.1 million from a New York area medical doctor and his professional corporation in its third alleged insurance fraud lawsuit of 2017.

In essence, honest hard working New Yorkers are paying a “fraud tax,” said Jaclyn Darrohn, Allstate New York spokesperson. “We need lawmakers to enact meaningful insurance reform that puts the citizens of New York first.

Allstate Insurance Company is seeking to recover $1.1 million from a New York area medical doctor and his professional corporation in its third alleged insurance fraud lawsuit of 2017. The complaint, filed under the Racketeer Influenced and Corrupt Organizations Act (“RICO”) and principles of common law, alleges that the defendants engaged in a scheme 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. The case was filed in the Federal Eastern District of NY, docket number 17-CV-01599.

Among the allegations included in Allstate’s complaint are that Dr. Benjamin M. Chang, M.D., through Liberty Physical Medicine & Rehabilitation, 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 75 fraud lawsuits in New York State seeking more than $310 million in damages.

According to the Insurance Information Institute, No-Fault fraud is costing New Yorkers millions of dollars year-after-year. “In essence, honest hard working New Yorkers are paying a “fraud tax,” said Jaclyn Darrohn, Allstate New York spokesperson. “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,” Darrohn said. “Without the support of lawmakers, incidents of fraud will continue to increase. We need to work together this legislative session to fix the broken No-Fault system.”

The Allstate Corporation (NYSE: ALL) is the nation’s largest publicly held personal lines insurer, protecting approximately 16 million households from life’s uncertainties through auto, home, life and other insurance offered through its Allstate, Esurance, Encompass and Answer Financial brand names. Allstate is widely known through the slogan “You’re In Good Hands With Allstate®.” The Allstate brand’s network of small businesses offers auto, home, life and retirement products and services to customers in the United States and Canada. In 2015, The Allstate Foundation, Allstate, its employees and agency owners gave $36 million to support local communities. Allstate employees and agency owners donated 250,000 hours of service across the country.

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Christina Kelly
@AllstateNewYork
since: 02/2010
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