Allstate Insurance Company Files $2 Million Health Care Fraud Lawsuit Against No-Fault Professional Corporations and Owners

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Since 2003, Allstate has filed 81 fraud lawsuits in New York State seeking more than $319 million in damages.

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

Allstate Insurance Company is seeking to recover more than $2 million in damages against thirteen professional corporations, including All County Diagnostic Chiropractic Services, P.C., Alliance Spine Associates, L.L.C., Haar Orthopedics & Sports Medicine, P.C., Horizon Anesthesia Group, P.C., Main Street Med Care, P.C., New Horizon Surgical Center, L.L.C., NY Medical Solutions, P.C., NY Spine Physical Therapy, P.C., Regency Healthcare Medical, P.L.L.C., Upper Eastside Surgical , P.C., Walter E. Mendoza Chiropractor, P.C., WEM Diagnostic Chiropractic Services, P.C., and Willets Point Chiropractic, P.C., in its second insurance fraud lawsuit of 2018. Since 2003, Allstate has filed 81 fraud lawsuits in New York State seeking more than $319 million in damages.

The complaint was filed in the Supreme Court of New York, Nassau County against the following defendants: Walter E. Mendoza, D.C., Anthony DeGradi, Richard Grosso, D.C., Robert Haar, M.D., Wayne Hatami, P.T., Mussarat Iqbal, M.D., Roman Kosiborod, M.D., Kenneth McCulloch, M.D., Richard Seldes, M.D., Stefan Trnovski, M.D., All County Diagnostic Chiropractic Services, P.C., Alliance Spine Associates, L.L.C., Haar Orthopedics & Sports Medicine, P.C., Horizon Anesthesia Group, P.C., Main Street Med Care, P.C., New Horizon Surgical Center, L.L.C., NY Medical Solutions, P.C., NY Spine Physical Therapy, P.C., Regency Healthcare Medical, P.L.L.C., Upper Eastside Surgical , P.C., Walter E. Mendoza Chiropractor, P.C., WEM Diagnostic Chiropractic Services, P.C., and Willets Point Chiropractic, P.C.

It alleges that the corporations acted in concert to defraud Allstate for reimbursement of unnecessary procedures by chiropractors and physicians at New Horizon Surgical Center in New Jersey. The complaint alleges that the professional corporations submitted fraudulent and misleading invoices and records to Allstate for reimbursement under New York State’s No-fault Law notwithstanding that they were not entitled to be paid due to the services not being necessary or not being provided as billed. The Complaint alleges that manipulations under anesthesia ("MUAs") were routinely performed without necessity, and in some cases the reports misrepresented the service actually performed. The defendants purposefully steered patients from New York to New Jersey in an attempt to embellish their billing and seek reimbursement under the New York State no-fault system. The services provided, including the use of the facility in New Jersey, were not necessary for the patients and only served to increase the amount billed for by the defendants.

According to the insurance information institute, no-fault fraud is costing New Yorkers millions of dollars year-after-year. “In essence, honest hardworking New Yorkers are paying a 'fraud tax',” said Jaclyn Darrohn, Allstate 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.”

Docket Number: 608378/18

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Christina Kelly
@AllstateNewYork
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