18 Pa CS 4117 Insurance fraud
- Offense defined
A person commits an offense if the person does
any of the following:
- Knowingly and with the intent to defraud
a State or local government agency files,
presents or causes to be filed with or
presented to the government agency a
document that contains false, incomplete
or misleading information concerning any
fact or thing material to the agency's
determination in approving or
disapproving a motor vehicle insurance
rate filing, a motor vehicle insurance
transaction or other motor vehicle
insurance action which is required or
filed in response to an agency's request.
- Knowingly and with the intent to defraud
any insurer or self-insured, presents or
causes to be presented to any insurer or
self-insured any statement forming a part
of, or in support of, a claim that
contains any false, incomplete or
misleading information concerning any
fact or thing material to the claim.
- Knowingly and with the intent to defraud
any insurer or self-insured, assists,
abets, solicits or conspires with another
to prepare or make any statement that is
intended to be presented to any insurer
or self-insured in connection with, or in
support of, a claim that contains any
false, incomplete or misleading
information concerning any fact or thing
material to the claim, including
information which documents or supports
an amount claimed in excess of the actual
loss sustained by the claimant.
- Engages in unlicensed agent, broker or
unauthorized insurer activity as defined
by the act of May 17, 1921 (P.L. 789, No.
285), known as The Insurance Department
Act of one thousand nine hundred and
twenty-one, knowingly and with the intent
to defraud an insurer, a self-insured or
the public.
- Knowingly benefits, directly or
indirectly, from the proceeds derived
from a violation of this section due to
the assistance, conspiracy or urging of
any person.
- Is the owner, administrator or employee
of any health care facility and knowingly
allows the use of such facility by any
person in furtherance of a scheme or
conspiracy to violate any of the
provisions of this section.
- Borrows or uses another person's
financial responsibility or other
insurance identification card or permits
his financial responsibility or other
insurance identification card to be used
by another, knowingly and with intent to
present a fraudulent claim to an insurer.
- If, for pecuniary gain for himself or
another, he directly or indirectly
solicits any person to engage, employ or
retain either himself or any other person
to manage, adjust or prosecute any claim
or cause of action against any person for
damages for negligence or for pecuniary
gain for himself or another, directly or
indirectly solicits other persons to
bring causes of action to recover damages
for personal injuries or death, provided,
however, that this paragraph shall not
apply to any conduct otherwise permitted
by law or by rule of the Supreme Court.
- Additional offenses defined
- A lawyer may not compensate or give
anything of value to a nonlawyer to
recommend or secure employment by a
client or as a reward for having made a
recommendation resulting in employment by
a client; except that the lawyer may pay:
- the reasonable cost of
advertising or written
communication as permitted by the
rules of professional conduct; or
- the usual charges of a
not-for-profit lawyer referral
service or other legal service
organization. Upon a conviction
of an offense provided for by
this paragraph, the prosecutor
shall certify such conviction to
the disciplinary board of the
Supreme Court for appropriate
action. Such action may include a
suspension or disbarment.
- With respect to an insurance benefit or
claim covered by this section, a health
care provider may not compensate or give
anything of value to a person to
recommend or secure the provider's
service to or employment by a patient or
as a reward for having made a
recommendation resulting in the
provider's service to or employment by a
patient; except that the provider may pay
the reasonable cost of advertising or
written communication as permitted by
rules of professional conduct. Upon a
conviction of an offense provided for by
this paragraph, the prosecutor shall
certify such conviction to the
appropriate licensing board in the
Department of State which shall suspend
or revoke the health care provider's
license.
- A lawyer or health care provider may not
compensate or give anything of value to a
person for providing names, addresses,
telephone numbers or other identifying
information of individuals seeking or
receiving medical or rehabilitative care
for accident, sickness or disease, except
to the extent a referral and receipt of
compensation is permitted under
applicable professional rules of conduct.
A person may not knowingly transmit such
referral information to a lawyer or
health care professional for the purpose
of receiving compensation or anything of
value. Attempts to circumvent this
paragraph through use of any other
person, including, but not limited to,
employees, agents or servants, shall also
be prohibited.
- A person may not knowingly and with
intent to defraud any insurance company,
self-insured or other person file an
application for insurance containing any
false information, or conceal for the
purpose of misleading information
concerning any fact material thereto.
- Electronic claims submission
If a claim is made by means of computer billing
tapes or other electronic means, it shall be a
rebuttable presumption that the person knowingly
made the claim if the person has advised the
insurer in writing that claims will be submitted
by use of computer billing tapes or other
electronic means.
- Grading
An offense under subsection (a)(1) through (8) is
a felony of the third degree. An offense under
subsection (b) is a misdemeanor of the first
degree.
- Restitution
The court may, in addition to any other sentence
authorized by law, sentence a person convicted of
violating this section to make restitution.
- Immunity
An insurer, and any agent, servant or employee
thereof acting in the course and scope of his
employment shall be immune from civil or criminal
liability arising from the supply or release of
written or oral information to any entity duly
authorized to receive such information by Federal
or State law, or by Insurance Department
regulations.
- Civil action
An insurer damaged as a result of a violation of
this section may sue therefor in any court of
competent jurisdiction to recover compensatory
damages, which may include reasonable
investigation expenses, costs of suit and
attorney fees. An insurer may recover treble
damages if the court determines that the
defendant has engaged in a pattern of violating
this section.
- Criminal action
- The district attorneys of the several
counties shall have authority to
investigate and to institute criminal
proceedings for any violation of this
section.
- In addition to the authority conferred
upon the Attorney General by the act of
October 15, 1980 (P.L. 950, No. 164),
known as the Commonwealth Attorneys Act,
the Attorney General shall have the
authority to investigate and to institute
criminal proceedings for any violation of
this section or any series of such
violations involving more than one county
of the Commonwealth or involving any
county of the Commonwealth and another
state. No person charged with a violation
of this section by the Attorney General
shall have standing to challenge the
authority of the Attorney General to
investigate or prosecute the case, and,
if any such challenge is made, the
challenge shall be dismissed and no
relief shall be available in the courts
of the Commonwealth to the person making
the challenge.
- Regulatory and investigative powers additional to
those now existing
Nothing contained in this section shall be
construed to limit the regulatory or
investigative authority of any department or
agency of the Commonwealth whose functions might
relate to persons, enterprises or matters falling
within the scope of this section.
- Violations, penalties, etc.
- If a person is found by court of
competent jurisdiction, pursuant to a
claim initiated by a prosecuting
authority, to have violated any provision
of this section, the person shall be
subject to civil penalties of not more
than $5,000 for the first violation,
$10,000 for the second violation and
$15,000 for each subsequent violation.
The penalty shall be paid to the
prosecuting authority to be used to
defray the operating expenses of
investigating and prosecuting insurance
fraud. The court may also award court
costs and reasonable attorney fees to the
prosecuting authority.
- Nothing in this subsection shall be
construed to prohibit a prosecuting
authority and the person accused of
violating this section from entering into
a written agreement in which that person
does not admit or deny the charges but
consents to payment of the civil penalty.
A consent agreement may not be used in a
subsequent civil or criminal proceeding,
but notification thereof shall be made to
the licensing authority if the person is
licensed by a licensing authority of the
Commonwealth so that the licensing
authority may take appropriate
administrative action. Penalties paid
under this section shall be deposited
into the Insurance Fraud Prevention Trust
Fund created under the act of December
28, 1994 (P.L. 1414, No. 166), known as
the Insurance Fraud Prevention Act.
- The imposition of any fine or other
remedy under this section shall not
preclude prosecution for a violation of
the criminal laws of this Commonwealth.
- Insurance forms and verification of services
- All applications for insurance
and all claim forms shall contain or have
attached thereto the following notice:
"Any person who knowingly and with
intent to defraud any insurance company
or other person files an application for
insurance or statement of claim
containing any materially false
information or conceals for the purpose
of misleading, information concerning any
fact material thereto commits a
fraudulent insurance act, which is a
crime and subjects such person to
criminal and civil penalties."
- Repealed.
- Definitions
As used in this section, the following words and
phrases shall have the meanings given to them in
this subsection:
- Insurance policy
A document setting forth the terms and
conditions of a contract of insurance or
agreement for the coverage of health or
hospital services.
- Insurer
A company, association or exchange
defined by section 101 of the act of May
17, 1921 (P.L. 682, No. 284), known as
The Insurance Company Law of 1921; an
unincorporated association of
underwriting members; a hospital plan
corporation; a professional health
services plan corporation; a health
maintenance organization; a fraternal
benefit society; and a self-insured
health care entity under the act of
October 15, 1975 (P.L. 390, No. 111),
known as the Health Care Services
Malpractice Act.
- Person
An individual, corporation, partnership,
association, joint-stock company, trust
or unincorporated organization. The term
includes any individual, corporation,
association, partnership, reciprocal
exchange, interinsurer, Lloyd's insurer,
fraternal benefit society, beneficial
association and any other legal entity
engaged or proposing to become engaged,
either directly or indirectly, in the
business of insurance, including agents,
brokers, adjusters and health care plans
as defined in 40 Pa.C.S. Chs. 61
(relating to hospital plan corporations),
63 (relating to professional health
services plan corporations), 65 (relating
to fraternal benefit societies) and 67
(relating to beneficial societies) and
the act of December 29, 1972 (P.L. 1701,
No. 364), known as the Health Maintenance
Organization Act. For purposes of this
section, health care plans, fraternal
benefit societies and beneficial
societies shall be deemed to be engaged
in the business of insurance.
- Self-insured
Any person who is self-insured for any
risk by reason of any filing,
qualification process, approval or
exception granted, certified or ordered
by any department or agency of the
Commonwealth.
- Statement
Any oral or written presentation or other
evidence of loss, injury or expense,
including, but not limited to, any
notice, statement, proof of loss, bill of
lading, receipt for payment, invoice,
account, estimate of property damages,
bill for services, diagnosis,
prescription, hospital or doctor records,
X-ray, test result or computer-generated
documents.
HISTORY: 12-28-94, Act 165, 1 (PL 1408), eff.
2-26-95; 7-6-95, Act 28, 2 (PL), eff. 9-4-95;
12-19-90, Act 219, 1 (PL 1451), eff. 12-19-90;
2-7-90, Act 6, 2