Post Date June 27, 2012 –  A New Jersey social worker will be facing a probation sentence after pleading guilty to committing third degree health insurance –related fraud.   State Attorney General Jeffrey Chiesa had announced recently that Rashmi Gupta, 39 years old, had pleaded guilty to the act of defrauding Medicaid by submitting unscrupulous time sheets pertaining to counseling services of troubled teenagers.  Gupta’s sentencing was scheduled on June 22 before Judge Clark. With her pleading guilty, New Jersey’s Office of the Insurance Fraud Prosecutor had recommended her to probation, and that she will be banned from reimbursement through the Medicaid for five years. With regards to her profession, Gupta’s case has already been brought up to the New Jersey Board of Social Work Examiners for possible actions on her social work license.

Gupta who worked with the TYSN (The Youth Success Network) in Passaic, had disclosed that between July and December 2010, time sheets for counseling services even if none was provided.  With her fraudulent time sheets, TYSN demanded claims from the Medicaid and then paid Gupta. Based on the social worker’s timesheets, she was paid for $10,177.50 for services that never existed.  Ronald Chillemi, Insurance Fraud Prosecutor, had said Gupta’s fraud schemes and other fraud on health insurance in NJ continues to thrive, stealing huge amounts of the state’s tax dollars.

Gupta’s scheme was discovered when one client reported to TYSN that the social worker did not render them such services. With this information, TYSN notified the Office of the Insurance Fraud Prosecutor. The case was then thoroughly investigated by Medicaid Fraud Control through unit acting chief Nicole Rizzolo, Deputy Atty. Gen. Dolores Blackburn, and Detective Luisa Sanchez. Gupta’s probation sentence is due to a state law that if a person is found guilty with a third-degree crime but not previously convicted of any indictable offense, that person’s incarceration sentence can be presumed against.

On a personal note; insurance fraud is on the rise.  Anyone whom has followed my Blog knows I focus a fair amount of attention to car insurance fraud and the effect this has on the auto insurance industry. Sadly, there are far more people whom are aware of those whom commit insurance fraud than actually perpetrate the crime.  The sad thing is; the cost of insurance fraud is built into the premium of every car insurance policy in New Jersey.  Believe it or not, a $1000.00 auto insurance premium would be less than $700.00 if there was no insurance fraud.  The next time you hear about someone about to defraud an insurance company – think about how much that act has cost you over the last 10 years.

-Mike

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602

Post Date June 24, 2012 –  With all the natural disasters which have hit the Garden State the last few years; New Jersey’s Acting Insurance Commissioner, Ken Kobylowski, recently called on to New Jersey residents to prepare for this year’s hurricane season.  The state insurance department encouraged its residents, especially those living near coastal areas,  to have their plans in place to secure their  properties against major storms.   The hurricane season in the Atlantic is believed to last until the end of November this year. The National Weather Service is expecting at least 15 storms for this season.  Learning from last year’s experience with Hurricane Irene, state officials suggest that residents should ensure their safety and must have enough protection for their properties. This goes along with telling state residents to review their homeowner’s insurance policy and to purchase additional protection such as Flood Insurance Coverage if needed.  By reviewing their Homeowner and Flood Insurance Policies, residents should ensure all essential perils are covered.  Kobylowski also called on residents to conduct a home inventory. By doing this, residents can identify the gray areas in their policy helping them decide on which insurance coverage they shall need to add.

The New Jersey State Insurance Department had also suggested separately that residents shall consider buying a Flood Insurance Policy.  It’s vital to remember a Homeowner’s Insurance Policy in any US State does not include coverage for flood. Flood insurance policies can only be bought from the National Flood Insurance Program and their carriers or brokers.  Aside from advocating that residents shall have sufficient insurance coverage, Kobylowski also encourages the residents to take precautionary measures to mitigate the possible effects of these major storms.   You can always attempt to limit storm damage by ensuring storm shutters are installed properly, trees are trimmed, roof sheathings are secured and you and your family have an evacuation plan to the nearest storm shelter.

Mike

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602

Post Date June 21, 2012 –  Since wildfires ravaged parts of New Jersey, NJ State Authorities call for homeowners to review their Homeowners Insurance policies to assure their homes have sufficient protection from such type of disasters.  New Jersey’s Department of Banking and Insurance (DOBI) together with the Department of Environmental Protection (DEP) and the Department of Community Affairs (DCA) have reminded the state’s residents especially those who live near forest areas to maintain home insurance coverage that have wildfire protection. DOBI acting commissioner, Ken Kobylowski stressed that this months break from extreme dry weather makes it as an ideal time for residents to review their homeowners insurance policies to make sure they have the necessary coverage “to replace their homes and all contents in the event of a loss due to a wildfire.”

Since the start of the year, wildfires had already burned more than 2,500 acres in New Jersey. Though the rains have significantly reduced fire threat levels within the state, wildfires continue to pose a threat especially in the Pine Lands Region of NJ. A report from the State Fire Service showed that the number of wildfires that struck New Jersey areas this year had already exceeded last year’s total.  According to DEP Commissioner Bob Martin, wildfires are commonly caused by human activity such as arson, or plain carelessness and negligence. Wildfires might start when someone carelessly tossed a cigarette or a match, or due to unattended campfires, or a poorly maintained chimney.

To help residents in reviewing their home insurance policy, the DOBI recommend conducting home inventory to help them assess their insurance needs, and to inquire about the umbrella insurance policy for coverage of high-valued items. To cut down on homeowners insurance expenses,  DOBI also recommends that residents should inquire from their insurance providers about discounts when mitigation steps against wildfires are being taken.  One item not mentioned in the report is those whom rent their home or apartment near a high risk wildfire area.  Keep in mind an owners dwelling or homeowners Insurance Policy which insures the building you live in, will not cover your personal possessions. If they are lost in a fire – they’re gone forever.   If you want to guard against a fire loss, you must purchase a Tenants or Renters Policy which not only covers your personal property – it covers you for liability if you started the fire by accident.  In many cases, that careless act of a burning cigarette or iron left on is the fault of a renter or tenant.  The owner of the building and the others in the building can sue you for negligents.  If you maintain a renters insurance policy, you are covered for accidental acts.  If you are sued, your renters insurance policy will not only pay for your legal defense, they will pay the amount of the judgement against you.

-Mike 

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602

Post Date June 16, 2012 – A girl friend sending a text to her boy friend driving his car in the State of New Jersey has been proven not to be the cause of a car accident.  Although the vehicle’s driver is also being held responsible, a New Jersey Judge feels charging a person sending the Text is illegal.

Just recently, a New Jersey judge ruled that a person sending a message to a person who is driving a vehicle in the State of New Jersey shall not be held liable if that vehicles drivers has a crash while the driver is responding to that text message. This ruling came out after an injured couple sued a woman who sent a text message to his boyfriend who at that time was driving a car and caused the couple’s injuries. The case stemmed from an incident that took place in September 2009 in Mine Hill, New Jersey. The victims, David and Linda Kubert sued Shannon Colonna, girlfriend of Kyle Best to whom the motorcycling victims had an accident with. Kubert’s lawyer had argued in court that Colonna had played a role in the accident as she was sending text messages to Best while he was driving therefore causing the accident. Asking for Colonna’s liability to the accident from the jury, Kubert’s lawyer, Stephen Weinstein insisted that however the respondent is not physically present at the incident, she was still “electronic present”. Colonna’s counsel countered the argument saying their client does not have the control as to how and when Best would reply to her messages therefore she has no hand at the accident. Colonna also testified that at the time of her texting, she was unaware that Best was driving. New Jersey State Superior Court Judge David Rand sided with Colonna and dismissed the claims filed against her. The said accident had resulted to the amputation of Linda’s leg, while David also suffered serious leg injuries.

On the other hand, at the case filed against him, Best pleaded guilty to distracted driving and was ordered by the court to speak to students of 14 high schools on the dangers of texting while driving. In addition, the driver was also ordered to pay $775 in fines. The Kuberts and their lawyer who had been disappointed with the decision will file an appeal for their case.

-Mike

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602

Post Date June 14, 2012 – After figuring out the husband of an employee to whom he alleged to having an affair with his wife, the chief executive officer of an established insurance company in Pennsylvania is now facing charges of defiant trespass and simple assault.  The insurance CEO identified as Kenneth Melani, 58 years old, of Highmark Inc., was charged on May 30 this year of the said cases by the Oakmont police force in Allegheny County. As stated in the local media reports, Melani allegedly went to the house of Mark Mayler, where the assault took place on Sunday. Mark is married to Melissa Myler who told authorities that her affair with the Highmark CEO started shortly after she was hired at the company on October last year. The affair was discovered on January by Melani’s wife who later then told Mark Myler.

According to the criminal complaint, after the affair was discovered, Melissa moved out from their house in Oakmont and moved in with Melani.  Highmark Inc., through their spokesperson, Michael Weinstein released a statement to the media stating that Melani’s case is a personal matter and that the CEO is already on an unpaid leave of absences from the insurance company to resolve the issue.  If convicted, his termination is assured. The Pittsburgh-based insurance company is a licensee of the Blue Cross and Blue Shield Association. It provides insurance coverage to about 4.8 million Pennsylvania and West Virginia residents. In 2010, Highmark had revenues of $14.6 billion.

 -Mike 

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602

Post Date June 10, 2012 – In order to further promote and circulate research materials on risk and insurance, University of Pennsylvania’s Wharton School recently establishes the new Wharton/Penn Risk and Insurance Program (WPRIP).  According to a university press release, WPRIP will promote the interdisciplinary study on the theoretical, empirical, domestic and global topics on the area of insurance and risk management. The topics will include government risk management, as well as corporate and household risk management, health and longevity risk management, property risk and casualty insurance. WPRIP will also promote research on Pennsylvania health and life insurance, pensions, and the legal aspects of risks management and insurance.  Scott Harrington, a Wharton professor of the University of Pennsylvania on Insurance and Risk Management and Health Care Management, also the current WRIP academic director, stated that crisis related to health, financial, and meteorological had underscored the need for a much comprehensive insurance and risk management study. Harrington as quoted said, “Our goal (WPRIP) is to provide new insights that will provide valuable to policy makers, consumers, and insurance and risk management professionals alike.”  The new program has been established in conjunction with the said university’s Law school and the Leonard Davis Institute of Health Economics. WPRIP activities will showcase workshops and conferences, working paper series, white papers, funded research and periodic research briefs.

Wharton School is a business school of the University of Pennsylvania with campuses in Philadelphia and San Francisco. It is being considered to be first business school in the United States. One of their already-existing global initiatives pertaining to the insurance industry are the: S.S. Huebner Foundation for Insurance Education that was named after the pioneer of insurance education, Solomon S. Huebner; Boettner Center for Pensions and Retirement Research; and the Pension Research Council. WPRIP will work closely with this existing Wharton centers to leverage each other’s capabilities.

– Mike

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602

Post Date June 8, 2012 – The United States Senate and House of Representatives have now agreed on extending the National Flood Insurance Program (NFIP) until July 30, giving it 60 days more.  The program should have ended on May 31.  Now, the Senate and House Representatives legislation to extend the flood insurance program and awaits President Obama’s signature.  NFIP’s 60-day extension is being viewed as a victory for many homeowners across the country especially those living within flood-risk areas.  The program provides affordable insurance coverage for homeowners with regards to flood insurance policies.

 According to Steve Rothman, a congressman from New Jersey, extending the flood insurance program is vital to their state where there are over 35,000 flood insurance policies that are active, insuring properties worth nearly $54 billion. In a press release, Rothman was cited saying that last year alone, NFIP had paid out $624,608,371 for flood losses in New Jersey. Rothman viewed that if the said insurance program was not extended, property owners who had been obliged to buy flood insurance will be incapacitated to complete mortgage transactions, and that claims payments for Hurricanes Lee and Irene would be halted. In addition, the insurance program had benefit a lot of New Jersey areas, helping people recover from flood damages like in Hudson, Passaic and Bergen Counties.

Since 2008, the NFIP was already caught in the loop of short-term extensions and that in 2010, it already expired four times. The recent extension had also come timely for the start of the Atlantic hurricane season. Jim Grande, a senior official of the National Association of Mutual Insurance Companies, said that the brewing storms in the upcoming Atlantic hurricane season shall serve as a reminder for the need of a strong and viable flood insurance program.  The two-month extension for NFIP will also provide the opportunity for legislators to study the problems of the said program and formulate its solutions.  On the other hand, several groups including that of the Property Casualty Insurers Association had lobbied for reforms of the NFIP and its long-term reauthorization.

-Mike

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602

Post Date June 3, 2012 – Well, that’s not exactly all he bought or the way it happened!  Joe was shocked one morning when he discovered that thousands of dollars had been deposited into his bank account.  Like many may do, he went on a shopping free spending almost all the money that magically-appeared in his checking account.  He bought a dog, a car, PA car insurance and other necessities. This lucky guy is Mr. Joseph Bucci, a resident of Trevose, Pennsylvania. He is now facing a 14-year jail term after spending the money that was mistakenly deposited into his account. The mistake stemmed from a typo error of a Wells Fargo teller who should have sent the $69,300 funds to an escrow account with a similar account number. Bucci’s account which a week ago only contained a $35 balance.

Upon learning that he had become suddenly “rich”, Bucci did not inform the bank of the mysterious appearance of the funds but instead unconditionally squandered the money. Bucci, whom is unemployed, bought a brand new Pontiac, a golden retriever, additional furniture for his house, branded clothes, food, and a round trip ticket to Orlando. He also bought himself  a PA car insurance policy (Not from InsureDirect) for his newly purchased Pontiac. Police have also learned that Bucci spent some of the money to pay off the utility bills for his family.

The mistake had only been discovered after the deposited funds failed to appear in intended bank account.  Wells Fargo then started tracing the transaction before contacting the police. Bucci was then charged of two third-degree felonies – receiving stolen property and theft of property lost. This may cost him 14-years in jail.  His case is being heard before Judge Joseph Falcone of the Bensalem District.  Bucci was released on $25,000 bail.  It was reported that Bucci turned himself over to authorities with only $2,000 remaining from the $69,300 funds that went missing.  A CBS report quoted Bucci as saying: “from the start I knew it was going to catch up with me” ; “I just did not realize that it was going to be this bad.”

-Mike

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602

Post Date June 1, 2012  –Pennsylvania senators are now working on a proposal that will empower the state’s citizens to prohibit laws that will force them to buy health insurance.   This particular attempt is aimed at striking off the “individual mandate” provision of the Patient Protection and Affordable Care Act (PPACA). The said proposal which will be a constitutional amendment is being worked on by 19 PA lawmakers led by State Senate President Pro Tempore Joe Scarnati, a Republican. It has been learned that the proposal of these PA senators has already been approved by the Senate’s Banking and Insurance Committee last month. This move is being viewed by some as a blow to the PPACA which is also colloquially known as Obama care. If the said proposal would run smoothly at the Senate as well as at the House of Representatives, and if it will have the backing of Pennsylvania Governor Tom Corbett, PA residents will be able to decide whether to strike off the “individual mandate” provision through a referendum, as early next year.

To some analysts, it is unconstitutional for the federal government to compel residents in buying health insurance in Pennsylvania or in any other states.  One citizen had commented that, “If the government can compel people from doing so, then can there be any limits then to what else they can compel us to do?

In a Bloomberg report, it has been known that there also same proposals against the healthcare reform law being worked on in 23 other states, with voters in Arizona and Ohio having already approved the constitutional amendments that have prevented their citizens from law that requires them to buy health insurance.

The PPACA came into law when US President Barack Obama signed it on March 23, 2010. This law’s passing had seen a very rough storm as all Republican senators have voted against it, and while at the House of Representatives, it had a 219-212 votes. After its passing, the constitutionality of this healthcare reform law is being questioned at the US Supreme Court which is expected to have its decision by June this year.

-Mike 

Michael E. Dortch
President &  Managing Agent
InsureDirect.com
Corporate Home Office
618 South Broad Street
Lansdale, Pennsylvania  19446
(800) 807-0762  ext. 602