Adrian man allegedly scams $1.7M in premiums
In May 2008, Jason Syrek, owner of CAS Resources, Inc., applied for group insurance with Blue Cross Blue Shield of Michigan, but submitted false information on enrollment applications for individuals who either did not exist or were not employed by CAS. Syrek did so in order to obtain health insurance coverage for ineligible out-of-state employees, which goes against existing BCBSM and Blue Cross Blue Shield Association policy. Unaware of these misrepresentations, BCBSM approved coverage.
CAS operated as a Professional Employer Organization in Adrian, Michigan. A PEO provides outsourcing of payroll, workers' compensation, human resources and employee benefits administration (including health care coverage). They hire “contract-to-hire” employees for a client then turn around and lease them back to the client. BCBSM’s PEO policy requires that each client’s company be headquartered in Michigan and enrolled separately from the PEO. Neither requirement was met in this case.
In November and December of 2010, Syrek allegedly collected premiums from CAS “employees,” and failed to send the payment for those premiums to BCBSM. As a result, BCBSM sustained a direct loss of premiums in the amount of $1,754,922.98.
In February 2011, Corporate and Financial Investigations referred this case to the police. Syrek admitted that he submitted false enrollment documents and planned to defraud BCBSM, while incarcerated in West Virginia. Investigation proved that in April, 2007, Syrek was indicted in Ohio for bank fraud, pled guilty and was sentenced to 13 months incarceration in connection with a PEO-related incident.
In October 2012, the FBI indicted and arrested Syrek for health care fraud. Syrek is scheduled to appear for examination in Federal Court, in Detroit, in January 2013. BCBSM holds that individuals are considered innocent until proven guilty.
Members who see anything suspicious on their Explanation of Benefits are urged to call our Anti-Fraud Hotline at 1-800-482-3787, or report fraud through our website.