Truth or consequences

Blue Cross Blue Shield of Michigan works with our contracted agents to generate enrollment of new groups and new individuals. Agents are required to determine if groups and individuals meet the eligibility criteria for coverage by asking questions or asking for documentation. Unfortunately, there are times when an agent fails to fulfill these requirements. This leads to the enrollment of ineligible subscribers or members, which then leads to payment of claims for ineligible subscribers or members.

The Corporate and Financial Investigations Department conducts investigations whenever Blue Cross sustains losses due to fraud, waste or abuse. Here are two examples of our agent investigations:

  • CFI conducted a payroll audit and determined a group couldn’t produce copies of payroll records or W2s for three alleged employees. Agent X, who was a friend of the group owner, had relied on the owner’s word that the “employees” were eligible and didn’t ask for records. Blue Cross canceled the contracts of the three individuals, and Agent X was required to refund commissions to Blue Cross.

  • CFI received information that Agent Y had re-enrolled four alleged employees for a group without approval from our Underwriting Department. Underwriting had canceled the four employees’ contracts because they didn’t meet the criteria of full-time employment. Agent Y had counted the employees’ actual hours worked and their on-call hours to determine their eligibility. CFI reviewed the group’s employee handbook, which specifically stated that for health insurance purposes, three on-call hours equaled one hour worked. Using this formula, the group owner agreed the four employees were part-time employees. Blue Cross canceled the contracts of the four individuals, and Agent Y was required to refund commissions to Blue Cross.

CFI and Sales Force Development conduct statewide joint presentations to agents throughout the year. During those presentations, we reinforce to agents that they are responsible for the truthfulness of enrollment documentation submitted to Blue Cross. Agents are informed that there are consequences for failure to adhere to Blue Cross’ policies; the consequences include commission refunds, agent agreement terminations and possibly criminal prosecution. Blue Cross is committed to taking a proactive compliance approach by providing education to agents.                      

If you suspect health care fraud, waste or abuse, please call our Anti-Fraud Hotline at 1-800-482-3787.