Can The Auto Insurance Model Work For Employer-Sponsored Health Insurance?

With most people with employer-sponsored insurance plans, an employee who never visits the doctor pays the same premium as her co-worker who is a regular in his doctors waiting room. But what about plans that either reward an employees healthy behavior or penalize those with risky lifestyles? takes a look at some plans being offered by Fortune 500 businesses like IBM, JetBlue and Caterpillar that take an approach to group health plans that resembles what you see in auto insurance policies.

Much like safe driving is often rewarded by auto insurers (and things like speeding tickets and accidents result in higher premiums), some of these plans are using this carrot/stick approach to encourage members to refrain from smoking, keep their cholesterol levels manageable, and maintain their treatments for chronic conditions.

The folks at IBM say their rewards plan, which has been in effect for years, has benefited both employees and employer. Workers who participate in exercise and nutrition programs can get up to $300/year in rebates. Between just 2005 and 2007, the company says it saved $190 million in health care costs, while the National Business Coalition on Health says IBM-ers pay upwards of 60% less on health care than the industry average.

JetBlue recently began a similar program that rewards employees (up to $400 for an individual and $800 for a family) who take part in wellness programs. Airline staffers with certain chronic conditions who enroll in care-management programs can slash even more off their premiums ($250 for an individual; $500 for a family).

Meanwhile, Dell is one of a growing number of companies that have eliminated employee co-pays for some medications and services. It also deducts $800 from insurance premiums for employees who take a health survey and check in with a health counselor once a quarter over the phone.

Experts say these attempts at encouraging employees to live healthier lifestyles are an improvement over previous efforts by businesses to simply reward workers who didnt visit the doctor. Those rewards, often in the form of bonuses, incentivized the notion of not seeking care, even when needed.

“By and large, that approach fell into disrepute because employees or their families were not getting the treatment they needed,” an Aon Hewitt rep tells Marketwatch. “Employees and families were just denying themselves care they needed so they could get a little cash.”

If you have a group health insurance plan that rewards healthy behavior (or penalizes unhealthy behavior), wed like to know whether you feel like its worse or better than what you had before. So if you want to share your thoughts, write up at

Texas Chiropractor Convicted In $3M Auto Insurance Fraud

Bryan Chiropractor Convicted of Defrauding Automobile Insurance Companies of $3 Million

US Attorney#39;s OfficeJanuary 22, 2013

Southern District of Texas (713) 567-9000

HOUSTON–A Bryan chiropractor has entered a plea of guilty to engaging in a conspiracy to defraud various automobile insurance companies of more than $3 million, United States Attorney

Kenneth Magidson announced today.

Chase Lindsey, 34, is the co-owner of Lindsey Chiropractic Care located in Bryan. Today, he admitted he participated in a two-year conspiracy to defraud numerous auto insurance companies by allowing fraudulent chiropractic bills to be created under his name for treatments that were never performed and used as support for fraudulent settlement demand letters sent to auto insurance companies.

Lindsey entered into an agreement with the office manager of a law firm which represented clients allegedly injured in auto accidents. Lindsey agreed to provide medical evaluations of, and recommend treatment for, those patients in exchange for $2,000 in cash per month, which totaled approximately $58,000 during the course of the conspiracy.

For the clients he actually evaluated, Lindsey routinely recommended medically unnecessary therapeutic treatments. In some instances, Lindsey either never evaluated the patient or did so after the patient had already begun receiving treatments. The treatments, if done, were done by unlicensed, untrained, and unqualified individuals whom Lindsey never supervised. Lindsey always prescribed the same six treatments, but the patients usually received only two: ice/heat packs and electric stimulation. He prescribed the treatments be done three to four times per week for five to six weeks, but patients usually went once a week for three to four weeks. Lindsey also provided no follow-up treatments.

Lindsey and others used four chiropractic clinics in the scheme. Lindsey started working at the first clinic, Texas Avenue Chiropractic Clinic, in February 2007 and continued until it closed on or about September 1, 2007. After that, Lindsey was listed as the only chiropractor at H amp; E Chiropractic and Private Chiropractic Care, two businesses also involved in the conspiracy. After Private Chiropractic Care shut down in September 2009, Lindsey and others agreed to continue the fraud scheme by sending the law firm clients to Lindsey Chiropractic Care–Lindsey#39;s chiropractic clinic. Clients were sent there until search warrants were executed in November 2009.

Despite changing the name and location of the chiropractic clinic four times, the fraud scheme remained the same. Co-conspirators recruited individuals allegedly involved in auto accidents to be represented by the law firm who were then sent to Lindsey to be evaluated. Lindsey routinely prescribed medically unnecessary treatment which was provided, if at all, by unlicensed, untrained, and unqualified individuals. Lindsey knew that most of the treatments were not being performed. Nonetheless, Lindsey allowed false and fraudulent chiropractic bills to be created under his name from each of the four clinics for treatments which were never performed.

The fraudulent bills were used as support for settlement demand letters sent to auto insurance companies which caused the insurance companies to issue settlement checks. Lindsey acknowledged the scheme to defraud the automobile insurance companies resulted in the submission of more than $3 million in false billing claims. The insurance companies paid at least $1.2 million in false claims during 2007-2009.

US District Judge

Kenneth Hoyt, who accepted the guilty plea, set sentencing for April 22, 2013. At that time, Lindsey faces up to 30 years in prison and a possible $1 million fine. As part of his plea agreement, Lindsey also agreed to pay restitution of $1.2 million to the insurance companies victimized by the scheme. Lindsey was permitted to remain on bond pending his sentencing.

The remaining defendants charged in relation to the conspiracy are set for trial on April 2, 2013.

The criminal charges are the result of a joint investigation by agents of the FBI and the National Insurance Crime Bureau. Assistant United States Attorney

Al Balboni is prosecuting the case.

State Farm aims to lower cost of auto insurance with new program

State Farm attracting attention over new program

Since early December, 2012, State Farm has been offering significant auto insurance discounts for those participating in the companys Drive Safe and Save program. Currently, this program is only available to drivers in Wisconsin, a state well known for its privacy advocacy. State Farm suggests that the program can help drivers save money on their insurance coverage, but some state officials suggest that the information that the insurer could obtain through the program outweighs the potential benefits that consumers may see.

Small device records a drivers habits

The program makes use of a small device that is installed within a vehicles diagnostic port. The device can track the miles a vehicle travels and record how well the vehicle performs and how well it is being handled by a driver. The system is very similar to one developed by Esurance, which is also used in a program designed to help consumers save money on their auto insurance. The problem is, of course, that such programs are not designed solely for the benefit of consumers.

Information collected through program could be used by advertisers