Three Residents Indicted for Insurance Fraud by Grand Jury

Late last month in New Castle County, a Grand Jury indicted multiple residents for insurance fraud. The indictments stem from Department of Insurance Fraud Prevention Bureau investigations, in partnership with the Delaware Department of Justice. They allege that following vehicle accidents, each indicted resident did knowingly present false information to auto insurers or otherwise caused false information to be presented.

“I want to commend our Fraud Prevention Bureau for their work identifying deceitful activity and helping to bring those who would defraud Delaware residents and companies to justice. Their efforts continue to send a strong message that fraud will not go unnoticed here, which can prevent future crimes,” said Insurance Commissioner Trinidad Navarro. “Through this work, we can help keep insurance premiums from rising by helping to make sure companies do not have to pay out fraudulent claims, and we can educate residents that engaging in fraud is very costly.”

A resident of Wilmington was indicted on September 27 following a two-vehicle auto accident and a fraudulent claim filed with Permanent General Insurance. The resident had no insurance at the time of the accident but obtained it afterward, and intentionally misrepresented the date of the accident to obtain a benefit that they were not entitled to. Video evidence was uncovered that confirmed the accurate date of the accident.

A resident of Newark was indicted on September 27 for knowingly misrepresenting the time of an auto accident. During the investigation, evidence was obtained that confirmed that the resident had no auto insurance coverage at the time of their accident and that their auto insurance policy was obtained after the accident had occurred. They engaged in insurance fraud through intentionally providing false information in order to obtain a benefit that they were not entitled to from Good to Go Insurance.

An additional resident was indicted for similar activity in an attempt to defraud Progressive Insurance. The resident obtained an auto insurance policy and filed a claim two days later, stating that their vehicle was struck by an unknown vehicle while parked at their residence. An examination of vehicle damage was inconsistent with this depiction, and the investigation further identified that the vehicle was involved in an accident three days prior to obtaining insurance coverage.

An indictment is merely an allegation and is not evidence of guilt. In all cases, defendants are presumed innocent until and unless proven guilty. Insurance Fraud is a felony.

Commissioner Navarro has a background in law enforcement and serves as Chair of the National Association of Insurance Commissioner’s Antifraud Task Force. The Delaware Department of Insurance Fraud Prevention Bureau is fully funded by annual assessment fees, not taxpayer dollars, and employs staff with extensive law enforcement and insurance investigative backgrounds and training, including credentials such as Certified Fraud Specialists and Accredited Healthcare Fraud Investigators.

The Bureau facilitates the detection of insurance fraud and works to reduce fraud occurrence through enforcement and deterrence. Additionally, the Bureau requires restitution for deceptively obtained insurance benefits, and by doing so reduces the amount of premium dollars used to pay fraudulent claims, in turn decreasing the likelihood of premium increases. The Bureau can be reached by toll free hotline (800) 632-5154, or (302) 672-7350, or by emailing fraud@delaware.gov. Reporting known or suspected fraud is free of charge and can be done confidentially.


Medicare Assistance Bureau Shares Resources in Advance of Open Enrollment

Free one-on-one counseling and information available to residents; Bureau earns federal grant

The Delaware Medicare Assistance Bureau (DMAB), a division of the Delaware Department of Insurance, is encouraging residents to get ready for Medicare Open Enrollment. DMAB, which provides free, one-on-one Medicare counseling, offers a myriad of virtual appointment options for residents, as well as video tutorials and other guides that can assist in beneficiaries’ preparation. DMAB has provided more than 3,000 counseling sessions so far this year, saving beneficiaries more than $372,438 in premiums through application help.

DMAB will engage in thousands of counseling sessions during Medicare Open Enrollment, which takes place October 15 through December 7. During this time, beneficiaries can make changes to their health and drug coverage and review existing coverage against other options. DMAB will offer virtual appointments throughout this period, available via Webex, Duo, and Microsoft Teams, as well as by phone. Residents are encouraged to register for a MyMedicare.gov account prior to their counseling session so that DMAB can generate personalized plan comparisons.

“Our DMAB team works to increase residents’ understanding of the complex Medicare system and can even help save you money. I encourage the community to reach out to our team for Medicare assistance and information,” said Insurance Commissioner Trinidad Navarro.

A Virtual Medicare Seminar, which DMAB began to offer in 2020, is available on-demand online, and educates participants on topics including Medicare benefits, supplemental insurance policies, Medicare Advantage plans, prescription drug coverage and details on signing up. While specifically created for new or soon-to-be eligible beneficiaries, the informative series can be helpful for all Medicare participants.

“Many people have questions about Medicare and don’t know where to start, and COVID-19 has only increased the stress of choosing the right healthcare plans. We are here to help people in Delaware deal with the complex and often confusing health insurance system,” said DMAB Director Lakia Turner, “and, we’re more accessible than ever through our new virtual programs.”

As Medicare Open Enrollment approaches, the Department of Insurance reminds residents to scrutinize any contact during the open enrollment period to ensure it is from a known, credible source. The most frequent fraudulent contact occurs by phone, but residents should review all communications carefully.

“If you are receiving contact regarding Medicare that you did not initiate, or contact not from one of your healthcare providers, it could be fraudulent,” said Commissioner Navarro. “Protect your Medicare Number like you do your Social Security number or bank account information, and never give it out to unknown or unexpected callers.”

DMAB has been awarded a Medicare Improvement for Patients and Providers Act (MIPPA) 2021 Grant from the federal government, which will provide the bureau $71,943. The annual MIPPA grant has and will assist the bureau’s outreach, education, and one-on-one beneficiary assistance programs over the next year by assisting those beneficiaries who are likely to be eligible for the Low-Income Subsidy program (also called “Extra Help”) or Medicare Savings Programs.

The Delaware Medicare Assistance Bureau provides free one-on-one health insurance counseling for people eligible for Medicare. Residents can call DMAB at 1-(800) 336-9500 or (302) 674-7364 to set up a free, confidential session. Counselors can assist with Medicare, Medicaid, Medigap (Medicare supplement insurance), long term care insurance, billing issues, prescription savings, and much more.

 View DMAB’s 2021 Open Enrollment Flyer


Delaware Receives $10.8 Million to Improve Access to Affordable Health Coverage through Reinsurance Program

NEW CASTLE (Sept. 7, 2021) – The Biden Administration has awarded Delaware $10,831,203 through the Centers for Medicare & Medicaid Services (CMS) to improve access to affordable, comprehensive health insurance coverage through its section 1332 state-based reinsurance waiver. Delaware is one of 13 states to receive these funds, also known as “pass-through funding,” which are available to states with approved section 1332 waivers that also have lowered premiums in implementing their waiver plans.

“We are grateful to the Biden Administration for acknowledging the progress of our reinsurance program in making health insurance more affordable and more accessible on the individual market,” Governor John Carney said. “During the COVID-19 pandemic, it is even more important that Delawareans have access to affordable coverage.”

In June 2019, Governor John Carney signed enabling legislation to create a reinsurance plan in Delaware, and in August 2019, CMS authorized the program. Under Delaware’s reinsurance program, which began Jan. 1, 2020, a portion of high-cost health care claims that drive up insurance rates for everyone on the individual market are reimbursed through a fund. The fund uses a mix of federal funding and assessments collected by the Delaware Department of Insurance from health insurance carriers. The Delaware Health Care Commission administers the program.

Delaware’s reinsurance plan, which is authorized by the federal government through 2024, has lowered premiums on the Health Insurance Marketplace on average more than 19% in the first two years. In addition to reducing premiums on the marketplace, the reinsurance program benefits anyone who buys coverage on the individual market, including people who are not eligible for coverage at their workplace, those who are too young for Medicare or make too much money to be eligible for Medicaid, young people who have aged off their parents’ plans, or those who are self-employed.

As a result of changes made in the American Rescue Plan Act of 2021 (ARP), residents in Delaware and the other 12 states implementing reinsurance waivers may have access to more affordable health insurance coverage. States will also have more pass-through funding to implement their waiver, and they may also have their own state funding—that otherwise might have been spent on 2021 reinsurance costs–available to pursue innovative state strategies to further improve affordability.

These funds, also known as “pass-through funding,” are determined on an annual basis by the Department of Health and Human Services and the Department of the Treasury.

The additional funds announced by CMS range from $2.5 million to $139 million per state – varying based on factors such as the size of the state’s reinsurance program. The funds are the result of expanded subsidies provided under the ARP, which will result in new individuals enrolled, and will cover a portion of the states’ costs for these reinsurance programs.

“This investment is a testament to our Administration-wide commitment to making health care more accessible and affordable,” said HHS Secretary Xavier Becerra. “This funding from the American Rescue Plan will reduce monthly health care costs for consumers, increase coverage, and provide more options. We will continue to work with states to strengthen the health care system as we respond to the COVID-19 pandemic.”

“Reducing a family or individual’s average monthly health coverage costs frees up that money for other needs,” said CMS Administrator Chiquita Brooks-LaSure. “The Biden-Harris Administration continues to work with states to reduce costs and deliver more affordable health coverage options. This is another example of how the American Rescue Plan is helping more people meet their health care needs.”

States with approved section 1332 state-based reinsurance waivers have experienced reduced premiums in the individual market. Delaware’s next open enrollment on the Health Insurance Marketplace will be Nov.1-Dec. 15 for coverage beginning in 2022.

Beyond reduced premiums, section 1332 state-based reinsurance waivers may help states maintain and increase issuer participation, and may increase the number of qualified health plans (QHPs) available from year to year.


$12.3 Million in Health Insurance Rebates for Individuals and Small Businesses

Highmark plan participants and groups to receive checks

Insurance Commissioner Trinidad Navarro announced today that Highmark Blue Cross Blue Shield Delaware will issue rebates totaling over $12.3 million to some Delawareans. Residents who purchase insurance on the Delaware Health Insurance Marketplace, those who purchase Highmark Delaware plans outside of the marketplace, and Highmark small group policyholders may receive rebates as a result of the Medical Loss Ratio (MLR) calculation.

MLR measures an insurer’s spending on medical expenses to confirm that at least 80 percent of premiums are being used for policyholders’ healthcare and prescription needs. It is an accountability measure included in the Affordable Care Act (ACA) that holds insurers to a strict standard and requires refunds if the threshold is not met. Insurers are not permitted to retain funds above this value for any reason, including to lower premiums for future years, as the policyholders effected may change. MLR is calculated on a three-year average – 2018, 2019, and 2020 were used in this assessment.

“Requiring insurers to meet the MLR ratio is one of the most critical tools the ACA gave us to protect consumers. These guardrails ensure residents and small businesses get the care they pay for, or get their money back – and they’re more important now than ever before,” explained Commissioner Navarro, who pointed to policyholders’ decreased and delayed use of healthcare throughout the pandemic as something likely to necessitate future rebates. “With decreased utilization of health services in 2020 and 2021 factoring into MLR for the next four years, and expected increases of utilization factoring into rates for 2022, this is yet another reminder that COVID will impact all aspects of healthcare, including insurance, for much of the foreseeable future.”

20,857 individual policyholders will receive rebates totaling over $8.4 million, with the average rebate being $405. This will be the second time in state history that rebates will be distributed to the participants of the individual market, with more than $12.6 million being sent to over 19,000 residents last year.

Highmark small groups, often small businesses, will receive nearly $3.9 million in cumulative return. 2,573 groups will receive an average rebate of $1,514, with 20 groups receiving rebates over $10,000. Employers can consider using these dollars to enhance benefits, reduce premiums for employees in future policy years, or provide refunds directly to group health plan participants.

Communications will be sent to policyholders in September and checks for both individual policyholders and small groups will be sent the week of September 15. Not every policyholder will receive a rebate. Those in the individual market with rebate questions can contact Highmark at 800-544-6679. Small group employers with rebate questions can contact their insurance producer, or Highmark at 800-241-5704.


Highmark Increases 2022 Affordable Care Act Marketplace Premiums

Expanded federal subsidies keep consumer costs low; SEP sees success

After two consecutive years of rate decreases, Highmark Blue Cross Blue Shield of Delaware, who offers the state’s Affordable Care Act (ACA) health plans, will increase base rates an average of 3% for the 2022 plan year. The announcement comes after extensive, in-depth independent actuarial reviews and a public comment period on the insurer’s initial proposal of a 4% increase. While insurers are increasing rates across the country, federal subsidies from the Biden-Harris Administration have cut consumer costs by 40% and will continue to be applied in the 2022 plan year. Residents are still expected to see savings despite the modest increase in the base rate.

The 2022 rate announcement comes after the end of the Biden-Harris Administration’s Special Enrollment Period (SEP), which gave residents the ability to enroll in 2021 ACA plans between February 15 and August 15. More than 5,377 Delawareans signed up for coverage during the SEP. Taking into account the 5% participation increase seen in last fall’s open enrollment, an estimated 30,000 Delawareans are now covered by 2021 plans. 23% of new and returning Delaware participants are enrolled in a plan costing $10 or less per month due to the American Rescue Plan.

“Stability in the individual health insurance market is so critical as we continue to battle COVID-19 and healthcare shortages. Rates remain more than 15% lower than they were just a few years ago, and with the American Rescue Plan, they’re more affordable than ever before,” said Insurance Commissioner Trinidad Navarro. “Coupled with the safety net of the SEP, the past year has been positive for insurance access.”

Delaware SEP enrollment February 15 through July 31 was more than double the same period last year, which saw higher-than-usual circumstantial enrollment due to COVID, and is nearly triple the typical enrollment for this time of year. Final numbers are expected in the coming weeks. The SEP’s success has led to proposals at the federal level for permanent open enrollment expansion as well as monthly enrollment opportunities.

Expansion of access and increased affordability remains a priority at the federal level, as American Rescue Plan funds increased tax credits and expanded subsidies farther into the middle class. Premium assistance will continue through 2022, and majority of Delaware marketplace enrollees will be eligible for these discounts that can reduce their monthly premiums.

Nationally, insurers are requesting premium increases as policy use is expected to rise with more residents scheduling postponed elective procedures and visits. The rise of prescription costs continues to be a factor in premium planning.

All ACA plans offer essential health benefits, including coverage of pre-existing conditions, prescriptions, emergency services and hospitalization, mental and behavioral health coverage, outpatient care and telehealth, lab services, and more. ACA rates do not vary based on vaccination or COVID-19 status.

Highmark Blue Cross Blue Shield Delaware is the sole health insurer offering plans on Delaware’s Health Insurance Marketplace for 2022, offering 12 plans for individuals and families. Two dental insurers – Delta Dental of Delaware, Inc. and Dominion Dental Services, Inc. – offer stand-alone dental plans on the marketplace.

Open enrollment for the Marketplace takes place between November 1 and December 15 each year. However, residents may qualify to enroll or change plans based on special circumstances, such as a loss of qualifying health coverage, change of income, becoming a parent, and several other qualifying factors. Find out if you qualify for special enrollment.

The rate change does not apply to Medicare, Medicaid, or those with group or individual policies outside of the Marketplace.

More information on the rate review process