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Risk Insiders

The Risk & Insurance website is also a self-publishing platform for select risk managers and industry experts.
By: | April 1, 2014

Risk Insiders are an unrivaled group of leading executives focused on the topic of Risk. They share their insights and opinions – and from time to time their pet peeves and gripes – on the Risk & Insurance website.

Each Risk Insider is invited to publish based on their expertise, passion and/or the quality of their writing. The only rules are no selling and no negative competitor mentions.

The topic of Risk is very broad and very complex. By inviting leading industry experts to share their insights we hope to provide a more complete perspective for our readers.

Selection Criteria

Risk Insiders are considered editorial contributors. As such, we are looking for individuals who want to publish their ideas, opinions or insights. Assistance from PR is great but we are not looking for ghost-written articles or corporate marketing perspectives.

Our primary target participants are Risk Managers, CFOs, Workers’ Comp Managers and other professionals responsible for risk mitigation for their companies.

Structure

Risk Insiders are free to write about any event, trend, opinion or other topic that is relevant to risk management or the insurance industry. There are no schedules or deadlines, write when you have something to say. Articles should be concise yet complete.

Some additional guidelines include:

    • Do your own writing (review and editing by colleagues is fine).
    • Original submissions only.
    • Publish 2 times a year, minimum.
    • Write from your own perspective, not your firm’s.
    • Avoid heavy jargon or corporate-speak.
    • Expressing complexity does not provide clarity. Keep it simple.
    • No selling.
    • No competitor put-downs.
    • Be concise but complete. 500 words max.
    • Pictures, graphics, videos, etc. are encouraged but not required.

How to apply

For more information and an application please contact us via riskletters@lrp.com.

Matthew Kahn is the Publisher and Executive Editor of Risk & Insurance. He manages the editorial and sales teams as well as develops new content and platforms. His best risk management lessons come from his frequent aviation experiences as a pilot. Matthew can be reached at mkahn@lrp.com.
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Risk Insider: Greg Bangs

When Do-Gooders Do Wrong: Fraud at Nonprofits

By: | May 21, 2015 • 2 min read
Gregory W. Bangs is chief underwriting officer of global crime at XL Catlin. Over the last 30 years, he’s been underwriting insurance and developing new products in the U.S., U.K., Hong Kong and France. He can be reached at Gregory.Bangs@xlcatlin.com.

Recently, a former Emory University employee pleaded guilty to wire fraud after embezzling more than $300,000 in tuition and fees paid by students. She instructed students to wire their tuition into her own Paypal account.

According to her attorney, “Based on the circumstances at her life at the time, she made some poor choices.”

From universities to religious groups to a host of local, national and global charities, nonprofit organizations are full of honest, hard-working people dedicated to improving society in some way. Unfortunately, even the most well-meaning individuals can find themselves in situations — faced with financial troubles or other personal circumstances — that tempt them to act inappropriately. Before they know it, they find themselves in financial hot water and, in turn, their nonprofit employer is in it as well.

According to the latest “Report to the Nations on Occupational Fraud and Abuse, 2014 Global Fraud Study,” by the Association of Certified Fraud Examiners, not-for-profit organizations continue to make up more than 10 percent of frauds committed.

While a for-profit organization may see stolen money take a bite out of its profits, a charitable organization may see even greater financial and reputational damage when money intended for doing good goes elsewhere.

That’s why the temptation to cover up financial problems can be particularly attractive for nonprofits. For organizations that rely on charitable giving, the notion that they are not safeguarding donations more carefully can put a dent in the future donation stream.

It’s also a bit of a double-edged sword for nonprofits. Putting fraud controls in place may entail some administrative costs and many donors evaluate their giving decisions based on nonprofits’ cost allocations, leaning towards organizations that show more of a donor’s dollar goes directly to their cause, not administrative costs.

While a for-profit organization may see stolen money take a bite out of its profits, a charitable organization may see even greater financial and reputational damage when money intended for doing good goes elsewhere.

In the long-run however, internal processes and protocols can prove to be a wise investment that will assure that money given to a cause is allocated to do the good it is intended, not to get swiped by employees.

Like any for profit organization, not-for-profits need to maintain a strong system of internal controls, among them:

  • Segregate duties. This assures that one employee cannot perform a complete financial transaction from end-to-end without involving someone along the way.
  • Background checks. For a nominal cost, nonprofits can make sure that employees have not already had some past issues that would affect their judgment with the organization’s money
  • Invest in technology. Today software accounting packages can raise a variety of red flags such as repetitive withdrawals or employee expense reimbursements.
  • Identify the role of board members for responding to or investigating allegations of fraud. Many seasoned financial and business professionals serve on charitable organization’s boards of directors and can be valuable sources for setting up fraud control procedures.
  • Commit to an independent audit every 4-5 years. Larger charitable organizations may commit to independent audits more regularly as they are often required in order to receive federal funding. Smaller organizations can seek more affordable methods of evaluating the nonprofit’s financial positions, such as a review of certified financial statements.
  • Prosecute offenders. Again, many nonprofits can be reluctant to go public with fraud cases because of its potential effect on donors. Not acting however, can be equally detrimental, sending a signal that employees who dip into an organization’s bank account may just walk away with a slap on the wrist.
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Sponsored Content by Helios

Mitigating Fraud, Waste, and Abuse of Opioid Medications

Proactive screening for fraud, waste and abuse situations is the best way to minimize their effects on opioid management.
By: | May 8, 2015 • 5 min read
SponsoredContent_Helios

There’s a fine line between instances of fraud, waste, and abuse. One of the key differences is intent and knowledge. Fraud is knowingly and willfully defrauding a health care benefit program for personal gain or profit. Each of the parties to a claim has opportunity and motive to commit fraud. For example, an injured worker might fill a prescription for pain medication only to sell it to a third party for profit. A prescriber might knowingly write prescriptions for certain pain medications in order to receive a “kickback” by the manufacturer.

Waste is overuse of services and misuse of resources resulting in unnecessary costs, whereas abuse is practices that are inconsistent with professional standards of care, leading to avoidable costs. In both situations, the wrongdoer may not realize the effects of their actions. Examples of waste include under-utilization of generics, either because of an injured worker’s request for brand name medication, or the prescriber writing for such. Examples of abusive behavior are an injured worker requesting refills too soon, and a prescriber billing for services that were not medically necessary.

Actions that Interfere with Opioid Management

Early intervention of potential fraud, waste, and abuse situations is the best way to mitigate its effects. By considering the total pharmacotherapy program of an injured worker, prescribing behaviors of physicians, and pharmacy dispensing patterns, opportunities to intervene, control, and correct behaviors that are counterproductive to treatment and increase costs become possible. Certain behaviors in each community are indicative of potential fraud, waste, and abuse situations. Through their identification, early intervention can begin.

Injured workers

  • Prescriber/Pharmacy Shopping – By going to different prescribers or pharmacies, an injured worker can acquire multiple prescriptions for opioids. They may be able to obtain “legitimate” prescriptions, as well as find those physicians who aren’t so diligent in their prescribing practices.
  • Utilizing Pill Mills – Pain clinics or pill mills are typically cash-only facilities that bypass physical exams, medical records, and x-rays and prescribe pain medications to anyone—no questions asked.
  • Beating the Urine Test – Injured workers can beat the urine drug test by using any of the multiple commercial products available in an attempt to mask results, or declaring religious/moral grounds as a refusal for taking the test. They may also take certain products known to deliver a false positive in order to show compliance. For example, using the over-the-counter Vicks® inhaler will show positive for amphetamines in an in-office test.
  • Renting Pills – When prescribers demand an injured worker submit to pill counts (random or not), he or she must bring in their prescription bottles. Rent-a-pill operations allow an injured worker to pay a fee to rent the pills needed for this upcoming office visit.
  • Forging or Altering Prescriptions –Today’s technology makes it easy to create and edit prescription pads. The phone number of the prescriber can be easily replaced with that of a friend for verification purposes. Injured workers can also take sheets from a prescription pad while at the physician’s office.

Physicians

  • Over-Prescribing of Controlled Substances – By prescribing high amounts and dosages of opioids, a physician quickly becomes a go-to physician for injured workers seeking opioids.
  • Physician dispensing and compounded medication – By dispensing opioids from their office, a physician may benefit from the revenue generated by these medications, and may be prone to prescribe more of these medications for that reason. Additionally, a physician who prescribes compounded medications before a commercially available product is tried may have a financial relationship with a compounding pharmacy.
  • Historical Non-Compliance – Physicians who have exhibited potentially high-risk behavior in the past (e.g., sanctions, outlier prescribing patterns compared to their peers, reluctance or refusal to engage in peer-to-peer outreach) are likely to continue aberrant behavior.
  • Unnecessary Brand Utilization – Writing prescriptions for brand medication when a generic is available may be an indicator of potential fraud, waste, or abuse.
  • Unnecessary Diagnostic Procedures or Surgeries – A physician may require or recommend tests or procedures that are not typical or necessary for the treatment of the injury, which can be wasteful.
  • Billing for Services Not Provided – Since the injured worker is not financially responsible for his or her treatment, a physician may mistakenly, or knowingly, bill a payer for services not provided.

Pharmacies

  • Compounded Medications – Compounded medications are often very costly, more so than other treatments. A pharmacy that dispenses compounded medications may have a financial arrangement with a prescriber.
  • Historical Non-Compliance – Like physicians, pharmacies with a history of non-compliance raise a red flag. In states with Prescription Drug Monitoring Programs (PDMPs), pharmacies who fail to consult this database prior to dispensing may be turning a blind eye to injured workers filling multiple prescriptions from multiple physicians.
  • Excessive Dispensing of Controlled Substances – Dispensing of a high number of controlled substances could be a sign of aberrant behavior, either on behalf of the pharmacy itself or that injured workers have found this pharmacy to be lenient in its processes.

SponsoredContent_Helios

Clinical Tools for Opioid Management

Once identified, acting on the potential situations of fraud, waste, and abuse should leverage all key stakeholders. Intervention approaches include notifying claims professionals, sending letters to prescribing physicians, performing urine drug testing, reviewing full medical records with peer-to-peer outreach, and referring to payer special investigative unit (SIU) resources. A program that integrates clinical strategies to identify aberrant behavior, alert stakeholders of potential issues, act through intervention, and monitor progress with the injured worker, prescriber, and pharmacy communities can prevent and resolve fraud, waste, and abuse situations.

Proactive Opioid Management Mitigates Fraud, Waste, and Abuse

Opioids can be used safely when properly monitored and controlled. By taking proactive measures to reduce fraud, waste, and abuse of opioids, payers improve injured worker safety and obtain more control over medication expenses. A Pharmacy Benefit Manager (PBM) can offer payers an effective opioid utilization strategy to identify, alert, intervene upon, and monitor potential aberrant behavior, providing a path to brighter outcomes for all.

This article was produced by Helios and not the Risk & Insurance® editorial team.



Helios brings the focus of workers’ compensation and auto no-fault Pharmacy Benefit Management, Ancillary, and Settlement Solutions back to where it belongs—the injured person. This comes with a passion and intensity on delivering value beyond just the transactional savings for which we excel. To learn how our creative and innovative tools, expertise, and industry leadership can help your business shine, visit www.HeliosComp.com.
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