A major insurance company has filed a lawsuit alleging a wide-reaching healthcare fraud scheme that could have significant implications for both the insurance industry and public health. Allstate Insurance Company, along with its subsidiaries, filed a complaint in the United States District Court for the Eastern District of New York on September 5, 2024, against multiple defendants including doctors, medical providers, and various entities.
The plaintiffs—Allstate Insurance Company, Allstate Indemnity Company, Allstate Property & Casualty Insurance Company, and Allstate Fire & Casualty Insurance Company—claim that the defendants engaged in fraudulent billing practices under New York's No-Fault automobile insurance system. The lawsuit accuses individuals such as Daniel Bogatin, Gary Bogatin, David Carmili MD, Joseph F. Dorsten DO, Andre Jocelyn Duhamel MD, and several others of submitting inflated and fictitious claims for medical services that were either unnecessary or never rendered.
According to the complaint, New York’s No-Fault insurance system has been plagued by fraud since the mid-1990s. The defendants allegedly exploited this system by submitting fraudulent bills for services like Transcranial Doppler (TCD) testing, Vestibular system testing (VNG), and Sympathetic Skin Response (SSR) testing. These tests are designed to diagnose serious conditions but were reportedly used as tools for financial gain rather than patient care.
"The Defendants’ practices have been relentless," states the complaint.
The lawsuit further alleges that laypersons provided most of these services without proper medical oversight or licensing.
The complaint details how these fraudulent activities not only increased insurance costs but also jeopardized patient safety. For instance, patients diagnosed with severe conditions like transient cerebral ischemic attacks received no actual treatment; instead, they were used to carry out an extensive billing scheme.
"Numerous Defendants diagnosed these very serious injuries and then proceeded to do absolutely nothing for the patients," the complaint asserts.
Allstate is seeking to recover at least $1.67 million paid out on fraudulent claims and is asking for a declaratory judgment stating they are not obligated to pay any further No-Fault claims submitted by these defendants due to their improper practices. The plaintiffs argue that this pattern of fraud significantly impacts consumers by driving up insurance premiums and compromising healthcare quality.
Representing Allstate are attorneys from Short & Billy P.C. Case ID 24-CV-6235.