Health insurance fraud estimated to cost St. Maarten government millions


PHILIPSBURG--Research into forms of fraud shows that health insurance fraud can cause great financial damage to St. Maarten. This is one of the conclusions drawn in the Crime Pattern Analysis CBA on Fraud.
Health insurance fraud is committed when persons use fake proof of employment to acquire insurance. Persons are most likely to commit this form of fraud are unemployed or undocumented domestic workers.

This type of fraud is appealing for two reasons. First, by having health insurance a person's chance of receiving a residence permit greatly increases, because the health insurance is perceived as proof that the person is working in St. Maarten.

Second, through this fraudulent act an illegal immigrant benefits from free or reduced-cost medical services without paying the insurance premiums.

The agency for social and sickness insurance USZV has noted a rise in this type of fraud in the last five years. USZV estimates about 15 companies issue fake proof of employment; 10 years ago it was limited to about one or two businesses. USZV does not exclude the possibility that the Brooks Tower Accord (BTA) has played a role in this.

Research showed direct links between this type of fraud and the stream of immigrants. It is well known that just before BTA was implemented several companies were created that had a sudden increase in registered workers.

Three businesses were found to have between 50 and 220 persons for whom they were not paying insurance premiums. Premiums were being paid only for persons who actually were working for the company, which in relation to fake employees were very few in number.

Often these persons pay an agreed amount to business owners or someone posing as an employer so that they are placed on an employee pay list. These "employers" do not pay insurance premiums for these employees. The estimated amount paid to receive a fake proof of employment is US $150-250. Some "employers" charge a monthly fee of about $100.

The exact total damage caused by health insurance fraud is believed to run into the millions. This is based on the estimated 15 companies that fraudulently placed hundreds of persons on their employee lists.
It is expected that this type of fraud will continue and even increase because of a neglect in controls. The lack of controls is believed to be caused by restrictions in system access and insufficient inter-departmental communication.

The current situation calls for better supervision of immigrants and for better registration of residents and businesses in St. Maarten. Only after doing this and increasing inter-departmental system access and communication can the situation be better tackled, advised the CBA report.