EagleTribune.com, North Andover, MA

Merrimack Valley

April 30, 2013

Crackdown saves city drivers $68M


- Significant reduction in “high volume” medical providers, those billing over $100,000-a-year for services. There were 22 “high volume” chiropractors and physical therapists in Lawrence before its task force was established. Only seven remain and their collective billing dropped by 90 percent ($8.1 million).

- A huge dollar drop in both claims and premiums. The average auto insurance premium in Lawrence has dropped from $1,613 in 2003 to $1,260 in 2011. The average annual savings per vehicle in Lawrence through 2011 was $335 — higher than any other task force community. Collectively, the task force communities had an annual savings of $185 per vehicle compared to $148 statewide. Total written premiums in Lawrence dropped from more than $43-million in 2003 to $36.7-million in 2011.

Overall, there has been a $266 million reduction in claims dollars ($19 million in Lawrence).

Altagracia Arias, a great-grandmother, was killed in a Sept. 4, 2003 crash that she helped plan to scam insurance money for needy relatives, The Eagle-Tribune reported. The story disclosed that just hours before her death, Arias approached several people at the Lawrence Senior Citizens Center offering them a seat in the car for $200 cash.

In the wake of the two-car crash at the intersection of Ferry and East Haverhill streets, Lawrence Police Chief John Romero assigned a handful of his detectives to team up with investigators from the fraud bureau, the fraud units of several insurance companies doing business in Lawrence, the Essex County District Attroney’s Office and the state Attorney General’s Office.

“This tragic event led to the creation of a unique and unprecedented task force dedicated to combating insurance fraud in the city, and eventually to the unraveling of a network of staged accident participants and facilitators that spanned ordinary citizens, runners, chiropractors, physical therapists and lawyers,” the insurance-funded report said.

“This scheme had saddled the insurance industry, and ultimately the auto insurance buying public, with hundreds of millions of dollars of escalated costs for years. The good news is that the trend has been halted and significantly reversed,” it concluded.

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