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Allstate Insurance files $6.6m medical fraud lawsuit in New York

Personal lines insurer Allstate Insurance Company has filed a $6.6m lawsuit against 47 durable medical supply entities and their respective individual owners in the US District Court for the Eastern District of New York.

The 80 New York and Florida area defendants include 31 durable medical retail equipment firms and 28 individuals, and 16 durable medical wholesale companies and five individuals, who allegedly owned one or more of these firms.

The suit alleges that the accused submitted or facilitated fraudulent submission of bills and supporting documents to Allstate for reimbursement under New York State’s No-fault Law.

Allstate spokesperson Allison McMahon said that the no-fault system is being exploited and responsible citizens are the victims.

"Without the support of lawmakers, incidents of fraud will continue to increase. We need to work together this legislative session to fix the broken no-fault system," McMahon added.

Around 48 fraud lawsuits have been filed in New York State by Allstate since 2003, seeking more than $237m in damages.