GEICO has taken legal action against several medical companies in Florida and New York, accusing them of running expensive fraud schemes involving no-fault auto insurance claims. The insurance company filed lawsuits earlier this month targeting firms it says submitted false claims for medical treatments and equipment that weren’t really needed.
In Tampa federal court, GEICO filed suit against AJ Therapy Center and its leaders. The company alleges they billed more than $4.6 million in personal injury protection claims for treatments that were unnecessary. According to the complaint, the clinic often exaggerated the injuries people suffered in car accidents. Police reports, however, showed little vehicle damage and no serious injuries in many cases.
Over in Brooklyn, GEICO sued Droz Medical Supply, GB Medical Supply, and their executives. The complaint says these companies collected over $835,000 for medical equipment and prescription drugs that weren’t medically required. The fraudulent items were reportedly provided to people involved in car accidents who sought coverage under GEICO’s no-fault insurance policies in New York.
The lawsuits claim the defendants knowingly made false statements and hid important facts to get GEICO to pay for claims that didn’t qualify under state no-fault insurance laws. Both cases are asking the courts to award compensatory and punitive damages. So far, none of the companies involved have responded to the complaints.
This move by GEICO is part of a broader push by insurers to fight back against fraud, which drives up costs for everyone. By targeting companies allegedly abusing the no-fault system, the insurer hopes to recover money and discourage others from submitting phony claims.