WorkCompCentral reported [sub req] this morning that a Pennsylvania County was defrauded by its risk manager to the tune of $490,000. The County’s TPA (Inservco, owned by Penn National) paid $490,000 for fraudulent bills approved by Dauphin County’s risk manager. The County discovered the scam when the risk manager, Garry Esworthy retired and the county reviewed the bills and payments to a company he’d set up in his wife’s name.
While there’s plenty of embarrassment to go around, it appears that the scam was easy to perpetrate. As the risk manager, Esworthy had the ability and authority to approve payments for bills processed by Inservco. He set up a company in his wife’s name, and submitted bills to Inservco. The TPA processed the bills, then sent them to Esworthy for approval. Once he signed off, the checks were cut and sent to his account.
The scam was discovered after he retired and a County official looked into some of the bills and became suspicious.
Evidently Inservco is not to blame in this case. WorkCompCentral’s Mike Whiteley reported that earlier this year Inservco “came under fire from New Jersey State Comptroller Matthew Boxer, who said the company failed to disclose “side agreements” with bill repricing vendors it hired as TPA for the New Jersey Sports and Exposition Authority and for a city, county, and school district in New Jersey.” (the NJ Sports and Exposition Authority is a former HSA consulting client)
Boxer released an alert indicating “New Jersey governments could be wasting taxpayer dollars if they don’t closely monitor companies they hire to administer workers’ compensation claims…”