4117 - Insurance fraud.

     § 4117.  Insurance fraud.        (a)  Offense defined.--A person commits an offense if the     person does any of the following:            (1)  Knowingly and with the intent to defraud a State or        local government agency files, presents or causes to be filed        with or presented to the government agency a document that        contains false, incomplete or misleading information        concerning any fact or thing material to the agency's        determination in approving or disapproving a motor vehicle        insurance rate filing, a motor vehicle insurance transaction        or other motor vehicle insurance action which is required or        filed in response to an agency's request.            (2)  Knowingly and with the intent to defraud any insurer        or self-insured, presents or causes to be presented to any        insurer or self-insured any statement forming a part of, or        in support of, a claim that contains any false, incomplete or        misleading information concerning any fact or thing material        to the claim.            (3)  Knowingly and with the intent to defraud any insurer        or self-insured, assists, abets, solicits or conspires with        another to prepare or make any statement that is intended to        be presented to any insurer or self-insured in connection        with, or in support of, a claim that contains any false,        incomplete or misleading information concerning any fact or        thing material to the claim, including information which        documents or supports an amount claimed in excess of the        actual loss sustained by the claimant.            (4)  Engages in unlicensed agent, broker or unauthorized        insurer activity as defined by the act of May 17, 1921        (P.L.789, No.285), known as The Insurance Department Act of        one thousand nine hundred and twenty-one, knowingly and with        the intent to defraud an insurer, a self-insured or the        public.            (5)  Knowingly benefits, directly or indirectly, from the        proceeds derived from a violation of this section due to the        assistance, conspiracy or urging of any person.            (6)  Is the owner, administrator or employee of any        health care facility and knowingly allows the use of such        facility by any person in furtherance of a scheme or        conspiracy to violate any of the provisions of this section.            (7)  Borrows or uses another person's financial        responsibility or other insurance identification card or        permits his financial responsibility or other insurance        identification card to be used by another, knowingly and with        intent to present a fraudulent claim to an insurer.            (8)  If, for pecuniary gain for himself or another, he        directly or indirectly solicits any person to engage, employ        or retain either himself or any other person to manage,        adjust or prosecute any claim or cause of action against any        person for damages for negligence or, for pecuniary gain for        himself or another, directly or indirectly solicits other        persons to bring causes of action to recover damages for        personal injuries or death, provided, however, that this        paragraph shall not apply to any conduct otherwise permitted        by law or by rule of the Supreme Court.        (b)  Additional offenses defined.--            (1)  A lawyer may not compensate or give anything of        value to a nonlawyer to recommend or secure employment by a        client or as a reward for having made a recommendation        resulting in employment by a client; except that the lawyer        may pay:                (i)  the reasonable cost of advertising or written            communication as permitted by the rules of professional            conduct; or                (ii)  the usual charges of a not-for-profit lawyer            referral service or other legal service organization.        Upon a conviction of an offense provided for by this        paragraph, the prosecutor shall certify such conviction to        the disciplinary board of the Supreme Court for appropriate        action. Such action may include a suspension or disbarment.            (2)  With respect to an insurance benefit or claim        covered by this section, a health care provider may not        compensate or give anything of value to a person to recommend        or secure the provider's service to or employment by a        patient or as a reward for having made a recommendation        resulting in the provider's service to or employment by a        patient; except that the provider may pay the reasonable cost        of advertising or written communication as permitted by rules        of professional conduct. Upon a conviction of an offense        provided for by this paragraph, the prosecutor shall certify        such conviction to the appropriate licensing board in the        Department of State which shall suspend or revoke the health        care provider's license.            (3)  A lawyer or health care provider may not compensate        or give anything of value to a person for providing names,        addresses, telephone numbers or other identifying information        of individuals seeking or receiving medical or rehabilitative        care for accident, sickness or disease, except to the extent        a referral and receipt of compensation is permitted under        applicable professional rules of conduct. A person may not        knowingly transmit such referral information to a lawyer or        health care professional for the purpose of receiving        compensation or anything of value. Attempts to circumvent        this paragraph through use of any other person, including,        but not limited to, employees, agents or servants, shall also        be prohibited.            (4)  A person may not knowingly and with intent to        defraud any insurance company, self-insured or other person        file an application for insurance containing any false        information or conceal for the purpose of misleading        information concerning any fact material thereto.        (c)  Electronic claims submission.--If a claim is made by     means of computer billing tapes or other electronic means, it     shall be a rebuttable presumption that the person knowingly made     the claim if the person has advised the insurer in writing that     claims will be submitted by use of computer billing tapes or     other electronic means.        (d)  Grading.--An offense under subsection (a)(1) through (8)     is a felony of the third degree. An offense under subsection (b)     is a misdemeanor of the first degree.        (e)  Restitution.--The court may, in addition to any other     sentence authorized by law, sentence a person convicted of     violating this section to make restitution.        (f)  Immunity.--An insurer, and any agent, servant or     employee thereof acting in the course and scope of his     employment, shall be immune from civil or criminal liability     arising from the supply or release of written or oral     information to any entity duly authorized to receive such     information by Federal or State law, or by Insurance Department     regulations.        (g)  Civil action.--An insurer damaged as a result of a     violation of this section may sue therefor in any court of     competent jurisdiction to recover compensatory damages, which     may include reasonable investigation expenses, costs of suit and     attorney fees. An insurer may recover treble damages if the     court determines that the defendant has engaged in a pattern of     violating this section.        (h)  Criminal action.--            (1)  The district attorneys of the several counties shall        have authority to investigate and to institute criminal        proceedings for any violation of this section.            (2)  In addition to the authority conferred upon the        Attorney General by the act of October 15, 1980 (P.L.950,        No.164), known as the Commonwealth Attorneys Act, the        Attorney General shall have the authority to investigate and        to institute criminal proceedings for any violation of this        section or any series of such violations involving more than        one county of the Commonwealth or involving any county of the        Commonwealth and another state. No person charged with a        violation of this section by the Attorney General shall have        standing to challenge the authority of the Attorney General        to investigate or prosecute the case, and, if any such        challenge is made, the challenge shall be dismissed and no        relief shall be available in the courts of the Commonwealth        to the person making the challenge.        (i)  Regulatory and investigative powers additional to those     now existing.--Nothing contained in this section shall be     construed to limit the regulatory or investigative authority of     any department or agency of the Commonwealth whose functions     might relate to persons, enterprises or matters falling within     the scope of this section.        (j)  Violations, penalties, etc.--            (1)  If a person is found by court of competent        jurisdiction, pursuant to a claim initiated by a prosecuting        authority, to have violated any provision of this section,        the person shall be subject to civil penalties of not more        than $5,000 for the first violation, $10,000 for the second        violation and $15,000 for each subsequent violation. The        penalty shall be paid to the prosecuting authority to be used        to defray the operating expenses of investigating and        prosecuting insurance fraud. The court may also award court        costs and reasonable attorney fees to the prosecuting        authority.            (2)  Nothing in this subsection shall be construed to        prohibit a prosecuting authority and the person accused of        violating this section from entering into a written agreement        in which that person does not admit or deny the charges but        consents to payment of the civil penalty. A consent agreement        may not be used in a subsequent civil or criminal proceeding,        but notification thereof shall be made to the licensing        authority if the person is licensed by a licensing authority        of the Commonwealth so that the licensing authority may take        appropriate administrative action. Penalties paid under this        section shall be deposited into the Insurance Fraud        Prevention Trust Fund created under the act of December 28,        1994 (P.L.1414, No.166), known as the Insurance Fraud        Prevention Act.            (3)  The imposition of any fine or other remedy under        this section shall not preclude prosecution for a violation        of the criminal laws of this Commonwealth.        (k)  Insurance forms and verification of services.--            (1)  All applications for insurance and all claim forms        shall contain or have attached thereto the following notice:                Any person who knowingly and with intent to defraud                any insurance company or other person files an                application for insurance or statement of claim                containing any materially false information or                conceals for the purpose of misleading, information                concerning any fact material thereto commits a                fraudulent insurance act, which is a crime and                subjects such person to criminal and civil penalties.            (2)  (Repealed).        (l)  Definitions.--As used in this section, the following     words and phrases shall have the meanings given to them in this     subsection:        "Insurance policy."  A document setting forth the terms and     conditions of a contract of insurance or agreement for the     coverage of health or hospital services.        "Insurer."  A company, association or exchange defined by     section 101 of the act of May 17, 1921 (P.L.682, No.284), known     as The Insurance Company Law of 1921; an unincorporated     association of underwriting members; a hospital plan     corporation; a professional health services plan corporation; a     health maintenance organization; a fraternal benefit society;     and a self-insured health care entity under the act of October     15, 1975 (P.L.390, No.111), known as the Health Care Services     Malpractice Act.        "Person."  An individual, corporation, partnership,     association, joint-stock company, trust or unincorporated     organization. The term includes any individual, corporation,     association, partnership, reciprocal exchange, interinsurer,     Lloyd's insurer, fraternal benefit society, beneficial     association and any other legal entity engaged or proposing to     become engaged, either directly or indirectly, in the business     of insurance, including agents, brokers, adjusters and health     care plans as defined in 40 Pa.C.S. Chs. 61 (relating to     hospital plan corporations), 63 (relating to professional health     services plan corporations), 65 (relating to fraternal benefit     societies) and 67 (relating to beneficial societies) and the act     of December 29, 1972 (P.L.1701, No.364), known as the Health     Maintenance Organization Act. For purposes of this section,     health care plans, fraternal benefit societies and beneficial     societies shall be deemed to be engaged in the business of     insurance.        "Self-insured."  Any person who is self-insured for any risk     by reason of any filing, qualification process, approval or     exception granted, certified or ordered by any department or     agency of the Commonwealth.        "Statement."  Any oral or written presentation or other     evidence of loss, injury or expense, including, but not limited     to, any notice, statement, proof of loss, bill of lading,     receipt for payment, invoice, account, estimate of property     damages, bill for services, diagnosis, prescription, hospital or     doctor records, X-ray, test result or computer-generated     documents.     (Feb. 7, 1990, P.L.11, No.6, eff. 60 days; Dec. 19, 1990,     P.L.1451, No.219, eff. imd.; Dec. 28, 1994, P.L.1408, No.165,     eff. 60 days; July 6, 1995, P.L.242, No.28, eff. 60 days)        1995 Repeal Note.  Act 28 repealed subsec. (k)(2).        References in Text.  Chapter 65 of Title 40 (Insurance),     referred to in this section, is repealed. The subject matter is     now contained in Subarticle A of Article XXIV of the act of May     17, 1921 (P.L.682, No.284), known as The Insurance Company Law     of 1921.        The act of December 28, 1994 (P.L.1414, No.166), known as the     Insurance Fraud Protection Act, referred to in subsec. (j)(2)     was repealed by the act of December 6, 2002, P.L.1183, No.147.     The subject matter is now contained in Article XI of the act of     May 17, 1921 (P.L.682, No.284), known as The Insurance Company     Law of 1921.        Cross References.  Section 4117 is referred to in sections     911, 5708 of this title; section 5552 of Title 42 (Judiciary and     Judicial Procedure).