Don't mess with Louis Parisi.
The former New Jersey cop turned top fraud fighter at Empire Blue Cross and Blue Shield is the white-collar criminal's worst nightmare. Last year alone, Parisi's dragnet recovered $36.1 million in payments on fraudulent claims filed by crooked providers, phony patient groups and assorted rip-off artists. Many of the perpetrators now face criminal prosecution.
How much of that fraud was contrived by organized crime? None, as far as the 53-year-old gumshoe knows.
The mob's involvement in healthcare makes for sensational headlines, he says, but it's highly overrated.
"I don't think there's a mob infiltration of healthcare," Parisi maintains. He believes organized crime is in such disarray and so many different law enforcement agencies are monitoring mob activities these days that it would be difficult for the Mafia to break into something new.
"Will they try it? Sure," Parisi says. But under the intense probing of local, state and federal investigators, he doesn't see how the mob could easily infiltrate healthcare and make a ton of money. "I think organized crime is doing their best just to stay alive."
Parisi thinks the mob's undoing began in the 1960s with Mafia informer Joseph Valachi's disclosures about organized crime. It continues today with turncoats like Salvatore "Sammy the Bull" Gravano.
The Mafia dons aren't the problem, he says. It's the multinational assortment of providers, patients and con artists out to cheat the healthcare system. The General Accounting Office, Congress' investigative arm, estimates that $100 billion of healthcare fraud is committed every year, and that translates to higher insurance premiums. Parisi's crime-fighting operation is eking out a tiny fraction of that amount.
The large-framed, straight-talking Parisi joined Empire in 1995 from the New Jersey Department of Insurance Fraud. New York-based Empire suffered more than one black eye, with the ouster of its former president in 1993 and the discovery of inappropriate spending and false financial reporting by top-ranking officials. After Michael Stocker, M.D., took over the embattled plan in 1994 and began to clean house, he brought in the unflappable Parisi to root out crimes against the company.
More "NYPD Blue" than Empire Blue, the former New Jersey State Police lieutenant stands apart from his button-down insurance colleagues. His desk is a clutter of paper, and his walls bear the trophies of his profession: awards, caricatures and framed newspaper clippings recounting tales of the criminals he's bagged.
During his 22-year stint with the state police, Parisi's assignments ranged from organized crime to internal affairs. From 1967 through 1978, he assisted the U.S. House of Representatives' Select Committee on Assassinations in its investigations of the deaths of President John F. Kennedy and Martin Luther King Jr.
Now, backed by a 100-member fraud squad housed in Empire's headquarters, Parisi employs all the tricks of the sleuthing trade.
One unit monitors providers who have been "flagged" for chronic or suspected overbilling, upcoding and unbundling. Even doctors who have been tossed out of Empire's provider networks remain under surveillance.
Down the hall, a door labeled "FAMS," for fraud-and-abuse management system, opens to a room full of IBM computers. Just a handful of companies now have the system, he says. FAMS is able to map out typical physician billing patterns by sorting through billions of old claims. The profiles help Empire investigators detect suspicious claim-filing behavior.
Take Leon Cantor, a Manhasset, N.Y., otolaryngologist, who pleaded guilty to insurance fraud in federal district court in Brooklyn March 6. Cantor defrauded Empire and other insurers by submitting claims for procedures he never performed. Empire investigators suspected a rip-off when they noticed he was billing for an unusually high number of bronchoscopies among a select group of patients. The procedure generally is performed once or twice a lifetime, but those patients allegedly endured the procedure as frequently as once a week.
Parisi also employs a team of undercover agents who, posing as patients, visit suspect providers to expose fraudulent billing scams. A year ago, for instance, Empire cracked a physician's $1 million overbilling scheme by videotaping investigators receiving facials that were later billed as acne surgery.
"What's good, though, is they know we do this," Parisi says. Some scam artists now refuse to accept patients' Empire cards.
Employees of the company look forward to receiving Parisi's one-page fraud-of-the-week updates skew-ering the division's latest victims. They are also encouraged to report suspected fraud.
The company's toll-free hotline, 1-800-I-C-FRAUD, is printed on every paycheck, every "explanation of benefits" sent to providers and subscribers, and every weekly fraud update. Anyone who provides information leading to an arrest, prosecution or conviction may receive as much as $25,000.
Empire has paid two such awards, one for $25,000 and another for a lesser amount.
Having worked in law enforcement for some 32 years, Parisi has seen about every scam in the book. But he seems remarkably unjaded by the amount of fraud occurring in what is supposed to be a healing profession.
"Everybody has their percentage of rotten apples," he says, nonchalantly.