Allstate Insurance Company Seeks $2.6 Million From Michigan Medical Practitioners.

FARMINGTON HILLS, Mich. -- Allstate Insurance Company has filed a declaratory judgment action (DJA) against New Start, Inc., Another Step Forward, The Healing Place, Ltd., THP Intensive Services, Roman Frankel, Bruce Lessien M.D. and Thomas Kane D.O. for $2.6 million. The DJA includes: fraud, misrepresentation, corporate practice of medicine, unjust enrichment, practicing psychology without a license and illegal fee splitting.

The investigation of the practitioners and corporations began in June 2003. Frankel and the corporations - New Start, Inc., Another Step Forward, The Healing Place, Ltd. and THP Intensive Services - were responsible for treating patients with substance addiction, traumatic brain injury and/or psychiatric illness. Insureds were placed in initial care under Bruce Lessien, psychiatrist and medical director of The Healing Place, Ltd., Insureds were later discharged to Another Step Forward and New Start, under the supervision of medical director Thomas Kane, D.O. Frankel would bill for his services in addition to fees generated for the above stated programs.

The DJA alleges the corporate entities owned by Roman Frankel were not properly licensed for the services they were providing. Further, the complaint alleges Frankel is not licensed to be a psychologist in the state of Michigan nor is his degree recognized by the state. Accordingly, Allstate has filed this action to recover the money improperly collected by the defendants.

"In reviewing our records with Mr. Frankel and corporate entities doing business with him, Allstate has uncovered alleged improper billing procedures of services for which they were not licensed. As a commitment to our Allstate customers, we will diligently pursue this issue for timely resolution," said Edward Moran, Allstate assistant vice president for Special Investigations.

Allstate alleges that fees paid to the corporations for services were to be provided to their insureds under the No Fault Act, which states automobile insurers are responsible to pay for all reasonable and necessary medical services for insureds.

As such, the DJA will demand reimbursement in excess of $25,000 as allowed by Michigan Statute for payments issued by Allstate Insurance Co. Payments issued by Allstate total $2.6 million. There have been a total of 15 claimants. Allstate filed the declaratory judgment action on Oct. 25 in Oakland County Circuit Court.

The Allstate Corporation (NYSE:ALL) is the nation's largest publicly held personal lines insurer. Widely known through the "You're In Good Hands With Allstate([R])" slogan, Allstate helps individuals in approximately 17 million households protect what they have today and better prepare for tomorrow through approximately 14,100 exclusive agencies and financial professionals in the U.S. and Canada. Customers can access Allstate products and services such as auto insurance and homeowners insurance through Allstate agencies, or in select states at allstate.com and 1-800 Allstate([R]). Encompass(SM) and Deerbrook([R])Insurance brand property and casualty products are sold exclusively through independent agents. The Allstate Financial Group provides life insurance, supplemental accident and health insurance, annuity, banking and retirement products designed for individual, institutional and worksite customers that are distributed through Allstate agencies, independent agencies, financial institutions and broker-dealers.