A friend of mine cashed a check from his insurance company that was supposed to be used to pay the anesthesiology bill for surgery. The check was made out to him and him alone. His disability insurance was running out and he needed to pay his bills. He called up the anesthesiology people to make payment arrangements and they sent him to a bill collector. The bill collector contacted him and told him that he committed insurance fraud and that if he doesn't pay the whole bill in one month he is going to jail. Are they just trying to scare him or is that the truth?

I wouldn't call it insurance fraud. The cheque was made out to him and he would have had to put it in his account anyway to pay the med. Bill. If he is not past due on paying the med bill then the collection agency should not even be in the picture.