Allstate says a Michigan medical network ran a fraud "scheme" against it - and the carrier wants triple its money back.
In a 231-page complaint filed June 19, 2026, in federal court in Detroit, three Allstate entities sued a cluster of clinics, labs, a pharmacy and a medical-transport company, along with the network's owners and a physician, Dr. Pedro Toweh. The filing alleges the group "engaged in a scheme to defraud Allstate" by billing for care that was never delivered, not medically necessary, or "not lawfully rendered" under Michigan's No-Fault Act, the law governing auto-injury claims in the state.
For claims professionals, it reads like a map of where no-fault dollars allegedly leak.
Patients, the complaint says, were funneled in through a referral line called "1-800-PAIN-800," which Allstate alleges is owned by one of the defendants. The line advertised that "Our Goal Is To Get You Healthy & Wealthy After A Car Accident" by "connecting you to top notch medical providers and lawyers," the filing says - but Allstate claims it really steered alleged accident victims toward the defendant clinics for treatment "they do not actually need." A former Select Medical nurse practitioner testified that "most of [the patients of Select Medical] came through 1-800-PAIN-800," according to the complaint.
The numbers are what an adjuster will notice. Allstate alleges Michigan First billed it more than $786,000 for "alleged laser therapy" since February 2024. It claims Greenfield Labs and Tox Testing "routinely billed Allstate $3,976" for a single presumptive urine drug test using one billing code, while a simpler presumptive test relies on "dipsticks that can be purchased for less than $1.00," the filing says. On braces, the complaint alleges First Choice "never charged less than $799," and "often charged $1,850," for equipment Allstate says patients could buy retail for around $30.
The complaint also disputes billing for "trigger point impedance imaging ('TPII')" and "localized intense neurostimulation therapy ('LINT')," which it calls experimental and unnecessary. The machine "will not operate if there are fewer than ten (10)" trigger points, the filing says, yet the defendants allegedly billed for sessions where reports showed as few as one - or none.
Allstate's legal theory is built for maximum recovery. It brings federal RICO claims across several alleged "enterprises," plus common-law fraud, civil conspiracy, payment under mistake of fact and unjust enrichment. It asks for "treble damages" - three times its actual losses - plus interest, costs and fees. It also wants a court declaration that it owes nothing on the defendants' "pending and previously-denied insurance claims" and that they cannot "balance bill" Allstate's customers.
The filing also points to past matters. It alleges that on Nov. 18, 2024, the U.S. attorney's office for the Western District of Michigan announced that Toweh "had agreed to pay more than $85,000 to resolve allegations that he ordered over 800 medically unnecessary orthotic braces in exchange for kickbacks." That is the complaint's description of an earlier matter, not a ruling in this case.
The takeaway for insurers: this is a classic no-fault fraud blueprint - referral pipelines, cookie-cutter treatment protocols and high-margin services billed regardless of need. The RICO-and-treble-damages structure shows how hard carriers can push back in court.
The allegations have not been proven, and no court has ruled on Allstate's claims.
