More than 94% of businesses have workers compensation insurance. While many claims of workers compensation are legitimate, almost 2% of workers compensation claims are fraud.
Workers compensation fraud has seen an alarming rise over the years going beyond employees exaggerating their medical conditions or working for money while being supposedly disabled. This rise in workers compensation fraud has cost the industry and citizens millions of cash annually.
What Is Workers Compensation Fraud?
Worker’s compensation fraud happens whenever someone falsifies statements knowingly or hides important information so as to receive workers compensation benefits. These false statements are at times made to prevent someone else from receiving the said benefits that they’re entitled to.
How Is Workers Compensation Fraud Committed?
What are the indicators of workers compensation fraud? Well, fraud has many faces and anyone misrepresenting a claim they submit will be committing fraud.
1. Employer Fraud
- Employers who knowingly lie to acquire, maintain or renew a workers compensation policy are committing fraud.
- An employer deducts premium dollars from his/her employees’ wages
- Employers willfully failing to have the required workers compensation coverage
2. Claimant Fraud
- Exaggerating symptoms
- Failing to report income and to work while supposedly disabled
- When a claimant claims a job-related injury that never took place
- Falsification of mileage reports
- A claimant who knowingly claims a non-work related injury as an injury that occurred at work.
3. Medical Provider Fraud
- Offering unnecessary treatments of injured workers with the intention of reaping some financial benefit
- Writing medical bills for treatments and services that were never performed
Fraudulent Case In Cuyahoga County
WorkersCompensation.com recently reported of a woman who pleaded guilty of workers compensation fraud in
Cuyahoga County. The woman had provided misleading information about her status as a student in college. She is expected to pay $12, 319.98 to the BWC as well as serving six months in prison.
Red Flags Common In Fraud Cases
There are sites that offer tips to help people stay alert and look out for fraud cases that may occur, workers compensation fraud still negatively impacts a larger population, from honest businesses to individuals looking for employment opportunities. The following warning signs may not necessarily call for alarm; however, two or more signs should raise suspicions and push for an investigation.
- An alleged injury that occurs either early on a Monday morning or late Friday afternoon but reported on Monday.
- Lack of witnesses in the accident yet the employee’s description of the event can’t provide logical evidence of an injury.
- Claimant does not want any form of treatment as a procedure to confirm his/her injuries.
- Suspicious changes of physicians, addresses and jobs by the claimant.
- A claimant provides a medical or legal consultant with a history of handling past suspicious claims.
Facing Fraud Repercussions
Workers compensation fraud is normally regarded as a class E felony that’s punishable by fines, prison time or
both with subsequent violations being class D felony. Workers compensation fraud aside from being illegal leads to a higher increase in insurance premiums that negatively impacts honest businesses.
Just as other forms of insurance fraud, workers compensation fraud is considered a felony. Different states probably have various penalties put in place for anyone who commits workers compensation fraud.
Anyone who violates the laws put in place for workers compensation stands to face a maximum of seven years in prison. Moreover, they may end up using more than $15,000 in paying fines. Aside from these expenses, there will be a lot of money lost when dealing with these cases such as court costs and legal fees that will be needed.
The biggest consequence that may affect an individual is the stigma associated with being a convicted felon; they’ll have to carry this with them for the rest of their lives.