Workers’ compensation fraud can have severe financial and reputational consequences for businesses. When employers suspect fraudulent claims, it is crucial to take immediate action to protect their interests.
Here are the steps companies can take if they suspect workers’ compensation fraud, ensuring a thorough investigation and appropriate response.
- Gather facts that lead to suspicion: When suspicions of workers’ compensation fraud arise, it is essential to gather all relevant information and facts surrounding the claim. This includes reviewing incident reports, witness statements, medical records, and any other documentation related to the claim. Identifying inconsistencies or red flags can help build a case for potential fraud.
- Assess relevance to the value of the claim: Evaluate the financial impact of the suspected fraudulent claim. Determine if the value of the claim is significant enough to warrant further investigation. Claims with high monetary value or those involving long-term disability may require more extensive scrutiny.
- Consider current HR issues: Consider any ongoing human resources issues involving the employee in question. This includes performance concerns, disciplinary actions, or conflicts within the workplace. These factors may provide additional context and motivation for fraudulent behavior.
- Conduct a social media search: Perform a thorough search of the employee’s social media profiles. Look for any posts, photos, or comments that contradict the claimed injury or suggest the employee is engaging in activities inconsistent with their reported condition. Social media can provide valuable evidence to support suspicions of fraud.
- Conduct a medical canvass: Engage the services of a professional medical canvassing company to gather information from healthcare providers who may have treated the employee. This process involves contacting medical facilities to verify the treatment received, the severity of the injury, and any discrepancies in the reported symptoms.
- Conduct a background check: Perform a comprehensive background check on the employee to uncover any previous workers’ compensation claims, criminal records, or other relevant information. This step can help identify patterns of fraudulent behavior or inconsistencies in the employee’s history.
- Notify insurer or Third-Party Administrator (TPA): Inform your workers’ compensation insurer or TPA about the suspected fraud. Provide them with all the gathered evidence and documentation to support your suspicions. They can guide you through the investigation process and aid in handling the claim.
- Initiate surveillance: Consider hiring a professional surveillance team to monitor the activities of the employee in question. Surveillance can provide valuable evidence of the employee’s physical capabilities and activities that may contradict their reported injury or limitations. Surveillance works best when the employer knows about the activities of the employee’s in question (i.e. working somewhere else, playing some kind of sport/working out, playing with/taking care of kids/grandkids, etc.).
- Seek legal opinion: Consult with legal counsel experienced in workers’ compensation fraud cases. They can provide guidance on the legal aspects of the investigation, advise on the appropriate steps to take, and ensure compliance with relevant laws and regulations.
- 10. Initiate a formal fraud complaint: If the evidence supports the suspicion of fraud, file a formal fraud complaint with the appropriate authorities. This may involve reporting the suspected fraud to law enforcement agencies, state workers’ compensation boards, or other relevant regulatory bodies.
In addition to these steps, working with an insurance broker who has strong claims management can help minimize risk.
When a company suspects workers’ compensation fraud, it is crucial to follow a systematic approach to investigate and address the issue. By gathering relevant facts, assessing the claim’s value, conducting social media searches and medical canvasses, performing background checks, notifying insurers or TPAs, initiating surveillance, seeking legal advice, and filing a formal fraud complaint, businesses can protect their interests and deter fraudulent behavior. Prompt action is essential to mitigate financial losses and maintain the integrity of the workers’ compensation system.
