A small business in Waco suffered four workers’ compensation claims in one year. The claims were so costly that the owner feared for her business. Desperate, she spied on her injured employees outside their chiropractor’s office to see if they were committing workers’ compensation fraud.
Did she over-react? Small business owners watching their bottom lines would probably say “no.” Every year, workers’ compensation fraud costs the system millions of dollars. Those costs trickle down to all employers in the form of higher premiums.
Fortunately, employers don’t have to lurk in dark alleys with a camcorder to keep their businesses from becoming victims of workers’ compensation fraud. They can learn to identify fraud and take a proactive approach to fighting it.
What Is Workers' Compensation Fraud
Claimant fraud is the most talked about kind of fraud. It is also the type that employers are in the best position to help uncover. Claimant fraud happens when employees knowingly lie to collect benefits. They may claim an injury was work-related when it wasn’t, exaggerate an injury, or secretly continue working while collecting benefits.
What Workers' Compensation Fraud Is Not
Collecting benefits for a work-related injury is not fraud. Many employers feel that the longer an employee stays off work and collects benefits, the more likely the claim is fraudulent. Under state law, injured employees don’t have to get back on the job until the doctor releases them to work.
Red Flags for Workers' Compensation Fraud
There is no sure-fire way to identify fraud without proof, but there are red flags. Employers should call their carriers immediately if they identify two or more of these flags.
