Employer's School - Take Control Part 5

Saturday, July 17, 2004 | 0

The following is the fifth in a lengthy series of articles that, when pieced together, comprise the "Employer's School" developed by Brent Heurter, Founder and Chief Solutions Officer of ClearComp. The article series presents an "employer's school" on workers' compensation, how to examine your work injury strategy and ensure a "best practices" environment designed to lower your workers' compensation expenses. This article continues the "school." Earlier articles can be accessed by clicking on a title in the right side bar.

11. Extinguish Fraud in Your Organization
California employers waste $3 billion dollars a year on fraudulent workers' compensation claims.

The Los Angeles district attorney cites a "Little Hoover Commission" report that concludes that ...

* 30% of system costs are wasted in fraud.
* 20% to 30% of employee claims are fraudulent.
James Walsh, author of Workers' Comp for Employers, informs us that "most workers' comp thieves come from the middle class. One study pegged the median income of the scammers in the range of $40,000 a year. This suggests that the thieves have decent jobs, enough to eat, a place to live."

Fraud is a culture and a cancer. It runs rampant in some companies while other companies are relatively unscathed. It will spread unless you take control. You must take fraud seriously and learn the strategies and techniques that are available today.

Ask Yourself:Here are some fraud warning signs to be alert for:

Warning signs in the worker
* Unstable work history
* History of reporting subjective injuries
* Consistently uncooperative
* Recently terminated, demoted, or passed over for promotion
* In line for early retirement
* Making excessive demands
* Calls soon after the injury and presses for a quick settlement
* Moves out of state soon after the injury
* Changes address to a post office box, or receives mail via a friend or relative

Warning signs regarding the injury
* The injured worker was not injured in the presence of witnesses.
* The injury is a subjective one, like stress or emotional trauma-or it is hard to prove, like back pain, headache, or insomnia.
* The accident is not promptly reported by the employee to the employer.
* The employer's first notice of the injury is from an attorney or a medical clinic and not from the injured worker.
* Physicians who have examined the injured worker have vastly differing opinions regarding the injured worker's disability.
* There is no sound medical basis for the disability; all physicians' reports indicate a full recovery.
* The injured worker is claiming disability exceeding that which is normally consistent with such an injury.
* The accident occurs late Friday afternoon or shortly after the employee reports to work on Monday.
* The claimant has the accident at an odd time, such as at lunch hour.
* The accident occurs in an area where the injured employee would not normally be.
* The task that caused the accident is not the type that the employee should be involved in-for example, an office worker who is lifting heavy objects on a loading dock.
* The details of the accident are vague or contradictory.

Warning signs about the medical relationship
* The claimant frequently changes physicians or medical providers.
* The claimant changes physicians when a release for work has been issued.
* A review of medical reports provides information that is inconsistent with the appearance or behavior of an injured person; i.e., a rehabilitation report describes the claimant as being muscular, with callused hands and grease under the fingernails.
* The employer's first report of injury contrasts with the description of the accident set forth in the medical history.
* The injured worker develops a pattern of missing physician's appointments.

Warning signs about the claim itself or the claimant's attorney
* The injured worker's attorney requests that all checks and correspondence be sent to the attorney's office.
* The claimant's attorney is known for handling suspicious claims.
* The attorney lien or representation letter is dated the day of the reported accident.
* The same doctor /lawyer combination previously known to handle the same kind of injury is handling this claim.
* The claimant is unusually familiar with workers' compensation claims-handling procedures and laws.
* The claimant's attorney complains to the carrier's CEO at the home office to press for payment.
* The claimant initially wants to settle with the insurer but later retains an attorney and files increasingly subjective complaints.
* The claimant's attorney threatens further legal action unless a quick settlement is made.
* There is a high number of applications from a specific firm.
* The claimant's attorney inquires about a settlement or buyout early in the life of the claim.
* The claimant writes unsolicited statements about how much better he or she is, but treatment continues and the claimant doesn't return to work.

Warning signs about outside activities
* There are tips from fellow employees, friends, or relatives suggesting that the injured worker is either working or is active in sports.
* The injured worker's rehabilitation report shows evidence of other activity.
* The injured worker is in a trade that would make it possible to otherwise work while collecting compensation.
* The injured worker is exaggerating an injury in order to get time off to work on personal interests; i.e., the injured worker is remodeling or building a home concurrently with the injury.
* The injured worker is in a seasonal business that would make it attractive to be "injured" during the off-season; i.e., occupations in fields such as roofing, landscaping, plumbing, farming, masonry, etc.
* The injured worker leaves different daytime and evening telephone numbers.

Fraud prevention starts with education and awareness. Educate your employees and enlist your honest employees in the fight against fraud and abuse. In addition, deliver the message that workers' comp fraud hurts everyone and that it undermines morale and productivity.

The next article in this series will review tips on holding your carrier accountable.

Article series by Brent Heurter.
Brent Heurter is the Founder and Chief Solutions Officer of ClearComp, a workers' compensation alternative for companies that desire to control and reduce their workers' compensation costs. Brent can be reached at 888-CLEAR-89 or email brent@clearcomp.com.

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