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Signs of worker's compensation fraud that every claimant should know

There is concern among employers and insurers about workers' compensation fraud, particularly fraud committed by employees. Fraudulent claims cost money and undermine the workers' compensation system. Most states consider fraud to be a significant problem.

Based on television shows that purport to expose allegedly injured employees moving furniture or sailing, the average person probably believes there is an epidemic of workers' compensation fraud. However, fraudulent workers' compensation claims usually account for less than 2% of all claims; in many cases they account for less than 1%.

Although the number of fraudulent cases is relatively small, fraud can have a big impact on the workers' compensation system. The most tangible impact of fraudulent claims is lost money. It is estimated that 5 billion dollars is spent annually on fraudulent claims. Higher costs for insurers usually results in higher premiums for employers. This can be a problem for employees and consumers, too, since these costs are often passed on to them in the form of reduced wages or higher prices.

But, why should the average worker worry about fraudulent workers' compensation claims? An employee who has a legitimate workers' compensation claim should know the signs of fraud in order to avoid unnecessarily casting suspicion on his or her claim. State workers' compensation fraud units have established criteria to help employers identify fraudulent claims. If employees know these signs, they can avoid being innocently caught in the net.

Many fraud units, also called fraud divisions, fraud sections, or investigations units, state that inaccurate or inconsistent statements are indicators of fraud. When an employee's description of an incident varies from one report to another it raises suspicion. When an employee does not recall the details of the incident, in particular, the exact date or time it is another red flag for fraud. In order to avoid this situation, an employee should write a complete statement soon after the incident occurs so that he or she can accurately report all the details. This statement can be used later to refresh the employees memory and ensure that they do not make any inconsistent statements.

Timing is another important factor when making a claim for a workplace injury. Injuries that go unreported for some time arouse suspicion. Also, injuries reported on Mondays have been flagged by many in enforcement as claims that may warrant a closer look. The lesson for employees is to report any injury right away.

Sometimes, the circumstances surrounding a claim could raise a red flag for an employer but there is nothing that an employee can do to prevent this. If the employee is about to lose their job due to a strike, reduction in force, or because their work is complete any injury claim is more likely to be scrutinized. An employer may suspect that the employee is looking for a source of income to hold them over while they are not working.

Although many of the situations that could raise a cautionary flag for an employer are things that are out of an employee's control, knowing the warning signs of fraud can help avoid certain pitfalls. One very simple step that any employee can take is to use care when completing all paperwork. An employee should be sure that the information is accurate and that the document is legible. It may not be a fair criterion, but some workers' compensation fraud units have said that cross-outs and erasure marks may signal fraud.

Although the presence of one or even all the warning signs does not necessarily mean a claim will get extra scrutiny, knowing the signs of workers' compensation fraud can improve an employee's chances of avoiding unnecessary delays in the claim process.

Employers advised to keep an eye out for warning signs of fraud

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Employers advised to keep an eye out for warning signs of fraud

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