Indicators of

Worker’s Compensation Fraud

Although most claims are legitimate, many are inflated or fraudulent, and the adjuster should review all claims for possible fraud. These indicators, or fraud possibility factors, should help isolate those claims meriting closer scrutiny. No one indicator by itself is necessarily suspicious.

Even the presence of several indicators, while suggestive of possible fraud, does not mean that a fraud has definitely been committed.  Indicators are "red flags" only, not actual evidence.

The Claimant, Prior Claim History and Current Work Status

• Employee is disgruntled, soon-to-retire, or facing imminent firing or layoff.

• Employee is involved in seasonal work that is about to end.

• Employee took unexplained or excessive time off prior to claimed injury.

• Employee takes more time off than the claimed injury seems to warrant.

• Employee is nomadic and has a history of short-term employment.

• Employee is new on the job.

• Employee is experiencing financial difficulties.

• Employee recently purchased private disability policies.

• Employee changes physician when a release for work has been issued.

• Employee has a history of reporting subjective injuries.

• Review of a rehab report describes the claimant as being muscular, well tanned, with callused hands and grease under the fingernails.

• First notification of injury or claim made after employee is terminated or laid off.

• Disputes the average weekly wage due to additional income (i.e. cash, per diem and/or 1099 income)

• Has several other family members also receiving workers’ compensation benefits or other “social insurance” benefits, i.e. unemployment.

• Demands quick settlement decisions or commitments.

• Demands quick payments for medical providers, etc.

• Is unusually familiar with workers’ compensation claim handling procedures and laws.

• Is consistently uncooperative.

• Surveillance or “tip indicates that the totally disabled worker is currently employed elsewhere.

• Employee has submitted material misrepresentation on the employment application.

• Employee comes to office for delivery of benefit checks, avoids use of U.S. Mail.

• Employee refuses to allow visits or rehabilitation at home or specifies plenty of warning time prior to a visit.

• Employee participates in contact sports or physically demanding hobbies.

• After injury, employee is never home or spouse/relative answering phone states the employee “just stepped out,” or may have to contact him/her by pager.

• Return calls to residence have strange or unexpected background noises that indicate it may not be a residence.

• Employee protests about returning to work and never seems to improve.

• Employee cancels or fails to keep appointment, or refuses a diagnostic procedure to confirm an injury.

• Employee complains to carrier’s CEO or executive management at home office to press for payment.

• Social Security number provided does not belong to employee.

• Applicant refuses or cannot produce solid or correct identification.

• Employee’s family member (s) know nothing about the claim.

 Employee participates in contact sports or physically demanding hobbies.

• After injury, employee is never home or spouse/relative answering phone

• Return calls to residence have strange or unexpected background noises that indicate it may not be a residence.

• Employee protests about returning to work and never seems to improve.

• Employee cancels or fails to keep appointment, or refuses a diagnostic procedure to confirm an injury.

• Employee complains to carrier’s CEO or executive management at home office to press for payment.

• Social Security number provided does not belong to employee.

• Applicant refuse or cannot produce solid or correct identification.

• Employee’s family member (s) know nothing about the claim.

• Accident occurs late Friday afternoon or shortly after the employee reports to work on Monday.

• Accident is not witnessed, or witnesses to the accident conflict with the applicant’s version or with one another.

• Employee has leg/arm injuries at odd time, i.e. at lunch hour.

• Fellow workers hear rumors circulating that accident was not legitimate.

• Accident occurs in an area where injured employee would not normally be.

• Accident is not the type that the employee should be involved in, i.e. an office worker who is lifting heavy objects on a loading dock.

• Accident occurs just prior to a strike, or near end of probationary period.

• Employer's first report of claim contrasts with description of accident set forth in medical history.

• Details of accident are vague or contradictory, have inconsistencies, are not credible.

• Incident is not promptly reported by employee to supervisor.

• Diagnosis is inconsistent with treatment.

• Physician is known for handling suspect claims.

• Treatment for extensive injuries is protracted though the accident was minor.

• "Boilerplate" medical reports are identical to other reports from same doctor.

 

 

 

• Workers ' compensation insurer and health carrier are billed simultaneously;

• Injured worker protests about returning to work and never seems to improve.

• Summary medical bills submitted without dates or descriptions of office visits.

• Medical bills submitted are photocopies of originals.

• Extensive or unnecessary treatment for minor, subjective injuries.

• Treatment directed to a separate facility in which the referring physician has a financial interest (especially if this is not disclosed in advance).

• Referral for treatment/testing to facility close to referring facility.

• Injuries are all subjective, i.e. pain, headaches, nausea, inability to sleep.

• Treatment dates appear on holidays or other days that facilities would not normally be open.

• Employee is immediately referred for a wide variety of psychiatric tests, when the original claim involved trauma only. These claims usually present with vague complaints of "stress."

• Inappropriate expensive medical equipment prescribed for minor injury.

• Alleged injury relates to a pre-existing injury or health problem.

• Attorney becomes involved early in the claims process.

• Employee receives all mail by and through his attorney.

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Last Update:  Sunday, October 21, 2007 02:25 AM

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