When a Government Institutes a program that is responsible for distributing billions of dollars each year, there are individuals who will attempt to take advantage of the program by engaging in fraud.

During the course of any given year, billions of dollars are paid out through the Workers’ Compensation Insurance Program to Injured Workers for temporary disability and permanent disability benefits, Medical Providers are paid for various medical procedures provided, Attorneys are paid fees out of Injured Workers’ settlements, and Vendors are compensated for various services provided such as for medications, durable medical equipment, interpreting or photocopying. Also, Employers are obligated to pay premiums in the billions of dollars in insurance premiums.

Per the State of California, “[w]orkers’ compensation fraud costs the citizens of California billions of dollars each year. It is more than an employee exaggerating a medical condition. Workers’ compensation fraud also occurs when health care providers bill for services never performed, when employers under-report payroll, and when attorneys or claims adjusters facilitate claimant fraud.”

The State of California issued this warning as a reminder that Workers’ Compensation Fraud has serious consequences that compromise the program.

What Types of Workers’ Compensation Fraud are There?

In Workers’ Compensation, there is Medical Provider Fraud, Claims Adjuster Fraud, Employer Fraud, Employee Fraud, and Attorney Fraud.

What is Medical Provider Fraud?

Medical Provider fraud includes billing fraud, employing individuals to solicit new patients, unnecessary treatment or self-interested referrals, and failing to report a work injury.

What Is Claims Adjuster Fraud?

Claims Adjuster fraud include causing payments to be made to non-existent claimants or medical providers, referring patients or clients to medical providers or attorneys for compensation, issuing excessive payments to an attorney or medical provider in return for a kickback, backdating documents in an attempt to avoid penalties for delays in benefit payments or altering documents to support an unjustified denial of a claim.

What is Employer Fraud?

Employer Fraud includes premium fraud which is when an employer schemes to defraud their workers’ compensation insurer by paying less for workers’ compensation insurance. Examples include under-reporting payroll, misclassifying employees’ job descriptions, or paying an employee’s medical provider directly for medical treatment for a work-related injury, Fraud can include failing to secure workers’ compensation insurance coverage

What is Employee Fraud?

Employee fraud includes making knowingly false or fraudulent statements to obtain entitlement to workers’ compensation benefits.

What is Attorney Fraud?

Attorney Fraud is facilitating claimant, employer, or insurer fraud. It can include engaging in client solicitation and receiving a fee for referring clients to a medical provider.

What are the Consequences of Fraud?

Per the State of California, “WORKERS’ COMPENSATION FRAUD IS A CRIME It is a felony to make a false or fraudulent material statement to obtain or deny any compensation. It is a crime to knowingly assist, conspire with, or solicit any person in an unlawful act of workers’ compensation insurance fraud. It is also a crime to make or cause to be made a knowingly false or fraudulent statement with regard to entitlement to benefits with the intent to discourage an injured worker from claiming benefits or pursuing a claim. Workers’ compensation fraud may be punished by imprisonment in a county jail for over one year, or in a state prison for two to five years. A fine may also be imposed not exceeding $150,000, or double the amount of the fraud, whichever is greater. If someone is convicted of workers’ compensation fraud, the court is required to order restitution, including restitution for any medical evaluation or treatment services obtained or provided. A person convicted of workers’ compensation fraud may be charged the costs of the investigation and is ineligible to receive or retain any compensation, where that compensation was owed or received as a result of workers’ compensation fraud.”

How Do You Report Workers’ Compensation Fraud?

If you need to report workers’ compensation fraud, please call the Department of Insurance’s fraud hotline number: (800) 927-4357. You can also access the Fraud Division’s website to obtain more information and locate the telephone number for the Fraud Division office nearest to you.

Where Can I Get Legal Advice in California?

If you would like a free consultation regarding workers’ compensation, please contact the Law Offices of Edward J. Singer, a Professional Law Corporation.
They have been helping people in Central and Southern California deal with their worker’s compensation cases for 26 years. Contact us today for more information.


Image: Alpha Stock ImagesNick Youngson

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