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Decrease Fraudulent Work Comp Claims

Decrease Fraudulent Work Comp Claims

The Texas Department of Insurance reports that 13,513 incidents of workers’ compensation fraud were filed in 2015. Those cases referred for prosecution represented a cost of $8.56 million. As an employer, you can reduce your risk of fraudulent workers’ comp claims with a few proactive measures.

Watch for Warning Signs

One method is to look for red flags, warning signs that may indicate a claim is fraudulent. Watch for any of these circumstances that often signal fraudulent claims.

  • Timing of the claim – for example, an employee reports a workplace injury prior to an impending layoff or termination; or following a weekend, vacation, etc.
  • History of filing claims – has reported numerous other injuries on the job in the past.
  • Lack of witnesses – the employee’s explanation of the injury cannot be corroborated by co-workers when it occurred in the workplace.
  • Conflicting Reports – Witnesses describe incident in contrast with claimant’s description.
  • Delay in reporting incident – Employees should be encouraged to report injuries to supervisors immediately.
  • Injury is inconsistent with the type of work involved – if the injury is not something that can reasonably be expected to occur given the job description, such as a back injury when the employee’s work involves no heavy lifting.
  • Excessive recovery time – the employee takes more time off than the reported injury should require.

Employee Screening and a Focus on Workplace Safety

The best means of reducing workers’ comp fraud is to create a work environment that promotes safety and discourages fraud. A pre-employment background check will include an employment history and criminal records. Past convictions of fraud, or a history of job-hopping can help identify potential trouble.

Initiate a robust safety program with ongoing training and scheduled meetings to promote safe work practices. Reward workers for achieving safety milestones. It is more difficult to file a fraudulent injury report in a workplace environment where there is an emphasis on safety.

Activity Checks

If you are concerned that an injured employee might have filed a fraudulent workers’ compensation claim, consider getting an activity check by a reputable investigative service. An activity check can verify the subject’s recreational and social activities, and may include surveillance if necessary, to determine if a claim is fraudulent.