Employers pay for workers’ compensation insurance to protect their companies and support their employees if an on-the-job injury occurs. Most of the time, workers’ compensation claims are legitimate, and employees who are injured or become ill on the job rightly receive the medical and indemnity benefits they deserve.
In about 1 to 2% of cases, however, the claims are fraudulent. While the percentages are small overall, the National Insurance Crime Bureau reports that, nationally, those false claims can amount to billions of dollars in annual costs. This fraud has a ripple effect, driving up an employer’s workers’ compensation premiums and perhaps inhibiting the company’s ability to give raises or bonuses and necessitating increases in customer prices.
It may not be possible to eliminate all worker’s compensation fraud. But, as a small business employer, you can reduce it by watching for these 13 signs a workers’ compensation claim may be fraudulent.
1. Nobody Else Saw the Incident Happen
If the employee typically works around others but professes to have been alone at the time of the incident, you might want to give the claim a second look.
2. The Story Keeps Changing
When the employee repeatedly changes details about how the injury happened, it’s reason to suspect he or she is not telling the truth.
3. The Evidence Doesn't Support the Employee's Story
The claim is suspect if the company reviews the incident scene and the evidence gathered doesn’t match up with the employee’s description. The same is true if a medical exam indicates the injury isn’t consistent with the worker’s description of how it happened.
4. The Employee Has a Pre-Existing Medical Condition Similar to the Alleged Work Injury
5. The Employee Says the Injury Happened Days or Weeks Ago
But is just now making the claim and can't explain the delay.
6. The Timing is Strangely Coincidental
There is reason to doubt a claim’s veracity if the employee submits it after having been terminated, after a change in job responsibilities or when the alleged injury coincides with the employee’s need for personal time off. Likewise, an employee who claims an injury first thing Monday morning may be trying to cover for an accident that actually happened over the weekend.
7. The Employee is Historically Dissatisfied
Workers who have been disciplined for performance or behavioral issues or who always seem disgruntled may have decided that filing a worker’s compensation claim is a way to “get even” with the company.
8. The Employee Has a Checkered History
Their history includes frequent job, address and physician changes and/or a history of filing workers’ compensation claims.
9. The Employee Refuses to See a Doctor
A physician’s diagnosis can determine whether the claimed injury exists. If it does, the doctor can determine how severe it is and determine the proper course of action to promote healing. Employees with legitimate injuries should welcome medical treatment.
10. Financial Problems May Be a Factor
Employees who have requested pay advances or asked to borrow money from colleagues may be financially strapped. If they haven’t been successful in getting funding elsewhere, a workers’ compensation claim may look like a way to meet their financial needs.
11. You Can't Reach the Employee
A worker who’s out on leave because of an injury at work shouldn’t be hard to contact. If the employee doesn’t answer repeated calls, it may be a sign that the worker’s compensation claim is fraudulent.
12. An Attorney Gets in Touch
Neither pushing for a quick claim settlement nor immediately hiring an attorney is a sign that the employee is operating in good faith. An employee who refuses to cooperate or who swiftly hires a lawyer may have something to hide.
13. Activity Tells a Different Tale
An employee receiving worker’s compensation benefits for a severe back injury who simultaneously is seen lifting heavy weights at the gym, or one posting photos on social media of a just-completed 10K while supposedly home with a broken foot has certainly filed a fraudulent claim.
Being aware of the warning signs of a fraudulent worker’s compensation claim will help you protect your small business. Axcet HR Solutions also can help by vigilantly monitoring workers’ compensation claims submitted against its clients, as well as helping clients minimize employee recovery time and overall claims costs.