2009
STRIMA
SNIFFING OUT WORKERS’
COMPENSATION FRAUD
Putting a Leash on Workers’ Compensation Fraud
2009
STRIMA
ARMED ROBBERY WITH A DANGEROUS WEAPON
 The ink pen.
 Workers’ compensation fraud occurs when an employee
knowingly lies to obtain benefits.
2009
STRIMA
THE RIFF-OFF
Workers’ Compensation Fraud results in:
 An increase in premiums.
 Withholding of employee raises.
 Cuts to employee benefits.
 Job loss.
2009
STRIMA
FRAUD RAP SHEET
 Insurance fraud costs the average family between $400
and $700 each year in increased premiums.
 Workers’ compensation fraud cost $80 million in Louisiana
alone.
 A legitimate claim can easily turn fraudulent.
2009
STRIMA
FRAUD ALIASES
2009
STRIMA
NOT YOUR USUAL SUSPECTS
 Summer baby sitter.
 Deer hunter.
 Home for the holidays.
 No vacation time on the books.
 Got on my last nerve.
 The pregnant claimant.
 The husband and wife tag team.
2009
STRIMA
NOT YOUR USUAL SUSPECTS
 Doctors.
 Pharmacists.
 Therapists.
 Attorneys.
2009
STRIMA
FRAUD STAKE OUT
2009
STRIMA
COULD IT BE FRAUD?
 Disgruntled employee.
 Financial or domestic hardship.
 Misses medical appointments.
 Injured worker wants to control the time he can meet with the
adjuster or doctor.
 Applies for unemployment benefits.
 Physical appearance:

Tanned.

Calloused hands.

Grease under fingernails.
2009
STRIMA
RUMORS
 The accident never happened.
 The injury did not occur at work.
 The employee can return to work.
 The employee is working somewhere else.
2009
STRIMA
INJURED WORKER IS NEVER HOME
 The injured employee is difficult to reach.
 Voice mail always picks up when trying to reach employee
by phone.
2009
STRIMA
CAN’T GET STORY TOGETHER
 Conflicting descriptions of the accident.
 Not clear on the details of the accident.
 Provides vague responses to questions.
2009
STRIMA
METHOD OF OPERATION
Employee has filed past workers’ compensation claims.
2009
STRIMA
HEADQUARTERS
THE EMPLOYER’S ROLE
2009
STRIMA
SOUND HIRING PRACTICES
 Conduct criminal background checks.
 Drivers’ license and MVA checks.
 Verify references.
 Maintain current addresses for all employees.
2009
STRIMA
NO EXCUSES
 Employee education.
 Employer education.

Knowledgeable supervisors and managers.
 Online claims reporting capability.
 Fraud hotline.
 Online fraud reporting capability.
 Maintain a working relationship with the adjuster.
2009
STRIMA
KNOW FRAUD INDICATORS
 Rumors.
 Late reporting.
 Doctor shopping.
 Voice mail / answering machines.
 Can’t get the story straight.
 Friday / Monday accidents.
 No witnesses.
2009
STRIMA
INVESTIGATE ALL ACCIDENTS
Use sound investigation techniques.
 Obtain accurate information about job-related accidents.
 Review video surveillance of accident scene.
 Interview injured workers and witnesses as soon as
possible.

Separate witnesses.
2009
STRIMA
PROMOTE A FRAUD-FREE WORKPLACE
 Develop a policy statement about WC fraud.

WC fraud is a crime.

Show employees how fraud affects benefits.
 Discuss WC policies and procedures with employees.

What to do when an accident occurs.

Return to work program.

Transitional duty employment deters fraud.

Find a place for the injured worker to come back to.
2009
STRIMA
PERIODIC SAFETY CHECKS
 Maintain a safe work environment.
 Have regular inspections of work areas and equipment.
 Fix hazards immediately.
 Document all safety checks and repairs.

Safety records are evidence.
2009
STRIMA
EXIT INTERVIEWS
 Discourage post-termination claims.
 Obtain a signed statement from employee about any
unreported injury at work.
2009
STRIMA
FRAUD- PROOF THE WORKPLACE
 Complete the first report of injury.

Incidents.

Near-misses.
 Report the injury to the carrier immediately.
 Obtain prompt medical attention.
 Stay in touch with injured workers.
2009
STRIMA
THE PRECINCT
-THE ADJUSTER’S ROLE
2009
STRIMA
SPECIAL INVESTIGATION UNIT
 Take recorded statements.

Injured worker.

Supervisor.

Witnesses.
 Accident Reconstruction.
 Scrutinize medical documentation.
2009
STRIMA
WATCH FOR CLAIM PATTERNS
 Symptom magnification.
 Injured worker is never home.
 Injured worker always wants medication.
 Excuses to get out of medical appointments.
 Doesn’t return state required forms.
 Will not cooperate with voc rehab.
 Injured worker is knowledgeable about the comp system.
2009
STRIMA
OUTSIDE RESOURCES
 Medical case management.
 Vocational rehabilitation.
 Claims clearinghouse (index system).
 Surveillance.
2009
STRIMA
SURVEILLANCE
 Coordinate with defense attorney.
 Same day of a doctor’s visit.
 Evenings, nights and weekends.
 Regional and local festivals.
 Question injured worker about activities seen on the surveillance
video.
 Have the treating physician question the injured worker about his
pain level and physical activities.
2009
STRIMA

PLAY IT SAFE!
DO NOT GIVE THE VIDEO TO THE DOCTOR!

Lose right to privileged information.


Plaintiff has a right to the video as well.
Hold video until after the deposition.
 Attorney

Show surveillance video to defense attorney.

Schedule deposition after surveillance.
2009
STRIMA
ONCE YOU SUSPECT FRAUD
 Get a second medical opinion.
 Utilize surveillance.
 Involve law enforcement agencies.

Attorney General.

District Attorney.
 Involve professional oversight boards.

Pharmaceutical Board.

Board of Medical Examiners.
2009
STRIMA
QUESTIONS TO ASK
 What lie did the injured worker tell to receive benefits?
 Did the injured worker lie knowingly or intentionally?
 Was the lie made to obtain or deny benefits?
2009
STRIMA
FRAUD IS A CRIME
Workers’ compensation fraud is costly and it’s illegal.
 Employees who knowingly lie or help someone else provide false
information in order to receive benefits

5 years in prison.

$5000 fine.
 Employers who lie to pay lower premiums face

10 years in prison.

$10,000 fine.
2009
STRIMA
FRAUD LINE UP
2009
STRIMA
FRAUD LINE UP
 Three comp claimants caught with side jobs in Texas.
 New York roofer accused of collecting benefits after
returning to work.
 Five years prison for executive convicted of comp fraud.
2009
STRIMA
FRAUD LINE UP
 Brooklyn doctor charged with workers’ compensation
fraud.
 Business owner in Massachusetts accused of premium
fraud.
 Ex-paramedic charged with false reporting.
2009
STRIMA
FRAUD LINE UP
 Ft. Lauderdale business owner convicted in federal court in
July for workers’ compensation employer fraud.
 $4,600,000 fraud.
 60 months in prison with restitution.
2009
STRIMA
HELP TAKE A BITE OUT OF WC FRAUD
 Know what to look for.
 Know what to do.
 Don’t be afraid to prosecute.
 Work with law enforcement agencies.
 Work with professional oversight boards.
2009
STRIMA
HELP TAKE A BITE OUT OF WC FRAUD
2009
STRIMA
REFERENCES
 www.lwcc.com
 www.nicb.org
 da.la.ca.us/workers compensation fraud
 Coalition Against Insurance Fraud
 www.LAWORKS.net
 dogthebountyhunter.com/downloads
 business-insurance.suite 101.com
 www.tdi.state.tx.us/fraud
 claimsadvisor.com