Most people imagine workers’ comp fraud as an employee faking or exaggerating an injury in order to claim benefits, but did you know employers and even healthcare providers can participate in this kind of fraudulent activity as well?
Assuming you understand employee fraud, we’ll cover this type of workers’ comp issue with a shocking example. After an alleged injury to her neck and shoulders, a woman claimed pain so severe it prevented her from working. While she was collecting workers’ comp insurance, the woman was filmed riding in two different rodeo competitions.
Although this type of workers’ comp is usually simple, some employees create complex schemes to fake their injuries.
More often than not, however, the biggest conspiracies come from employers and healthcare providers.
The most common type of employer fraud comes from employers trying to minimize their insurance premiums. They do this by making false claims about the nature and safety of their work environment, or by denying the existence of employees altogether. In California especially, companies frequently misclassify workers as independent contractors to avoid providing workers’ comp benefits.
Due to the abuse of the so-called, “gig economy,” Governor Gavin Newsom recently signed a new labor law that will reclassify thousands of independent contractors as employees.
While misclassification is the hot-button issue of the moment, some employers go to even greater lengths to avoid paying workers’ comp insurance premiums. A Florida woman was charged with several felonies after renting her insurance policy out to uninsured contractors, issuing more than 250 false certificates. In another wild case of workers comp fraud, a Los Angeles man created a shell company to hide the majority of his employees and thus provided insurance to only 35 of his 2,700 employees.
In less extreme cases, employers can commit fraud on an employee-to-employee level. If an employer denies benefits to an employee, for instance, or lies about what coverage is available, they can also be found responsible for fraudulent activity.
Healthcare Provider Fraud
According to the California Department of Insurance, medical professionals can commit workers’ comp fraud by creating false or exaggerated claims, providing unnecessary treatments, and “over-prescribing harmful and addictive drugs.” When providers engage in this kind of behavior, they become white-collar criminals. In the most newsworthy stories, multiple parties are involved in out-of-this world conspiracies with false referrals, kickbacks, and even nonessential surgeries.
What to do if You Suspect Fraud
In fiscal year 2015-2016, workers’ comp fraud cost the state of California $193,353,616. Much of this money came out of tax-payers’ pockets.
If you see something fraudulent, speak up. You can report your suspicions to California’s Fraud Division via a phone call to the Golden Gate Regional Office at (707) 751-2000, an email to fraud@Insurance.ca.gov, or a scheduled meeting with Insurance Commissioner Ricardo Lara.
When you are the victim of workers’ comp fraud, you may also need to hire an attorney. At the Law Offices of Andrew B. Shin, we focus our practice on workers’ compensation and help injured employees gain access to the benefits they are entitled to.
Don’t let your employer get away with dishonesty. Call us today at (408) 709-7317 and schedule your free consultation.