What is Workers’ Comp Fraud?

workers comp fraud

If an employee is injured at work or sick from a work related cause then employers may be responsible for medial bills, lost wages among other expenses. Knowingly and intentionally makes a false, material statement to obtain or deny a benefit for themselves or another is the definition of workers’ compensation fraud. This fraud can be committed by employers, employees and even healthcare providers. Frauds can be simple misrepresentations of the truth or a complex web of deceptions.

Honest mistakes it goes without saying, but people do make mistakes. When it comes to a fraud investigation, it must be shown that there was intent behind the fraud, otherwise a mistake is not classified as such. Worker’s Comp fraud can lead to higher insurance premiums and penalties, fines and even up to 5 years in jail. It is important that you are honest and truthful when reporting your injury or an injury of your employee. It is important to not only protect your business, but the individuals involved as well.

Employers Methods of Fraud Can Include:

  • Employers falsifying documents to avoid paying premiums to people injured at work
  • Misleading workers to discourage them from making a workers’ comp claim
  • Employers falsifying documentation to make it appear that their workers are covered when they really are not
  • Misclassifying their business type to lower their insurance premiums
  • An employer misclassifies employees to avoid having to pay a workers’ compensation insurance premium.
  • Employers failing to keep and maintain accurate records
  • Employers failing to inform workers that they are entitled to compensation benefits from their first day of work health

Care Methods of Fraud Can Include:

  • The submission of false medical reports or inflating care costs and prices charged to the compensation fund
  • A hospital bill for a service that was not performed
  • Exaggerating an injury to push additional treatments

Workers’ comp is a complex and daunting topic for business owners and employees. The biggest step in preventing Worker’s Comp fraud is to help employees and employers understand what worker’s comp insurance is and how it works.  If they know how and what workers’ comp is, it can limit the possibilities of fraud.

To learn more contact the professionals at EMD Law today.