Looking back at fraud cases from December 2015 and why it is not what most people expect.
People think employee fraud is the largest problem in workers’ compensation today. Special interest groups use this narrative to “reform” the system for their gain.
We thought it would be interesting to look at some of the higher profile fraud cases from last month and give some additional perspective.
A much larger problem is employee misclassification and underreporting. This type of premium fraud runs into the millions and results in higher overall insurance costs. We typically see this occur when employees are called independent contractors.
Beverly Hills Patch has a story about a janitorial company contracted to service luxury hotels. It is alleged that owners concealed the existence of hundreds of hotel workers to avoid paying millions of dollars in insurance premiums. Employees did not get workers’ compensation benefits and feared retaliation if they reported injuries.
Medical providers also commit fraud when billing for services that are not actually performed. This has serious financial and personal costs.
KABC-TV Los Angeles has reported that several people have been charged with fraudulently billing of more than $24 million in workers’ compensation claims. Medical offices allegedly contracted with interpreters to perform unnecessary translation services. One translator had $422,000 in charges despite being incarcerated for the entire period of time.
Michigan Workers Comp Lawyers never charges a fee to evaluate a potential case. Our law firm has represented injured and disabled workers exclusively for more than 35 years. Call (855) 221-2667 for a free consultation today.