State Action on Workers’ Compensation Fraud

The workers’ compensation system is an important safety net to help provide employees with a way to get their medical costs covered as well as a degree of replacement wages while they are recovering.  The system also protects employers by preventing an employee from suing them in court for the injury in addition to the workers’ compensation process, with very few exceptions.  Although the overwhelming number of workers’ compensation claims are valid, workers’ compensation fraud is a serious problem, costing the California taxpayers millions of dollars a year.  To that end, there have been significant actions by the state to help combat fraud.

One way that the state of California combats workers’ compensation fraud is by creating specialized workers’ compensation fraud units in district attorneys’ offices across the state.  These units are full of attorneys with specialized knowledge about some of the most common types of workers’ compensation fraud, including claim mills, malingering, premium fraud, and provider fraud.  These attorneys are familiar with the types of evidence required to move forward with a case and are skilled in getting convictions.  These convictions help cut down on the amount of fraud being perpetrated, saving untold tax dollars.

Another way the state of California combats workers’ compensation fraud is the Workers’ Compensation Fraud Program, which was established by the legislature in 1991.  The program made it a requirement for employers to report suspected fraud, made workers’ compensation fraud a felony, and provided a way to fund enforcement and prosecution activities.  The legislation also established the Fraud Assessment Commission.  The role of the Fraud Assessment Commission allocates funding to fraud prosecutors.

The state also takes action against workers’ compensation fraud by passing new legislation to combat fraud.  One example is Assembly Bill 2046, which was introduced in 2018.  The bill modifies the way that the legislation and commission are permitted to spend funds on fraud prosecutions.  The bill also allows certain government agencies which have workers’ compensation insurance fraud information to release that information to certain designated and authorized government agencies.  Several bills were also introduced in 2018 dealing with the requirement to carry workers’ compensation insurance, including requirements for particular contractors to carry a certificate of workers’ compensation insurance or certificates of self-insurance.

If you have questions about workers’ compensation fraud and how to make sure your company complies with the law, call us today.  We can talk with you about workers’ compensation and your business.

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