The RED FLAGS of Workers Comp Fraud

June 19, 2019 by Leave a Comment

workers compensation red flags of fraudA critical part of controlling workers’ compensation costs is to put into place solid investigation techniques.  No matter how severe or minor a workplace injury, each case needs to be reviewed to identify any fraudulent claims and take appropriate action.

 

When communicating with employees, make it clear that the company will:

 

 

  • Identify corrective measures

 

  • Watch for minor extensions of days out of work and outright fraudulent claims.

 

 

Review these Red Flags of Fraud and request an investigation if you suspect a claim is illegitimate or exaggerated.
 

 

Injured Worker Red Flags:

 

  • Injury reported late, to an attorney or to the state commission before reporting it to the employer.

 

  • Fails to attend weekly meetings.

 

 

  • Is never home when you phone, especially during regular workday hours.

 

  • Has only a postal box rather than a home address.

 

  • Misses doctor appointments.

 

  • Is known to perform seasonal activities, hobbies, or work.

 

  • Has moved out of town or out of state.

 

  • Disputes average weekly wage due to additional income.

 

  • Files for benefits in a state other than the main location.

 

  • Disputes information supplied by the employer on “First Report of Injury” notice.

 

  • Refuses to cooperate in claim investigation.

 

  • Has an unstable work history.

 

  • Has recently been terminated, demoted, or passed over for promotion.

 

  • Has a prior history of injury management or liability claims.

 

  • Makes excessive demands or is pressing for a quick settlement.

 

  • Carries little or no health insurance.

 

 

Medical Flags:

 

  • Medical reports are repetitive, indicating continuing, constant pain with conservative medical treatment

 

  • The word “disproportionate” is used in medical reports

 

  • The doctor mentions there is “facial grimacing”

 

  • Positive “Waddell Tests” (test for low back pain) are mentioned

 

 

Workplace Flags:

 

  • Employer experiencing labor difficulties (i.e., layoffs, strikes, walkouts).

 

  • Tips from fellow workers, friends, or relatives.

 

  • The insurance company wants to settle the claim for a considerable amount of money.

 

 

“Things” just don’t ADD UP! Trust your gut, and if something seems off, be sure to check it out.

 

 

Michael Stack - AmaxxAuthor Michael Stack, CEO Amaxx LLC. He is an expert in workers’ compensation cost containment systems and helps employers reduce their workers’ comp costs by 20% to 50%.  He works as a consultant to large and mid-market clients, is a co-author of Your Ultimate Guide To Mastering Workers Comp Costs, a comprehensive step-by-step manual of cost containment strategies based on hands-on field experience, and is the founder & lead trainer of Amaxx Workers’ Comp Training Center.

 

Contact: mstack@reduceyourworkerscomp.com.

Workers’ Comp Roundup Blog: http://blog.reduceyourworkerscomp.com/

 

©2019 Amaxx LLC. All rights reserved under International Copyright Law.

 

Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional.

Filed Under: Fight Workers Comp Fraud & Abuse Tagged With: , , , , , , , , , , , ,

This is a TEST, Can You Spot the Workers Comp Fraud Red Flags

January 31, 2013 by Leave a Comment

 

Amaxx Risk Solutions has published several articles on combating fraud in workers’ compensation claims.  While we can tell our readers the importance of fighting fraudulent claims, and publish lists of red flag indicators of fraud, it is often difficult for the risk manager or workers’ compensation coordinator to separate the legitimate work comp claims from the bogus claims.

 

To assist you in recognizing the bogus claims, we are providing a sample claim, using the actual facts of a submitted workers’ compensation claim to see if you can recognize or spot ten red flags of a bogus claim (the name of the employee  has been altered to protect the guilty).

 

 

The Claim:

 

John Doe works in an auto repair shop as a mechanic.  Upon arriving early for work on Monday morning, Mr. Doe went into the auto parts store room to get a part for the car he was going to work on.  While leaving the storeroom and using both hands to carry the heavy auto part in a box, he tripped over another box on the floor.  In an effort to keep from falling, he grabbed a storage shelf, twisting and injuring his shoulder as he fell to the floor.  No one saw him fall in the parts storage room as the other employees were just arriving for work.

 

Mr. Doe immediately reported the claim to the shop manager and explained to the manager how he fell over the box on the floor he did not see because of the box he was carrying with both hands.  The shop manager offered to take Mr. Doe to the nearest industrial medicine clinic, but Mr. Doe instead chose to take himself to his “family doctor”.  The family doctor took Mr. Doe off work and did not indicate when he would be able to return to work.

 

When the shop manager called Mr. Doe the next morning to see how he was doing, Mr. Doe’s wife stated he was sleeping and could be disturbed.  The shop manager waited and called Mr. Doe again that afternoon.  Per the wife, Mr. Doe had stepped out.  The shop manager asked for Mr. Doe’s cell phone number, but instead of providing the phone number, the wife promised to have Mr. Doe call the manager.  Mr. Doe almost immediately called the manager back to relay what the family doctor had said. The shop manager recorded the cell phone number of Mr. Doe.  When the shop manager called Mr. Doe’s cell phone the following week to see what the family doctor had to say after the second medical appointment, the background noises did not sound like the noise you would hear in a person’s home.

 

A second mechanic in the shop after being overworked for three weeks due to the absence of Mr. Doe advised the shop manager that he had heard through a mutual friend that Mr. Doe had injured his shoulder while rock climbing the weekend before the reported injury.

 

The claim has numerous red flags that could be a tip-off for fraud.  They are:

 

  1.      Monday morning accident.  Almost twice as many accidents occur on Monday morning than any other morning of the week.  This is due to people claiming non-work related weekend injuries as work related in order to not lose their source of income.

 

  1.      Arriving early for work.  Unless the employee habitually arrives early for work, arrival for work early on the day of the alleged accident is an indicator the employee wanted to “have the accident” before other employees see he is injured.

 

  1.      Not seeing a hazard he had just saw moments earlier. If boxes on the floor were a common occurrence, the employee would be careful about watching where he was going.  If a box on the floor was unusual, the employee would have made a mental note to avoid it.

 

  1.     The mechanism of injury does not make sense.  If the employee was using both hands to carry a heavy box, how did he have a hand free to grab the storage shelf?

 

  1.      The accident was not witnessed.  Bogus injury claims almost always occur where no one else will see the accident happen.

 

  1.      The selection of a particular doctor over a more qualified doctor who specializes in treating injured employees.  This is normally a sign the employee wants a doctor who will accommodate his desire to be off work.

 

  1.      A doctor who does not address return to work.  This is normally because the injured employee tells the doctor that he does not feel he will be able to meet his job requirements.

 

  1.      The employee being asleep when he would normally be awake.  Unless the doctor has prescribed some very strong pain killers, the employee should be available to talk to the employer.

 

  1.      The employee not being at home.  Occasionally not home is understandable, repeatedly not home/not available is usually a sign the employee has something better to do than being at home, i.e., possibly another job, either short-term or long-term.  Background noises that don’t sound like a spouse or a television often are an indicator the employee is working elsewhere.

 

  1. Tips from co-workers.  This is probably the strongest evidence of fraud and should be investigated thoroughly.

 

None of these red flags by themselves are proof of fraud, nor is a combination of two red flags.  However, the more red flags the employer sees on a claim, the higher the probability the claim is fraudulent.  If you see multiple reasons to question the validity of a claim, the insurance adjuster and the special investigative unit of the insurer should be notified as to why you believe the claim to be questionable.

 

 

Author Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.

Contact: mstack@reduceyourworkerscomp.com.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law.

 


Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker, attorney, or qualified professional about workers comp issues.

Filed Under: Fight Workers Comp Fraud & Abuse Tagged With: , , , , , , , ,

Postal Worker Guilty of Fraud After Running Marathons While Receiving Workers Comp

October 17, 2012 by Leave a Comment

 

26 Year Veteran Ran Marathons and Received Workers Comp Benefits
 
A former Florida postal worker ran her way recently into a federal court sentence, following an investigation by the United States Postal Service, Office of Inspector General.
 
The 26-year veteran had been convicted of fraud after she was caught running marathons while receiving workers compensation benefits.
 
According to Jacquelyn Myers' attorney, the postal service should've confronted Myers if they knew she was running marathons while on light duty at work. The judge said he understood that the government had to build its case but, agreed that probation (three years) was appropriate.
 
 
Guilty of Healthcare Fraud and Making False Statements
 
A federal judge claimed just because someone can do this, it doesn't mean they should do this. However, the judge stated he had to base his sentencing on the jury's findings and in May, 2012 a jury found 55-year-old Jacquelyn Myers, guilty of healthcare fraud and making false statements to get workers comp.
 
 
Ran 80 Athletic Events
 
Prosecutors report Myers claimed she was physically unable to do her job as a mail carrier with the U.S. Postal Service because of a 2009 back injury yet, she competed in more than 80 athletic events even running the Boston Marathon and winning the title of top athlete in her age group in all of Georgia.
 
Myers' attorney denied prosecutors' claims that the marathon runner misled doctors and her employers just to be put on light duty and have Saturdays off.
 
Myers' attorney said Myers did tell her physical therapist that she was running races while on disability. The judge said that the postal service should've sat down with Myers and asked what her physical capabilities were.
 
The judge ordered Myers to pay restitution of $26,714 plus $400 special assessment.
 

Author Michael B. Stack, CPA, Director of Operations, Amaxx Risk Solutions, Inc. is an expert in employer communication systems and part of the Amaxx team helping companies reduce their workers compensation costs by 20% to 50%. He is a writer, speaker, and website publisher.  www.reduceyourworkerscomp.com.  Contact:  mstack@reduceyourworkerscomp.com. 

 

 


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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.

 

©2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact us at: Info@ReduceYourWorkersComp.com.

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7 Steps to Reduce Workers Comp Fraud

May 7, 2012 by Leave a Comment

When an employee commits workers compensation insurance fraud, they are stealing direct from the employer.  While the insurance carrier or the self-insurance program may write the check, the cost of workers comp fraud comes right out of the employer’s pocket.  The fraudulent workers comp claim is included in the calculation of the insurance premium, the same as legitimate workers comp injuries.

 
Per the Coalition against Insurance Fraud, bogus claims cost employers $6 billion a year.  It is estimated that nearly 25% of the workers comp claims contain some element of fraud, whether it is the outright bogus claim or the employee who stays off work when he knows he could be working light duty. [WCx]
 
 
The employer should know the indicators of fraud, often referred to as the red flags.  Something unusual about the claim does not indicate fraud, but unusual things can point to the possibility of fraud.  When any of the following exist, consider a fraud investigation:
 
 
  • Late reporting of the injury:  real injuries get reported quickly.

 

  • Accident details that do not fit: the accident details are sketchy or vague, the employee has difficulty describing what happened, and the employee gives more than one version of what happened.

 

  • Witnesses:  there are no witnesses, especially when the employee normally works around other employees, or the witnesses’ version differs from the employee’s version of the accident.

 

  • Disgruntled employee:  the employee has previous express dissatisfaction with supervision or management, the employee did not get a promotion she wanted, the employee is on "positive improvement needed" status, the union has announced an impending strike; the factory is closing, etc.

 

  • Medical care: the injuries are subjective, i.e., low back pain, complaints of pain out of proportion to diagnostic findings, the employee changes doctors, the employee attempts to add additional body parts to the medical treatment.

 

  • Monday morning claims: the injury, usually with no witnesses, occurs early Monday morning shortly after the employee gets to work (the injury occurred over the weekend while the employee was away from work). [WCx]

 

 Unfortunately, when it comes to workers comp fraud, some employers take the defeated approach with “there is nothing we can do about it” line of thinking.  There are many approaches the employer can follow to reduce and/or eliminate fraud including:

 
 

1.  Having an established practice of investigating every workers comp claim.   If the employees know it will not be easy to commit fraud, they are less likely to try it. 

2.  A required transitional duty program that all employees know about will prevent the employee who wants to “take a vacation on comp” or to work another job while collecting workers comp benefits.

3.  Make sure all employees are aware that workers comp fraud is a crime and you strongly prosecute insurance fraud.

4.  Make fraud beneficial to the employee who reports it.  Have a published policy of paying a reward to the employee who provides information leading to the conviction of the criminal committing the fraud.

5.  Report ALL questionable claims to the Special Investigative Unit of the insurer or third party administrator.

6.  Have a strong safety program which will remove many of the scenarios the fraud prone employee can use to create a bogus claim.

7.  Avoid hiring people of questionable ethics.  Complete a thorough background check including criminal history and credit score (the lower the credit score, the higher the probability of a questionable workers comp claim).  If you do not have the time to do an in-depth background check, consider a member of the National Association of Professional Background Screeners, www.napbs.com.

 

 
Fraud should never be tolerated and should be fought any time it occurs.  As the employer, you should learn as much as possible about defeating workers comp insurance fraud.  Our 2012 Manage Your Workers Compensation: Reduce Costs 20% to 50% has an entire chapter on Fighting Fraud and Abuse.  It will show you many additional steps you can take as the employer to combat workers compensation fraud.
 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and website publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Manage Your Workers Compensation: Reduce Costs 20% to 50% www.WCManual.com. Contact: RShafer@ReduceYourWorkersComp.com.
 

Our WORKERS COMP BOOK:  www.WCManual.com
WORK COMP CALCULATOR:  www.LowerWC.com/calculator.php

 
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
 
© 2012 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact

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An Adjuster Pinpoints Eight Medical Provider Red Flags of Over Treatment

December 1, 2011 by Leave a Comment

Back again with the final part of the series on medical provider red flags.  This could be 50 red flags, but these are some of the most common. This is to provide continued awareness that not all medical clinics are on your side.  The caveat again is that this is not the norm. This article is just meant to raise awareness.  Because these issues, while uncommon, really do happen. That is about as politically correct as I can make it.  Here are the physician red flags you should be watching for. This article is summarized from an interview with an adjuster I met recently.

 

 

  1. The medical records are “template” style, or barely exist at all. Out of all of the red flag issues we discuss, this one does not indicate a shady doctor.  It could just be that the doctor is very poor at note taking.  But the two go hand in hand.  Great doctors do great analysis, and back up opinions with objective medical facts.  They arrive at this point by walking through the medical records, and creating a great conclusive medical report.  Doctors that get by by pairing up subjective history from a patient’s mouth are another story. (WCxKit)

 


  1. Missing dates of service, or no date labels on the medical notes.      I suppose if the “template”style medical record, is paired with one that is similar to a fill-in the-blank system (Patient came in with complaints of _______ which they attribute to work causing them _____ pain out of 10, with 10 being the worst pain imaginable) and pair it up without a date of service, I guess you could use that medical record for every date of service you ever have.  If anyone is watching, a physician will not get far by doing this.  But, if nobody is paying attention, thousands of dollars could be paid and for who knows what.  Make sure the notes are clearly labeled, dated, and legible.  If not, you need to contact the physician’s office right away.
    3. Different handwriting or inks on same dates of service.  Granted again, that may be the nurse or the medical assistant jotting some notes down before the doctor jots the notes down, but if you get the feeling that something is not adding up, then call them.  Their patient may be contacting them and coaching them what to put in the record, which we all know is not OK.
    4. The medical provider office will not send medical records or state that they do not keep a medical “record”.  I cannot think of one legit company that does not keep a note or record of some sort, for whatever reason.  Even the most trivial of companies store records of some sort.  So using that as a comparison, the medical record is very important.  And for a clinic to say they do not keep a record is unbelievable.  As a matter of fact, you should not pay any bill ever without a medical record attached to it.  How do you know what is being paid and for what?  If a doctor’s office ever tells you that they do not keep a record on a patient, my advice is to alert your counsel and have them step in right away.
    5. The medical notes showed continued high levels of pain. I have never broken my arm, but I anticipate that it hurts quite a bit.  Enough to be uncomfortable anyway.  So if it is 2 months later and you still have “10 out of 10” pain, that is just not correct.  If the pain is so unbearable, and you have treated with this doctor for 2 months, why go back there?  And how is the worker driving to these appointments?  And how can the worker go to the bank and cash your check, all with “10 out of 10” pain that has not lessened?  The doctor should be stating in the medical notes that the objective indicators for pain do not match the subjective complaints of “10 out of 10” pain.  If the physician is not doing anything about it, or the person is no better, then you have to find out what is going on medically and get that person to a specialist or set up an IME to address these ongoing complaints.

 

  1. Consistent improper billing practices.  Your Carrier/TPA usually cannot process a payment off of an invoice.  Usually the bill has to be printed on an HCFA-1500 form so the Carrier/TPA can process it.  This is standard.  A lot of offices that handle any type of insurance work know this.  So if they keep trying to submit their bills improperly, something is going on.  Why are they doing this?  Have any others had this sort of problem with this provider? Coding errors, print errors, ICD-9 code errors, etc. should be correct and correlate to the claim.  A few errors are to be expected.  But if it is constantly going on and on and on, you have to dig a little deeper.
    7. Conflicting medical reports or conflicting subjective complaints that are not addressed.  Let us say you are the adjuster and you are reviewing a stack of medical records on your claimant.  One day your claimant states they are in very bad pain, 8 out of 10.  It is hard to bend, and walk.  The next day they show up for therapy and they tell the therapist they are doing great, and they think treatment is really helping them.  2 days later they go back to the doctor and say they feel the same, about 7-8/10 pain. Then the same day they have therapy and tell the therapist they feel great, and are looking back to getting back to work.   I believe in the fact that people have good days and bad days.  But if you are hurt, and in legit pain, your symptoms should not yo-yo up and down like that.  Therapy can flare pain up a bit, but over the course of a few weeks the pain should be gradually lessened.  If you start to notice yo-yo pain complaints and pain out of proportion to the injury, think about getting your IME in order because the claimant is trying to extend their time out of work.

 

  1. Consistent excessive referrals or quick referrals to physical therapy where it may not be needed.  I know of a very popular occupational clinic.  A very large one. And I have handled a ton of claims where the clinic is the treating provider.  And over the course of a year or 2, I wager to say that everyone that walks through their doors with a comp case had a referral to go to the same physical therapy facility after the first or second visit. These were strains, sprains, lacerations, contusions, etc.  Every injury you could think of and they were all sent for therapy.  We had to call and talk to the doctor to find out the rationale.  This took a lot of time, but after a while they go the point and started to go by the medical norm for a referral for physical therapy.   This is meant to be a very loose example, but a lot of times personal doctors or practices also own therapy companies or diagnostic laboratories, or they have partial ownership in them, so they get to make money twice; once when you go to see them, and again when you go to their therapy facility.  So trust your instinct.  If you think a referral is questionable, call and talk to the doctor.  Make that doctor defend their decision and ask them questions.  After all they have a service to provide to you, and you have rights too in these work comp scenarios. Depending on your jurisdiction anyway. NOTE:  Make sure your company is aligned with a high-quality independent physical therapy network, perhaps even a national network, and put that in the account handling instructions, then monitor compliance and make sure the adjuster is helping monitor compliance.

 

 

Summary

Again this is not every doctor, at every clinic, attempting to get extra.  These questionable doctors are few and far between. But they are out there, and your adjuster and counsel know of some of them.  Physicians will say that they can only treat what the patient is telling them, and if the patient states they are in pain, then no matter what doctors are going to do what they can to help them.  So part of this problem is on the doctor, and part is on the claimant or patient. However, all of it can be questioned by you in a workers comp scenario.  Keep names of doctors and group practices that you had trouble with in the past.  If something does not seem right call and talk to the doctor about it and share your concerns. Remember the doctors or practices that caused you problems–chances are you will cross paths with them again.  Continue to stay proactive, and trust those instincts.

 

Your responsibility as an employer is to establish procedures, select vendors, and make sure you are actively involved in who treats your employees and the results they get from treatment, assuming this is allowed in your state. Working with a good TPA is important; ask them how they control these issues and learn what they are doing to prevent over treatment.

 

 

Author Rebecca Shafer, JD, President of Amaxx Risk Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and website publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. She is the author of the #1 selling book on cost containment, Manage Your Workers Compensation: Reduce Costs 20-50% www.WCManual.com. Contact: RShafer@ReduceYourWorkersComp.com.

 

 

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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.

 

©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com

 

Filed Under: Claim Management, Coordinating Medical Care, Fight Workers Comp Fraud & Abuse, Medical Cost Containment, TPA and Claims Administration Tagged With: , ,

Massachusetts AG Reminds of Importance of Fraud Detection By Employers

October 20, 2011 by Leave a Comment
Recently addressing a group of 40 fraud directors from around the country, Massachusetts Attorney General Martha Coakley highlighted the importance of collaboration among law enforcement, employers, employees, and local fraud bureaus to prevent and prosecute cases of fraud across a variety of industries, according to a report from her office.
 
 
“The cost of corruption on businesses and taxpayers is significant,” AG Coakley said. “It undermines the level playing field for businesses, distorts the competitive marketplace, and costs taxpayers at a time when every dollar is crucial.  It is in everyone’s interest – in both the public and private sector – to deter and prosecute cases of fraud, and we must all work together to do that effectively.” (WCxKit)
 
 
The Fraud Directors Conference, held in Chatham, was sponsored by the Insurance Fraud Bureau of Massachusetts. The Attorney General discussed the types of cases prosecuted by her office ranging from public corruption and Medicaid fraud matters to workers compensation and auto insurance schemes. 
 
 
She highlighted examples in which public and private cooperation proved key factors in deterring cases of fraud.  For instance, when the state was confronted with an uptick of cases of auto insurance fraud schemes, a collaborative effort between the Massachusetts Insurance Fraud Bureau, District Attorneys, federal and state law enforcement, and private insurance companies worked to combat these crimes and build strong criminal cases.
 
 
Coakley’s office has made the investigation and prosecution of cases of fraud and corruption a priority. For instance, in the last fiscal year, the Attorney General’s Office recovered $69 million in Medicaid fraud. (WCxKit)
 
 
Recently, she reported the indictments against 10 people in connection with four Medicaid Fraud cases.
 
 
Author Robert Elliott, executive vice president, Amaxx Risk Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. See www.LowerWC.com for more information. Contact: Info@ReduceYourWorkersComp.com
 
 
REDUCE COMP BOOK:  www.WCManual.com
 
WORK COMP CALCULATOR:  www.LowerWC.com/calculator.php

 
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact
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10 Red Flags in Workers Comp Psychiatric Evaluations

June 28, 2011 by 1 Comment

A worker is injured, anxious, and depressed. Is his or her emotional condition caused by the injury? Is the psychological condition – separate from any physical injury – causing any impairment? Is treatment needed and, if so, what kind? Can the worker return to full duty in the same environment the injury occurred? If not, why not?

 

 

These questions, and many others, are often faced by attorneys and insurance personnel in workplace injury cases involving claims of emotional distress. Such claims often prove both challenging and controversial, as the interplay of pre-existing conditions, injury, somatization, motivation, and intercurrent stressors can be difficult to unravel. In some areas of medicine, diagnostic tests can point convincingly to causation, such as in the case of a crush injury, fracture, or disc herniation. In contrast, psychiatry lacks even a definitive diagnostic test, much less one that provides objective indicators of etiology. The mental health examiner must weigh a host of potential contributing factors in arriving at opinion about causation. Then, it is on to impairment, where the line between capacity and motivation is blurred even more than in cases of physical injury. (WCxKit)

 

A full discussion on the nature and causes of psychiatric conditions in workers compensation far exceeds the current forum, as would a detailed description of the appropriate methods for evaluating and diagnosing these conditions.

 

The following 10 “red flags” are common problems seen in evaluations, not only from treating providers but from “expert” examiners as well, and are suggested as a quick reference guide:

 

  1. Insufficient time spentwith claimant: How long does it take to sort out the many factors needed to determine causation, impairment, and treatment needs? Anything under 1.5 to 2.0 hours is likely inadequate. After all, forensic experts in high profile criminal cases spend dozens, if not hundreds, of hours getting to know and understand the defendant. The stakes in WC cases, though different, are also high. The information needed to render a well-informed opinion cannot be obtained in 15 or 20 minutes.

 

 

  1. Insufficient record review:Have both medical and mental health records been reviewed? So often we see records from medical providers noting some symptoms of depression or anxiety, and causally (and often casually!) attributing the symptoms to the workplace injury or event. Mental health records also frequently include diagnoses and causal imputation. A good evaluation report must not only note these records but must evaluate their basis and value. Also, request for and review of records preceding the injury is critical.

 

 

  1. Failure to identify pre-injury, peri-injury, and post-injury stressors: It is critical that all other possible contributing stressors be detailed and accounted for. In Connecticut, where I practice, a psychiatric condition is only compensable under WC if it arises out of a physical injury. For example, if a worker loses a limb in a construction accident and develops depression secondary to the disabling injury, that clearly falls under the purview of the law. But often we see claims for emotional distress arising more out of the stressful workplace environment than in response to the actual injury. Not infrequently, a minor physical injury is incidental, and it is the stressful workplace event or context that is truly the substantial causal element. Other life stressors, including financial and social consequences of the workplace injury, must also be accounted for. Finally, prior life stressors or traumas (e.g., a prior history of abuse or injury) must be assessed, as these often represent a predisposing vulnerability factor and can be associated with both pre-existing symptoms and/or impairments.

 

 

  1. Lack of malingering assessment:There are several widely used and standardized assessment instruments for assessing symptoms exaggeration or malingering (they will not be listed here to protect the integrity of the tests). A thorough assessment of malingering integrates results of these measures with observation, consistency of records, assessment of motivational factors, and collateral information to make a determination about the validity of the claimant’s self-report. Any evaluation in a WC case that does not address this issue thoroughly should be cause for concern.

 

 

  1. Psychological testing:Has psychological testing been conducted? Is the rationale for the tests used provided? It is difficult to determine the appropriate use and interpretation of test results without direct consultation with a psychologist. For starters, however, it is important to note that results of many objective tests are only valid when viewed in aggregate: Individual responses to individual test questions are not valid for interpretation, and should never be reported as such.

 

 

  1. No family history:What is the claimant’s genetic and environmental vulnerability? Providers and examiners frequently omit such history in WC cases in an effort to protect the individual’s privacy. However, defensible assessment of causation cannot be done without knowledge of the family history.

 

 

  1. Mental status exam:This section appears in most psychiatric reports, with the intent of describing what is observed about the claimant on examination. What is his or her apparent emotional state? Is he forthcoming with information, or guarded and defensive? Importantly, do the observed emotional state and the reported symptoms and function match?

 

 

  1. Where is the beef?A description of symptoms supporting the diagnosis is critical, and these symptoms should accord with the criteria set forth in the DSM-IV-TR. Reports should also include a detailed description of day-to-day function. Can the claimant socialize, travel, engage in hobbies, or do housework?

 

 

  1. Differential diagnosis.Is it really post-traumatic stress disorder (PTSD)? The diagnosis of PTSD is the sin qua non of psychic injury arising out of workplace events. Why? Because it is the only psychiatric diagnosis that denotes causation. However, many workplace injuries and their circumstances do not truly meet what is referred to as Criterion A: that is, a stressor must involve not only “threat to the physical integrity of self or others,” but the individual’s emotional reaction at the time must include “intense fear, helplessness, or horror.” Caution is urged in accepting diagnoses of PTSD caused by routine events or injuries.

 

 

  1. Misguided Permanent Partial Disability (PPD) ratings: Mental health examiners rarely use the AMA Guides to the Evaluation of Permanent Impairment, instead relying on the traditional multiaxial diagnostic system per DSM. The only Axis that reflects impairment is Axis V, the Global Assessment of Functioning or GAF. However, the GAF scale reflects symptom severity and/or impairment, and in the case of desynchrony between the two the lower score is to be used. Thus, an individual who is functioning well despite severe symptoms may warrant a low GAF score that is not reflective of actual impairment in either social or occupational function. If asked specifically to use the Guides, mental health examiners must be aware that the Guides 6th edition has a new system that uses the median of three distinct measures to calculate a PPD rating. The process is not subjective yet is rarely used. In a recent WC evaluation, I reviewed a claimant’s file in which the treating provider had given a 40 percent PPD rating for mental health. In contrast, my evaluation following the AMA Guides formula yielded a 10 percent rating, of which I concluded about half was related to the workplace incident. Bottom line: impairment ratings are usually subjective and often unreliable. Beware of any GAF rating under 40, unless the person is gravely disabled and on the verge of hospitalization, this is likely to be an inflated rating of severity.(WCxKit)

 

These “red flags” provide a thumbnail checklist, but fall well short of the knowledge required to fully understand and evaluate reports and opinions in this field. Attorneys and insurance adjusters would benefit from additional education on the nature of mental illness and the challenges inherent in determining causation and impairment in these cases.

 

Author: Dr. Andrew Meisler is a clinical and forensic psychologist in practice in Hartford, CT, with faculty appointments at the UConn School of Medicine and the Yale University School of Medicine. He serves as independent examiner for attorneys and insurers, provides consultation to the office of the Attorney General in workers compensation claims, and has extensive deposition and trial experience in state and federal court as well as at the CHRO and Workers Compensation Commission. Contact at: andrewmeisler@gmail.com or phone (860) 236-8087, #108.

 


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Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.

 

©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com.

 

Filed Under: Assessment & Diagnostics, Medical Issues Tagged With: , , ,

How the Adjuster Handles a Suspected Fraudulent Claim

May 30, 2011 by Leave a Comment
Many injured workers and the public in general often feel it’s “them” against the EMPLOYER. They also think insurance companies live to deny claims – of any type. So, okay – now and then we hear of an insurer who denies claims left and right, but in truth most claims are accepted.
 
When claims are denied there is usually a good reason. Let’s explore how an adjuster handles fraudulent claims… 
 
 
The Fraudulent Claim
When the adjuster has questions about a claim it may be denied or suspended pending investigation.  Receiving a Notice of Dispute or Suspension of Benefits does not mean the claimant (injured worker) is suspected of fraud, it just means there is an ongoing investigation to determine the validity of the claim- the claim is being substantiated.
 
 
Fraud constitutes statements made or injuries claimed that are 100% untrue. Carriers rarely see an outright fraudulent claim in workers compensation even though this is what is so often reported on television. The carrier must prove without a shadow of a doubt that the claimant is lying about the circumstances or statements surrounding the injury claimed. And, even though I use the words "shadow of a doubt" that is not the true legal standard for how much proof the carrier must have. The burden of proof is established by the workers comp laws in each respective state and varies, and is much less than in a criminal case.
 
 
Adjusters are always looking for more definitive information from doctors including:  past medical records, workers comp injuries or auto accidents, pre-existing conditions, and witness statements to help correlate the injury to the claim details. They will also review photographs of the location where the injury is said to have occured and a handwritten statement from the claimant. A recorded statement is critical for further action against the claimant if the claim is determined to be fraudulent. Good claim investigation takes time. Medical report statements and objective medical evidence are the most solid details to go on.
 
 
If a worker claims a knee injury at the workplace, unwitnessed by anyone and has no classic signs of a knee injury, that doesn’t constitute fraud. It just means the claim is weak and may be denied. In such a case, an adjuster may speak with the insured to request surveillance to "see" what degree of disability the claimant is exhibiting in their day-to-day activities.
 
 
On the other hand, if the worker claims a knee injury and submits a medical slip created on a home computer, fraud is possible if it is an attempt to submit a piece of evidence for the support of a claim that is a 100% fake. The carrier may initially accept the claim and then discovers through investigative means the medical slip is a fake, completely made up or altered to state there is a higher degree of disability than there really is. The claim will be denied and, in some jurisdictions, the carrier will pursue recovery of payments made to the claimant through legal means.
 
 
A claimant has to be very bold, and ready to risk probable legal action from both the carrier and the state were the claim is filed. Filing a fraudulent claim is not very rewarding, and the down side is huge — which is probably why true fraudulent claims are rare. (WCxKit)
 
 
A claim under investigation doesn’t mean it is denied due to fraud. It means the adjuster’s investigation is not complete. The most common mistake employers make is not reporting a claim to the adjuster. Even when an employer has a good idea the “injury” is not legit, or doesn’t make sense, report it and let the adjuster decide. If the claim is denied be assured it is done properly and ethically.
 

Author Rebecca Shafer, JD, President of Amaxx Risks Solutions, Inc. is a national expert in the field of workers compensation. She is a writer, speaker, and website publisher. Her expertise is working with employers to reduce workers compensation costs, and her clients include airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality, and manufacturing. See www.LowerWC.com for more information. Contact: RShafer@ReduceYourWorkersComp.com or 860-553-6604.

 
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com.
Filed Under: Fight Workers Comp Fraud & Abuse, WC 101 Tagged With: , , , ,

New Zealand Dishonesty Conviction in Workers Comp Case

April 13, 2011 by Leave a Comment
New Zealands Accident Compensation Corporation (ACC) has welcomed the conviction of Daryl Adair Ramsay, who was sentenced to nine months home detention in the Waitakere District Court recently.
 
 
Ramsay, of Waitakere City, faced 18 charges of dishonestly using a document under the Crimes Act, for a period of offending which spanned more than four years. (WCxKit)
 
 
On July 3, 2003, Ramsay, who at the time was national service manager for a commercial cleaning company, injured his neck and shoulder. He supplied ACC with a medical certificate stating that he was unable to work because of his injury, and ACC began paying him weekly compensation for lost earnings from July 17, 2003.
 
 
For approximately four years Ramsay supplied further medical certificates to ACC, advising that he was fully unfit for work, and ACC kept paying weekly compensation. Throughout this period Ramsay constantly misrepresented his employment status and submitted a significant number of false declarations to ACC.
 
 
In May 2007, ACC launched an investigation which revealed Ramsay had begun operating a business, ‘D’Z Contracting’, within five months of his injury. He had both worked physically for and received income from this business during the period when he was receiving weekly compensation. (WCxKit)
 
 
In total, Ramsay received $133,525 from ACC to which he was not entitled. As well as the sentence of home detention, Ramsay was also ordered to repay a portion of the money fraudulently obtained.
 
 
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. See www.LowerWC.com for more information. Contact:Info@ReduceYourWorkersComp.com or 860-553-6604.
 
 
 
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com
Filed Under: Fight Workers Comp Fraud & Abuse, Medical Issues, WC in Other Countries (International) Tagged With: , , ,

13 Arrested in New York Workers Comp Fraud Investigation

April 1, 2011 by Leave a Comment
Thirteen people from eight New York counties have been arrested on charges that they cheated New York's workers compensation system, often by working side jobs while collecting benefits for injuries they pretended left them physically unable to work.
 
 
The series of arrests follow investigations by the New York State Insurance Departments Frauds Bureau, along with investigators from the Workers Compensation Board Office of the Fraud Inspector General, the New York Insurance Fund, insurance company special investigative units and local law enforcement agencies. (WCxKit)
 
 
The cases range from a Steuben County woman accused of fraudulently collecting $10,000 in benefits while running a ceramic supply store to a Schenectady man who claimed a job-related injury prevented him from working but was caught on videotape doing odd jobs.
 
 
Workers comp is designed to compensate people for lost wages after they suffer a job-related injury. It is also used to pay for medical care and rehabilitation for workers hurt on the job. Individuals must be legitimately unable to work to receive compensation.
 
 
Frauds Bureau investigators say people who illegally double-dip are often discovered in routine insurance company audits. In other cases, co-workers, and even relatives, have been known to turn them in.
 
 
The 13 recent arrests resulted in a range of charges which, in the event of convictions, could lead to sentences of up to seven years in prison. (WCxKit)
 
 
In some cases, individuals were charged with workers comp fraud, while in other cases, the charges included grand larceny and offering a false instrument for filing.
 
 
Author Robert Elliott, executive vice president, Amaxx Risks Solutions, Inc. has worked successfully for 20 years with many industries to reduce Workers Compensation costs, including airlines, healthcare, printing/publishing, pharmaceuticals, retail, hospitality and manufacturing. See www.LowerWC.com for more information. Contact:Info@ReduceYourWorkersComp.com or 860-553-6604.
 
 
 
Do not use this information without independent verification. All state laws vary. You should consult with your insurance broker or agent about workers comp issues.
 
©2011 Amaxx Risk Solutions, Inc. All rights reserved under International Copyright Law. If you would like permission to reprint this material, contact Info@ReduceYourWorkersComp.com.
Filed Under: Fight Workers Comp Fraud & Abuse, Legal Doctrines, NY Workers Comp Issues Tagged With: , , , , ,
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