Malingering, the Gray Area in Workers’ Compensation Fraud

Nearly 25% of all lost-time workers’ compensation claims are exaggerated, according to the National Insurance Crime Bureau. While only a small percentage of workers’ comp claims are fraudulent, quite a few include employees staying away from work even after they’ve been cleared to return by their doctor and when they feel able to work. The term for this is malingering and it can cost an employer a lot of money.

When injured workers malinger, the claim lasts longer than the medical disability. The employee has recovered enough to return to work, but has not gone back. This can be due to employee intent, a medical provider’s lack of knowledge about the job requirements, employer disinterest, or other reasons. As you can see, it’s not always the employee’s fault. When an employee malingers and doesn’t return to work when they are able to, the cost of the workers’ compensation claim will continue to rise, counting against the employer’s claims experience. Additionally, malingering can evolve into a self-perpetuating cycle: the longer someone stays away from work, the less likely it is they will ever return.

While it’s not a good idea to spy on your workers at home, you also don’t want one of them drawing out the claim to both your and their detriment. However, there are signs indicating that an injured worker may be malingering.

 

20 Indicators of Malingering or Workers’ Compensation Fraud

1. Tips from neighbors, relatives, friends or co-workers that a claimant is actually more active than alleged.
2. The injury coincided with a company’s reduction of the workforce.
3. Nurse case manager, doctor and therapist report a healthier and more active claimant than what is alleged.
4. The lack of organic basis for the disability; most of the complaints and allegations are subjective.
5. Premature or excessive demands for compensation.
6. The claimant works in a seasonal occupation.
7. The claimant often misses their therapy and/or doctor appointments.
8. Having “dueling doctors,” with one physician stating that the claimant is disabled while another reports a completely different prognosis indicating they are not disabled.
9. No witnesses to the reported accident.
10. The claim was reported after the claimant was terminated, suspended or had resigned.
11. The claimant had only been employed for a short while when the alleged accident occurred.
12. The claimant is not home when you try to contact them.
13. The claimant is disabled longer than is normally associated with the reported injury.
14. The claimant has a history of workers’ comp claims or short-term employment.
15. The claimant’s job performance has been below average, or they were disciplined at some point.
16. The claimant’s Facebook or other social media page shows they are more active than they claim they can be.
17. The claimant has financial problems.
18. The course of treatment seems to be too much for the injury, like extensive treatment and testing for a minor injury.
19. If it was a car accident, the damage to the vehicle is inconsistent with the claimed injuries.

The documentation of treatment is suspect, for example, photocopies of bills, no record of dates of treatment, no itemization.