Workers’ compensation is designed to cushion the impact of a work-related injury to the employee’s finances. It also helps the employer avoid unexpected costs when an employee gets injured on the job. But it’s no secret that it’s often abused by self-serving individuals.
Studies show that about 1% to 2% of workers’ comp claims are fraudulent. But it only takes into account frauds committed by employees. Employers and service providers also commit fraud (but more on that later). In Florida alone, 502 workers comp fraud cases were presented for prosecution in 2018. More than half of which were successfully prosecuted.
Because of the rising incidence of workers comp fraud in the country, many states are tightening their laws. Insurance companies and employers alike are also on the lookout for red flags in workers’ comp claims. This is why many fraudsters have already been sent to jail or made to pay steep penalties.
If you’re an injured employee with a legit claim, you obviously don’t want to be charged with workers comp fraud. But even if you really were injured while on the job, certain red flags may prompt an investigation. For example, going against your doctor’s restrictions even – if it’s unintentional – can raise a red flag. If the investigator finds enough grounds, you could lose all your benefits or worse, find yourself behind bars.
To avoid unknowingly committing workers’ comp fraud, here are some of the basic things you need to know:
What Counts as Worker’s Compensation Fraud?
When an employee gets injured on the job, by law, they are entitled to workers comp benefits. Aside from medical benefits, they can also receive compensation for lost wages. So even if they don’t work, they’ll still receive a significant portion of their usual income. It’s no wonder why opportunistic freeloaders often turn to workers’ comp fraud.
From the name itself, workers comp fraud is when someone cheats on the workers’ comp system for their own gains.
When an employee lies about their injury with the intent of collecting benefits, they are already committing fraud. It can involve lying about having an injury when they really are in perfect health. Or exaggerating their injuries to make it look worse than it really is. Some employees may also claim that they got injured on the job even though it really isn’t work-related.
But one common misconception about workers’ comp fraud is that it’s only committed by employees. In reality, far more employers are abusing the workers’ comp system than employees.
It’s not unheard of for employers to intentionally misclassify their employees as contractors. This way, they won’t have to pay for their workers’ comp insurance. Many also tend to under-declare their total number of employees to lower their premiums. Investigators have also found out some companies are using a “shell” company to reduce their premiums.
Another party that’s also involved in many workers’ comp fraud cases are medical professionals. Yes, a lot of doctors have been prosecuted for workers comp fraud in the past years. They usually do this by lying about a medical procedure they didn’t do to inflate a patient’s hospital bill.
Penalties for Workers’ Comp Fraud
Every state has different workers comp rules. So penalties for workers comp fraud also tend to vary per state.
In some states like California, workers’ comp fraud falls under a law punishing fraudulent insurance claims. While in certain states like Florida, the punishment is detailed in the workers’ comp law itself.
But in general, punishment for workers compensation involves:
- jail time
- penalties
- reimbursement of the amount fraudulently received
Jail time usually depends on the classification of the workers’ comp fraud charge. If it’s a misdemeanor, you’ll most likely spend no more than a year in prison. But if it’s elevated to a felony, prison time can be as long as 30 years.
Whether it’s a misdemeanor or a felony depends on the severity of the fraud committed. If it’s just a misrepresentation of information, it’s usually just considered a misdemeanor. But if it’s an intentional and repeated deception, it becomes a felony.
So if the fraud you committed is not that severe and you’re not a repeat offender, you won’t have to worry about getting a felony charge. But still, it’s important to consult an experienced workers’ compensation attorney like Victor Malca to avoid getting imprisoned for something you really didn’t intend to do.
VICTOR MALCA – Florida Workers Compensation & Social Security Disability Attorney
Victor Malca P.A. has over 27 years of litigation experience in Workers Compensation and Social Security Disability lawsuits. His experience and continued success when fighting for his clients puts him among the most trusted workers’ compensation attorney’s in Florida. He specializes in representing injured workers on compensation benefit cases and disabled individuals claiming lost social security disability benefits.
Book a free consultation today. Our unwavering advocacy for employee rights and privileges are recognized by our past clients across South Florida.
About The Author
Judy Ponio is a writer and editor for the Victor Malca Law P.A. website and blog. She enjoys helping people in need with questions about social security disability and workers compensation law. She has a passion for helping those in need and the elderly with accurate legal information that can make a positive difference in their lives.