Whether a workers’ compensation claim is suspected to be fraudulent or not, prompt reporting is an important step in proactively managing workers’ compensation claims costs. Multiple studies conducted in recent years demonstrate that on average, the sooner claims are reported, the lower their ultimate cost. Just as this is true for providing injured workers with the best care possible to get them back to work, it’s also true for mitigating the cost of fraudulent claims.
When engaging with the claims management specialists from the insurance carrier, businesses should describe the injuries and any related events in as much detail as possible. Quick and detailed communication regarding the incident with the carrier will best enable the claims professionals to investigate the relevant facts and determine the compensability or validity of the claim. This information is key to making sure that invalid workers’ compensation claims are not paid.
To be considered compensable, an accident or illness must arise from or occur in the course of on-the-job activities, which are commonly referred to as Arising Out of Employment (AOE) and in the Course of Employment (COE). In order to ensure the claim is legitimately compensable, it is important to learn the details of the accident and determine if there were any witnesses. With the proper procedures in place, managers can quickly collect all the facts as described by the affected employee and communicate those details to the carrier’s claims management professionals. The trained claims professionals will then be best suited to make final determinations of compensability.
Fraud Prevention
As part of a comprehensive risk management program, businesses should incorporate procedures to help identify potentially fraudulent workers’ compensation claims. First and foremost, the precedent must be set that workers’ compensation fraud will not be tolerated. Each time a business communicates to employees its commitment to workplace safety, it should also clearly communicate a zero-tolerance policy for workers’ compensation fraud.