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The Myth of Extensive Worker’s Compensation Fraud by Claimants – Taking a Closer Look at Employer Fraud

The insurance industry, employers, and others with a vested interest in discouraging worker’s compensation claims and reducing the amount of payouts have perpetrated the widespread myth that the system is inundated with fraudulent claims.  This myth is based on isolated anecdotal incidents with little effort to identify the actual scope of the issue.  Admittedly, there are isolated cases of employees faking or exaggerating injuries, as well as other examples of illegitimate claims.  However, experts generally recognize that amount of fraud by claimants is infinitesimal.  Generally, the rate of worker’s compensation fraud involving employees is considered to be about one percent or less.  Ironically, worker’s compensation fraud committed by employers is far more extensive but almost never discussed in the media.  This blog post is intended to advise employees about the real existence of employer fraud and to provide common examples.

Many people are unaware of the existence of employer fraud because it is so rarely discussed in the media or promoted as a problem.  However, there are a number of reasons that it is far more prevalent than employee fraud.  The first factor is the difference in incentives for employers and employees to cheat the system.  The motivation to engage in fraud to receive $540 per week in benefit payments is almost non-existent compared to the millions of dollars that employers save by excluding entire classes of employees from obtaining worker’s compensation benefits.  This disparity in the gains to be obtained by cheating also affects the risk-reward analysis for the parties on both sides of the employment relationship.  When considering cheating, either party must consider the risk of detection and potential penalties compared to the reward associated with success in pursuit of the fraudulent scheme.  The massive returns that employers can obtain from screening out hundreds of thousands of employees from worker’s compensation benefits dwarf the rewards of an individual employee successfully obtaining benefits.

Some of the most common examples of employer/insurance carrier fraud include the following:

  • Misclassification of Employees: Employers frequently classify employees as 1099 independent contractors to avoid liability for worker’s compensation benefits.  Since workers classified as independent contractors do not qualify for benefits, companies frequently engage in the practices of misclassifying workers to avoid the cost of worker’s compensation insurance and liability for claims.  When companies with hundreds, thousands, or even tens of thousands of employees engage in this type of practice, the financial gains are staggering.
  • Refusing Medical Care: Worker’s compensation claimants are entitled to free health coverage for virtually all expenses, including diagnostic testing, doctor’s appointments, specialists, medications, and other costs.  However, carriers often routinely refuse to pay for necessary drugs and medical attention.
  • Referring Employees to Biased Physicians: Employers often steer injured workers to unscrupulous doctors or industrial medical clinics where the physician denies care, prematurely returns the employee to the job, or issues unjustified low permanent impairment ratings.
  • Retaliation: Some companies terminate an employee who files a worker’s compensation claim to discourage other workers injured on the job from filing valid claims.
  • Improper Use of Health Insurance: Employees might be directed to use their own health insurance for expenses that should be covered by the worker’s compensation system.
  • Failure to Secure Coverage: Certain companies intentionally avoid purchasing worker’s compensation coverage for their workers.  This strategy shifts a significant portion of the cost of medical expenses from the employer’s worker’s compensation carrier to Medicare.

These are just a handful of the ways employers can engage in fraud schemes that result in a large number of employees receiving less in worker’s compensation benefits or none at all.  Our Mississippi Worker’s Compensation Lawyers have successfully represented many injured employees during our decades of representing clients.  At Barrett Law, we are here to help.  Contact our firm today at 800-707-9577 to schedule your free consultation, so we can answer any questions you may have regarding filing your claim.

 

 

 

 

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Ten Important Questions from Mississippi Worker’s Compensation Claimants

Our Mississippi Worker’s Compensation Attorneys at Barrett Law, PLLC receive certain questions from employees injured on-the-job on a frequent basis.  Many of these inquiries are a product of the complex and difficult process of pursuing a valid claim.  While the best legal advice about worker’s compensation issues can be obtained by talking with an experienced work-related injury attorney, we have provided answers in this two-part blog to ten of the most common questions we hear for injured workers looking for general information.  If you have further questions or concerns, we invite you to contact us to schedule a free consultation.

What is the worker’s compensation system?

The worker’s comp system furnishes injured workers with benefits through a no-fault insurance plan that most insurers in Mississippi are required to carry.  The objective of this system is to make access to certain benefits available to workers who suffer an injury or occupational illness in the workplace without the delay and complexities of civil litigation.  Companies required under Mississippi law to obtain worker’s compensation coverage (or to self-insure) will have insurance to compensate injured employees with wage loss and medical benefits.  This method of compensating injured workers eliminates the need of a claimant to prove negligence by the employer.  However, the benefits paid pursuant to a worker’s compensation claim will constitute an exclusive remedy against an employer in most cases.

What benefits can an injured worker pursue through a claim?

The two most important forms of benefits that an employee can qualify to receive include wage loss and medical benefits.  If an employee suffers temporary disability from employment, the worker can receive up to two-thirds of his or her weekly income.  However, the amount of money received is subject to certain caps.  These payments, which continue during the course of treatment and until the claimant can return to work, are referred to as “temporary disability payments.”  At some point, the treating physician will determine that the worker has reached a point of maximum improvement.  If the employee has a permanent disability or handicap, he or she can qualify for further wage benefits referred to as “permanent disability payments.”

The other key form of benefits available through the worker’s compensation system are medical benefits.  An injured worker is entitled to obtain medical care and services that are necessary and reasonable until the claimant reaches the point of maximum recovery.  The coverage extends to a broad range of health care services, such as doctor’s appointments, medications, travel reimbursement for appointments/medical procedures, nursing services, physical therapy, medical devices/apparatus, and other needed medical services.  Depending on the circumstances, the claimant also might be eligible for certain rehabilitation services to facilitate the worker’s ability to re-enter the job market.

Who is covered under the worker’s compensation system in Mississippi?

An employer with five or more regularly employed workers is required to carry worker’s compensation insurance or to self-insure.  Some employers with fewer than five workers voluntarily obtain coverage.  Certain companies are exempt from the requirements of Mississippi worker’s compensation laws, including charitable, fraternal, non-profit, or religious organizations.  Agricultural and domestic workers also fall outside the scope of the worker’s compensation system.  Individuals employed by the federal government and certain other workers are not covered, so an employee who suffers a workplace injury or occupational illness should seek legal advice from an experienced Jackson worker’s compensation lawyer if he or she has any uncertainty about coverage.

Workers need to be aware of an important and sizeable exception to worker’s compensation that applies to independent contractors.  Benefits eligibility depends on the employee status of a claimant.  Employers often mischaracterize workers as independent contractors to avoid certain expenses, such as worker’s compensation insurance.  Fortunately, the existence of an independent contractor relationship is not controlled by the designation made by an employer or an agreement between the parties.  Our law firm investigates the extent of the control exercised by a company over the employee to expose attempts to obscure the existence of an employment relationship.

Our Mississippi Worker’s Compensation Lawyers at Barrett Law, PLLC have successfully represented many injured employees in obtaining worker’s compensation benefits and damages in third-party lawsuits.  At Barrett Law, we are here to help.  Contact our firm today at 800.707.9577 to schedule your free consultation, so we can answer any questions you may have regarding filing your claim.

 

 

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Frequently Asked Questions about Worker’s Compensation Claims in Mississippi

This is the second installment of our blog that provides answers to recurring questions about Mississippi worker’s compensation claims.  While we have attempted to answer many of the most common questions we receive from prospective clients, injured workers are welcome to contact us for more specific information about your claim.

How should an employee beset by a workplace injury or occupational illness proceed?

When workers experiences a work-related injury, they should notify their supervisor or other individual designated by the company.  It is essential that the reporting of the incident and injury be accurate and prompt.  Although notice should be given as soon as practical, the employee needs to provide notice within thirty days of the incident causing injury.  If the employee does not hear back about the claim, the claimant should seek immediate legal advice.  When two years elapse from the date of injury without payment of wage loss benefits, the employee will forfeit all rights to benefits unless the claimant has commenced a claim with the Commission during the two year period.

Will a claimant be required to pay a deductible for medical benefits as under health insurance policies?

While the employer might have to pay a deductible, an injured worker pursuing a claim for a workplace injury can pursue medical benefits free of charge, which means no deductible is needed.

Will a claimant receive benefits covering all work days that are missed?

If an injured worker is disabled for a period shorter than 14 days, a waiting period must be observed before benefits are paid.  In this situation, the employee will not be compensated for the initial five day period.  When a worker’s disability is severe enough that the claimant misses 14 days or more, there is no waiting period that must be met prior to entitlement to benefits.

When will coverage commence after a claim is made?

An employee will become eligible and covered once the employee starts his tenure at the company.  There is no probationary period or minimum earning threshold that must be satisfied prior to the claimant becoming eligible for benefits.

What is the duration of wage loss benefits?

The duration of payments for disability depend on the nature and severity of the injury.  When an employee is rendered totally and permanently disabled, the time limit will depend on specific facts related to the injury.  However, the maximum duration that worker’s compensation benefits will be paid cannot extend beyond 450 weeks.

Can I assume that safety violations and obvious workplace hazards are irrelevant since the worker’s compensation system operates on a “no fault” basis?

Although worker’s compensation benefits do not depend on negligence, compensation through such benefits often fall short of what is needed to make an injury victim whole.  Safety practices should be observed because prevention is a better alternative than the recovery of works comp benefits.  Frequently, a civil lawsuit can be filed against parties responsible for a work-related accident other than the claimant’s employer.  Safety violations often constitute negligence and entitle an injured worker to damages against a third-party defendant.

Do I really need an attorney to pursue my claim for benefits?

There are many reasons to retain a Mississippi worker’s compensation attorney.  The attorney can makes sure that a claimant has appropriate medical evidence to support the claim.  Legal advice can also prove invaluable to ensure proper compliance with procedural and timing requirements in pursuing a disputed claim for benefits.  Further, an experienced workplace injury lawyer can explore viable liability claims against third-party defendants.  A third-party lawsuit can facilitate a fuller recover because damages in a civil lawsuit can include pain and suffering and other types of compensation that do not fall within the purview of the worker’s compensation system.

Our Mississippi Worker’s Compensation Lawyers at Barrett Law have successfully represented many injured employees in obtaining worker’s compensation benefits and damages in third-party lawsuits.  At Barrett Law, PLLC, we are here to help.  Contact our firm today at 800.707.9577 to schedule your free consultation, so we can answer any questions you may have regarding filing your claim.

 

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