In every state of the nation, including our beautiful state of SC, workers’ comp fraud is a massive, expensive problem. The workers’ compensation insurance system has certainly been a critical factor in the lives of the many employees hurt on the job since its implementation, but as with any assistance program, it has also been abused by people looking to skim some money off for themselves. Fraud occurs in many different ways, and some schemes are more difficult to spot than others. As an employer, there are concrete steps that you can take to create an environment that discourages fraud on the part of your employees, their health care providers, and even on the part of your own management—unintentional mistakes made due to lack of knowledge about correct procedures can result in fraudulent claims and incorrect reporting.

Types of Fraud

SC workers’ comp fraud comes in many different forms. Some forms lead back to the employee, others to the employer, and others to health care providers. Here is a brief overview of fraud categories:

Employee Fraud

There are two main ways by which dishonest employees try to “play the system.” Once a worker has been hurt on the job, goes through the standard procedures to file a claim, and begins receiving workers’ comp checks, he may attempt to get hired for another job and earn income while he is being compensated for his injury. Another common scam is simply to pretend that an injury occurred at work in order to get some “paid vacation” time. The injury may have occurred at home or elsewhere; it may be an old injury; or there may be no injury at all.

Employer Fraud

The SC workers’ comp insurance system relies on accurate, honest reporting by employers. If that reporting is incorrect, either intentionally or unintentionally, the system will not function as it should. A common problem is categorizing employees incorrectly. A construction worker’s insurance premiums are higher than those of a receptionist due to the higher injury risk. But if the employer classifies the construction worker as an office worker to get a lower premium payment, the employee and ultimately the entire system will be cheated.

Provider Fraud

Sadly, some health care providers engage in SC workers’ comp fraud by billing multiple insurance companies for the same treatment. A practice may even agree to test or treat an employee for injuries after discovering that there is no reason to do so, simply to gain payment for the services.

Fighting Fraud Through Clarity

There are many things that you, as an employer, can do to fight SC workers’ comp fraud. Most of those things are not even directly related to the issue, though—they are simply good business practices that will save your company money in many different ways. The fact is, most workers’ compensation fraud schemes rely on one major factor: lack of communication. Consider these scenarios:

  • When an individual applies for a job while collecting workers’ comp benefits, he counts on his new employer not finding out about his injury status.
  • When an employee claims that an old injury is a brand new work-related one, he counts on his employer not investigating his past medical records.
  • When a manager incorrectly classifies a high-risk worker as a low-risk one, he counts on no one auditing that choice and discovering the error.
  • When a health care provider bills two insurance companies for the same service, it counts on neither company communicating with the other about the claim.

As you can see, the more communication there is between an employer and his employees, insurance providers, health care practices, past employers, and other agencies, the less opportunity there is for fraud to slip through the cracks.

A professional employer organization brings the knowledge of SC workers comp fraud, strict organization, communication, and clarity that it takes to avoid all types of fraudulent activity. Instead of making it easy for dishonest employees to hide their actions under your watch, you can create a clear, organized environment that rewards honest behavior and eliminates reporting errors. In the end, those practices carry a huge number of other benefits for your business as well! Call or email us today to find out more about how Complete Employee Services can help you avoid SC workers’ comp fraud.