Contractors sign up for Workers’ Compensation insurance to protect employees who are hurt on the job. Although most claims are legitimate, workers compensation fraud is common. Bogus claims can add up to big losses for not only insurance carriers but employers, too. Read more
Between 2005 and 2013, five California men made off with $36 million by defrauding worker’s comp insurers and over billing for a physical therapy machine at Aspen Medical Resources. Unfortunately (for them), they did not make it to 2014, and will be arraigned on March 14, according to the Orange County DA’s office.
Jeffrey Edward Campau, Abraham Khorshad, Landen Alan Mirallegro, and Ryan Nathanil McCracken have been charged with an array of felonies among other charges. Campau, Khoshad, and Mirallegro all stand accused of multiple counts of conspiracy and submitting fraudulent claims, which could result in each man spending up to 53 years in prison. McCracken has been charged with one felony count of conspiracy, which could result in a prison term of up to five years if convicted.
The company the four men formed Aspen Medical Resources LLC, and rented out a machine that provided hot and cold therapy to treat pain and inflammation for patients. Though the machine is valued at less than $500, the four men managed to charge almost $17,500 for worker’s comp insurers to rent the machine. That’s 35 times more than the machine is worth. Apply that over an eight year period, and it’s no mystery how Aspen Medical Resources managed to steal more than $36 million from worker’s comp insurers.
They sought to boost their revenue further by using other company names in order to collect on their billings. Through this process, they managed to collect $12 million more. Their daring seemed to know no bounds, either. Rather than lay low when insurers denied payment, Mr. McCracken would file a liens with the California Worker’s Compensation Appeals Board, and eventually reach an agreement between the insurer and Aspen Medical Resources.
Campau, Khoshad, and Mirallegro will likely be behind bars for quite some time once they are tried for their crimes. However, people will continue to attempt to make their fortunes by making fraudulent worker’s comp claims. If something does not seem right, report it and save your business and others from those looking to exploit the system.
A medical-only worker’s comp claim can evolve into a big problem for the risk manager when that claim becomes a lost time claim. With little to no warning, a small claim can turn into a large amount of money flying out of your company’s bank account. Listed below are some common scenarios and what to do when they arise.
(1.) The employee does not seek medical care
When an employee becomes injured, they may choose to seek medical care as part of their employer’s worker’s comp package. But if that employee is unaware that they will be paid while they cannot work, they may forego seeing a medical professional. Typically, when the employee tells the employer they do not want medical care, it is a relief for that employer. They write an “incident only” record and both men move on with their lives.
However, just an “incident only” record can result in future headaches for the employer. Instead of just writing the record, the employer should recommend that the injured employee to seek medical treatment. If they re-aggravate their injury or it gets worse, their medical bills could skyrocket, which leaves the employer paying for the medical visits, and in search of another worker while that employee has to stay home.
(2.) The employee goes to their general practitioner
Employees that are injured on the job often just go to their general practitioner–it’s simple and familiar. The doctor will often just recommend bed rest for the employee, and will tell the patient that the injury will get better with time. That can result in an employee being out a lot longer than they should. Professional athletes return quickly because they have access to specialists on their training staffs, and they can be referred to doctors who are better suited to consult on particular injuries.
Employees should understand that there are medical professionals that can get them back on their feet quickly, and they should also know where to find them. It is the responsibility of the employer to post a list of recommended doctors, which can result in a healthier and happier workforce. Assemble a training staff for your employees, and your team will perform at a higher level.
(3.) No medical triage nurse
A triage nurse recommends the necessary level of medical care that the employee needs. When an employer does not have a triage nurse, the responsibility of assessing the injuries falls onto the employer. Construction employers generally have much less medical training than a medical professional. By determining the proper medical care required, the nurse is step one to getting employees back on their feet in an appropriate amount of time.
(4.) Employee fakes injury or tries to get treatment for preexisting condition under worker’s comp
As an employer, it is your responsibility to find out the extent to which your employee was injured. You need to know where he was injured, how he was injured and what he needs to do to recover. You can call his doctor to make sure that what the employee has told you is true, and to take the proper precautions when he returns to the work force. If the employee is faking it and the employer is looking into his affairs, he will likely drop his fraudulent claim. Also, by establishing the extent of the injury, the employee cannot seek medical help for a previous condition and be covered by worker’s comp.
If you take these precautions, you lower the risk of being conned into paying for a fraudulent worker’s comp claim. By using these steps, your company will perform more efficiently.
Nurses scurry back and forth tending to patients. Paper shuffles, clipboards snap, and the low hum of the air conditioner permeates the room. The lights are blinding. The walls sterile. And a lone figure limps through the doorway, dragging his right leg which bends out awkwardly at the knee. One of the nurses approaches him; she sits him down and pulls out her clipboard. He claims to have no I.D. and gives her a name, he explains he was hurt on the job and that his medical expenses will be covered by worker’s comp. She gets the doctor. They treat his injuries, but the doctor does not know whether to deny the man painkillers (which he could clearly use) or to prescribe an alternative treatment option.
What would you do?
A Washington man used this same fraudulent scheme to con hospitals and clinics in the state which has resulted in $134,000 in unpaid medical fees. Robert B. Boyer, Jr. gave false names, birthdates, and Social Security numbers to more than three dozen emergency rooms in Western Washington in order to procure prescriptions for Vicodin, Percocet, and other painkillers. He used this information to gain access to worker’s comp claims with the Department of Labor and Industries.
He now faces 25 counts of obtaining a controlled substance by fraud. The charges stem from an L&I investigation that discovered that Boyer had filed 51 worker’s comp claims. After missing his court date, it is highly probable that Boyer will be spending quite a lot of time behind bars.
One of the biggest complications of Boyer’s case is that he didn’t give the medical professionals whom he conned any form of identification, exploiting their duty to treat patients in a medical emergency. He stated that he was aware that his real name was registered with the Washington State Prescription Monitoring Program, which would alert the hospital officials that he’d already received his allotment of controlled substances.
Medical professionals who suffered at the hands of the con artist asked L&I investigators what they could do to prevent such a scheme from succeeding. They were advised to always try to verify the employment of any patients who are claiming worker’s comp injuries, and that if employment can’t be verified, to treat them through other methods than prescribing narcotics.
The holiday season typically brings about the happiest of feelings and an inspiring amount of generosity in most people. It is commonly known as the ‘Season of Giving,’ and one Ohio man probably ended up giving a little bit more than he intended at the end of last year. Todd Bittner of Hamilton County was found guilty this past December of two counts of worker’s compensation fraud, which will result in $55k moving from Mr. Bittner’s bank account and into the account of the Ohio Bureau of Worker’s Compensation (BWC).
The $55k will not be the only way Bittner will pay for insurance fraud. On top of the large premiums, he also faces four years of community control and 500 hours of community service. The sentence may seem extreme, but for a man who has continued to operate his construction firm since 2007, despite being approached on numerous occasions by the BWC for lapsed coverage, it appears these charges stem from years of negligence. In September of 2007, the BWC’s Employer Fraud Team (EFT) approached Bittner Construction about the construction firm’s lapsed coverage. Mr. Bittner explained to them that he was responsible for the firm’s worker’s comp duties, and that they would pay the premiums. However, he never paid the premiums, nor did he ever enter a payment plan that the EFT required him to do.
In July of 2013, Bittner was indicted for 12 fifth-degree felony counts of worker’s compensation fraud. He pleaded guilty to two of the 12 counts this past October as part of a plea deal. The other 10 counts were immediately dismissed.
Upon learning that Bittner had been found guilty, BWC Administrator/CEO Steve Buehrer stated, “Bittner Construction had lapsed coverage, and this wasn’t the first time. BWC attempted to work with Mr. Bittner, but he failed to pay the premiums or enter into a payment plan. The bottom line is that all employers need to pay for workers compensation coverage. We’re pleased that these overdue premiums will finally be collected.” Worker’s compensation insurance is required by law in the United States, and it is there to protect both employers and employees from litigation and injuries. By following the rules and not committing worker’s compensation fraud, employers can worry less about what unexpected legal fees they will have to pay in the future, and save themselves a lot of headache.