Although the injury was real, her disability seemed less than permanent. One month after corrective surgery in 2000, Sacramento County investigators filmed Lucena riding a personal watercraft and having fun going down water slides at a local water park.
Nearly 10 years after the accident, Lucena was found guilty on 14 counts of insurance fraud, sentenced to seven years in prison and fined $349,000.
It’s not all that unusual for this to happen, experts say. While there is no clearinghouse tallying all workers’ compensation claims fraud, the National Insurance Crime Bureau says it is a significant contributor to the country’s $30 billion insurance scam problem.
Employees wanting to take advantage of the system fake or exaggerate injuries, and employers that don’t have well-communicated procedures for documenting the accident, taking care of the employee’s injury and having them return to some level of work get conned.
Plus, employers can’t protect against fraud by asking prospective workers whether they’ve filed prior workers’ compensation claims.
"Employers have to be proactive," says Margaret Spence, president of Boca Raton, Florida-based Douglas Claims & Risk Consultants. "It is a necessity to put policies in place."
While workers’ compensation rules vary among states, most offer free and helpful ways to create safety plans often referred to as injury/illness prevention programs, says Robert Miller, director of human resources for the Greater Los Angeles Vector Control District. Miller, who has worked in myriad workers’ compensation capacities, says many employers don’t realize that creating a plan is the first step in reducing the risk and ultimately the cost of being scammed.
When Miller came to the Vector Control District in April 2007, he hired a safety specialist, costing about $12,000, to identify potential hazards. The Vector Control District has only about 100 employees, but its workers deal with chemicals and potentially dangerous insects, so a strong safety program is needed, he says.
Training, communication and documentation are key. Employees should be trained in how to report accidents, and handbooks should reinforce the training with a detailed process, Miller says. Vector Control District supervisors are trained annually on how to handle accidents. Employees are trained to use hazardous materials properly, and then are required to sign waivers that they’ve learned specific procedures.
Spence says supervisors play a key role in reporting accidents properly. Supervisors need to write down the injured employee’s responses to specifically ordered questions. This accident report should be sent to the doctor evaluating the employee, so they are aware of the incident and what might be wrong.
"When ‘body claims’ happen, sometimes the injury moves around; a hurt finger at the job can end up being an injured shoulder at the doctor’s office," Spence says. "Part of the process in identifying fraud is asking the right questions and identifying inconsistencies."
Smart employers know the red flags, including Monday-morning accidents, no witnesses, or employees returning to work with an injury that happened on a previous day. Completing an injury report as soon as possible helps claims adjusters understand the incident better and can help identify inconsistencies, Spence says.
Plus, having a solid working relationship with a claims adjuster can help increase the time allowed to investigate when the elements of an accident don’t look right, Miller says. A thoroughly documented accident report helps the adjuster get a better picture of what happened from employee and employer standpoints.
Another critical component is to clearly communicate a return-to-work program, experts say. Bringing an employee back even in a limited capacity helps mitigate the cost of lost time and lowers the potential for increased workers’ compensation premiums and other expenses, Spence says.
"If the employee is going to perpetuate fraud and you let them stay at home, you’re never going to get them back in the workforce," Spence says.
Miller says well-communicated return-to-work programs often act as a fraud deterrent, and help those employees who are truly injured feel more valued. In his first 18 months, he processed only one workers’ compensation accident, and that employee was back to work within two days.
"You can’t control human behavior, but you can structure a training and documenting process," Miller says. "It’s all about the planning and procedures you put forth first."