|Labor Research Association,
the organization that wrote "The Real Story," has a series of reports
on workers' compensation here.
We highly recommend visiting this site. Other reports include, "The
Next Assault on Workers' Comp" and "Workers' Comp in Oregon
May Be in for a Shake-Up." The Next Assault... has been reproduced for
Foundation for Taxpayer & Consumer Rights provides details of
numerous cases of HMO's abusing the arbitration process. It is stated,
"By law, arbitration requires that each side pay their costs when
an HMO is involved, regardless of who wins. By the sheer fact that HMOs
have endless financial resources, this makes it a cinch for HMOs to prevail."
consumer group says insurers wrongly blame their own insured. In what
may be the least exposed form of insurer abuse, insurance companies often
wrongly determine their own policyholders to be "at-fault" in
car accidents in order to boost the premium charged to the policyholder.
California Insurance Commissioner Chuck Quackenbush has not been indicted one year after his forced resignation for numerous illegal activities.
Taxpayers pay his legal bills. The press now ignores that $100,000's were
given to his political bank account just days after he proposed an 18.4%
increase in workers' comp rates and other
workers' comp related accusations. No insurer has been prosecuted.
library files on Quackenbush here.
Dozens of articles on the scandal are here.
insurance company founder Bill Griffin received a five-month federal prison
sentence in August 1998 for his part in a six-year conspiracy involving
800 illegal political contributions worth nearly $400,000 to 27 political
candidates who could help his workers' compensation insurance company. Florida Insurance Commissioner Tom Gallagher received the most in illegal
campaign contributions and Katherine
Harris (now Florida Secretary of State) received more than $20,000
from Riscorp. [Link
National Insurance Crime Bureau (NICB), funded by the insurance industry,
receives the help of the FBI (taxpayer money) to crack down on insurance
fraud by consumers after a senior FBI official becomes NICB president.
When asked if the FBI would investigate insurance companies who were ripping
off consumers, NICB replies: No, that would be a job for state insurance
numerous examples of fraud by employers, medical providers, and others
at the Labor Research Association Web site. [More]
on the Job, a Newsday investigation shows that scores of injured immigrant
workers in New York face an overwhelming fight to get benefits or medical
compensation when they are injured on the job. The investigation also
found that families of those killed on the job in New York can spend years
waiting for death benefits, including funeral expenses.
Faith Case Nets Employer $6 Million in Damages. In August 2001, a
California Appeals Court affirmed in Lance Camper Manufacturing Corp.
v. Republic Indemnity Co. a $6.3 million award against the insurance
company.The employer had accused Republic of inflating reserves, claims
mishandling, and destroying files, among other infractions.
Fraud Unit Favors Those Who Privately Fund It by the Los Angeles Times.
A review of prosecutors' performance involving workers' compensation shows
that their decisions--on whom to investigate and on whom to prosecute--have
consistently favored those who provide them with money. The money
originates with the state's employers and is handed out by employers and
recover less than half of their injury-related wage losses during the
first five years after injury. An August 2000 report released by the
RAND Institute for Civil Justice, found that claimants had average total
wage losses of $39,500 but received only $19,000 in workers' compensation
benefits. The study, funded by the state's Commission for Health and Safety
and Workers' Compensation (CHSWC), focused on 68 large companies who were
R. Engel, without the aid of an attorney, filed a Petition for Writ
of Review in 1998 with the State of California Court of Appeals. He stated
that California Law denied him the right to adequately pay an attorney
for his worker's Compensation Claim because of the 12% maximum allowed.
He says, on the other hand United Parcel Service and Liberty Mutual Insurance
are allowed to hire as many attorneys as they can afford to protect themselves.
Insurance Fraud for Your Client's Sake states, "In this day
and age, it is virtually impossible for an injured person in America
to receive a fair trial, as a result of the anti-fraud campaign, funded
by big businesses, which pollute our jury pools and in some cases our
judges." Examples of fraud listed are: In Missouri an adjustor
for the Home Insurance Company was convicted of defrauding an injured
worker by hiding the results of an IME in order to settle her case
for less than full value; In California two former Freemont Insurance
Company executives were charged with fraud for back dating claimants'
checks in order to minimize the penalties to be accessed by the Department
of Industrial Relations; and a defense attorney in St. Louis was charged
and pled guilty to misdemeanor fraud in connection with the workers'
compensation matter when he withheld a medical report which demonstrated
an injured worker was totally disabled.
Slaps Insurers on Ergo Standard. The National Association of Insurance
Commissioners refused to support the workers' compensation insurance industry
in their legal challenge to the ergonomics standard issued by OSHA. NAIC
commissioners say, "...one can argue that the overall effect of the
standard might be to reduce the incidence of occupational injury. Such
a result would reduce the cost of workers' comp coverage."
Commit the Real Fraud in Workers' Comp reports on an investigation
and prosecution in California that resulted in sentences of eight years
and six years for two business owners who falsified payroll data to
lower their premiums. Another article, Investigate Employer Fraud,
gives examples from various states of premium fraud being committed by
Drive Proves Costly for Employees details the decade-old campaign
against workers. "It was a crisis, and the insurers needed ways
to persuade the legislatures to restrict their costs," said Edward
Welch, director of the Workers ' Compensation Center at Michigan State
University. "Fraud was one of the images they used to justify narrowing
eligibility, changing the way you measure benefits and basically
saving money for employers at the expense of injured workers."
"Most thoughtful people who do a lot of
research in workers' comp would come to the conclusion that there
is not a lot of fraud in the system," said Rand Corp. economist
Robert Reville. [emphasis added] "By making a claim that there
was a lot of fraud, I think they [insurance carriers] were benefiting
at workers' expense [and] discouraging workers from filing claims."
Compensation Claim Management Fraud Awareness is written by a consultant
for the property casualty insurance industry. It repeats often-stated
business and insurance industry propaganda that 10 to 20% of claims are
fraudulent. It also states, "The actual amount of workers compensation
fraud remains unsubstantiated." The article later states, "To
find the heart of the fraud problem, however, you must follow the money.
And money most often ends up in the hands not of workers, but the professionals
who live off the system: a relatively small percentage of the nation's
doctors, lawyers, insurance adjusters, and dishonest employers. While
blame most often falls on the shoulders of the worker, we believe that a small minority of professionals make the most money through fraud."
Patients Quickly For Workers' Comp Fraud. The physician who wrote
this article thinks if a worker is disgruntled or been disciplined by
management they will fake an injury for workers' comp benefits. He states,
"various researchers have determined that between 5 and 15 percent
of workers' comp claims are fraudulentno injury ever occurredor
constitute an abuse of the system in that while an injury did occur, the
worker tried to prolong the "free ride."
Bad Faith in Professional Disability Cases discusses how the discovery
of several "smoking gun" documents made possible a $36.7 million
judgment in an Arizona bad faith suit against a professional disability
insurer. It states that damaging documents continue to pile up showing
an industry-wide conspiracy to deny legitimate claims.
Wal-Mart workers: Please do not report injuries, an article published
by Seattle Weekly, details Wal-Mart's refusal to provide RSD treatment
to an employee until such treatment couldn't help her anymore and lists
other cases of worker abuse. In the article, officials of Washington's
Department of Labor and Industries contend that Wal-Mart mistreats its
injured employees in the state. Regulators state that Wal-Mart has
managed its program so badly, for so many years, that it should no longer
be allowed to self-insure. L&I says the company "repeatedly
failed" to respond to worker claims, or pay workers their benefits,
in a timely way; that it prematurely cut off employees' replacement
wages or "miscalculated" them; that it has shown "consistently
poor record keeping," and has even failed to provide "adequate
first aid facilities." [Alternate
link for printing]