Lanterna Rally

Author: Shelley A. Criss

Publisher:

Published: 2011

Total Pages: 120

ISBN-13:

Workers' Compensation fraud like most insurance frauds effects everyone in the distribution chain. In response to fraud, insurance companies raise premiums, businesses raise prices and the consumer suffers by paying the higher price on goods and services. Unfortunately, workers that find themselves in financial difficulty rationalize reasons for committing workers' compensation fraud. The rise in workers' compensation fraud has cost the insurance industry billions of dollars annually. To prevent this type of fraud New York State legislatures have incorporated investigative agencies to conduct oversight and imposed stiffer penalties for offenders who are caught committing workers' compensation fraud. Additionally, private insurers must establish special investigative units to look into suspected cases of fraudulent activity. These are examples of some measures that have produced noticeable reductions in fraudulent workers' compensation fraud claims. However, as fraudsters create ways to feign injuries and illnesses other methods of prevention and detection must be employed to continue mitigating fraud. This study focuses on the history of the workers' compensation system, types of workers' compensation frauds, challenges facing the insurance industry as well as possible solutions. Further research should be conducted to identify weaknesses in the system and possible solutions to limit and if possible eliminate fraudulent activity.