Workers’ compensation professionals have repeatedly questioned why insurance fraud is not prosecuted more frequently, in light of all of the unsavory behavior observed on the front lines.
Throughout the years, I’ve heard everyone from WCAB commissioners to claims adjusters to self-insured employers ponder the seemingly small ratio of fraud cases that are filed by district attorneys.
For decades, a large part of that question was answered with a single word: resources. In short, prosecutors lacked the staff to spend the time on fraud cases emanating from a system that they were often unfamiliar with.
Fortunately, the “resources problem” has been addressed with the proliferation of grant money aimed at giving prosecutors the monetary resources to help staff insurance fraud divisions. For instance, the Orange County District Attorney’s Office and San Diego County District Attorney’s Office are two shining examples of prosecutors that have used that money well.
As you may have heard, the Orange County District Attorney’s Office has employed these new resources to staff an entire unit dedicated to filing large-scale fraud cases, which requires the analysis of thousands of bills, reports, and bill reviews.
Counties with lower populations tend to have scarcer resources, as well as competing priorities. For instance, the Ventura County District Attorney’s Office has been compelled to open investigations into other large-scale problems affecting important members of its population base, such as scams targeting the county’s numerous veterans and sudden increases in troubling drug-related deaths among teenagers. However, even smaller counties are taking a growing interest in prosecuting insurance fraud, as is evidenced by the Santa Barbara County District Attorney’s recent job ads seeking attorneys to do insurance fraud work.
Now that district attorneys have more funds to tackle insurance fraud, the next step is to get them the information that they need.
Most assume that the Department of Insurance forwards complaints over to the district attorneys’ offices. That simply does not happen. (I suspect that it probably has something to do with the high volume of complaints that the DOI receives, and the staggering amount of staff time it would take to forward all of those complaints over.)
This places the burden on us, the card-carrying members of the workers’ compensation system, to send in the information ourselves.
Prosecutors want proof of a material misrepresentation, which means something that would affect the outcome of the case. They need this evidence to be crystal clear, so a criminal defense attorney cannot downplay it as mere “confusion” or a “misunderstanding” or a “miscommunication.”
All too often, payers tend to send prosecutors information showing how much money they have been bilked out of. While that is certainly an important statistic to be aware of, it doesn’t do very much to help the prosecution satisfy their burden of proof.
District attorneys also need the evidence to be crystal clear for another reason – jurors tend to be sympathetic to employees. After all, the vast majority of the general public is far more likely to have worked as an employee.
So what constitutes “crystal clear” evidence? In applicant fraud cases, that might be a vehement denial of a fact that is well-documented in subpoenaed records or sub rosa video.
For provider fraud cases, prosecutors need a plethora of information, such as:
- The documentation of what services were allegedly provided, such as the prescription for the service and the accompanying medical reports.
- The provider’s bill for said services.
- Internal or external bill reviews showing that different services were actually billed for.
While I’ve heard prosecutors request those three categories of elements, I’d also recommend summarizing the evidence in a concise letter or a Word document that can be easily saved. Pretend the prosecutor is a judge, and make it easy for them to surf through all that evidence with something that akin to a short legal brief.
Lastly, be sure to follow-up on your submittal request via phone or email once a month. Ask the prosecutors if there is anything else you can do to help. After all, our district attorneys are regular people who are just like us – they face mountains of information and use impressive problem-solving skills to navigate those very mountains. Fraudsters are best served by getting lost and forgotten among those mountains of paperwork, which is reminiscent of the following quote from early 1990s crime drama film, The Usual Suspects. “The greatest trick the Devil ever pulled was convincing the world that he didn’t exist.”
John P. Kamin is an associate attorney for Bradford &Barthel, LLP (Tarzana). He can be reached at firstname.lastname@example.org.
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