Top Three Employer Workers’ Compensation Scams in Louisiana
Employee fraud workers’ compensation claims often dominate the headlines. Sometimes, unscrupulous workers fake or exaggerate injuries. Other times, unscrupulous doctors treat nonexistent injuries. But such claims account for less than 2 percent of all workers’ compensation claims in Louisiana.
Employer fraud is a much more pervasive problem. Some of the more common schemes are outlined below.
A New Orleans workers’ compensation attorney does more than obtain fair compensation for job injury victims. Attorneys also fight employer fraud. These frauds drain money from the system, so there is less money for truly injured workers. If the insurance company refuses to pay a claim because of fraud, additional compensation might be available.
False Payment Promises
Prior claims usually drive up premium payments. That’s true for auto insurance, homeowners’ insurance, and workers’ compensation insurance. To avoid paying higher premiums, many companies avoid paying claims.
To placate injured workers in these cases, these companies often offer to pay medical bills and/or replace lost wages under the table.
The trouble is that many of these victims do not know how badly they are hurt. Head injuries are a good example. Falls and other trauma injuries cause more than superficial head injuries. They normally cause internal brain injuries as well. An independent doctor needs to diagnose these injuries. Many company doctors patch workers up and send them back into the game. And, because the brain conceals its own injuries, many victims do not realize the full extent of their injuries.
Additionally, if the employer later goes back on this promise, which is usually the case, the claims deadline might have passed. In these situations, workers might not have any legal rights.
So, if you are hurt at work, always file a claim, always see a doctor, and always speak with an attorney. You can always withdraw the claim later.
Fake Insurance Policies
Frequently, the system encourages cheating. Louisiana law requires most employers to purchase workers’ compensation insurance. But the overworked inspectors who enforce this law often only give paperwork a cursory review. As a result, many workers’ compensation “companies” do not meet the legal requirements for insurance companies in Louisiana. Undercapitalization is the biggest issue. Other companies produce policy paperwork that they manufactured themselves.
If the company did not have a valid policy, injured workers might be able to file civil claims. If they can establish negligence, additional compensation for their emotional distress and other noneconomic losses is usually available.
Prior claims help determine premium payments. Number of employees and payroll size is another risk factor. The more workers a company has, the more likely it is that one of them will get hurt. And, the more these workers earn, the more wage replacement the insurance company must pay.
So, some employers lie about the number of workers or payroll size. These lies could include patently false statements or intentionally misclassifying workers (e.g. claiming that a roofer is really an office worker).
Once again, if the insurance company refuses to pay because of a false statement, additional compensation might be available. Negligence is usually easier to prove in these cases. Louisiana law prohibits these employers from using certain key defenses.
Work with a Diligent Attorney
Employer fraud is rampant in Louisiana. For a free consultation with an experienced workers’ compensation lawyer in New Orleans, contact Lunsford, Baskin & Priebe, PLLC. Home, virtual, and hospital visits are available.