The Blog

Judy Schurke, Director, Department of Labor & Industries

01/19/10

L&I is dedicated to fighting fraud in our workers’ compensation system. We also work hard to bring employers into compliance with industrial insurance regulations so that everyone pays their fair share of premiums.

L&I’s Fraud Prevention and Compliance program recovered $128 million last year — a 3 percent increase over the previous year, as detailed in our new annual report to the Legislature for fiscal year 2009, Targeting Fraud and Abuse.

Injured workers often come to mind when people think about worker’s comp fraud, but we also recover overpayments from health-care providers and collect premiums from employers when they are delinquent or have reported falsely.

Recovering these funds is not just a one-time cost savings. By investigating and stopping fraudulent activity and bringing employers into compliance, L&I avoided an estimated $5.9 million in future costs.

The return on investment total proves our efforts are worthwhile. Fraud Prevention and Compliance brings in about $8 for every dollar spent on preventing fraud and improving employer compliance with reporting requirements.

We are also catching problems sooner, thanks to improvements in our computer systems that help us analyze data. L&I compares internal and external data while reviewing up to 2,000 claims each month that have been flagged as potentially fraudulent.

In 2009, L&I also referred 25 fraud cases for criminal prosecution, including 18 workers, four employers, and three health-care providers — with a 100 percent success rate in cases where charges were filed.