Insurance Code 1871.4 & Penal Code 549-550
Workers' compensation fraud is California insurance fraud in connection with workers' compensation benefits.
“Workers' compensation” is a system of insurance that provides medical care and payments for lost income to workers who are injured on the job. 1 Fraud committed in connection with workers' compensation insurance can lead to harsh criminal penalties.
Acts that are considered workers' compensation fraud in California include:
- Knowingly making or presenting a false or fraudulent material statement for the purpose of either obtaining or denying workers' compensation benefits;
- Making a false or fraudulent statement about eligibility for benefits in order to discourage an injured worker from claiming benefits;
- Knowingly aiding and abetting, or participating in a conspiracy to commit, workers' compensation fraud; 2
- Preparing or submitting multiple claims for payment of a health care benefit covered by workers' compensation insurance, all for the same injury;
- Submitting a claim for a health care benefit covered by workers' comp that was not actually used; 3 and
- Soliciting, referring or accepting any business from a person, knowing that s/he intends to commit workers' comp fraud. 4
Workers' compensation insurance provides benefits to workers injured on the job.
Here are some examples of people who could be charged with California workers' compensation fraud:
- A man claims to have debilitating back pain due to a fall down the stairs at his office and collects workers' comp payments for lost income. In reality his back pain is minor, and
he is working a new job under the table while also collecting benefits.
- An employer lies about the circumstances of an employee's accident at work in order to prevent that employee from getting workers' compensation benefits (which would raise the employer's premium for workers' comp insurance).
- A doctor specializes in treating patients injured in the workplace and regularly submits bills to workers' comp insurance for treatments that the patients did not actually need or receive.
Most forms of workers' compensation fraud are California wobblers. This means that they may be charged as either misdemeanors or felonies in California law. 5
The potential felony prison sentence for most forms of workers' compensation fraud is two (2), three (3) or five (5) years. Felony fines can go up to one hundred fifty thousand dollars ($150,000), or twice the amount of the fraud (whichever is greater). 6
In most cases, workers' comp fraud as a misdemeanor carries a potential county jail sentence of up to one (1) year. 7
Both so-called "blue collar" and "white collar" workers can be charged with workers' compensation fraud.
If you are charged with workers' compensation insurance fraud in California, you may be able to get the charges reduced or dismissed by arguing one of the following common legal defenses :
- You did not act knowingly or with fraudulent intent; and/or
- There is insufficient evidence to support the charges.
In this article, our California insurance fraud defense attorneys 8 explain the following: