Fraud, SB 863 Highlights at California Workers’ Comp Conference

By Don Jergler | September 15, 2014

Rick Hudson was sitting at his booth at the California Workers’ Compensation & Risk Conference on Thursday scanning emails on his smartphone during a slow period when he was asked what the most significant change to his job has been over the last year or two.

Hudson, president and CEO of Irvine, Calif.-based Hudson Investigations Inc., gave his answer in a fraction of a second.

“Social media.”

Hudson spends a lot of his time tracking down and ferreting out workers’ comp fraud suspects, and nowadays he starts his search right at his desk by combing through postings on Facebook, Twitter or Instagram.

“They’ll post pictures of themselves skiing, or snowboarding or running a race,” he said.

A few booths down Michael Kowalski, Southwest manager of investigations at Bonnamy & Associates LLC, a national claims investigation, audit and risk management firm, offered an example of just how much easier social media has made life for investigators.

He was recently investigating a woman who was out of work and on workers’ comp for a back injury.

While trolling the Internet he found video of the woman competing in a rigorous Tough Mudder obstacle course race shot by her friend, who had posted it on a social media site.

“We got 30 minutes from her friend who was doing video of her with a GoPro camera,” Kowalski said. “I couldn’t have got video like that if I tried.”

Hudson said that in roughly 30 percent of cases he finds incriminating evidence of workers’ comp fraud on social media, and often it’s someone’s friend or a family member who posts a video or picture of a purported injured worker doing something they aren’t supposed to able to do.

“You find information that they might be careful about, but their spouse isn’t,” Hudson said.

Often people announce their pending activities to friends and Facebook or Twitter, such as “Can’t wait to get to the river,” or “Saturday’s moving day,” and that’s a clue for Hudson to be on the lookout for pictures and videos.

That’s what Hudson did recently while following the trail of a firefighter with an alleged back injury who announced his family’s big move on Facebook. Hudson sent an associate out with a video camera to the locale where a moving van was parked and he recorded the man lifting several pieces of furniture, including a large couch.

The three-day annual workers’ comp conference was held at the St. Regis Hotel in Dana Point. It ended Friday.

The conference included a motivational speech by former Lakers NBA star James Worthy, as well as several informational sessions.

Sessions included: Employer & Stakeholder Panel: The Current State of California Workers Compensation and what’s on the horizon for 2015; Cyber Security: Implementing a Strategic Risk Management Strategy; WCAB UPDATE: 2014 Decisions & Latest Trends in Workers’ Comp Litigation; Opiate Prescribing in Workers Compensation: We know the problem, what are the solutions?; and Connecting the Dots….Tying in the foundational pieces with your Best Practice Future State.

In the later session speakers spent time outlining the fundamental best practices of their organizations’ workers’ comp and risk departments.

Joe Carresi, manager of project/product at Southern California Edison, talked about the utility giant’s position on drug compounding and physician dispensing and how that position has helped the company keep claims costs under control by weeding out medical providers they don’t want to be doing business with.

“It they want to do dispensing, that’s a deal breaker,” Carresi said.

Others at the conference offered their thoughts on the workers’ comp space in California, including a less than lukewarm review of how SB 863, the state’s new worker’s comp reform law, is doing.

“SB 863 has made workers’ comp the new unemployment in California,” said Frank Cannizzaro, an employers’ attorney in the Los Angeles office of Lewis Brisbois Bisgaard & Smith LLP.

Cannizzaro blamed the increased permanent disability benefits created by the reforms for making workers’ comp an attractive, though potentially illegal, option for workers who are about to get laid off.

“Workers’ comp has been abused a lot as a consequence of the bad economy,” he added.

Jillanna Pomelow and Debbie Hubble, partners in QuestPro Insurance Recruiting Specialists, said firms that offer workers’ comp have been recruiting more adjusters as claims have risen.

“A few years ago it was rare that we got a workers’ comp adjuster search,” Pomelow said.

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