Request a call Login

  • As a small business owner in Ohio, you understand the importance of a well-functioning workforce for the success of your business. Your employees are the backbone of your business operations, ensuring your daily tasks run smoothly and the overall growth of your business. Running a small business comes with numerous responsibilities, one being properly navigating workers’ compensation. Though insurance programs aim to protect employees in case of work-related injuries or illnesses, what if there was an invisible threat within your business, silently draining your resources and jeopardizing your hard-earned success? If you’re unfamiliar, an alarming issue plagues businesses, especially in Ohio – workers’ compensation fraud.

    Detecting warning signs of workers’ compensation fraud is crucial for small business owners in Ohio to safeguard their interests and maintain a fair and safe work environment. Continue reading to explore critical indicators that can help you identify potential fraud.

    What Is Workers’ Compensation Fraud? 

    Let’s start with the basics – what is workers’ compensation fraud? Workers’ compensation fraud occurs when someone willfully makes a false statement or conceals information to receive workers’ compensation benefits or prevents an individual from receiving benefits to which they might be entitled. It’s more than just an employee exaggerating their medical condition or working while supposedly disabled. While these things occur within the workplace, employers are committing fraud by underreporting their payrolls to receive lower premiums, and health care providers are billing for services they’ve never performed. This can take various forms, ranging from exaggerated claims to staged accidents, ultimately leaving businesses burdened with inflated insurance premiums, legal situations, and a compromised work environment.

    However, states have different criteria for workers’ compensation fraud. Specifically in Ohio, an injured employee who does one of the following is considered to have committed fraud:

    • Receive workers’ compensation benefits the employee is not entitled to get
    • Enters into an argument for conspiracy to defraud the state Bureau of Worker’s Compensation or a self-insuring employer by making false claims for disability benefits
    • Makes false or misleading statements with the purpose of securing goods and services under the workers’ compensation act
    • Alters, falsifies, destroys, conceals, or removes documents necessary to establish the validity of a claim or needed to establish the nature of goods and services for which reimbursement is requested

    According to the Ohio Bureau of Workers’ Compensation, in Ohio alone, an estimated $80 to $320 million in fraudulent medical and compensation payments are made each year.

    Detecting Warning Signs Of Fraud

    According to the National Insurance Crime Bureau, one in 10 small business owners fears employees will fake an injury, and one in five owners do not know how to identify workers’ compensation scams. Understanding the warning signs to prevent these concerns and protect your business is critical. Let’s dive into these warning signs.

    Delayed reporting:

    If an employee consistently delays reporting an injury or accident, it could be a red flag. Fraudulent individuals may wait to report the incident to avoid scrutiny or make it seem like the injury occurred at work when it didn’t.

    Inconsistent descriptions:

    Employees involved in fraud may provide inconsistent or vague descriptions of the accident or injury. They might struggle to recall specific details or change their story when questioned. Inconsistencies between their statements and witness accounts or medical reports should raise suspicion.

    Having no witnesses:

    Legitimate workplace accidents often have witnesses who can support the injured employee’s account. However, employees involved in fraud may avoid involving witnesses or claim that no one else was present when the incident occurred.

    Late claims:

    Fraudulent claims often occur on Monday mornings or are reported late on Fridays. This timing is strategic, as it allows fraudsters to make it seem like the injury happened at work, even if it occurred outside of working hours or over the weekend.

    Lack of cooperation:

    Employees engaged in fraudulent activities may lack cooperation during the investigation process. They may be evasive, unresponsive, or hesitant to provide additional information. Genuine claimants are usually cooperative and willing to assist in the investigation.

    Conflicting medical reports:

    When reviewing medical reports, pay attention to any inconsistencies or discrepancies between the reported injury and the employee’s statements. Fraudulent individuals may exaggerate symptoms or provide misleading information supporting fraudulent claims.

    History of suspicious claims:

    Keep track of employees with a history of suspicious or frequent workers’ compensation claims. If an employee repeatedly files claims for minor incidents or has a high number of claims compared to their peers, it could indicate potential fraud.

    Lifestyle inconsistencies:

    Be mindful of any lifestyle inconsistencies or activities contradicting the claimed injury’s severity. For instance, an employee with a severe back injury claiming complete disability but regularly engaging in physically demanding activities outside of work raises suspicion. “It’s important for employers to know who their employees are and participate in good hiring practices. Knowing what your employees do for extracurricular activities (sports, groups, personal circumstances, and more) can always help investigate a claim,” emphasized Dani Terry, GMS’ Workers’ Compensation Claims Specialist Manager.

    Remember, it’s crucial to approach these warning signs with care and conduct a thorough investigation before making any conclusions. If you suspect workers’ compensation fraud, consult legal professionals and work closely with your insurance provider to gather the necessary evidence.

    Combatting Workers’ Compensation Fraud With A PEO

    Being aware of these warning signs of workers’ compensation fraud is essential for small business owners in Ohio to protect their businesses and maintain a fair working environment. By diligently recognizing these red flags, you can proactively address potential fraud, safeguard your employees’ well-being, and maintain the integrity of your workers’ compensation program.

    However, navigating the complexities of workers’ compensation can be challenging for small businesses. Fortunately, a professional employer organization (PEO) like GMS can help! We provide small business owners with comprehensive HR solutions, including workers’ compensation administration, claims management, and fraud prevention strategies. Partnering with us allows business owners to tap into expert knowledge, gain access to resources, and ensure compliance with Ohio Workers’ compensation regulations. You can finally focus on growing your business while having peace of mind knowing that your workers’ compensation program is effectively managed and protected against fraud.

    Dani added, “At GMS, we take the concerns from our employers very seriously regarding employees’ potentially filing a fraudulent workers’ compensation claim. Some of the immediate red flags that are common when dealing with a potential fraudulent case include the following:

    • Unwillingness to cooperate with employers and/or answer questions related to the circumstances surrounding the injury
    • Doctor shopping when they are released to return to work
    • Copycat claims
    • Filing a claim after paid time off (PTO) is denied
    • Alleged injury occurred right after clocking in on Monday morning

    If you ever feel that a situation is not right, do not be afraid to speak up. When you partner with GMS, you have a designated claims specialist that is there to help you.”

    GMS experts are here to protect your business. Contact us today to learn more!

  • As the saying goes, “To make money, you have to spend money.” While spending money is an inevitable part of running a successful business, keeping track of all your expenses without a proper process can be difficult.  

    While some companies choose to track their expenses manually, there is a quicker and safer approach: using an expense report tracking system. 

    What Are Expense Reports and What Do They Do? 

    Expense reports are special forms that outline and track business-related purchases and are submitted by employees for tracking and reimbursement purposes.  While they may be tedious to complete, these reports help streamline budgets, confirm purchases, ensure compliance through documentation, and track tax deductions.  

    Common expense report categories include the following: 

    • Travel 
    • Parking 
    • Hotels and other lodgings 
    • Gas 
    • Office expenses such as rent, utilities, office supplies, etc.  
    • Repairs and maintenance 

    The most common expense on a report is when an employee uses their own money to buy something on behalf of the business. The employee provides details on the purchase, attaches proof of payment such as an invoice or a receipt, and submits it to their employer, who then decides whether to approve or deny reimbursement. 

    What’s Included in an Expense Report? 

    While there isn’t one expense report format, there are common fields and information needed to submit a report. These fields include: 

    • Name of the employee who made the purchase 
    • The date of the purchase 
    • How the purchase was paid for (i.e., credit card, cash, etc.) 
    • Type of expense (Travel, parking, etc.) 
    • Description of the purchase 
    • Proof of payment 
    • Reimbursement total 
    • Any additional notes or information regarding the purchase 
    • Signature or approval from a supervisor 

    Top Benefits of an Expense Report Tracking System 

    Manually reviewing a long list of business expenses can be daunting, but an expense tracking system can simplify the entire process and offer several other benefits. 

    Enhanced compliance 

    An expense reporting system enables businesses to categorize expenses and produce documentation for tax returns, ensuring compliance with federal, state, and local tax laws. In the event that there is miscommunication among a team or a miscalculation, having an expense reporting system allows you to quickly review the expense in question and go over any details, making it easier to correct any mistakes made during the reimbursement process. Fixing potential expense mistakes before it’s too late can help reduce the potential for a non-compliance fine or monetary penalty.  

    Budget management 

    Expense reporting software plays a crucial role in effective budget management. It allows businesses to track and categorize expenses accurately, ensuring that cost amounts are correct and accounted for. By automating the expense reporting process, the software reduces the risk of errors and fraud while streamlining expense approval and reimbursement. This software enables businesses to make informed financial decisions and identify areas to improve and maintain compliance.  

    Saves time 

    As a business owner, your time is valuable. By automating expense reporting, you remove the need for manual processing. This not only increases efficiency but also saves you time, allowing you to concentrate on higher-value tasks, such as strategic planning and business development. Reporting software can also flag various issues and fix them in real time, reducing potential delays with reimbursement.  

    Simplify Administrative Tasks with GMS 

    Managing expense reporting alongside other responsibilities can make it challenging for business owners to concentrate on growth. That’s where a professional employer organization (PEO) like Group Management Services (GMS) can be a beneficial ally.  

    GMS’ knowledgeable experts can assist business owners with administrative functions like human resources, benefits administration, payroll, and more. GMS provides insight, assistance, and resources to help business owners effectively manage their business and employees. Our human resources information system (HRIS) allows business owners to easily manage everything from payroll to paid time off (PTO) requests to expense reporting.   

    Contact GMS to learn how we can help save you time and money with our services.