Pursuant to the Workers' Compensation Act, an injured employee's exclusive remedies against the employer are generally limited to such benefits as temporary total disability payments and reasonable and necessary medical expenses. The underlying legal theory is that while claimants forgo an extensive range of tort damages available to them in other personal injury actions, they receive speedy and certain medical and lost-time payments and are not required to prove fault.
Fraud, however, has been a growing concern in the workers' comp arena. Employees who elect to abuse the system do so at the risk of hefty criminal and civil penalties. Nonetheless, claim managers and adjusters who suspect fraud also should be cognizant of the relationship between fraud, slander, and libel actions, and the anti-retaliation and whistle-blower laws that operate to protect the rights of injured workers.
Caution should be exercised in the investigation of suspected fraud. Claim professionals should not make unsupported statements or premature decisions based on a mere hunch that fraud is present. Overly zealous fraud investigations could lead to defamation or other civil lawsuits. Accordingly, claim professionals should avoid actions that create unnecessary and costly legal exposures.
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