In the last several years, our nation has been in the throes of the worst recession since the Great Depression. While the Great Recession brought plenty of challenges for the workers’ compensation industry—including increased potential for fraud—during this time our country also underwent significant comprehensive health reform. These events have created unique challenges and significant uncertainty for the workers’ compensation industry.
In March 2010, President Barack Obama signed into law the Patient Protection and Affordable Care Act and the companion Health Care Education Reconciliation Act of 2010 (hereinafter referred to together as “ObamaCare”). Although the full effects of ObamaCare on the workers’ compensation industry remain to be seen, initially experts have seen it as a double-edged sword for medical costs.
The recession presents the entire workers’ compensation industry with an increased risk of fraud as well. The increased number of layoffs caused by the recent downturn in the economy has insurance investigators watching for possible increases in spurious injured worker claims. According to a May 18 National Insurance Crime Bureau (NICB) Suspicious Claims Report, the number of suspicious workers’ compensation claims for first quarter 2011 was up 24 percent overall compared to the first quarter of 2010.