Managing claims under the Federal Employees’ Compensation Act (FECA) requires both diligence and discernment. Identifying red flags early can safeguard the program’s integrity and ensure benefits are distributed appropriately. However, red flags are not definitive proof of wrongdoing—they simply serve as an indicator that further investigation is warranted. This is where administrative investigations come into play, leveraging more expansive resources to clarify the situation.
Here’s how workers’ compensation specialists can spot red flags and utilize administrative investigations to assess their validity.
Recognizing Red Flags with Limited Data
Even with restricted access to medical records and claim files, specialists can identify potential red flags. These include:
- Prolonged Recovery: Claims lasting significantly longer than the typical recovery period for the injury type.
- Workplace Rumors: Reports from supervisors or coworkers suggesting activities inconsistent with claimed limitations.
- Suspicious Claim Origins:
- Unwitnessed injuries.
- Incidents reported on Monday mornings (potentially indicating a weekend injury).
- Escalating restrictions for occupational illnesses without clear justification.
- Questionable Timing: Claims filed immediately after disciplinary actions or denied time-off requests.
- Provider Patterns: Multiple claims from claimants that know each other linked to the same medical provider or clinic.
While these patterns don’t automatically indicate misdeed, they provide a basis for further examination.
Broadening Red Flags with Social Media and Data Access
Advances in data resources and social media platforms allow for a wider range of red flag detection, enhancing a Claims Specialist’s ability to assess claims. Examples include:
- Social Media Evidence:
- Posts showing claimants participating in marathons, physical sports, or activities inconsistent with reported limitations.
- Advertisements for businesses owned or operated by claimants.
- Occupation-Specific Indicators:
- For desk job professionals: signs of at-home businesses, bookkeeping, or online consulting.
- For medical professionals: activities involving hands-on tasks, such as administering treatments outside work hours.
It is a Claims Specialist obligation to look for illegitimate claims in their caseload and report them to the Department of Labor OWCP. But red flags don’t confirm fraudulent activity; they merely point to inconsistencies or areas requiring further clarification. An administrative investigation can reveal fraud or that discrepancies are due to outdated, incorrect, or benign information.
Administrative Investigations: Expanding the Scope
When a claim raises red flags, Claims Specialists can initiate an administrative investigation with a third-party knowledge expert to dig deeper and vet the information. This next step involves utilizing broader resources and expertise to determine the nature of the red flags—whether they result from coincidence, permissible variance, or actual discrepancies.
How Administrative Investigations Clarify Red Flags
- Enhanced Resource Access: Administrative investigators can access additional data sources, such as:
- Proprietary data sources
- Vehicle registration databases.
- Business filings (e.g., UCC filings, corporate affiliations).
- Financial records, including bankruptcies, liens, or judgments.
- Licensing records, like hunting permits, professional credentials, or pilot licenses.
- Physical and Digital Surveillance: If red flags suggest a significant variance from reported limitations, targeted surveillance can verify claimants’ activities, ensuring compliance with restrictions.
- Activity Context Analysis: Investigators evaluate whether observed activities align with or contradict the claimant’s stated limitations. For example:
- A claimant with reported back pain coaching youth sports or engaging in DIY home renovations.
- Social media photos showing skiing, dancing, or other strenuous activities.
- Establishing Intent: Administrative investigations differentiate between harmless discrepancies and deliberate misrepresentation. For instance:
- A red flag such as a business license registered to a claimant may simply indicate a family member’s venture, not the claimant’s active involvement.
- Similarly, a registered hunting permit may not conflict with physical limitations unless corroborated by evidence of active participation.
Interpreting Red Flags: A Balanced Approach
Not every red flag is indicative of fraud. An administrative investigation helps determine whether red flags stem from:
- Coincidence: Unrelated factors causing an appearance of incongruity.
- Permissible Variance: Activities that do not violate OWCP guidelines or the claimant’s reported limitations.
- True Discrepancy: Evidence suggesting that the claim does not align with reported physical or occupational restrictions.
For example, a landscape trailer registered to a claimant’s address might initially seem suspicious. An investigation could reveal that the trailer belongs to a neighbor who used the claimant’s address as a mailing convenience. This underscores the importance of context in red flag evaluation.
Dynamic Red Flag Criteria
To stay ahead of emerging trends, Red Flag Criteria should be treated as a dynamic document—one that evolves with new patterns of fraud or industry insights. Specialists and investigators alike must remain vigilant, updating criteria to reflect technological advancements, workforce changes, and claimant behavior trends.
Conclusion
Red flags are valuable indicators for Claims Specialists indicating which claims require closer scrutiny, but they’re not definitive proof of wrongdoing. With the support of administrative investigations, Claims Specialists can expand their reach and clarify whether inconsistencies are benign or significant. This layered approach protects program resources, presents to OWCP vetted evidence and ensures evenhanded treatment for all claimants with a FECA claim.
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Disclaimer: This blog post is for informational purposes only and should not be considered legal advice. Please consult your general counsel for specific legal guidance. Frasco investigators are licensed, and our operations comply with US industry, federal, state, and local laws.