California Department of Industrial Relations - DIR Fraud Prevention

Workers’ Compensation Insurance Fraud

Workers’ compensation fraud costs California billions each year. Workers’ compensation fraud can take the form of health care providers billing for services never performed, employers under-reporting payroll, and attorneys or claims adjusters facilitating fraud.

Workers compensation fraudsters include medical providers who:

  • Bill for inappropriate or unnecessary treatment
  • Submit bills with improper medical codes
  • Pay bribes or kickbacks

Workers compensation fraudsters includeinsurers, claims administrators and third-party administrators who:

  • Make payments to nonexistent claimants or medical providers
  • Refer patients or clients to medical providers or attorneys for compensation
  • Issue excessive payments to an attorney or medical provider in return for kickbacks
  • Backdate documents to avoid penalties, or alter documents to support unjustified denials of claims



Workers compensation fraudsters include employers who:

  • Misreport claims history, or omit work injuries
  • Encourage workers to submit fraudulent claims



May 2018