Late Reported Workplace Injury Claims and Higher Case Cost

In an effort to minimize the cost of workers’ compensation insurance cases, employers
should require employees to report all incidents, injuries and property damage immediately to
a supervisor. This should be a written policy that is signed by employees at the time of hire
that all incidents must be reported immediately. In addition, work-place awareness posters
should be displayed that all injuries should be reported immediately as to demonstrate that
the employer has given the workers adequate notice of what is required. This forms the basis
of your workplace reporting policy if it is ever called into question.
This article attempts to fill the gap of information needed by employers to activate a roves of
how to handle questionable notices of workplace injuries. As has been the author’s
experience, often employers wish they had taken affirmative, tangible steps when a notice
was given to attempt to refute notice of injury with questionable details. These cases often
lead to extended periods of disability, doctor shopping, symptom magnification and
Why is so much attention focused on reporting injuries immediately you might ask? The
facts may disturb you. The Hartford Insurance company studied 53,000 cases and identified a
correlation between the cost of the case and the lapse in time between the occurrence of the
event and the reporting of the event to supervisory management. Understand that also delays
the amount of time it took to get to the insurance company adjusters involved so they were
robbed of many early intervention opportunities and investigative approaches were reduced.
The Hartford Study concluded that late reported claims cost more money than injuries
reported promptly:
A study of 53,000 cases indicated the following; when claims are reported
+ 1-2 weeks after occurrence they are 18% more expensive
+ 3-4 weeks after they are 30% more expensive
+ 1 month 45% more costly
A late reported incident should be a red flag to management about the circumstances of the
alleged incident. If someone was genuinely injured in the workplace it seems logical that
they would notify their supervisor immediately. Companies with high focus on loss
prevention and claims management usually have a company doctor selected to deliver care.
This doctor selection is in place because of pre-employment drug testing and pre-placement
physicals. So it is only logical to have the same doctor provide post injury care. In many
states the injured worker may chose their own treating physician. However, there is usually
statutory provisions to allow the employer to have a second medical opinion with the
company doctor.

In my experience of intervening in open lost time cases, often when the case was reported
late, reported after the employee was reprimanded, reported by a plaintiff attorney or after
some employer-employee negative event.
When the case finally gets reported to the carriers there is a scramble to make sure the
alleged injured workers receives prompt medical care as is required by statute.
If they have received care and have been taken off work by the doctor there is a rush to
obtain wage information and get it to the carrier so claims personnel can do what they are
hired for- that is pay claims. Now the case is being processed and is quasi- honored by the
carrier and the benefits are flowing.
Hold the line! I submit that the employer should not report the case right away. After all if
the injury was that severe surely the injured worker would have reported the case to receive
the care and benefits that we are now scrambling to provide. I submit that the employer
immediately begin to document every event that occurs from that moment on. The first
response to any request for care and benefits to a late reported case is to explain to the
submitting party, be it an attorney or injured worker that we want to document that this is the
first notice we have been given of any such injury. This forms the factual basis of the issues
that may latter be need in a mediation or trial. Secondly, it should be made clear to the
reporting party that we have a claim management protocol that has already been violated
whereby we (the employer) require that all injuries no matter a how slight be reported
immediately and we have this in writing signed by the worker alleging the injury. Note to the
reader-the tone is changing from one of “Oh let’s get care” to one of “investigation and let’s
get facts”. The words such as “alleged incident” convey a tone of suspicion verses reporting
the injury. The employer must at the first report of notice attempt to get questions answers
such as why was the case not reported when it occurred? Explain to the reporting party that
before we will report this case to our Workers’ Compensation carrier we will perform an
accident investigation.
The employer should ask the worker to come into the office to complete the accident
investigation. This is the best approach because you can read body language and obtain face
to face details in the presence of a witness. If the worker will not agree to come to the office
for an accident investigation the employer should conduct one over the phone. Of course the
accident investigation and the log of events should be documented and updated as new
information becomes available. If the worker refuses to answer any questions which are
typical of an accident investigation such as where, when, why, how the incident happened
that needs to be documented. If a worker, who is a victim of an alleged accident refuses to
give such details, it further supports the suspicion of the incident. Next the employer should
explain that the company requires all injured workers to have a post- accident drug test. The
writer does not mean to automagically build programs here but rather recall that in the
opening we stated that the more safety focused companies have loss prevention programs in
place. If the employer reader does not have such a program it would be a solid suggestion to
pursue the development and implementation of such a program because many states allow for

the denial of Workers’ Compensation benefits in the event of a positive post accident drug
screen. The employer or safety manager handling this late reported alleged incident should
explain to the worker that it is company policy that all reported injuries, after receiving
medical care, receive a post accident drug screen. To not have this performed will violate the
rights of every other employee who did report a past injury on time and did have the drug
screen conducted. So by not forcing the issue in the alleged late reported worker you create a
two headed monster because the policy was not followed and therefore discriminates against
the workers’ who have reported injuries timely and gives the late reported worker a free ride.
This may become an employment law issue if it is discovered by other workers. But our
focus here is on bringing the late reported incident into a more employer- controlled
environment. Once it is reported to the carrier and the worker is represented by legal
counsel, it is my experience that current and future intervention opportunities dwindle. If the
worker refuses to submit to testing you seek to fortify your case that this is another written
signed policy that has not been followed. If the test is positive, benefits may be denied by
law. However, to avoid litigation on the issue many claims personnel require the drug test to
be conducted within 24 hours of the incident. If the claim is reported three days late how can
the employer have had had the chance to obtain a drug screen within 24 hours? Employers
cannot respond to incidents that they do not know about. These are the reasons that create the
need for the up-front, aggressive investigation and questioning of the injured worker who
reported the case late.
The employer should be aware that if a case is reported to them by an attorney, the employer
may not be able to contact the injured worker. Nevertheless, the policies that are in writing
and were signed by the injured worker at hire still apply. The above conversation can be held
with the attorney just as the injured worker. When the attorney begins to understand that you
will not roll over and the carrier will not grant a quick settlement, the plaintiff will
understand that the case has issues that are in dispute.
In the interview with the alleged injured worker or his new found plaintiff representation, it is
important to cover the question of witnesses. This is a crucial part of the accident
investigation that needs to be documented and followed up on. Rarely in our work place are
we absent of the view of other workers. The fact that an incident is unwitnessed is not a
conclusion that the case is fraudulent but rather another brick in the wall of questioning.
Furthermore, the actual location of the alleged event should be pinned down with
investigative questioning and this information documented. If the worker says the floor by
the #3 machine was slippery then the employer should go evaluate the floor. Take pictures of
the area to preserve the condition. Ask other workers’ if they have had any issues with the
surface area. Ask them if they remember anyone slipping or any statements or sounds of
injury. Remember to document everything.
From the information gathered the employer should make a conscious decision of how to
now present this case to the carrier. Please understand that the employer has a duty to report
all cases promptly to the Workers’ Compensation carrier. However, in the best interest of the

carrier and the employer, the employer has the responsibility to protect the assets of the
company and the documented investigation of the facts and details will better allow the
employer to make an informed decision about the validity of a late reported claim. The time
delayed between the late report and the Notice of Injury given to the carrier is an
investment in validation. If after the investigation the employer concludes that the facts
suggest a fraudulent claim, the employer should file a Notice of Injury with a detailed
explanation of the information that supports such a conclusion. Also, the employer should
require the claims adjuster to report back to the employer that if they see otherwise, that is
they will honor the claim as valid, then the employer should appeal to the claims adjusting
firms management, the insurance agent and if needed the state insurance department.
Request the carrier to provide an Accident Investigator, which is an educated and skilled
representative who will come to the place of employment, interview workers, observe the site
of injury and communicate with employer management. Then they will provide a written
report back to the carrier. To stop the toll from running with regards to the late payments of
benefits and the violation of statutes the carrier can issue a “Reservation of Rights Letter” to
the alleged injured worker. This means that the carrier is investigating the incident and the
carrier may pay for the first medical visit so they can now obtain records but they reserve the
right to deny the case if circumstances support such a denial.
There is a common misconception that if we turn the case over to the carrier promptly that
will protect our interest, they will identify fraud, that they will have an action plan to move
the case forward expeditiously. Understand claim adjuster’s handle many, many cases and
their workload is often such that they can not spend as much time on a case as is warranted.
This is an industry issue outside the scope of this article. Please be advised that the claims
adjuster can only cook a fine dish with the quality of the ingredients provided.
In the quest for truth the employer should obtain in writing exactly what is the objective
medical finding. That is the medical professional statement of what is wrong with the body
and what is the likely cause of that medical condition. Objective medical findings are
diagnostic test results that indicates a medical condition exists directly related to a workplace
injury. On the other hand, the employer should look for subjective medical complaints which
are symptoms of the mind. Subjective medical complaints are medical symptoms that are not
validated by medical reports and evaluations.
True Story:
I know of an employer who two claims reported late with different outcomes.
Case one:
This incident was reported late, a few weeks after the alleged incident, and being a good
employer they promptly reported the case to the carrier. The employer required a post
accident drug screen but was told that it was too late as 24 hours had passed and the injured
worker could state he took something illegal for pain. (Now that is convenient!) It is now
litigated and the worker continues to have subjective medical complaints.

Case two:
The worker reported an incident a few weeks after it allegedly occurred. When it was
reported the employer required the injured worker to have a drug screen which, came back
positive. Based on the positive test, the employer terminated the employee and stated in a
letter that he forfeited his rights to receive WC benefits. They reported the case to the carrier
for reporting purposes only. The employer has not heard back from the employee.
Please understand that I am not suggesting that employers make coverage decisions and deny
cases. It is the intent of conveying this story that when the employer is aggressive at the time
of the late report, the outcome can be modified from one of simply fraudulent activity to one
of case denial.
Ideas to prevent fraudulent claims:
■ Screen and Hire consistently and comprehensively
■ Have new workers sign off that all incidents must be reported immediately
■ Develop and implement a Drug Free Workplace program
■ Develop and implement a safety program
■ Hold and document safety meetings
■ Have workers sign a No-accident certification stating they leave daily/weekly with no
■ Develop and implement a exit interview process where exiting workers declare no injuries
have occurred
■ Develop a rapid response to late reported injuries program
■ Centralize claim reporting to one person who has been educated on this process
So when an alleged incident is reported late, the employer should not immediately report the
issue to the carrier until the employer has done significant due diligence to determine the
factual and causal factors of the late reported event. The rush to get the case reported should
be changed to a rush to obtain and document facts that will provide the basis of a possible
denial. Now common sense needs to prevail, this is not a method to get employers out of the
negative ramifications of legitimate cases. If the injury was witnessed by a credible employee
that is a high probability event that the case is legitimate. If there is a valid and viable reason
that the injured worker could not report the case, that also must be taken into account. The
purpose of this information is to prevent fraudulent claims from being honored by the carrier.
Often, employers look back over cases after significant benefits have been paid and wish they
had done things different. The time to establish a defense it at the time of the late report.
The FBI estimates that 10 percent of insurance claims contain some element of fraud.
Workers’ Compensation cost the nation $5 Billion nationally. So if fraud is 10% of a 5
Billion dollar industry, that would mean it is a $500 million dollar a year business.