Tuesday, 26 August 2014 18:00

Perceptions of Insurance Fraud

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I recently attended a presentation from Sean Clifford, Colorado First Assistant Attorney General, concerning insurance fraud and found some of the presented statistics very interesting. The statistics presented were what Americans’ perceptions were of insurance fraud.

-One out of five adult Americans (about 45 million people) believe it is ok to defraud insurers (insurance companies or providers).

-Nearly one of ten Americans would commit insurance fraud if they knew they would get away with it.

-One out of three Americans say it is ok for employees to stay off work and receive workers compensation benefits because they feel pain, even though their doctor returns them to work.

-One out of five employed workers say they have been aware of fraud in their workplace.

The FBI reports that the total cost of insurance fraud (non-health insurance) is estimated to be more than $40 billion per year (yes that is billion with a “b”). Additional conservative estimates for insurance fraud including health insurance come out to be roughly $80 billion. These costs of fraud are passed on to all of us in higher premiums, service fees and costs of goods. Insurance fraud is seen as a “low risk – high reward” crime by its perpetrators, resulting in rising claims year over year. The Colorado AG office has seen an increase of 24% in referrals over the past year.

 Don’t be like the reported two-of-five people who are “not very likely” or “not likely at all” to report someone who defrauded an insurer (Coalition against Insurance Fraud). Help reduce this rising cost to all Americans by reporting suspected fraud to the state or local authorities, insurers or consumer watch agencies. Additionally clients of StaffScapes should report any suspected fraud or other concerns to their representative as soon as possible.

 Included below are some additional resources regarding insurance fraud:

Colorado Attorney General website

Additional statistics from the Coalition against Insurance Fraud

What insurance fraud is and how to report it, from NAIC

Wednesday, 13 June 2007 18:00


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Nothing can derail a healthy balance sheet faster than the cost of defending an unexpected lawsuit.

Prudent companies carry liability insurance and budget a certain amount for legal expenses, but a type of litigation that often catches small businesses by surprise is the area of employee lawsuits — and they’re on the rise. As a growing number of employees and employers find themselves battling over their differences in the judicial system, litigation costs for businesses have increased drastically. These costs are both direct, in the form of the actual expense of litigating a case and potentially owing damages, and indirect, from the negative impact of the conflict on employee morale, job satisfaction and, ultimately, business performance. It has therefore become imperative that companies develop strategies for minimizing the costs of employee litigation.


Everybody would like to avoid lawsuits, but simply hoping that employees will be sufficiently satisfied with their work to forego legal action is a gamble, not a strategy. The best way to avoid employee litigation is to proactively evaluate and align your employment practices to remove the sources of workplace conflicts, establish processes for documenting your employee relationships, and resolve disputes before they lead to litigation.

Shifting to a proactive approach to employment disputes requires a three-phase strategy:

Identifying the primary reasons for litigation

Analyzing what drives your employees to resort to litigation will enable you to begin thinking strategically about how to prevent lawsuits. In this phase, you must determine whether there are systemic problems in your business that may be leading to high litigation levels, then devise methods for reducing employees’ tendency to resolve disputes through the courts.

Recognizing potential legal pitfalls

Employer-employee relationships are filled with blind spots that can lead to the filing of a lawsuit. Hiring, managing and firing practices all have legal considerations, some of which can be overlooked. By understanding all the requirements and incorporating them into your employee management practices — not merely paying them lip service — you may be able to avoid the pitfalls in each stage of employment and drastically reduce the incidence of employee lawsuits.

Implementing prevention tactics

Having recognized the primary drivers of employee use of the court system and the common legal blind spots in employee management, you must implement proven prevention tactics. These tactics may include establishing internal conflict management systems, instituting additional training, and continually auditing your practices to measure their thoroughness and effectiveness. The goal of strategic employee management is to reduce costs and improve business performance. With that in mind, a strategy for reducing employee litigation offers an excellent cost-benefit proposition for achieving both objectives.

Litigation is on the rise for state overtime compliance.

CCH Human Resources Management reports that claims of state overtime violations are increasing due to the attention that the new white-collar regulations of the Fair Labor Standards Act (FLSA) received. The change caused many plaintiff’s attorneys to focus their efforts on the differences between the federal and state requirements. Steven S. Greene, managing member of the law firm of Helms & Greene, LLC, while speaking at WorldatWork's 2007 Conference and Exposition, stated that attorneys are exploiting the material differences between the federal and state standards, causing settlements and verdicts to soar.

StaffScapes, a Colorado based Professional Employer Organization (PEO), guides our clients through the complicated maze of human resource management, including state and federal labor law compliance. Please contact us at 303-466-7864 or This email address is being protected from spambots. You need JavaScript enabled to view it. to discuss what our services can do for you.

Monday, 24 May 2010 18:00

Litigation & EEOC claims

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Let’s face it, litigation is a fact we all have to deal with.  And, if you are a business owner, chances are even greater that at some point in your career you will be directly impacted.  Lora Manternach, Benefits Administrator for StaffScapes, Inc. recently attended a legal updates seminar presented by Fisher & Phillips, LLP.  Here’s a few key statistics that they shared that you need to know:
1.    Lawsuits are up almost 400% over the past 20 years
2.    Most common target for lawsuits is private employers with 5-100 employees
3.    In federal court, 67% of all awards exceed $100,000 with the average compensatory damages awarded at almost $500,000
One large area of litigation centers around EEOC (Equal Employment Opportunity Commission) claims.  As expected, filings have increased and in fact set a record high of 95,402 in 2008.  This marked a 15.2 % increase from the year before.  The response is that the EEOC has become more aggressive aided by a $23 million dollar budget increase.  After hiring an additional 300 employees, the EEOC has collected $274 million, filed 290 “merit” lawsuits, focused additional attention to class actions and systemic violations and worked to change enforcement policies.
What’s the best way to mitigate potential claims?  We recommend establishing policies and procedures and/or making sure current handbooks are up to date.  Keeping consistent is key in how you deal with daily operational situations.  For further assistance, please contact StaffScapes, Inc. at 303-466-7864 or This email address is being protected from spambots. You need JavaScript enabled to view it..