The California Department of Insurance announced it has awarded $34.9 million in grants to 37 district attorney offices representing 42 counties in California to combat workers’ compensation insurance fraud. The award is an increase over the $31.8 million awarded statewide last year. The grants, funded through employer assessments, support law enforcement efforts in investigating and prosecuting workers’ compensation insurance fraud.
The three highest awards this year were in Southern California with Los Angeles receiving $6,458,643, San Diego $4,990,459 and Orange County at $3,966,000. At the low end of the list, Sonoma was awarded $66,800, San Luis Obispo $54,419 and Siskiyou $52,992.
The grants are performance based. California District Attorneys apply for workers’ compensation insurance fraud grant funds. The Commissioner’s grant review panel reviews the applications and makes funding recommendations to the Commissioner, based on multiple criteria including past performance, the county’s problem statement and their program strategy for the upcoming year. The panel sends a recommendation to the Insurance Commissioner, who either accepts or amends the panel’s recommendation. Upon completion, the Commissioner’s recommendation is submitted to the Fraud Assessment Commission for their advice and consent, and then the grants are awarded.
The Fraud Assessment Commission (FAC) is charged with allocating funding to fraud prosecutors statewide. The governor appoints members to the FAC who serve four year terms or until the governor appoints a replacement. The FAC meets 3-4 times per year (typically January, June and September). Meetings are generally held in Sacramento. The last meeting was June 17.
Presently, the commission is composed of seven members, consisting of two representatives of organized labor, two representatives of self-insured employers, one representative of insured employers, one representative of workers’ compensation insurers, and the President of the State Compensation Insurance Fund, or his or her designee. The Governor recently reappointed Joel Sherman, the Director of Safety, Workers’ Compensation and Regulatory Compliance for Grimmway Farms to the FAC where he has served since 2010.
The California Department of Insurance is required by law to report workers’ compensation fraud convictions to its website. These postings provide some feedback on the effectiveness of fraud prosecution efforts.