The Division of Workers’ Compensation has posted the 2020 DWC Audit Unit annual report on its website. The Audit Unit annual report provides information on how claims administrators audited by the DWC performed and includes the Administrative Director’s ranking report for audits conducted in calendar year 2020.
The DWC Audit & Enforcement Unit completed 60 audits, of which 33 were routinely selected for PAR. In addition, another 27 audits were selected, of which three were target audits based on the failure of a prior audit, and 24 audits were based on credible referrals and/or complaints filed with the Audit Unit. The PAR audit subjects consisted of 9 insurance companies, 11 self-administered/self-insured employers, 33 third-party administrators (TPA), and seven insurance companies/third-party administrators that combined claims-adjusting locations.
The DWC Administrative Director’s 2020 Audit Ranking Report lists, in ascending order by performance rating, the administrators audited in calendar year 2020. Congratulations to the following who were ranked among the top 10 administrative entities at the end of this years Audit:
1. RICA & RICC – Republic Indemnity / Calabasas
2. Sedgwick Claims Management Services / Rancho Cordova
3. City of Glendale / Glendale
4. The Traveler’s Companies, Inc. / Rancho Cordova
5. Golden State Risk Management Authority / Willows
6. ICW Group / San Diego
7. Matrix Absence Management, Inc. / Santa Clara
8. Athens Administrators / Concord
9. Murphy & Beane, Inc. / Culver City
10. City of Santa Monica / Santa Monica
Twenty-one audit subjects (64%) met or exceeded the PAR 2020 performance standard and therefore had no penalty citations assessed. However, these audit subjects were ordered to pay all unpaid compensation.
Twelve audit subjects (36%) failed to meet or exceed the PAR standard, and their audits expanded into full compliance audits of indemnity claims (FCA stage 1).
Five of them failed to meet or exceed the FCA 2020 performance standard, and their audits expanded into full compliance audits of indemnity claims (FCA stage 2), and samples of denied claims to be audited were added. These audit subjects were assessed administrative penalties for all penalty citations.
The other seven met or exceeded the FCA 2020 performance standard and therefore had penalty citations assessed for unpaid and late payment of indemnity.