Indemnity miscalculations, safety shortfalls plague comp

About two-thirds of payments made to injured workers in New Jersey were incorrect, according to an audit report issued Thursday by the state’s Office of the State Comptroller.

The audit pegged “inconsistent and informal processes for calculating injured workers’ wages” as the reason behind incorrect figures in 370 of the 554 compensation payments that were surveyed, according to a statement from the comptroller’s office.

Additionally, the Department of the Treasury’s Division of Risk Management, which administers workers compensation benefits statewide, “did not have policies in place to address specific hazards from repeat injuries, potentially leading to further on-the-job injuries and additional claims being paid out,” according to the statement.

In one example detailed in the report, a work facility’s defective gate and door lever mechanisms resulted in 23 workers compensation claims from 2007 to 2019 – resulting in $1.5 million paid out in benefits directly related to the faulty gate.

The audit also found that in 23% of the claim incidents reports surveyed no follow-up action, such as safety officer interviews or site visits, was taken.

The audit also found a lag in reports on medical services for injured workers, as required one business day after a doctor’s visit: the division managing claims received medical reports an average of 32 days after the doctor’s visit, and that 87% of surveyed reports did not include an estimated return-to-work date, in violation of a contract with the medical management team.

The statement includes several recommendations including implementing clear and consistent processes for calculating workers compensation benefits, establishing policies to manage multiple claims effectively to prevent potential abuse, improving safety, and closely monitoring the medical services vendor to ensure reporting requirements are adhered to.