Influential Pockets: The Story of Insurance Companies and County Prosecutors

Sep 15, 2015 | WC & Other Laws

A native of Odessa, Texas, Roy Kyees recently had a workers’ compensation case in that state. Unlike Denver workers compensation attorneys and Greeley workers compensation lawyers, in Travis County, Texas (Odessa is in this county), Texas Mutual Insurance Company has a deal with the Travis County District Attorney. At first blush, this is a decent deal intended to keep workers’ compensation fraud at a minimum and make workers’ compensation insurance affordable for the businesses in the area. If handled properly, of course the reduction of fraud and affordability of insurance are noble goals.

According to Tim Riley, the main investigator of fraud at Texas Mutual, the company simply pays back the prosecutor of Travis County when a fraud case comes up on the docket. Texas Mutual argues there is no conflict of interests because there isn’t enough interaction between the County prosecutor’s office and the fraud department at Texas Mutual. While two enterprising businesses could easily take advantage of such an exclusive relationship, in this case, the partnership is argued as shallow at best.

An investigation by the Texas Tribune, however, points out that the relationship may not be as simple as Texas Mutual would argue. Apparently, there are no written safeguards in terms of the procedure, not much awareness of the conditions of the contractual partnership, and questionable social media posts put on by the lead prosecutor of the insurance fraud unit. All things considered, a person couldn’t necessarily be accused of paranoia for finding this relationship between one of the biggest insurance providers in the state of Texas and a county prosecutor’s office a little too convenient.

Related: What are types of Colorado Workers’ Compensation Insurance?

Roy Kyees had a work injury in an Odessa, Texas, oil field. He’s worked in oil fields since he was 13 years old. Greeley workers’ compensation lawyers constantly have similar cases, as they are fairly common in areas with a good amount of oil production. The difference for Mr. Kyees was his resulting arrest, which was embarrassing to say the least, and the fight he had to put up to prove he wasn’t a criminal for reporting his work injury. He had to endure malicious prosecution and eventually settled, after winning the criminal case cooked up against him. As a result, Mr. Kyees is understandably untrusting of both the criminal justice system in his home county and the workers’ compensation program as a whole. He thinks the relationship is more of a partnership, with the prosecutors taking whatever the insurance company wants them to take.

In general, funding deals like these aren’t entirely unheard-of. Insurance companies often fund local prosecutors’ investigations of their fraud cases because with a touchy question like workers’ compensation, or any insurance claim, the insurance company’s first duty is to defend its insured. For workers’ compensation, this means the company purchasing the insurance. While an injured worker can be considered part of that company, generally, insurance companies look after their own interests and the interests of the employer. Technically, workers’ compensation can be considered a type of “no-fault” insurance so many of the traditional rules about insurance companies being vaguely antagonistic toward anyone trying to collect insurance money don’t apply. But the fact remains that generally, insurance companies don’t want to pay out on claims so it’s in their interest to find as many fraudulent claims from the claimant side as possible. When you file a workers’ compensation claim, you become the claimant.

Usually, insurance companies create a large pool from which prosecutors who specialize in workers’ compensation fraud can draw from. That way, no one insurance company is directly in control of the suits the prosecutor brings. This is the type of arrangement we have in Colorado, as well as Massachusetts and California. Even this kind of deal seems to create a tendency for courts to lean toward insurance companies’ interests against individual claimants.

A case like Roy Kyees’ may not have come up in Colorado because of the larger pool of insurers who contribute to the prosecutors’ fund. The obvious tendency toward insurer interests in courts seems clear, however, and serves to show how difficult it can be to enter the realm of workers’ compensation.

Workers’ Compensation can be difficult, confusing, and very complex. Kaplan Morrell has helped thousands of injured workers since 1997 get the benefits they deserve. Contact us here or call us at 303-780-7329 for your free consultation.