Report 2017-103 Recommendation 8 Responses

Report 2017-103: Workers' Compensation Insurance: The State Needs to Strengthen Its Efforts to Reduce Fraud (Release Date: December 2017)

Recommendation #8 To: Insurance, Department of

To better ensure the timely and effective use of fraud assessment funds to fight workers' compensation fraud in California, CDI should, by June 30, 2018, develop and implement a process to use its unspent funds to augment funding to district attorneys' offices rather than to offset collections from employers for subsequent years.

60-Day Agency Response

Implemented on February, 2018 and ongoing.

This process will be an additional component of the standard Request for Applications (RFA) (Attachment E) review, grant awarding process and Aggregate Assessment determination.

A revised RFA was generated and has been distributed to all California counties on February 7, 2018 for the current grant cycle. The RFA explains that unused Fraud Division funds at the end of the fiscal year may be redirected to grant applicants. This process will also be explained during February's Grant Information Webinar and county representatives will have the opportunity to ask questions regarding the process during the 2018/2019 Grant Workshops held statewide in March. Applicants will therefore be able to contemplate a possible supplemental award during the grant period, and style their applications accordingly.

After the close of the fiscal year, when the amount of any unused funds that had been allocated to the Fraud Division has been ascertained, the Commissioner's Review Panel will identify counties that should receive excess funds. The Review Panel will determine recommended eligibility for excess funds based on those grant applications that have the potential to have the greatest impact on workers' compensation insurance fraud activity. The Commissioner will make his/her decision concerning the disbursement of possible additional funds based on the Review Panel's recommendation. As with initial grant awards, the Fraud Assessment Commission (FAC) will be asked to give its advice and consent to the Commissioner's decision.

  • Completion Date: February 2018
  • Response Date: February 2018

California State Auditor's Assessment of 60-Day Status: Fully Implemented

All Recommendations in 2017-103

Agency responses received are posted verbatim.