For decades, Chicago’s worker’s compensation program was privately handled by Ald. Edward Burke. It was recently brought to surface that the program was operating under unfair practices, with under-trained staff and a lack of overall knowledge of the program. An audit performed back in January of this year confirmed the widespread suspicions of a corrupt program. It had surfaced that under Burke’s supervision, employees handling worker’s compensation claims were not properly trained in evaluating cases and providing fair and consistent claims.
In fact, the audit identified that the worker’s compensation program has been operating for years in ways that cost the city an immense amount of money to repair. In particular, it was noted that the program was not efficient or effective in identifying fraudulent cases, nor had the function for others to report suspicions of fraud. While most programs offer an anonymous way to report fraud, Burke’s program had no such amenity. This may have led to multiple cases in which payments were made on fraudulent accounts. The audit revealed that the program did not have the standard to prevent fraud or abuse from happening, likely resulting in unnecessary payouts.
Additionally, the auditing company Grant Thornton discovered that there were over 1,000 open cases for worker’s compensation, some dating back to over 10 years old. Unresolved cases mean that the program still may have additional money to pay on top of the false and fraudulent cases that it has already paid out. Not only that but the elongated time taken to resolve legitimate claims inflates their ultimate pay-out sums … to the detriment of taxpayers.
Former Mayor Rahm Emanuel had since decided that Chicago needed a change, and fast. Emanuel provided Chicago’s Finance Department with the duties of running the program, removing it from the City Council Finance Committee. Before leaving office, Emanuel ordered the audit of the program to help new Mayor Lori Lightfoot as she stepped into the office. Lightfoot has since made the decision to hire an outside industry leader, Gallagher Basset, to take over the city’s worker’s compensation program.
Outsourcing the operations of Chicago’s worker’s compensation program will likely have immense benefits for City Hall and the citizens of Chicago, Lightfoot hopes. Hiring a private firm that is sufficiently trained in the act of properly evaluating claims will provide faster responses to lawful claims, and quickly identify those which are not. Lightfoot also hopes that the city may be able to recoup wrongfully dispensed compensation made to fraudulent cases over the previous years. Ultimately, ending the ridiculous program overseen by Ald. Burke is bound to save the city considerable sums.