City Hall could save millions of dollars by tightening up workers’ compensation rules and regulations, audit says
While Ald. Edward M. Burke ran City Hall’s program to compensate injured workers, there was little, if any, effort to “detect potential fraud, waste and abuse,” according to an audit issued Friday — months after Burke lost control of the program following his arrest for attempted extortion in an unrelated case.
For decades, Burke has overseen the $100 million-a year workers’ compensation program, refusing to allow city agencies to monitor the expenses, and even hiring private law firms to fight Inspector General Joseph Ferguson’s efforts to examine the system, in which some city workers have been receiving disability payments for years.
After Burke’s arrest in January, Mayor Rahm Emanuel ousted the alderman as chairman of the City Council Finance Committee, and ended its oversight of the workers’ compensation program. The program is now overseen by the mayor’s finance department.
“After taking initial steps to begin to reform workers’ compensation program, we now have a framework to improve this important city program,” Emanuel said in a statement. “I am confident that the next administration will use this thorough review to make necessary reforms that will stand the test of time.”
Lori Lightfoot, who will replace Emanuel on Monday, declined to comment on the audit from Grant Thornton, the private firm the city hired to review the program.
Burke couldn’t be reached for comment.
While Burke ran the workers’ compensation program, the audit found there was little emphasis placed on ferreting out fraudulent claims “because its fraud risk management processes were largely missing or undocumented.” The alderman didn’t operate a hotline for people to report city workers who may be illegally receiving disability payments.
The auditors suggested Lightfoot’s administration determine if the program should continue to be run by a city agency or turned over to an outside company to evaluate the injury claims, process the medical bills and hire law firms to defend the city.
During its analysis covering 2017 and 2018, the auditors found that “25 percent of all payments made to medical providers were billed by providers outside of the state of Illinois,” many to providers in Arizona.
Also, the auditors found that about 5 percent of the claims were at least 10 years old, involving city employees who continue to collect disability payments.
This article was first published by Chicago Sun Times.