Workers’ compensation insurance fraud reporting.

Senator Archuleta's workers' compensation fraud reporting legislation expands California's fraud detection framework by requiring insurers to notify the Employment Development Department (EDD) when discovering potential premium fraud. The measure adds EDD to the existing notification requirements, which currently mandate reporting to local district attorneys and the Department of Insurance's Fraud Division.

The bill establishes new information sharing protocols between insurers and state agencies. Upon written request, the EDD must provide insurers and licensed rating organizations with detailed payroll data to verify information submitted through workers' compensation claims or policies. The legislation places strict limits on the use of this payroll information, prohibiting its application for purposes outside fraud investigation and prevention. Insurers and rating organizations must furnish any requested fraud-related information to authorized government agencies within 60 days.

These provisions maintain existing confidentiality requirements for shared information while creating additional data verification tools. Authorized agencies receiving information through these channels must continue handling it confidentially unless disclosure serves investigation, prosecution or prevention purposes. The measure preserves current protections that prevent information sharing when it would violate federal law or compromise active investigations.