As found in multiple cases in Oklahoma, an insured who quickly settles with a liable third party (tort-feasor) will eliminate any and all opportunities for its UIM carrier to subrogate or seek reimbursement for paid claims, against third party policy limits. Read more
Colorado:
June 5, 2008, Colorado Governor, Bill Ritter approved Senate Bill 11, abolishing subrogation for all medical payment coverage under auto insurance policies to be in effect of January 1, 2009. The new Colorado law will be in effect as of January 1, 2009. Read more
Cooper v. Premera Blue Cross, Slip Copy, 2008 WL 2180148 (W.D.Wash.) (May 23, 2008) addresses a risk often overlooked by plan participants when debating over their benefit plan’s right of reimbursement from other liable insurance carriers.
Cooper suffered multiple injuries while he was a passenger involved in an ATV accident and applied for benefits through his own auto carrier, Allied Insurance, because the driver’s vehicle was uninsured. Cooper received $64,200 for medical expenses and lost wages through his PIP and UM coverage. Read more
by Ron E. Peck, Esq.
In the case of Osborne v. Jauregui, Inc., the Texas Court of Appeals, Third District at Austin, has enforced the holding of Fortis Benefits v. Cantu, 234 S.W.3d 642 (Tex. 2007), and espoused an anti-double recovery policy, (Tex.App. - Austin, Aug. 29, 2007 & April 17, 2008 - No. 03-04-00813-CV). This represents yet one more victory for subrogating insurers, and those that hope to see the costs of insurance remain within reason. Read more
Following on the heels of our previous post, CNN Anderson Cooper posted an update advising that Wal-Mart has decided to waive its right to recover the funds in controversy.
http://ac360.blogs.cnn.com/2008/04/01/wal-mart-tells-brain-damaged-woman-keep-the-money/
While reducing or waiving a lien on a case by case basis is certainly not unusual, doing so now that this case has attracted so much attention may hurt Plan rights to subrogation in future cases. Hopefully, this will not set an unofficial precedent whereby every patient with a sad story publicly contests the Plan’s rights to reimbursement. If it does, the costs of providing employee benefit plans will surely skyrocket. In the end, it is the employees who pay for “double dipping” when their contributions need to increase, or the Plan is dissolved.
By Ron E. Peck, Esq. and Adam V. Russo, Esq.
As many of you have no doubt seen, The Wall Street Journal published the story of Deborah Shank and her employer, Wal-Mart, some months ago. In a nutshell, Ms. Shank was severely injured in a car wreck. Her substantial medical expenses were paid for by the Wal-Mart self-funded benefit plan. In the meantime, Ms. Shank’s family sued the insurance carrier of the truck that collided with her. They settled their claim for $700K of the $1 million policy limit. Part of their claim was for medical expenses; (expenses they sought to collect, but were paid for by the Wal-Mart plan). Wal-Mart heard about the settlement, which included monies for the medical expenses, they - not the Shanks - had paid, and sought to enforce their Plan Document’s subrogation / reimbursement provision. Read more
The Minnesota Senate and House both agree that it is essential for victims of the Interstate 35W bridge collapse to be compensated for their losses, however, the amount of proposed settlement funds are in opposition. The Senate bill would establish a $25 million fund while the House bill would establish a $40 million fund. The Senate bill would set a limit on how big the victim’s settlement would be. The Senate bill voids settlement negotiations based on the severity of injuries, loss of income, or pain and suffering for family members, whereas, the House bill proposes no such limitations on individual victim settlements. Read more
In North Dakota, the State’s workers’ compensation carrier was accused of faulty claims handling and administration. Workforce Safety and Insurance was therefore examined by a third party, Marsh USA, Inc., at the behest of Gov. John Hoeven. Marsh determined that the carrier was not unfairly denying injured workers’ claims. Read more
Minnesota lawmakers are in the process of discussing possible compensation to victims of the Interstate 35W bridge collapse to make up for damages including lost wages and medical expenses. If the fund is established, insurance companies that already paid victims’ medical bills might have a right to take some of the money, through subrogation.Insurance companies including HealthPartners, Medica, Blue Cross Blue Shield, who cover “fully insured” businesses (usually private businesses that buy insurance coverage, and when there’s a claim, the insurance company pays), said they won’t fight to seek a portion of the compensation. However subrogation could still cause a threat to victims covered under of “self- insured” businesses. Read more
There is a recent newsworthy item that I wish to discuss, as it is pertinent to our industry. The November 20, 2007 Wall Street Journal featured an extremely negative cover story, relating to the self-insured industry’s subrogation activities under ERISA. These types of prominent news stories do nothing for the self-insured industry except motivate the public to change current ERISA legislation. For those of you who do not know about this case, the story covers a woman’s collision with a semi-trailer truck seven years ago, leaving the 52-year-old Deborah Shank permanently brain-damaged and in a wheelchair. Her husband, Jim, received a $700,000 accident settlement from the trucking company involved. After legal fees and other expenses, the remaining $417,000 was put in a special trust to be used for Mrs. Shank’s care. Read more