Amicus Committee Report
By Daran P. Keifer, Kreiner & Peters Co.
2009 was a rough year for subrogation rights in the United States, as we saw many more bills across the various states and even in Congress, which sought to undermine or eliminate subrogation rights. NASP continues to expand its influence as the premier resource for education about “subrogation” and its importance to society. Your Amicus Committee’s efforts in various states prompted other organizations to consult and rely on NASP for education about the vital role subrogation plays. The first quarter of 2010 continued the frenetic pace at which states sought to restrict subrogation rights while strengthening NASP position within the insurance community.
NASP’s first challenge of the year came from the legislature in Colorado, which proposed House Bill 10-1168 seeking to codify by statute “made-whole” and “common fund” equitable doctrines. Bill 10-1168 originally proposed to ban all subrogation claims by eliminating the rights of subrogated carriers to pursue directly the responsible third party.
On behalf of NASP and with the assistance of John Karr and Brandon LaSalle, both with American Family Insurance, President Elect, Kenneth Levine, and myself spent the day at the Colorado state capitol and testified before the House Judiciary Committee in opposition to this bill. NASP member, Roger Moore, appeared and testified as well before the Judiciary Committee as a citizen of the state and subrogation attorney. As a member of NASP, we are all ambassadors of subrogation who can educate our communities and state about subrogation rights.
After much debate during the day, Bill 10-1168 was amended to exclude property, auto and worker’s compensation subrogation from its reach. As for health subrogation, the bill was amended to provide some guidance as to the meaning of “full compensation” in the statute. The amended provisions provided for a jury verdict to represent “full compensation” and creates a rebuttable presumption of “full compensation” when recovery is less than limits. This bill went to the governor’s desk on April 19th, 2010 with all indication he will sign it into law by early Summer of 2010.
South Dakota was the next state to attempt to codify “made-whole” through statute. This bill was novel for its short one sentence, which prohibited all subrogation until the insured has first been “made-whole”. The South Dakota bill passed the state Senate only after the Lt. Governor broke the tie voting for the bill. On March 25th, South Dakota Governor Rounds vetoed the bill ending the debate for 2010, but we will see this bill again in future legislative session.
New Hampshire followed the lead by introducing House Bill 1259, which sought to require all subrogated entities to reduce their recovery by at most one-third for attorney fees for the insured’s attorney. This bill sought to codify the “common fund” doctrine by statute and would have applied to Medicaid, contract subrogation and statutory subrogation involving medical payments. This bill remains pending.
Louisiana hopped on the anti-subrogation bandwagon through the introduction of Senate Bill 578. This bill is quite unique since it prevents auto, property, self-funded entities and others from paying or reimbursing health subrogation claims without the written consent of the injured party. While not eliminating subrogation, the proposed Bill 578 would make it nearly impossible, since the injured party must agree to reimburse the health subrogation claim.
In the midst of all this anti-subrogation legislation, NASP has strengthened our education reach serving as a resource for other trade associations. We worked with Property Casualty Insurers (PCI) in both South Dakota and Colorado. NASP will be presenting a national webinar for the National Association of Mutual Insurance Companies (NAMIC) in early May about anti-subrogation efforts and legislation. The newly-created “Fact Sheets” regarding subrogation have been used by other organizations to assist in their efforts to preserve subrogation rights. NASP’s stature has evolved within the insurance community as the foremost authority on subrogation rights and their importance.
Our connection with other organizations in the industry also ensures NASP members know about all potential threats to our profession. These connections increase the ability of NASP to make sure our members can respond to subrogation bills quickly. Despite all our hard work and time from the numerous volunteers, the NASP Amicus Committee is only as good as you, the members, make it.
We need you to contact us should you hear of a potential bill; contact us if you hear of a case that may impact subrogation rights; or contact us if you know of someone who needs help understanding the role subrogation plays in our society. If you need to reach out to Amicus Committee, please go to the NASP website at www.subrogation.org. You can always email our Executive Director, Leslie Wiernik, with any issues and she will make sure they get to the right committee members.
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