Charlottesville Personal Injury Lawyer - claims

Guardian Insurance Cancels Policies in Certain States

Greg Webb — Sun, 25 Oct 2009 18:19:05 GMT

Guardian Life Insurance, a New York-based insurance company, has begun canceling lines of coverage and specific policies in entire states in order to avoid paying high-cost claims; they are canceling coverage in entire states, such as Colorado, and certain policies in states such as New York, New Jersey and South Carolina because they are barred from discriminating specifically against policyholders that file large claims each month. The company only took aim at the plans whose claims were the highest.

For example Guardian discontinued its coverage of Ian Pearl, a muscular dystrophy victim, because his medical care costs about $1 million a year. In an e-mail, a Guardian Life executive called such high-cost patients “dogs” that the company could get rid of. A federal court has deemed this action legal, so unless the federal Department of Health and Human Services decides to intervene, Pearl and many like him will lose their coverage on December 1. A Guardian spokesman claims the policy Pearl had, which offered unlimited home nursing, became too expensive for new small-business customers to buy so the demand was diminished and a new plan was instated; the spokesman went further to state that neither Medicaid nor Medicare offer twenty-four hour home nursing. As a last resort, Ian can be admitted to the hospital under Medicaid, however his parents feel this is a death sentence since Ian needs one-on-one medical care.

Ian’s father claims Guardian Life Insurance have been trying to find a way out of paying Ian’s medical costs for years, sending private investigators to his workplace and to the family’s home to try to catch them in a lie. Guardian Life Insurance, which is a 150-year-old mutual company, reported profits of $437 million last year, a 50 percent increase over its $292 million profit in 2007. According to its annual report, it paid dividends of $723 million to policyholders and had $4.3 billion in capital reserves. The company's investment income totaled $1.5 billion that year, a small increase from the year earlier.

In July, Judge William Pauley, of the U.S. District Court for the Southern District of New York, ruled in Guardian’s favor saying the move by the insurance company was meant to increase its competitive position by reducing what it paid out in claims; this would help lower the overall rates and allow them to compete for more business. The judge also found that the Health Insurance Portability and Accountability Act (HIPAA) could only be enforced by the Department of Health and Human Services and private citizens cannot sue under it, as the Pearl family was attempting to do.

Guardian executives claimed they were no longer offering the plan Ian Pearl was under because it was too expensive and small businesses were not willing to purchase it. As a result, they were forced to offer different plans. The Pearl family is continuing to pursue a trial in order to get Ian’s policy reinstated.

In a recent flip-flop, probably because of media pressure and the public outcry, Guardian reversed its position and stated that it would restore Ian's policy. Guardian also apologized to Ian and his family for what occurred, and also for calling the policy a "dog" in internal emails.

One question remains for this writer: what about the others that have had their policies canceled because of Guardian's internal policies? Will Guardian only restore the policy for which a public outcry is made?

Originally posted at InjuryBoard by Greg Webb

Private Insurance Bureaucracies Abusing the System?

Greg Webb — Wed, 30 Sep 2009 14:52:07 GMT

A House subcommittee held a hearing last Tuesday regarding private insurance bureaucracies’ abuse of the health insurance system. "The hearing was part of a continuing Democratic effort to promote an overhaul of the nation’s health care system by focusing on alleged abuses by health insurers" reported The Washington Post in a September 17 article entitled, "House Subcommittee Hearing Focuses on Alleged Insurer Abuses".

The need for the hearing stemmed from "the actions of insurance company bureaucrats in causing needless delays and denials for coverage for prescribed treatment," said Rep. Dennis Kucinich (D-Ohio), chairman of a House subcommittee on domestic policy.

Jim Jordan, the subcommittee’s ranking republican, said that he feels insurers cancelling policies on policyholders when they become sick is, naturally, "inexcusable." He also noted that he feels "most Americans instinctively realize that trading some challenges with the insurance companies for the bureaucracy of the federal government is not the solution." Despite the Republican stance that "legislative proposals would put government bureaucrats between patients and doctors," the hearing was effective in showing that "patients now contend with private insurance bureaucracies."

When questioned about how much they were paid, some insurance company executives were expectedly withdrawn. Executives were given the choice to either answer at the hearing or submit their answers in writing.

That didn’t stop Colleen Reitan, executive vice president of Health Care Services Corp. from sharing, however. Her company does business as Blue Cross and Blue Shield of Illinois, New Mexico, Oklahoma and Texas, and she confessed that she makes $728,000. Rep. Patrick J. Kennedy (D-R.I.) claims that what he finds so disconcerting about all of this is that Cigna's head earned $11 million last year. Rep. Kennedy also believes that the insurance company earnings are coming from denied claims.

As an example, Kucinich cited the story of cancer patient Esther Dardinger. Esther was successfully undergoing chemotherapy treatment when her insurer, Anthem Blue Cross & Blue Shield, decided to stop paying for it. "The decision was based on a 10-minute review of the case, according to court records" reported The Washington Post. Although she appealed, Anthem maintained its position, eventually leaving her family to cover the cost of the treatment itself. Esther Dardinger died at the age of 49, and "would have lived an additional eight months to two years, ‘maybe longer,’ if her chemotherapy had not been interrupted, her doctor testified during the litigation."

Furthermore, Kucinich cited a recent report done by the California Nurses Association that claims "six of the largest insurers operating in California rejected 47.7 million claims – 22 percent of the total" filed from 2002 through the first half of 2009

The executives of these companies testified last Thursday that, in actuality, the rejected population is much smaller than the percentages claimed by the study. Wellpoint, now the parent of Anthem Blue Cross and Blue Shield of Ohio, said "the nurses association used data from a regulatory filing that included claims initially rejected for any reason – for example, if patients had not met their deductibles or the claims lacked supporting information."

Tom Richards, senior vice president of CIGNA, told the subcommittee, "[o]ur mission is to improve the health, well being and sense of security of the customers we serve."

This writer has to respectfully disagree with Tom Richards. I think CIGNA's mission, and the rest of the insurance industry, is to make money, and hold onto the money they have, as long as possible. That is what I see.

Originally posted at InjuryBoard by Greg Webb

New GM Accepts New Product Liability Claims

Greg Webb — Mon, 20 Jul 2009 08:00:00 GMT

In a bid to win court approval for a quick sale from bankruptcy, General Motors Corp. (GM) has agreed to accept liability for future product defects. Additionally, GM stated that it would change the terms of its proposed asset sale to address the objections raised by twenty suppliers and was working to create a “consensual” agreement regarding the future of a joint-venture plant with Toyota. These statements by GM demonstrate how the auto manufacturer and Obama administration officials have worked to counter some of the more controversial issues raised by the company’s bankruptcy filing. A group of nine state attorney generals, for example, voiced opposition to GM’s reorganization because it would have robbed consumers of protection against product defects under state legislation.

By August, under the GM reorganization plan, a new company would be created to buy the company’s best assets out of bankruptcy. This new company would be 60 percent owned by the federal government, 17.5 percent by the United Auto Workers union and 11.7 percent by the Canadian government and the province of Ontario. The consumers who have lawsuits pending against GM have objected to the reorganization plan since those injury and wrongful-death claims would have to be paid from the sale of GM’s most worthless assets. They further claim the automaker’s insurance would only cover product liability claims of up to $35 million per claim. This amount would not cover the claims of almost any of the lawsuits since many of the cases involved “devastating injuries” from alleged automobile defects.

GM has agreed, however, to continue paying “lemon law” claims so consumers would be entitled to a refund or replacement for defective vehicles. GM has also stated that the reorganized company, which will be nationalized with a $50 billion investment from the United States Treasury, will assume liability for future product defect claims as well.

While it is a good thing that GM will be back in business as (the New GM), it is a tragedy that there are thousands of product liability claims, including those for asbestos-related illnesses, that will effectively be kicked to the curb. All claims that existed before the "reorganization" are likely never going to be paid anything close to acual value. All of those that fall into this latter group probably feel as if the justice system has failed them. I am not sure how I could argue differently at the present time.

Originally posted at InjuryBoard by Greg Webb

Two Consumer Groups Fight Life Insurers’ New Policy to Lower Reserves

Greg Webb — Sun, 25 Jan 2009 18:39:55 GMT

Two prominent consumer groups, the Consumer Federation of America and the Center for Economic Justice, are extremely concerned about the proposal that will reduce the amount of money life insurers have to put aside to pay future claims. According to the American Council of Life Insurance, the proposal would reduce the total number of money insurers need to keep in their reserves by about $25 billion, or about 7% of the industry’s net worth. While life insurers believe this is a good proposal because policies had been overly conservative and inflexible, the consumer groups say these changes will give insurers even more of a reason to not pay all of its obligations under life insurance policies and annuity contracts.

The industry’s attempt to modify the rules has the support of regulators, who believe these revisions will not harm policyholders. The president of the National Association of Insurance Commissioners, the organization that supports state insurance regulators, says it would be irresponsible for his organization to support anything that would make products riskier. Because all states force insurers to comply with accounting rules set by this association, the organization can change capital requirements without the legislation passed by Congress; individual state regulators also have no direct say in the process.

Insurers invest the money they set aside, so due to last year’s sharp price declines for stocks and many types of bonds, the industry’s capital levels have declined too. This may create unneeded stress on the companies’ ability to continue with normal business procedures. Insurance companies do not have as great a safety net as the federal government in case of failure; if there is coverage, the coverage limits are not very high. Also, the Federal Deposit Insurance Corp. pays back depositors within a day of bank failure; however, insurance companies usually take several years to payoff policyholders.

If you would like to learn more about the guarantee policies in your state, please go to the National Organization of Life and Health Insurance Guaranty Assns. website at www.nolhga.com, which has links to each state's guarantee laws.

Originally posted at InjuryBoard by Greg Webb

Delays in Veterans Disability Claim Processing Results in Lawsuit

Greg Webb — Thu, 20 Nov 2008 08:00:00 GMT

A lawsuit has been filed against the Department of Veterans Affairs by two advocacy groups representing almost 60,000 veterans. The lawsuit claims that the VA is taking up to four years to process disability claims, which is causing economic devastation, homelessness, the breakup of families, and even suicide.

The Vietnam Veterans of America and Veterans of Modern Warfare filed the suit Monday, November 10, 2008, asking that the VA be required to pay interim benefits on any claim that takes longer than 90 days to process or six months to appeal. At this time, there are over 600,000 claims pending; the VA takes between six months and one year to make a decision, and appeals can take up to four years, said Robert Cattanach, a partner at Dorsey & Whitney who represents the veterans.

VA spokesman Phil Budahn had no response to the lawsuit. The Government Accountability Office and two independent, bipartisan commissions have reviewed delays in VA disability claims processing in recent years.

Do our veterans not deserve better care? Is not justice delayed, justice denied? I hope that a workable solution can be found for this important issue; these types of delays are incredibly difficult for veterans and their families to endure. I and other members of my law firm have volunteered in conjunction with the University of Virginia School of Law in a pro bono project to help veterans whose claims have been denied. I encourage others, attorneys and non-attorneys, to volunteer whenever possible to help veterans in whatever way possible. Even the smallest kind acts can prove to be a great help.

Originally posted at InjuryBoard by Greg Webb