Will Health Insurance Companies Grab Survivors’ Lawsuit Awards?
Posted: 29 January 2008 01:35 AM   [ Ignore ]  
K. Rove
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This is friggin unbelieveable. Health insurance companies are grabbing up disaster victims’ lawsuit awards to recoup the costs of their medical care.

I have no expertise in the field of medical insurance. All I know is that they get a big chunk of my paycheck every month, based on the calculation tables of risk and costs. So when I fall victim to a disaster, and get a lawsuit award that might help me support myself for the rest of my life, they grab that too? What the hell is that about?

Pretty damn hard to swallow when the head of an HMO walks away with a billion dollar golden parachute.

 
 
Posted: 29 January 2008 02:38 PM   [ Ignore ]  [ # 1 ]  
B. Goldwater
Total Posts:  2126
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thrice - 29 January 2008 01:35 AM

http://tinyurl.com/26cerm

This is friggin unbelieveable. Health insurance companies are grabbing up disaster victims’ lawsuit awards to recoup the costs of their medical care.

I have no expertise in the field of medical insurance. All I know is that they get a big chunk of my paycheck every month, based on the calculation tables of risk and costs. So when I fall victim to a disaster, and get a lawsuit award that might help me support myself for the rest of my life, they grab that too? What the hell is that about?

Would it make you any happier if the insurance companies allowed victims to keep the amounts of cash equal to what they’d paid for their coverage premiums?

The average cost of a typical insurance premium runs about $125.00 per month.  Assuming someone pays for their own health coverage 5 years before getting into a serious accident requiring a lengthy hospitalization and subsequent rehab.  The insurance payments are $7,500 and the hospital bill is well over a million dollars.

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Posted: 29 January 2008 09:55 PM   [ Ignore ]  [ # 2 ]

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K. Rove
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As I said, I’m no insurance expert. I do know that if I contracted cancer, and ran up the same million dollar medical bills, they’d get paid. I don’t know where you’re getting that $125 per month figure. A mediocre family policy in my workplace is $1,200 per month, whether it be husband and wife or the Von Trapp family. And that’s with thousands in deductibles, effectively raising my annual outlay to about $18,000-20,000 per year. If my out of pocket for the year is less than the deductibles, it cost them zippo.

The big issue to me is that the million dollar medical bill is spread out over millions of insurance premium paying members. That’s the whole principle behind risk pooling- some use the benefits lightly, and some use them heavily. I’ve been paying homeowners insurance premiums for decades, and it hasn’t cost the insurance company more than the postage to send out the bill.

If I get crippled in an accident, and the responsible party pays me, that’s my money, as far as I’m concerned, to compensate me for living in pain for the rest of my life and possibly being unable to work again in my profession. I don’t see where it should be going back to somebody I already paid. If the insurance company wants to recoup their loss, they can hire a lawyer and go after them too, on their own nickel.

The 35W bridge survivors are being offered about $400,000 in compensation to agree not to sue the state. If one is no longer able to work, how long would that last? It wouldn’t make much difference in an HMO’s bottom line, but it sure would to a disabled person.

 
 
Posted: 30 January 2008 02:37 AM   [ Ignore ]  [ # 3 ]  
B. Goldwater
Total Posts:  2126
Joined  2006-11-22
thrice - 29 January 2008 09:55 PM

As I said, I’m no insurance expert. I do know that if I contracted cancer, and ran up the same million dollar medical bills, they’d get paid. I don’t know where you’re getting that $125 per month figure. A mediocre family policy in my workplace is $1,200 per month, whether it be husband and wife or the Von Trapp family. And that’s with thousands in deductibles, effectively raising my annual outlay to about $18,000-20,000 per year. If my out of pocket for the year is less than the deductibles, it cost them zippo.

The big issue to me is that the million dollar medical bill is spread out over millions of insurance premium paying members. That’s the whole principle behind risk pooling- some use the benefits lightly, and some use them heavily. I’ve been paying homeowners insurance premiums for decades, and it hasn’t cost the insurance company more than the postage to send out the bill.

If I get crippled in an accident, and the responsible party pays me, that’s my money, as far as I’m concerned, to compensate me for living in pain for the rest of my life and possibly being unable to work again in my profession. I don’t see where it should be going back to somebody I already paid. If the insurance company wants to recoup their loss, they can hire a lawyer and go after them too, on their own nickel.

The 35W bridge survivors are being offered about $400,000 in compensation to agree not to sue the state. If one is no longer able to work, how long would that last? It wouldn’t make much difference in an HMO’s bottom line, but it sure would to a disabled person.

Here in NY we have a program called “Healthy NY” which permits individuals without insurance to purchase a full-coverage policy at $125.00 per month. The policy includes prescription coverage with a $5.00 co-pay.  It’s a better plan than most employer plans. 

But the issue you seemed to be making wasn’t the cost of different policies, but whether or not the insurance companies were entitled to recoup some of their losses when victims or their survivors launched lawsuits against the public for accidents such as happened with the bridge tragedy.  Some insurance policies have clauses in their contracts that permit this, simply because without them, they wouldn’t be able to provide coverage at low prices.  If they have a situation where large numbers of victims are awarded extravagant sums, the expense could easily bankrupt the company.

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Posted: 30 January 2008 09:29 AM   [ Ignore ]  [ # 4 ]

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K. Rove
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"Here in NY we have a program called “Healthy NY” which permits individuals without insurance to purchase a full-coverage policy at $125.00 per month. The policy includes prescription coverage with a $5.00 co-pay.  It’s a better plan than most employer plans. 

But the issue you seemed to be making wasn’t the cost of different policies, but whether or not the insurance companies were entitled to recoup some of their losses when victims or their survivors launched lawsuits against the public for accidents such as happened with the bridge tragedy.  Some insurance policies have clauses in their contracts that permit this, simply because without them, they wouldn’t be able to provide coverage at low prices.  If they have a situation where large numbers of victims are awarded extravagant sums, the expense could easily bankrupt the company.”

In Minnesota, we have MinnCare, which is a program to insure uninsured people, but it’s an income capped program (and actually one of the permitted “pilot programs” permitted under sChip). People making a median family income here aren’t eligible for it.

No, my issue isn’t whether the insurance companies can seek to recoup losses. It’s who they can recoup them from. Under our no-fault auto insurance rules, insurance companies pay their own policyholder’s bills, and then pursue claims against the insurance of the other party, and that’s fine. But- when an individual sues another individual or entity for wrongdoing or negligence that results in a permanent disability, as far as I’m concerned, the resulting award is intended to assist that individual in replacing lost income potential, and compensate them for pain and suffering, as the petitions for damages request. I don’t sue Company X “to reimburse my insurance company for their costs”. I sue them for “pain, suffering, and loss of wages”. My insurance company isn’t going to pay me for those, and they weren’t a party to the suit, nor did they pay any of the costs of pursuing the suit.

I mentioned the 35W disaster, which is a public situation, although private entities will likely get sued as well. If in fact the state settlement was limited to the families of the dead, the award would be approximately $5.2 million.

By contrast, CEO William McGuire of United Health got nearly $1 billion in stock options from the company on his retirement (which is being battled in court). So $5.2 million is going to bankrupt UH? Hell, they spend that every morning before breakfast. And as I understand it, most insurance companies also participate in secondary insurance pools, that provide them protection in the rare event that large losses exceed a certain benchmark in catastrophic cases.

All I’m saying, in the end, is that the issue of reimbursement to the insurer, and compensation to the victim are seperate issues. Lawsuit awards aren’t to compensate medical costs, unless that’s asked for by the plaintiff. They’re to compensate someone for permanent damage to their lives, and to assist them to live something approaching a normal one when someone else changes it permanently for the worse by fault or negligence. Insurance companies have no right to hitchhike on someone elses’ litigation.

 
 
 

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