Alabama Personal Injury Blog - Insurance

Why are Medical Bills so High?

Jon Lewis — Sat, 05 Dec 2009 13:49:34 GMT

Did you know that hospitals and physicians rarely ever receive the amount they charge for their services? Health insurance companies do not pay the actual bills invoiced by medical professionals. Why is that?

We had a client who was injured in a truck collision. His injuries were serious enough to warrant several nights in the hospital and a couple of surgeries. What were his medical bills? Approximately $72,000.00. What did the hospital and physicians get paid? $11,714.01, approximately 16% of the amount billed.

If you had a retail store, would you accept 16% of your prices? Why do hospitals and doctors? Are they over-charging, or are they getting paid too little?

What if you don't have health insurance? What happens then? Well, I can tell you that I handled collections for a hospital about 13 years ago, and if patients came in for emergency treatment and didn't have insurance, we sued them for the full amount, not 16%. Why do private pay individuals have to pay the full amount? I understand why health insurers receive a discount, but an eighty-four percent (84%) discount? What if Bill Gates doesn't want to get health insurance? He can pay any amount billed so why doesn't he receive the same discount as a company like BlueCross?

Is this a form of fraud or misrepresentation? In Alabama, BlueCross BlueShield has such a monopoly on health insurance that they dictate to hospitals and physicians what they can charge for their services. Many doctors speak poorly of BlueCross BlueShield as a result of their influence. Some won't even accept their rates as a result. Should the health insurance companies be setting the rates for medical treatment? Is that capitalism?

I don't have the answers to all these questions, but I think they need to be discussed, especially in light of healthcare reform. What are your thoughts?

Originally posted at InjuryBoard by Jon Lewis

Health Insurance Is A Life Or Death Issue

Pete Mackey — Tue, 01 Dec 2009 08:53:23 GMT

A recent study by researchers based at harvard has found that the lack of health insurance causes almost 45,000 deaths annually in the U.S. The American Journal of Public Health first published the study in its Septemeber, 2009, online edition. The statistics cited by the study's authors are disturbing:

Dr. Steffie Woolhandler, study co-author, professor of medicine at Harvard and a primary care physician in Cambridge, Mass., noted: "Historically, every other developed nation has achieved universal health care through some form of nonprofit national health insurance. Our failure to do so means that all Americans pay higher health care costs, and 45,000 pay with their lives."

Dr. David Himmelstein, study co-author and an associate professor of medicine at Harvard, remarked, "The Institute of Medicine, using older studies, estimated that one American dies every 30 minutes from lack of health insurance. Even this grim figure is an underestimate - now one dies every 12 minutes."

Do you think that any member of Congress would be willing to admit that they could not help an accident victim because they did not have health insurance? Of course not. Now that there are bills to consider, the opponents' cry is "we are for health care reform, but just not what is proposed." The debate over the best solution has been raging for a long time. It's too late in the game to pull out the "we can do better" card at this late stage. Opponents of health care reform have had plenty of time to put forth their own proposals, but decided instead to backseat drive. Time has run out, on the naysayers and on the 45,000 Americans who will not be alive next year without insurance.

Originally posted at InjuryBoard by Pete Mackey

Won Your Workers Compensation Case? Not so Fast

Jon Lewis — Tue, 24 Nov 2009 13:02:11 GMT

What are the insurance companies doing now? They are using "Utilization Review" in order to cut off workers compensation benefits. How does that work?

Well, the Alabama Workers Compensation Act allows for "Utilization Review". That means that the workers compensation insurance carrier can submit your medical records to a third party physician to review and determine if they are related to the injury. If that third party physician says, "No", the workers compensation carrier cuts off the injured employee's benefits.

How does this work in practice? Take my client for example. She had surgery approximately ten (10) years ago. Her workers compensation case was settled, and her medical was left open for future treatment. Typically, that is what happens in workers compensation cases. The person receives medical treatment for the related injuries for the rest of her life.

For ten (10) years, my client has been receiving prescriptions and medical treatment for her injuries. Out of the blue, the insurance carrier sends her records to a foreign doctor in El Paso, Texas who opines that her injuries and medical treatment are not related. So, the insurance carrier, under the "utilization review" provision, cuts off her medical treatment.

Why did they wait ten (10) years? How can this doctor supersede my client's local doctor's opinion when he hasn't even examined her. Shouldn't the "Authorized treating" physician have the final say? The insurance carrier approved her "Authorized Treating" Physician.

This is ridiculous and unfair, but that is how the insurance industry works. Insurance covers everything but the loss. All they want is their money and to hell with everything else - morals, humanity, sympathy, kindness, and generosity. It is all about the bottom line. People talk about "greedy trial attorneys" when they should be talking about "greedy insurance companies".

Originally posted at InjuryBoard by Jon Lewis

Alabama Workers Compensation - Disadvantaged Employees

Jon Lewis — Wed, 30 Sep 2009 13:28:21 GMT

We are in the process of representing an individual who was seriously injured on the job. He has had two back surgeries, and he is 72 years of age. He has been deemed 100% disabled, and we are trying to resolve his case. There is no question about whether or not his employer is responsible for compensating him under the Alabama Workers Compensation Act, so what is the issue?

Well, in Alabama, the employer (really, the employer's insurance company) can try to settle the case or force you to go to court to prove your case. If the insurance company settles your case, they typically pay the settlement in a lump sum amount. If you try the case to a verdict and win, the insurance company can choose to pay the employee weekly or in a lump sum. Usually, they will choose the weekly option because they will benefit if the employee dies before the payout is complete.

What about our situation? What would our client be entitled to in a lump sum? Approximately $170,000.00. What has the insurance company offered? $85,000.00. Why? Money. It is all about the bottom line for the insurance company, and they understand that we, as the employee's attorney, have no leverage to force them to do otherwise.

Why would our client accept a lump sum for less than $170,000? Several reasons. First, he can get a lump sum and know what he has. Second, if he were to die, he knows that his wife will receive something; whereas, if he died during the weekly payments, the payments stop immediately. Third, he doesn't have to try his case to a judge (you cannot get a jury in a workers comp case) and risk the judge thinking he's less than 100% disabled which would dramatically reduce his compensation. Finally, he can incorporate language for Social Security Disability which minimizes the effect on any set off Social Security would get if he received weekly payments.

Why wouldn't the insurance company pay the full value of the lump sum? They have no incentive. They have nothing to lose. If they don't pay it, what happens? They hire an attorney to defend the case. If the attorney wins or gets less than 100% disability, they don't have to pay as much. If they lose the case, they only have to pay the weekly benefits, and if our client were to die, they win. The only way the insurance company loses is if our client lives beyond his life expectancy, and the insurance company has to keep paying his weekly benefits. That is how the insurance company evaluates the claim: what is the likelihood that our client will live beyond his life expectancy. In their mind, our client is just another number, not a human being who is going to have a difficult time supporting his family because of his injury.

There should be some consequence to the insurance company and employer if they force the employee to try the case to a verdict, and the employee wins - at least in a 100% disability case. These types of cases are serious, and the individuals who have been injured have very little recourse and will have a difficult time the rest of their lives. This is their only chance at compensation, and the insurance companies hold their feet to the fire. It is time the employees could fight back and not be forced into settlement situations.

What do you think?

Originally posted at InjuryBoard by Jon Lewis

Males Die More Than Females

Jon Lewis — Wed, 09 Sep 2009 18:13:59 GMT

According to a study done by the Insurance Institute for Highway Safety, more males have died in automobile crashes from 1975 through 2007. Why? Men typically drive more and take more chances such as speeding and driving drunk. The study can be viewed here.

The article has some very interesting facts regarding the statistics relating to males and females in car crashes. For example, "Almost one-third of all motor vehicle crash deaths in 2007 were females. Females accounted for 29 percent of passenger vehicle driver deaths, 47 percent of passenger vehicle passenger deaths, 30 percent of pedestrian deaths, 12 percent of bicyclist deaths, and 9 percent of motorcyclist deaths."

Check ou the study for more interesting statistics.

Originally posted at InjuryBoard by Jon Lewis

The Healthcare Debate - Inform Yourself

Pete Mackey — Sun, 30 Aug 2009 17:17:36 GMT

The healthcare bill being considered seems to have a 1000 angles. One of the problems with tackling this monster is that it has many causes, and most of those causes lead back to a special interest group. When I am having trouble resolving a legal issue, I like to break things down in small pieces, so I can see the forest for the trees. I have been having a problem understanding the nuances of the issues in this healthcare dabate. Bill Moyers helped me out. Watch for yourself - it's powerful information that every family should know about this important subject.

Originally posted at InjuryBoard by Pete Mackey

Wendell Potter - Inside Man

Pete Mackey — Mon, 24 Aug 2009 08:52:51 GMT

Though there has been press coverage of Wendell Potter's changing role, it has been curiously light. In June, he testified before Congress on the abuses of HMOs. Now he's back in the picture, weighing in on the health care debate:

The former vice president of corporate communications at insurance giant Cigna, who left his post, says the industry is playing "dirty tricks" in an effort to manipulate public opinion.

"Words matter, and the insurance industry is a master at linguistics and using the hot words, buzzwords, buzz expressions that they know will get people upset," he told CNN Wednesday.

His former employer CIGNA's response was telling:

A Cigna spokesman would not comment directly on Potter's accusations. Instead, the company released a written statement saying officials agree that health care reform is needed. But the statement went on to say that officials don't see how a government-sponsored plan can accomplish that.

When an industry insider slams the hand that fed him for a long time, you would think that his words would get a lot of play. And if he was an embittered outcast or a fraud, it would logically follow that the evidence of such would be trumpeted 24/7. Maybe he knows what he's talking about. Maybe there really is a problem in need of a solution ...

Originally posted at InjuryBoard by Pete Mackey

Misdiagnosis

Pete Burns — Mon, 17 Aug 2009 14:36:18 GMT

Kentucky Senator Mitch McConnell is yet another anti consumer republican trying to shift the focus from insurance reform by pretending that problems in health care are the result of “junk lawsuits”. A well researched editorial published by a leading newspaper in McConnell’s home state points out that McConnell’s claims are contradicted by empirical evidence. Lexington (KY) Herald-Leader (8/16). So long as opponents of health insurance reform misdiagnose the cause of our problem they will not identify a cure.

Originally posted at InjuryBoard by Pete Burns

Insurance - Name of Game: Avoid Paying.

Jon Lewis — Thu, 13 Aug 2009 16:13:47 GMT

My grandfather had a saying when he would ask, "What does insurance cover?" The answer? EVERYTHING BUT THE LOSS. Isn't that the truth?

What happens to our premium money when we pay for our insurance? Well, some of the money goes to overhead for the company which includes rent, salaries, office equipment, etc. Some of the money goes to pay claims. Some of the money gets invested. And, some of the money goes to lobbyists, legislative campaigns, and judicial campaigns to have laws passed in states and federally which make it more difficult for people to make claims.

Take the collateral source rule in Alabama. The collateral source rule said that a defendant could not ask the plaintiff in front of the jury if she had health insurance. The theory was that the defendant should not be entitled to get the benefit of the fact that the plaintiff had health insurance. However, our Supreme Court abolished the collateral source rule several years ago. So, now, instead of telling the jury that the medical bills were $10,000 and letting the jury decide the value of the case, they are told that Blue Cross Blue Shield paid $4,000 for the $10,000 medical bills, and if the plaintiff wins, the plaintiff only has to pay back $4,000 because Blue Cross has a contract with the provider whereby the provider will take $4,000 for the $10,000. In effect, that reduces the claim from $10,000 to $4,000.

What's wrong with that you may say? Well, first, it lowers the value of the case so insurance companies can pay less on claims. Second, what if you have two individuals with the exact same injuries in the exact same car wreck, and one has health insurance, and the other one doesn't? One can tell the jury that his bills are $10,000, and he may obtain a $40,000 verdict. The other has to tell the jury that her bills were paid by Blue Cross and Blue Shield, and she only has to pay them back $4,000. She is more likely to get a verdict in the amount of $10,000 or less. Consquently, you have two cases with different values when they should be exactly the same.

In workers compensation cases, the insurance carriers have come up with a new plan to stop paying for a person's medical bills for their injuries. After several years (when the case has been concluded several years earlier), the workrers compensation carrier sends the medical bills to an "independent" doctor, and they call this "Utilization Review". The "Independent" doctor ALWAYS says that there is no documentation to support the need for further medical treatment based upon the injury, and they refuse to authorize any further medical treatment. This "Independent" doctor has never seen the patient, has never treated the patient, and is typically in another state. Why do they do this instead of asking the treating physician they authorized to treat the patient? Because, they don't want to pay any longer.

FOLLOW THE MONEY!! It, unfortunately, always comes down to money. These companies want to pay out as little as possible. That is where an attorney comes in. Unfortunately, everyone has bought into the fact that we attorneys are leeches on society when, in reality, we have been hand tied, and we have no recourse to protect against these unscrupulous actions. The only thing that talks to these companies is money, and when jury verdicts are reduced, they don't listen.

Originally posted at InjuryBoard by Jon Lewis

When your Health Insurance Policy is Rescinded

Pete Burns — Sun, 02 Aug 2009 15:38:34 GMT

Post hoc underwriting is the process the medical insurance companies use to cancel a customer’s policy after the customer develops a serious illness. If the individual develops a condition that is likely to result in large medical costs the insurance companies scour the customer’s medical records to see if there is any basis for contending that the customer had a medical condition that materially affected the customer’s health. Even if the customer did not know of the condition and the failure to disclose was completely innocent the insurer will frequently deny the claim.

According to CNN http://edition.cnn.com/2009/POLITICS/06/16/health.care.hearing/ and the NPR podcast on This American Live Podcast at http://podcast.thisamericanlife.org/podcast/386.mp3 the practice has saved the health insurers over $300,000,000 over the last 5 years. That is a huge savings to the insurance industry and a cruel burden to the ex post facto uninsured consumer.

If that happens to you consult a lawyer immediately.

Originally posted at InjuryBoard by Pete Burns