Injuryboard Commentary - Fraud

Dear Pres. Obama: What happened to the Mortgage Foreclosure Solution?

Bruce Bierhans — Tue, 08 Dec 2009 09:23:22 GMT

On February 16, 2009, I wrote a piece on this site advising President Obama on how to fix the mortgage foreclosure mess. I told him I wasn't a Harvard economist; just a lawyer that represented consumers. In fact, below is a portion of my post containing my recommendations:

"a) Reduce interest rates. You know that all those rates after the 6% margins on LIBOR kicked in; and the choices on the Pick a Payment Option ARMS were simply a fraud and a facade to begin with. Didn't you see the guy on 60 Minutes last night say they all knew it was a fraud? All subprime interest rates should be reduced to market and all loans should be at fixed rates, or the old conventional 3 or 5 year ARMS with reasonable caps. Some people know they'll sell their homes in 3-5 years and should be able to get an ARM based upon their circumstances.

b) Reduce principal. Not doable you might say. Why? Housing prices inflated because of this fraudulent easy money in the first place. Principle should be reduced to 80-85% of actual appraised value (remember, many of the subprime loans were based upon fraudulent appraisals in the first place) . This would also give many a little cushion and the opportunity to stuggle a bit to pay off money they may own on an equity loan. You want to have the government insure the difference between the old principle and the new principle. Why? Let the banks that made the stupid decisions absorb these losses. Of course, shareholders may suffer, but all our retirement accounts have already tanked anyway. Remember Charles Darwin?? Let the strong survive!

c) Bankruptcy: Let bankruptcy court judges have the authority to modify mortgage loans. I know some damn smart bankruptcy judges and have a few of these cases coming up. Can't wait to get the loan officers on the witness stands. I know one mortgage broker at a place formerly known as Hyannis Mortgage (now defunct, of course) that lived off of the Pick a Payment loans and thought they were a great idea. The judge will love to hear her explanations.

d) Bring sound underwriting back into the marketplace. I know regulations were already in place that could have avoided this disaster. However, fill the potholes and make mortgage lending simple and transparent and stop the fraud. Another scam will come around tomorrow, but do what you can to stop this one.

In summary, Mr. President, you need to restore confidence in our financial system, punish the wrongdoers, and give those that qualify a chance to get back on there feet. I know this isn't perfect and your economists will likely rip my ideas to threads, but what do I know. I'm just in the trenches trying to help some good folks try to dig their way out."

That was it way back in February 09. Well...yesterday, the CCTimes had an editorial that lamented the fact that of 315 application packets for loan modifications filed by the Housing Assistance Corporation in Hyannis, only FOUR have resulted in a permanently modified mortgage. Why? a) A mountain of paperwork; b) banks reluctance to permanently modify mortgages, and c) a failure on the part of the feds to be "forceful. The paper recommended that "more forceful steps" are required; that paperwork be streamlined; that there be court supervised mediation and that bankruptcy judges have the right to "cramdown" mortgages. I don't know whether or not the Times read my post; but these ideas are certainly not new. However, one element of my suggestion was that we stop bowing to the very institutions that perpetrated fraud upon the consumer and make them behave as if they actually appreciate the TARP money that WE gave them to avoid ruin.

Our office has been involved in a number of successful modifications. Unfortunately, some have come about as the result of litigation. However, until the President and the Congress engage in "tough love" and show that they actually have a clue about how to handle this mess, it will not be "fixed". The solution is actually very simple. But...what do I know? I just represent consumers.

Bruce A. Bierhans

Originally posted at InjuryBoard by Bruce Bierhans

Dear Pres.Obama:What Happened to the Mortgage Foreclosure Solution?

Bruce Bierhans — Tue, 08 Dec 2009 09:21:20 GMT

Bruce A. Bierhans

Originally posted at InjuryBoard by Bruce Bierhans

The Senate Health Care Debate Continues To Be About Money Instead Of Consumers

Mike Bryant — Sun, 06 Dec 2009 17:05:22 GMT

I've written a number of times about what the issues should be at the heart of the health care debate: making sure more people have insurance, helping businesses that are being crushed by insurance costs, and most importantly, making sure we have good care. Of course, to do these things we have to talk about how to pay for them. But, I've been watching the debate for a week now, and continue to see opposition speakers get up and ignore the consumer. You can't be surprised, considering so many of them have been there for a long time and for the most part never even brought up the health care issue.

Instead it has been a stream of classic Bush/Rove attacks against the lawyers. Today, Sen. Ensign offered an amendment which would limit contingency fees in medical malpractice lawsuits to 33% of the first $150,000 of the total amount recovered by judgment or settlement, and 25% of any amount recovered in excess of the first $150,000 recovered by such judgment or settlement. The amendment also calls for the periodic payment of successful judgments.

Who does this bill help? Less people would be able to bring meritorious claims and the liability insurance companies would save money. Bad doctors could keep making money or at least feel safer in their malpractice work. The defense could spend all the money they want and delay more claims. And when a jury says they are supposed to pay, they get more time and a payment plan to do it. How does this make sense to anyone?

This idea doesn't even directly save the system money. The proponents argue indirect savings, but every such argument has been shown to be inaccurate:

Saving through the reduction of defensive medicine:

Tort Reformers Ask: "What? You asked for an X-ray!" Bah! Humbug!,Steve Lombardi, October 19, 2009 10:14 AM

Saving of reduced junk law suits:

I sn't Tort Reform Only About Frivolous Cases?, Wayne Parsons , October 25, 2009 2:08 PM

Savings through better care:

Health care Reform Must Put Patients First Because Medical Errors Happen All Too Often, Christopher Nace, November 16, 2009 10:00 AM

The shining example of Texas:

Straight Talk on Tort Reform from Texas, Bret Hanna , November 23, 2009 11:20 PM

The contingent fee system is only way that many Americans have any chance of being allowed the "key to the courtroom." People who have already suffered an injury, have medical bills and no income can only fight when they have the backing and support to do so. It is a protection that helps fulfill the basics of the 7th Amendments and protects vital consumer protections.

93,000 people die each year from medical errors. This amendment does nothing to make things safer. It does nothing to insure people have a remedy when wronged. Most of all it does nothing to deal with the real issues of the health care debate.

When the amendment comes up this afternoon, it needs to be stopped.

Originally posted at InjuryBoard by Mike Bryant

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

Tougher Driver's License Requirements in North Florida January First

Eddie Farah — Fri, 04 Dec 2009 00:13:24 GMT

Beginning January first, it is not going to be as easy as it has been in the past to renew or replace your driver’s license in the North Florida’s St. Johns County.

It’s all part of the Real ID Act that was passed by Congress on May 11, 2005. Previously the rules were not as stringent, but now residents will have to provide their Social Security number, their identity, and address.

The Act was passed to help prevent fraud and identity theft and to make it more difficult for terrorists to easily assimilate into the general population. Remember 18 of the 19 Saudi nationals that hijacked planes on September 11, 2001, had valid U.S. driver’s licenses.

Here is what you will need to bring with you as a form of identification – a certified U.S. birth certificate (a hospital birth certificate is not acceptable); a valid U.S. passport; a Certification of Naturalization; or a Consular report of birth abroad. You may have to contact the vital statistics department in the state you were born.

For Social Security – bring a Social Security card; or a W-2 form; or a paycheck showing the SS number or a DD-214; or a school record showing the number or lastly any IRS document that shows the Social Security number.

For your residential address you’ll need the address to be on your license or bring a deed, mortgage or Florida voter registration card. The vehicle registration and title will do as well as a W-2 or 1099 form. Also round up a utility bill with your address or a current insurance policy.

If you’ve legally changed your name you’ll need a certificate from the court of a marriage or court order.

St. John’s County officials realize they are going to hear a lot of complaints for the stiffer requirements but the county says its state law was passed to comply with federal law and there is nothing they can do.

36 states will have to be ready to meet the requirement January 1. #

Originally posted at InjuryBoard by Eddie Farah

Merck is Jerking Investors Around in Securities Fraud Case

Mike Ferrara — Mon, 30 Nov 2009 21:20:30 GMT

Today, lawyers for drug giant Merck, infamous maker of the blockbuster painkiller Vioxx, delivered oral arguments to the Supreme Court saying that their shareholders had waited too long to file securities lawsuits alleging that Merck had misrepresented the safety of Vioxx.

According to Merck’s attorneys, investors should have filed their suits earlier, since information suggesting Merck had committed securities fraud was widely available as early as 2001. (The suits were filed in 2003, just after the two-year statute of limitations had expired, attorneys claim.) Somewhat contradictorily, the attorneys also argue that investors never had enough information to make a case for securities fraud against the company.

At least some of the justices, thank goodness, were dubious.

"Companies can't have it both ways," Justice Anthony Kennedy told a lawyer for Merck.

Justice Stephen Breyer said Merck's position, in effect, would require plaintiffs to file lawsuits before they had enough evidence to back them up. "That doesn't make sense to me," he said. –Wall Street Journal

Vioxx was Merck’s biggest seller until it was withdrawn from the market in 2004 for causing thousands of strokes and heart attacks. Merck ended up settling with former Vioxx users for more than $4 billion.

Merck shareholders are now seeking billions in damages from the company for deliberately misleading them, by downplaying a clinically established connection between Vioxx and an increased risk of heart attack. This in turn caused shareholders to pay artificially high prices for Merck stock—a situation they want rectified.

The Supreme Court is expected to rule on this case by late June 2010. Merck deserves to go down; let’s all recognize these stalling tactics for what they are.

Originally posted at InjuryBoard by Mike Ferrara

Health Care Shouldn't Be Politics As Usual

Mike Bryant — Mon, 30 Nov 2009 16:47:00 GMT

After the vote to send the health care bill to the Senate floor, there was a round of Republican tweets that predicted that the vote would end the careers of Senators that voted for the bill. That is the way to many of the misguided Senators see this issue. It's simply a political game.

They don't care about the 98,000 people that die each year due to medical errors. These are injuries that are preventable. They don't want to talk about the medical errors, or medical negligence, and the resulting medical malpractice.

Instead, they call for people to trade away their rights to get quality, affordable care. The CBO and GAO have stated time and time again that tort reform will do practically nothing to lower costs. They also found evidence that tort reform could lead to worse patient care. Less accountability will never mean better health care. Forty-six states have already passed some kind of tort reform, and costs continue to skyrocket. It clearly doesn’t work.

It all comes down to the old Bush/Rove anti lawyer mantra. The goal should be to lower costs and insure more people. But, it requires leaders that really want to fix the problem and not just use it to grandstand.

Originally posted at InjuryBoard by Mike Bryant

As Heath Care Bill Goes To The Senate Floor Focus Needs To Be On The Consumer

Mike Bryant — Mon, 30 Nov 2009 09:35:00 GMT

This week, the U S Senate will be debating the Heath care bill. It is expected that the usual Republicans will spend most of their time trying to add amendments to change the civil justice system. To cap damages and bar the courtroom door to the average American. It's the old Bush/Rove plan to attack the lawyers.

They will not want to talk about what is really going on. There is no question that America’s health care system is in crisis. Over 40 million people are without health insurance and costs are skyrocketing. Harvard researchers published a paper that concluded that illness or medical bills contributed to 62 percent of bankruptcies in 2007, up from about half in 2001. More than three-fourths of those with medical debt had health insurance.

The focus should be on how to fix the system. How to lower costs and cover the uninsured. So-called tort reform, or limiting patients’ legal rights, will not accomplish either of these goals. It will only make it harder for those injured through no fault of their own to seek recourse.

According to the Institute of Medicine, 98,000 people die every year from preventable medical errors, with countless more severely injured. Congress must put patients first, and not bargain away people’s legal rights.

Originally posted at InjuryBoard by Mike Bryant

U S Senate Debate: Still No Talk About The 98,000 That Die Each Year

Mike Bryant — Sat, 21 Nov 2009 18:30:00 GMT

It's been interesting to watch the U S Senate debate today. There is more to go, so I'm sure they might just touch on just about everything. About 30 minutes ago, Senator McCain started the fraudulent claims that medical malpractice reform would make a significant difference. Sure, half of one percent savings by eliminating all claims would be a great difference. To your Insurance contributers Senator McCain.

Let's talk about the 98,000 people that die each year due to medical errors. Let's go after those numbers and reduce them. You do that and you will bring down malpractice claims. You will get rid of the few doctors that do a majority of the malpractice. You will save lives.

We will see how the rest of the night goes. Hopefully, it will get around to what is best for the American consumer.

Originally posted at InjuryBoard by Mike Bryant

Report Says If You Eliminate Lawsuits The Defendants Save Their Money And Make More

Mike Bryant — Sat, 21 Nov 2009 15:05:00 GMT

Republicans are touting a report from the Congressional Budget Office that if you cut malpractice claims, there will be money saved. I would go further and say that if you eliminate all lawsuits, money will be saved. Defendants across the land could rejoice. But who will save the money?

- The wrongdoer who was going to be forced to pay and their insurance company?

Anyone else?

- Society won't because they will have to bare the burden of the injured who cannot seek relief from those who are negligent.

- The injured won't as they will have to bare what they can of the costs of their losses.

- Our system won't as a constitutional right of redress in court is stripped away.

So how about just a little bit of change? Maybe damage caps. Look at the list again and ask the same questions. You will get the same answers. Maybe you only strip the Constitutional protection a little bit, but hey it's only a right.

We do need to pay for a health system. So maybe the trade off needs to be looked at. How exactly does tort reform do that? Does it add money directly into the system the way that administrative and red tape changes do? Only if you accept the folly that fraudulent defensive medicine really exists. But accepting that as true, wouldn't you have to go back to eliminating the suits to make that really work?

Would the fantasy doctor who used to worry about lawsuits, so much that he did unneeded and criminal tests, now suddenly feel free to do the right thing? Who will that right thing benefit if we already know that this doctor doesn't seem to be bound by medical ethics?

I know we will get those dirty lawyers who give money to those dirty Democrats. I guess if you expect those two groups as being true enemies, I'm surprised you read this far. But since the Democrats would have to pass the bill and it will be up to us lawyers to still protect you when you are injured or wronged, you better go back to that original plan of eliminating every suit. "Start that revolution" , as Shakespeare is sometimes half quoted. Oh and make those wrongdoers oh so happy.

Originally posted at InjuryBoard by Mike Bryant