Health Insurance Issues

Health Insurance issues are becoming more and more important to the victim of auto collisions and other injuries. ERISA is the federal law that governs the offering of insurance through your work. Recent case law has empowered insurers to recover all their payouts when the accident was the fault of the third party. If there is adequate insurance, then there is no issue since the lawyer can obtain sufficient settlement to reimburse the victim and pay the health insurance back.

Unfortunately when there is inadequate insurance, our problems with reimbursement increase. Sereboff v. Mid Atl. Med. Servs., 126 S. Ct. 1869 (U.S. 2006) has set forth that a health insurance plan may write their plan to require that the plan be fully reimbursed if language in the policy was clear and demanded such reimbursement. The case did not set forth what would happen if the amount of money to be paid to the health insurance company would unfairly deprive the victim of their share.

All was then turned upside down in a case of Admin. Comm. of the Wal-Mart Stores, Inc. v. Shank, 500 F.3d 834. In that case a person suffered a brain injury in an accident and Walmart sought all the money from the settlement of the accident case. There was insufficient insurance to pay both the victim and Walmart.

Walmart being the kind hearted company that they were, pursued their reimbursement and WON the right to take it all. The court reasoned that  since ERISA statutes are silent on the meaning of equitable reimbursement, then the the Court affixed a meaning. This Court said, the plan is entitled to write the plan to their benefit AND THE ONLY EQUITABLE ISSUE TO BE CONSIDERED BY THE COMPANY OR INSURER IS THEIR RIGHT TO REIMBURSEMENT, NOT THE EMPLOYEE VICTIMS RIGHTS OR HARDSHIP. What do you think company’s are doing with this, why write that they want all reimbursement. In the last two years, almost all carriers and companies in an ERISA plan are demanding full reimbursement. Insurers and Companies will soon be trampling on all victims.

Don’t expect any help from the Courts on this. My firm is attempting to lead a grass roots change in ERISA law through the national and local legal entities that promote legislation. While Walmart gave all the money back after a deluge of public criticism from the media, the typical client is not as likely to get their money back.

If you have been in an accident, do not hesitate to contact an attorney before you agree to any reimbursement of a hospital or insurance company. Otherwise you could end up with literally nothing.