WBEZ | Insurance http://www.wbez.org/tags/insurance Latest from WBEZ Chicago Public Radio en Federal Workplace Law Fails to Protect Employees Left Out of Workers' Comp http://www.wbez.org/programs/morning-edition/2016-01-21/federal-workplace-law-fails-protect-employees-left-out-workers <img typeof="foaf:Image" src="http://llnw.wbez.org//main-images/worker.jpg" alt="" /><p><div id="res460259030" previewtitle="Schiller, who now relies on disability payments from Social Security to get by, says he's gotten &quot;no justice.&quot;"><div data-crop-type=""><div id="res460259516" previewtitle="After working for Macy's department stores as a building engineer for 21 years, a workplace accident has left Kevin Schiller unable to work since 2010."><div data-crop-type="">Kevin Schiller had no idea what hit him.</div><div data-crop-type="">&nbsp;</div><div data-crop-type="">With 21 years on the job, the building engineer for Macy&#39;s department stores had been in and out of every nook and cranny of many of the retail giant&#39;s Texas stores, including the storage room in the Macy&#39;s in Denton, Texas.</div></div><p>One minute, the stocky, 6-foot-2 Schiller was searching there for a floor drain. The next, he was sprawled on the floor, stunned, confused and bleeding slightly.</p><p>&quot;All I heard was a loud crack and I found myself looking up on people looking down on me,&quot; Schiller recalls more than five years later. &quot;They saw the mannequin hit me in the head and it drove my head into a shelf and then after that my head hit the cement.&quot;</p><p>The mannequin fell 12 feet from the highest shelf. Schiller has hardly worked since, given persistent headaches, memory loss, disorientation and extreme sensitivity to bright light and loud sound.</p><p>He now has to post notes on the front door and refrigerator of his apartment, reminding him to take medications and keep appointments. In case he&#39;s stopped by police, he carries a letter from his doctor that says he may appear drunk due to a head injury.</p><div id="res460259371" previewtitle="Schiller keeps a note on his refrigerator to remind him to take his medicine every morning. After his injury things like bright light and loud noises trigger painful headaches."><div><div><p>&quot;I&#39;m next to poverty,&quot; Schiller says. &quot;I sit in a dark room. I watch TV like an old 80- or 90-year-old person.&quot;</p></div></div></div><img alt="Schiller keeps a note on his refrigerator to remind him to take his medicine every morning. After his injury things like bright light and loud noises trigger painful headaches." src="http://media.npr.org/assets/img/2015/12/18/npr_151117_workerscomp_0117-edit_custom-a8cc6feadeea28a5415a24ea3ade84a1c4b92a08-s400-c85.jpg" style="width: 360px; height: 239px; float: right; margin-left: 10px; margin-right: 10px;" title="Schiller keeps a note on his refrigerator to remind him to take his medicine every morning. After his injury things like bright light and loud noises trigger painful headaches. (Brandon Thibodeaux for NPR)" /><p>Schiller, 54, is among 1.5 million workers in Texas and Oklahoma who don&#39;t have state-regulated workers&#39; compensation to turn to when they&#39;re injured on the job. Millions more may join them as more states consider giving employers the right to opt out of state workers&#39; comp systems.</p><p>As&nbsp;<a href="http://www.npr.org/2015/10/14/448544926/texas-oklahoma-permit-companies-to-dump-worker-compensation-plans">NPR</a>&nbsp;and&nbsp;<a href="https://www.propublica.org/article/inside-corporate-americas-plan-to-ditch-workers-comp">ProPublica</a>&nbsp;have reported, many employers prefer this opt-out alternative to workers&#39; comp, because the state systems, employers claim, result in expensive and long-lasting benefits, costly litigation and delays in treatment of injured workers.</p><p>When employers opt out, they avoid state regulation and write their own workplace injury plans, which make it easier to deny and cut benefits, control medical care and limit appeals of their decisions.</p><p>But don&#39;t worry, employers contend, injured workers are still protected by a federal law &mdash; the&nbsp;<a href="http://www.dol.gov/general/topic/health-plans/erisa">Employee Retirement Income Security Act</a>, or ERISA. The 1974 law initially applied to pension plans but has evolved to include health care and other workplace benefits.</p><p>&quot;ERISA ... says the benefits must be administered in the best interests of employees,&quot; says Dallas lawyer Bill Minick, who leads the movement in Texas and Oklahoma to get employers to opt out of state workers&#39; comp and shift to federal authority.</p><p>Minick and his company PartnerSource dominate a cottage industry, writing and supporting opt-out workplace injury plans, and lobbying for opt-out legislation in other states. ERISA is key to their sales pitch.</p><div id="res460258140" previewtitle="Bill Minick, president of PartnerSource, a Texas company that writes and administers opt-out plans for employers who want an alternative to state workers' compensation laws, says ERISA ensures injured employees are treated fairly."><div data-crop-type=""><img alt="Bill Minick, president of PartnerSource, a Texas company that writes and administers opt-out plans for employers who want an alternative to state workers' compensation laws, says ERISA ensures injured employees are treated fairly." src="http://media.npr.org/assets/img/2015/12/18/3_custom-b9c119f82c272aacf1150e2b7854ff5c783ba3af-s800-c85.jpg" style="height: 239px; width: 360px; float: right; margin-left: 10px; margin-right: 10px;" title="Bill Minick, president of PartnerSource, a Texas company that writes and administers opt-out plans for employers who want an alternative to state workers' compensation laws, says ERISA ensures injured employees are treated fairly. (Dylan Hollingsworth for ProPublica)" /></div><div><div><p>&quot;There are very detailed claims procedures that must be followed to make sure the employee gets a full and fair review of their claim, including opportunity to appeal any denial of benefits and then access to state and federal courts,&quot; Minick adds.</p></div></div></div><p>But ERISA didn&#39;t do much for Schiller, and NPR found the law doesn&#39;t provide the protections promised by opt-out promoters.</p><p>&quot;I was getting no help and no doctors would answer me,&quot; Schiller says. &quot;And they kept on sending me out the door instead of sending me to a hospital. They&#39;d tell me point-blank &#39;we&#39;re here to observe you, not treat you.&#39;&quot;</p><p>Macy&#39;s did not respond to NPR&#39;s multiple requests for comment about Schiller&#39;s case.</p><p>Legal documents, including witness statements, medical records, depositions and internal emails, show Macy&#39;s was skeptical of Schiller&#39;s injury from the very beginning. The company sent Schiller to doctors who concluded he was psychosomatic. One said he was faking.</p><p>In legal filings, Macy&#39;s&nbsp;claimed the accident never happened and implied it was staged. The company cut off all benefits for medical care and lost pay.</p><p>&quot;Why would anybody set that up and put themselves through freaking hell?&quot; Schiller asks. Unable to work and cut off from benefits, he lost his pickup and house.</p><p>&quot;I had made $80,000 a year at times and I&#39;m going to give that up to be on Social Security and food stamps?&quot; Schiller says. &quot;Who would want the life that I&#39;ve got now?&quot;</p><div id="res460259936" previewtitle="Schiller spends time with his Yorkie-doodle, Maxine, at his apartment. As a result of his mounting medical bills and his inability to work, he says he's now &quot;next to poverty.&quot;"><div data-crop-type=""><img alt="Schiller spends time with his Yorkie-doodle, Maxine, at his apartment. As a result of his mounting medical bills and his inability to work, he says he's now &quot;next to poverty.&quot;" src="http://media.npr.org/assets/img/2015/12/18/npr_151117_workerscomp_0008-edit_custom-a1df669f60bb0490bd0ae728b65e2a0169681194-s800-c85.jpg" style="height: 412px; width: 620px;" title="Schiller spends time with his Yorkie-doodle, Maxine, at his apartment. As a result of his mounting medical bills and his inability to work, he says he's now &quot;next to poverty.&quot; (Brandon Thibodeaux for NPR)" /></div><div><div><p>Schiller sought treatment from specialists at his own expense &mdash; about $90,000. They diagnosed a traumatic brain injury. A Social Security judge declared him disabled.</p></div></div></div><div>If Macy&#39;s had stayed in the state workers&#39; comp system, Schiller could have appealed the company&#39;s denial of benefits to the Texas Division of Workers&#39; Compensation and to state courts, where he would have expected an independent review of his case.</div><div>&nbsp;</div><div>ERISA blocks state action &quot;because this is a federal question,&quot; says Richard Faulkner, an arbitrator and attorney in Texas who advised Schiller&#39;s attorneys. &quot;ERISA says we&#39;re the federal law. We&#39;re superior. State law, you&#39;re irrelevant.&quot;</div><div>&nbsp;</div><div>Schiller was turned away by the state workers&#39; comp agency and a state court, which cited a mandatory arbitration agreement in the Macy&#39;s opt-out plan. Most of the 50 Texas plans obtained by NPR and ProPublica contain mandatory arbitration clauses.</div><div>&nbsp;</div><div>So, Schiller first went through an internal appeals process at Macy&#39;s, which is typical of opt-out plans in Texas and Oklahoma. People paid by employers decide whether employers are fair. Macy&#39;s rejected Schiller&#39;s appeals.</div><div>&nbsp;</div><div>&quot;There is no unbiased arbiter, so there can never be any true fairness,&quot; says Bob Burke, a former Oklahoma commerce secretary who leads legal challenges to Oklahoma&#39;s opt-out law.</div><div>&nbsp;</div><div>Workers theoretically have an easier time taking their cases to federal court. But federal judges, under ERISA, must first determine whether employer decisions are &quot;arbitrary and capricious&quot; and can only reject benefits decisions if employers were unreasonable or did not adhere to their plans.</div><div>&nbsp;</div><div>&quot;You really have to show that [benefits decisions are] irrational or contrary to the terms of the plan,&quot; says Karen Handorf, a private ERISA attorney who spent 25 years enforcing ERISA at the Labor Department.</div><div>&nbsp;</div><div>So, as long as employers follow their plans, they will likely prevail. It doesn&#39;t matter how unfair the plans or decisions may be.</div><div>&nbsp;</div><div>Even if injured workers win in federal court, they only get the benefits they were denied. There are no multimillion-dollar awards for pain and suffering. And if workers lose, they can be forced to pay the legal expenses of their employers.</div><div>&nbsp;</div><div>&quot;Consequently, you have to think long and hard about what exposures you may be generating for a client if you attempt some of these ERISA remedies,&quot; says Faulkner. &quot;ERISA can be incredibly dangerous for ... an injured worker.&quot;</div><div>&nbsp;</div><div>Schiller&#39;s attorneys decided a federal court appeal was too risky.</div><div>&nbsp;</div><div>These hurdles to going to court may explain why many employers include in their plans provisions that directly violate ERISA, according to Handorf.</div><div>&nbsp;</div><div>In Oklahoma, almost every opt-out plan includes mandatory settlements. Employers alone decide when to cut off benefits and pay lump-sum settlements. They also decide how much to pay. And if workers refuse to accept, they lose all their benefits.</div><div>&nbsp;</div><div>Injured workers also lose benefits in many plans in both Texas and Oklahoma if they don&#39;t report injuries by the end of their shifts or within 24 hours, even if supervisors are witnesses or the injuries initially don&#39;t seem serious.</div><div>&nbsp;</div><div>These provisions are &quot;an impediment to bringing claims and really isn&#39;t what ERISA is designed to do,&quot; says Handorf. &quot;ERISA is based on the idea that you get your right to make the best claim you can for benefits.&quot;</div><div>&nbsp;</div><div>There&#39;s also some questions about whether ERISA governs opt-out plans. The federal law explicitly states that it does not apply to plans &quot;maintained solely for the purpose of complying&quot; with state workers&#39; comp law.</div><div>&nbsp;</div><div>So, Minick and PartnerSource added a strategic benefit to 90 percent of the opt-out plans in Oklahoma. It pays $1,000 for deaths that have nothing to do with work.</div><div>&nbsp;</div><div>&quot;That&#39;s the magic language to have ERISA apply,&quot; Minick argues, because the plans then don&#39;t &quot;solely&quot; exist to provide workplace injury benefits or comply with state law.</div><div>&nbsp;</div><div>Minick says that any misuse or violations of ERISA will be addressed by federal regulators.</div><div>&nbsp;</div><div>&quot;The U.S. Department of Labor has enforcement authority,&quot; Minick says. &quot;So there are a variety of checks and balances in the process.&quot;</div><div>&nbsp;</div><div>But Faulkner says the agency isn&#39;t paying attention.</div><div>&nbsp;</div><div>&quot;The Department of Labor has civil and criminal authority that if it chooses to exercise it can go in, look at these things and stop it.&quot;</div><div>&nbsp;</div><div>Labor Department officials declined multiple requests for interviews. Spokesman Michael Trupo says the agency &quot;is aware of, and studying, the issues you note.&quot;</div><p>Trupo also says the agency has never litigated a single case involving possible misuse or violation of the law by employers who have opted out of state workers&#39; comp.</p><blockquote><p><span style="font-size:14px;"><span style="color: rgb(105, 105, 105);"><u>From the Department of Labor</u></span></span></p><p><span style="font-size:14px;"><em><span style="color: rgb(105, 105, 105);">Labor Department spokesman Michael Trupo provided the following statement in response to NPR inquiries about ERISA and the opt-out alternative to state workers&#39; compensation:</span></em></span></p><p><span style="font-size:14px;"><span style="color: rgb(105, 105, 105);">&quot;First and foremost, the well-being of workers and their families should be the priority when it comes to workers compensation arrangements. States should not be in a race to the bottom when it comes to minimizing workers comp costs at the expense of workers. To date, the department has no records of receiving complaints regarding opt-out plans.This may be due, in part, to workers not knowing they have rights under the Employee Retirement Income Security Act. If a worker believes they have been treated unfairly in a workers-compensation opt-out plan, they should contact one of our Benefits Advisors at&nbsp;</span><a href="http://www.askebsa.dol.gov/"><span style="color: rgb(105, 105, 105);">www.askebsa.dol.gov</span></a><span style="color: rgb(105, 105, 105);">,&nbsp;or via telephone at 1-866-444-EBSA.&quot;</span></span></p></blockquote><p>The agency has not received a single complaint, Trupo adds, which &quot;may be due, in part, to workers not knowing their rights under [ERISA].&quot;</p><p>ERISA requires employers to inform workers of those rights and of the process for filing complaints. Plans reviewed by NPR and ProPublica typically contain that information, but most are more than 50 pages long.</p><p>&quot;ERISA&#39;s been turned on its head really ... because initially it was passed for the protection of workers,&quot; says Jeffrey Dahl, an ERISA attorney in San Antonio who represents injured workers. &quot;But it in fact has become a shield for employers that operate these plans.&quot;</p><p>When Schiller&#39;s case went to mandatory arbitration, his lawyers worried about a process they consider pro-employer. Arbitration resulted in a mixed decision for Schiller and Macy&#39;s.</p></div><div data-crop-type=""><img alt="Schiller, who now relies on disability payments from Social Security to get by, says he's gotten &quot;no justice.&quot;" src="http://media.npr.org/assets/img/2015/12/18/npr_151117_workerscomp_0131-edit_custom-6fd33b887eb8bb03bdc77efebe4b53fb708bf687-s800-c85.jpg" style="height: 412px; width: 620px;" title="Schiller, who now relies on disability payments from Social Security to get by, says he's gotten &quot;no justice.&quot; (Brandon Thibodeaux for NPR)" /></div><div><div><p>Arbitrator John Allen Chalk Sr. concluded the incident actually happened and resulted from Macy&#39;s negligence. Schiller, Chalk ruled, suffered a &quot;mild&quot; traumatic brain injury and was subjected to &quot;scattered, intermittent [and] non-focused&quot; medical treatment.</p></div></div></div><p>Chalk also said medical records failed to show &quot;any serious attempts to thoroughly examine, diagnose, and treat Mr. Schiller&#39;s job-related injury.&quot;</p><p>But Schiller would likely recover within five years, Chalk ruled. Schiller received $713,000.</p><p>Ted Lyon, Schiller&#39;s attorney, believes his client would have done far better if the case had gone to state court.</p><p>Schiller &quot;would have worked until he was 65, so that&#39;s a million and a half dollars at least,&quot; Lyon says. &quot;In addition to that, [given] pain and suffering damages and the egregious way that they treated him, I could have easily gotten $5 million from a jury in this case.&quot;</p><p>And if Schiller&#39;s case had gone to court, every detail would be public. The mandatory arbitration clauses in opt-out plans impose secrecy. Arbitration hides cases like Schiller&#39;s and shields employers like Macy&#39;s.</p><p>We know the details of Schiller&#39;s case because he decided to talk about it. He wants others to know what can happen to injured workers, despite the promised protections of ERISA.</p><p>&quot;I&#39;m just getting by,&quot; he says. &quot;Thank God for Social Security Disability. And... after dealing with the whole process I went through and nowhere to go ... I mean I&#39;ve gotten no, no justice.&quot;</p><p>Most of the arbitration award paid legal fees, arbitration costs and existing medical bills. The rest is in a trust that pays ongoing living and medical expenses. And most of the award is gone. Schiller says he&#39;ll run out of money before he runs out of time.</p><p><a href="http://www.npr.org/2016/01/21/460257932/federal-workplace-law-fails-to-protect-employees-left-out-of-workers-compensatio?ft=nprml&amp;f=460257932" target="_blank"><em>&mdash; via NPR</em></a></p></p> Thu, 21 Jan 2016 11:11:00 -0600 http://www.wbez.org/programs/morning-edition/2016-01-21/federal-workplace-law-fails-protect-employees-left-out-workers Opt-out plans let companies work without worker's comp http://www.wbez.org/news/opt-out-plans-let-companies-work-without-workers-comp-113344 <img typeof="foaf:Image" src="http://llnw.wbez.org//main-images/optout2.jpg" alt="" /><p><p>Billy Doyle Walker loved working in the sky. He used to say he could see forever, perched high up communications towers as he applied fresh paint.</p><div id="con448584259"><p>Three years ago, working halfway up a 300-foot steel tower at the LBJ Ranch, the panoramic view included the rolling green hills and meadows of the Texas Hill Country. The tower was used by former president Lyndon B. Johnson to communicate with the White House.</p></div><p>Walker&#39;s wife, Krystle Meloy, was 23 then. She was home at the couple&#39;s apartment in New Braunfels, Texas, with their 4-month-old daughter Kaylee, when several of Walker&#39;s co-workers unexpectedly knocked at the door.</p><p>&quot;They just walked in very silent,&quot; Meloy recalls, tears forming in her eyes. &quot;They said Billy fell and he&#39;s on his way to the morgue. And I said, &#39;What?&#39;... I just fell. And we all just started crying.&quot;</p><p>What happened next to Meloy and Kaylee is indicative of an emerging trend in how workers and their families are compensated in the wake of workplace injuries or deaths. Nearly 1.5 million workers in Texas and Oklahoma do not receive state-mandated benefits under heavily-regulated workers&#39; compensation and are dependent instead on alternative, largely unregulated benefits plans controlled by employers.</p><p>State laws in both Oklahoma and Texas allow employers to opt out of workers&#39; compensation and develop their own workplace injury plans. Those plans generally cover fewer injuries, cut off benefits payments sooner, control access to doctors and even impose mandatory settlements, according to an&nbsp;<a href="https://www.propublica.org/article/inside-corporate-americas-plan-to-ditch-workers-comp">NPR and ProPublica investigation</a>. In Oklahoma, we found that most plans blatantly violate the law, yet regulators say they are powerless to respond.</p><p>NPR and ProPublica obtained nearly 120 opt-out plans used by Texas and Oklahoma companies and analyzed how this alternative to workers&#39; comp compares to the system it&#39;s replacing.</p><p>We found&nbsp;<a href="https://projects.propublica.org/graphics/workcomp-company">widespread differences in benefits among employers</a>, and restrictions and requirements that make it easier for employees to be denied coverage. Among the details in some employer plans:</p><blockquote><ul><li>Brookdale Senior Living, the nation&#39;s largest chain of assisted living facilities, does not cover most bacterial infections</li><li>Costco pays up to $600 for external hearing aids, while the cheapest model for sale at Costco costs $900</li><li>U.S. Foods, the nation&#39;s second largest food distributor, excludes any sickness or disease &quot;regardless of how contracted,&quot; potentially allowing the company to dodge work-related conditions such as heat stroke, chemical exposures or cancer</li><li>Managers at Taco Bell can accompany injured workers to doctor&#39;s appointments</li><li>Sears and many other companies can deny all benefits if workers don&#39;t report injuries by the end of their shifts.</li></ul></blockquote><p><span style="font-size:16px;"><strong><a href="http://www.propublica.org/article/inside-corporate-americas-plan-to-ditch-workers-comp">More On This Investigation</a></strong></span></p><p>The analysis also found that many plans in Texas cover medical care for only about two years, whereas workers&#39; comp pays as long as necessary. Plans exclude payments for things like wheelchair vans and chiropractors or for injuries caused by exposure to silica dust, mold or asbestos. Appeals are often controlled by employers.</p><p>&quot;What is being allowed is the employer to have absolute and complete control over every aspect of the system,&quot; says Rick Levy, an attorney for the Texas AFL-CIO. &quot;No negotiation. No compromise. No standards. No due process.&quot;</p><p>Most of the opt-out plans we reviewed in Texas &ndash; officially known there as &quot;non-subscription&quot; plans &mdash; strictly limit payments for catastrophic injuries and deaths on the job. That&#39;s what Meloy encountered when her husband died.</p><p>His employer, Ransor, Inc., paid a lump sum death benefit of $250,000, which mostly went into a trust for their daughter and paid for bills and a place to live. If Ransor had subscribed to worker&#39;s comp, the state-prescribed formula for death benefits could have paid Meloy and Kaylee as much as $1 million during the rest of their lives.</p><div id="res448631802"><div data-crop-type=""><img alt="Billy Doyle Walker with his daughter Kaylee on the day she was born. Four months later he died after falling from a tower he was painting. The opt-out plan his employer uses provided his family with only a quarter of the benefits they may have received under the state's workers' compensation law." src="http://media.npr.org/assets/img/2015/10/14/workerscomp-opt-billy-walker-8d68edba0c498886afd1c5bed031c081207e2bd6-s300-c85.jpg" style="height: 224px; width: 300px; margin-left: 10px; margin-right: 10px; float: left;" title="Billy Doyle Walker with his daughter Kaylee on the day she was born. Four months later he died after falling from a tower he was painting. The opt-out plan his employer uses provided his family with only a quarter of the benefits they may have received under the state's workers' compensation law. (Courtesy of Krystle Meloy)" /></div><div><div><p>Without her husband&#39;s income, Meloy struggles to get by on Social Security and is applying for food stamps, and says the jobs she can get don&#39;t pay enough to cover day care and other living expenses.</p></div></div></div><p>&quot;I feel desperate,&quot; Meloy says, three years after Walker&#39;s death. &quot;When you die that tragically and you&#39;re a good person... I just feel he was worth more. It&#39;s sad.&quot;</p><p>Proponents of the opt-out plans say they are not designed to reduce benefits, but rather to impose some sanity on a bureaucratic system that is expensive, slow and inefficient, and that often winds up forcing injured employees to go to court.</p><p>&quot;We&#39;re talking about reengineering one of the pillars of social justice that has not seen significant innovation in 100 years,&quot; says Bill Minick, the president of PartnerSource, a Texas company that helps draft opt-out laws and wrote many alternative injury plans. PartnerSource also setup opt-out advocacy and lobbying groups, and consults for some of the biggest and best-known employers in America.</p><p>&quot;We can take care of injured workers more effectively, get them back to their families and their work as productive members of society [and] save incredible amounts of money that create new jobs,&quot; Minick adds.</p><p>The opt-out system saves employers 40 to 90 percent in claims costs, according to Minick.</p><p>&quot;It&#39;s not about reducing benefits,&quot; he says. &quot;We can objectively show you that we have saved our clients over a billion dollars against Texas workers&#39; comp over the past decade. When you&#39;re saving that kind of money, you don&#39;t have to get hung up on squeezing the employee.&quot;</p><div id="res448632046"><div data-crop-type="" style="text-align: center;"><img alt="Bill Minick is the president of PartnerSource, a Texas company that helps draft laws that lets companies opt out of state workers' compensation plans." src="http://media.npr.org/assets/img/2015/10/14/workerscomp-opt-bill-minick-1d05a0df8c87f8d90608118f1a8fdfededea3e81-s800-c85.jpg" style="height: 405px; width: 540px;" title="Bill Minick is the president of PartnerSource, a Texas company that helps draft laws that lets companies opt out of state workers' compensation plans. (Picasa/Dylan Hollingsworth for ProPublica)" /></div><div data-crop-type="">Minick&#39;s company had no role in Ransor&#39;s workplace plan. When we told him about Meloy&#39;s plight, his voice softened.</div></div><p>&quot;This is a difficult situation it sounds like,&quot; Minick said, &quot;There&#39;s no occupational injury system that we found yet that will provide perfect results in 100 percent of cases. What we need to consider is what system is going to provide the best result in more cases.&quot;</p><p>As&nbsp;<a href="http://www.npr.org/series/394891172/insult-to-injury-americas-vanishing-worker-protections">NPR and ProPublica have reported</a>, in the past 13 years legislatures in 33 states have cut benefits, made it more difficult to qualify for benefits or given employers more control over medical treatment. Some states went through protracted, repeated and often painful efforts to rewrite workers&#39; comp statutes.</p><p>Opt-out plans provide a different path. A single piece of legislation in each state gives employers the ability to write their own workplace injury benefit plans. They avoid legislative battles over every benefit and gain far more flexibility.</p><p>Texas employers have been opting out of workers&#39; comp for decades. In neighboring Oklahoma, it&#39;s only been possible since last year.</p><p>The changes found in Oklahoma&#39;s opt-out plans include new requirements for reporting workplace injuries. Workers&#39; comp gives employees 30 days to report. Most opt-out plans require notification by the end of the shift or within 24 hours.</p><p>Last March, Rachel Jenkins was denied benefits for a workplace injury witnessed by her supervisor at a company called ResCare. The single mother of four was a job coach and personal care aide for mentally disabled adults when a client was suddenly attacked by another man. Jenkins intervened.</p><p>&quot;I was ... trying to grab this guy off my client because he was beating him,&quot; Jenkins recalls. They fell to the ground &quot;and that&#39;s when I heard my back crack... I had to put all of my strength into this man and that&#39;s when I hurt my shoulder.&quot;</p><div id="res448632777"><div><div><p>Jenkins went to the emergency room and was given pain medication that knocked her out, she says, into the following day. Still groggy, her mother drove her back to work. ResCare sent her to a company-selected doctor and 27 hours after the incident, she called the ResCare injury reporting hotline.</p></div></div></div><p>A ResCare claims representative told Jenkins she was too late &quot;because I didn&#39;t call the number within 24 hours,&quot; Jenkins recalled. &quot;And I kept...telling her I went to the emergency room. They put me on some powerful medicine ... She was like &#39;I understand you got four kids but there&#39;s nothing I can do.&#39;&quot;</p><p>Nothing Jenkins said to ResCare made a difference.<img alt="Rachel Jenkins welcomes home her daughters Kyonna Jenkins, (left), and Ti'yonna Hill from school in Boley, Okla. Rachel injured her shoulder while working as a nursing assistant and was originally denied workers' comp benefits because she reported the incident three hours too late." src="http://media.npr.org/assets/img/2015/10/14/workerscomp-opt-rachel-jenkins2-d3df04c5e23f3a58eb1364ea4eb78c278e066ec5-s800-c85.jpg" style="height: 464px; width: 620px;" title="Rachel Jenkins welcomes home her daughters Kyonna Jenkins, (left), and Ti'yonna Hill from school in Boley, Okla. Rachel injured her shoulder while working as a nursing assistant and was originally denied workers' comp benefits because she reported the incident three hours too late. (Nick Oxford/Nick Oxford for Propublica)" /></p><div id="res448635513">&quot;Everybody ought to report injuries quickly,&quot; says Bob Burke, Jenkins&#39; attorney and a former Secretary of Commerce in Oklahoma who was involved in major overhauls of the state&#39;s workers&#39; comp statutes.</div><p>&quot;But ... just giving the employer the right to ... deny all benefits no matter how serious the injury is because it was not reported to a toll-free number within 24 hours I believe is wrong.&quot;</p><p>Jenkins&#39; supervisor in Oklahoma City complained to corporate officials in Dallas and 16 days after the incident, ResCare agreed to provide benefits.</p><p>&quot;Simply by voicing the concern and by having the claim reviewed informally, it was determined that that was not a good denial. It was not fair to the injured worker,&quot; says Minick of PartnerSource, which wrote the ResCare plan.</p><p>&quot;And so the system worked,&quot; Minick adds.</p><p>That&#39;s not how Jenkins sees it, after enduring 16 days of pain while unable to afford treatment and worried about getting back to work.</p><p>&quot;I went through Hell, a whole lot of pain where I was in tears,&quot; Jenkins said. &quot;I was just thinking about &#39;How am I going to take care of my kids?&#39;&quot;</p><p>Minick, along with a lobbyist for the State Chamber of Oklahoma and an attorney for Unit Corporation, an oil and gas developer, claim credit for drafting the law that brought opt-out to Oklahoma, along with major changes in workers&#39; comp.</p><p>His company, PartnerSource, also wrote 53 of Oklahoma&#39;s 59 opt-out plans, for employers ranging from small health care companies to major national firms, including Macy&#39;s, Swift Transportation, Dillard&#39;s Department Stores, Big Lots and Cabela&#39;s.</p><p>On paper, the benefits in the Oklahoma plans look similar to &ndash; or better than &ndash; state workers&#39; comp. Both replace at least 70 percent of workers&#39; wages. Some plans pay 90 or even 100 percent of wages.</p><p>But benefits paid under opt out plans are taxable, while workers&#39; comp benefits are not. An analysis by ProPublica found that 80 percent of the plans actually provide lower benefits.</p><p>NPR and ProPublica discovered a departure from state law in almost every Oklahoma plan. The law permits lump-sum payments of benefits instead of stringing them out for years. These settlements must be voluntary for injured workers. But almost every PartnerSource plan includes a section titled &quot;Mandatory Final Compromise and Settlement.&quot;</p><p>The provision gives employers the right to determine when to settle and how much to pay. If workers don&#39;t accept the terms, the plans say, &quot;no further benefits will be payable.&quot;</p><p>The state&#39;s insurance department approved every one of those plans.</p><p>NPR and ProPublica cited this inconsistency between the plans and the law in emails and then an interview with officials at the Oklahoma Insurance Department. General Counsel Gordon Amini acknowledges the discrepancy and says the agency hadn&#39;t noticed it until we asked about it.</p><p>Amini also says his agency was powerless to reject plans that flout the law.</p><p>&quot;It&#39;s my opinion that the insurance department does not have the statutory authority to disapprove or deny based on the content of the benefit plan,&quot; Amini says.</p><p>In fact, NPR and ProPublica reviewed more than 2,000 pages of internal emails between the agency and PartnerSource and employers. The emails describe problems with plans and suggest corrections. In almost every instance, the agency only cited errors in punctuation, spelling, grammar and even formatting. There is no mention of the mandatory settlements issue.</p><p>One email between an agency lawyer and a chain of long-term care facilities notes a missing period in a paragraph that causes a run-on sentence. The same paragraph says the employer promises &quot;no interference&quot; with the doctor-patient relationship while also warning workers that seeing their own doctor, instead of a doctor selected by the company, &quot;may result in a complete denial&quot; of benefits.</p><p>&quot;There is no regulation of these plans,&quot; says Burke, Jenkins&#39; attorney. &quot;We can&#39;t as a society say, &#39;Okay, employers, write whatever plan you want to write, provide whatever benefits or lack of benefits you want to, set up whatever scheme you want to administer those benefits, and by the way, no one is looking over your shoulder.&#39;&quot;</p><p>Amini says the agency contacted PartnerSource after we discovered the mandatory settlement language. Minick says PartnerSource is planning to revise that language. But Amini admits that the agency can&#39;t hold PartnerSource to its promise.</p><p>&quot;It&#39;s up to the employee to enforce the requirements in regard to benefits,&quot; Amini says.</p><p>That&#39;s especially offensive to Burke, who is challenging Oklahoma&#39;s opt-out law on constitutional grounds.</p><p>&quot;In every other area of the law some government agency maintains accountability,&quot; Burke says. &quot;It&#39;s asinine to think that any accountability factor would be put on the backs of the victims.&quot;</p><p>The strict reporting requirements were borrowed from similar plans in Texas, where the workers&#39; comp law also gives employees 30 days to report injuries.</p><p><strong><a data-metrics="{&quot;category&quot;:&quot;Story to Story&quot;,&quot;action&quot;:&quot;Click Internal Link&quot;,&quot;label&quot;:&quot;http:\/\/www.npr.org\/series\/385540559\/injured-nurses&quot;}" href="http://www.npr.org/series/385540559/injured-nurses">Injured Nurses: Hospitals Fail To Protect Nursing Staff From Becoming Patients</a></strong></p><p>Two years after her injury at work at a nursing home in Stephenville, Texas, nursing assistant Rebecca Amador is still in pain and out of work.</p><p>It&#39;s &quot;like I&#39;m in a fire and I can&#39;t get out of that fire,&quot; says Amador, now 53.</p><p>The day she was injured, she was assisting a 250-pound man. He was holding on to her when the brake on his wheelchair slipped. Amador bore the full weight of the patient and felt a pinch in her back.</p><p>&quot;I thought, well, it&#39;s been a long day. I&#39;m tired,&quot; Amador recalls. &quot;So I paid no mind to it. I figured it would go away. It usually goes away.&quot;</p><p>But overnight the pain became so bad she could hardly breathe. Early the next morning, she returned to work, reported the injury and was sent to the hospital. But her employer, Fundamental Long Term Care, rejected any further care or benefits saying Amador hadn&#39;t reported the injury by the end of her shift. Only 19 hours had passed.</p><p>If Amador had worked for Fundamental in any of the 12 other states in which the company operated and had workers&#39; compensation, the injury would have been covered.</p><p>&quot;I think they did me wrong, me being there so long [and] helping them as much as I can,&quot; Amador says, noting 14 years of work for the nursing home. &quot;I cannot believe they did this to me. When I most need them, they don&#39;t know me anymore.&quot;</p><p>A spokeswoman for Fundamental declined to discuss the case.</p><p>Even when employers do provide benefits, workers still sometimes get less under the opt-out plans, NPR and ProPublica found.</p><p>Joe Becker, a 44-year-old truck driver in Abilene, Texas, received the medical care and surgery he needed, as well as money to replace lost pay, after he stepped down from his flatbed trailer and herniated several discs in his lower back. That was in June of 2012.</p><p>After 104 weeks, all his benefits stopped. His employer, Dent Truck Lines, has a workplace injury plan that cuts off benefits after two years. Workers&#39; comp provides those same payments for life, if necessary.</p><p>Becker needed one more surgery to ease his disabling pain. But he couldn&#39;t afford to pay for the procedure or all his medications himself. He was also unable to work.</p><p>&quot;Sometimes I have to make a choice,&quot; he says. &quot;Do I buy my pain meds ... or do I buy groceries?&quot;</p><div id="res448631397"><div data-crop-type=""><img alt="Joe Becker at his home in Abilene, Texas. Nearly two years after hurting his back at work, his benefits have stopped even though he's still in pain and in need of another surgery." src="http://media.npr.org/assets/img/2015/10/14/workerscomp-opt-joe-becker-78f1bbf7449a64f604f42e5947e25ea95a4f71a7-s800-c85.jpg" style="height: 464px; width: 620px;" title="Joe Becker at his home in Abilene, Texas. Nearly two years after hurting his back at work, his benefits have stopped even though he's still in pain and in need of another surgery. (Picasa/Dylan Hollingsworth for ProPublica)" /></div></div><p>Dent Truck Lines owner Cliff Dent says the opt-out plan costs him 50 percent less than workers&#39; comp.</p><p>Workers&#39; comp &quot;is so expensive,&quot; Dent says. &quot;Like everything the government controls, they charge you so much you have to go out of business.&quot;</p><p>The opt-out alternative to workers&#39; comp &quot;hearkens so unabashedly back to before the industrial revolution in terms of attitudes of employers,&quot; says Levy of the Texas AFL-CIO.</p><p>Minick of PartnerSource insists employers care more for workers now in his &quot;free market&quot; solution to a &quot;hyper-regulated environment.&quot;</p><p>&quot;Workers&#39; compensation systems grew up at a time when employers did not care about their employees,&quot; Minick says. &quot;If one got hurt, you cast him aside and brought in the next immigrant to fill that job. Now companies are competing to be the best place to work.&quot;</p><p>Minick also points out that opt out employers in Texas can still be sued for workplace injuries. They give up immunity from workplace injury lawsuits when they forego workers&#39; comp.</p><p>Protection from lawsuits is a fundamental element of workers&#39; comp. It is known as the &quot;Grand Bargain&quot; and &quot;exclusive remedy&quot; and it exists because employers agreed to pay medical and wage replacement benefits, on a no-fault basis, even for life, if necessary.</p><p>So opting out removes the shield and the ever-present risk of lawsuits provides a powerful incentive to treat workers right.</p><p>The plans also claim that they are regulated by a federal workplace benefits law, the Employee Retirement Income Security Act or ERISA, even though the law specifically excludes benefit plans &quot;maintained solely for the purpose of complying with applicable workmen&#39;s compensation laws.&quot;</p><p>If ERISA applies to opt-out plans, employers are able to assert federal court jurisdiction and keep disputes out of state workers&#39; comp commissions and state courts. The burden of proof is higher for workers under ERISA and the federal court process can take far longer.</p><p>Going to court hasn&#39;t helped Joe Becker. By the time his negligence lawsuit even gets to court, he&#39;ll have an entire year of pain without the surgery he needs.</p><p>Krystle Meloy tried to sue. Her wrongful death lawsuit seemed promising because Ransor was cited and fined for safety violations in the death of Billy Walker. Minick cites the possibility of a suit as justification for Ransor&#39;s $250,000 death benefit because Meloy had the opportunity to recover much more in a lawsuit.</p><p>But, shortly after she filed her suit, Ransor filed for bankruptcy.</p><p>Minick is working to spread the opt-out gospel to South Carolina and Tennessee, where a lobbying group he formed has bills pending. His goal is a dozen opt out states by the end of the decade.</p><p>&quot;This is what we do,&quot; he says. &quot;All you can do is pray that the Lord gives you a calling where you can really do good for society ... That&#39;s what gets us up every day.&quot;</p><p>&mdash; <a href="http://www.npr.org/2015/10/14/448544926/texas-oklahoma-permit-companies-to-dump-worker-compensation-plans?ft=nprml&amp;f=448544926"><em>via NPR</em></a></p></p> Wed, 14 Oct 2015 14:06:00 -0500 http://www.wbez.org/news/opt-out-plans-let-companies-work-without-workers-comp-113344 As cybercrime proliferates, so does demand for insurance against it http://www.wbez.org/news/cybercrime-proliferates-so-does-demand-insurance-against-it-113315 <p><p>Cybercrime is costing the global economy&nbsp;<a href="https://www.allianz.com/en/press/news/studies/150909_businesses-must-prepare-for-cyber-risks.html/">nearly half a trillion dollars a year</a>, according to the insurer Allianz. It&#39;s a major threat to businesses, which are looking for ways to protect themselves. One option is cybercrime insurance.</p><p>Mark Patterson found out the hard way that firewalls and anti-virus software are no longer enough protection for a small business.&nbsp;<a href="http://www.npr.org/sections/alltechconsidered/2015/09/15/440252972/when-cyber-fraud-hits-businesses-banks-may-not-offer-protection">Cybercrooks hacked into the email system of PATCO</a>, Patterson&#39;s construction company in Sanford, Maine, and ordered money transfers from its bank account.</p><p>&quot;Over the period of five consecutive nights, excluding weekends, $100,000 a night had been taken out of our checking account, and we were down about $545,000,&quot; he recalls.</p><p>Patterson&#39;s bank refused to reimburse him. He sued and finally won, but legal costs ate up most of what the bank paid. After that experience, Patterson boosted his security and bought cybercrime insurance.</p><p>But most companies aren&#39;t insured for cybercrime losses. In fact, only about one in five is. However, Chris Arehart, a vice president and cybercrime specialist at Chubb Group of Insurance Companies, says demand is now booming.</p><p>&quot;We have interest every day on this emerging topic, and it really has taken the world by storm,&quot; Arehart says.</p><p><span style="font-size:16px;"><strong>Computer Hacking And Old-Fashion Cons</strong></span></p><p>Chubb has added some cybercrime elements to its commercial crime policies over the past decade, and recently it added coverage for something called social engineering fraud, which Arehart says, often combines computer hacking and an old-fashioned con.</p><p>&quot;They may begin by researching online, using the wealth of information that we all share, to determine an appropriate mark within the company. They build up a pretext, a story that&#39;s as varied as the imagination of the criminal,&quot; he says.</p><p>Cybercriminals often penetrate a company&#39;s computer and email systems, and for a year or more watch and plan their attack. Then they strike.</p><p>One scenario might involve a fraudster impersonating a top company officer in Asia calling a lower level, U.S.-based employee. The fraudster knows the employee&#39;s boss&#39; name &mdash; and knows the boss is away &mdash; and asks the employee to handle an urgent, emergency wire transfer.</p><div class="image-insert-image " style="text-align: center;"><img 20="" 70="" a="" alleged="" alliance="" alt="" and="" ap="" at="" authorities="" been="" buy="" can="" class="image-original_image" computer="" countries="" cripple="" cyber-forensics="" cybercrimals="" department="" english="" for="" from="" gene="" hacked="" has="" in="" information="" j.="" justice="" largest-known="" malicious="" malware="" marketplace="" members-only="" more="" national="" online="" or="" other="" photo="" pittsburgh.="" sell="" software="" speaking="" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/AP_638634222060.jpg" steal="" style="height: 386px; width: 580px;" systems.="" targeted="" than="" that="" the="" title="In this photo taken July 14, 2015, FBI Supervisory Special Agent J. Keith Mularski, who heads the cybercrime squad at the agency’s Pittsburgh field office, displays a screenshot from the Darkcode website, top left, an English-language " to="" training="" using="" ve="" /></div><p>Cybercrimes like these are growing at an alarming rate, according to the FBI. Cyberfraud insurance can help protect companies from those losses.</p><p>But it&#39;s not a silver bullet, says Garrett Droege, who runs TechAssure, an association of companies that offer cybercrime insurance. Part of the problem, he says, is that many policies don&#39;t cover the latest scams.</p><p>&quot;Unfortunately, there&#39;s a lot of &#39;gotchas&#39; in this type of policy, just because it&#39;s evolved so quickly and the insurance companies are having a hard time innovating fast enough to keep up with the risks,&quot; he says.</p><p><span style="font-size:16px;"><strong>Risk Isn&#39;t Well Understood</strong></span></p><p>A company looking for coverage, Droege says, first needs to figure out its cyberrisk profile, then put protections and protocols in place and educate its workers. In fact, companies may not even be able to buy insurance unless they have that all in place, says Arehart, with Chubb Insurance.</p><p>&quot;We&#39;re looking for companies that have strong controls in the first place, and then strong cultural controls that would prevent this type of fraud from making it past the first phone call or the first email that hits the company&#39;s computer systems,&quot; Arehart says.</p><p>Insurers are being selective because the ultimate risk they&#39;re taking is not well understood, Droege says.</p><p>&quot;Traditional insurance is based on sometimes hundreds of years of historical data,&quot; he says. &quot;They can look back, see where the losses came from, and they price accordingly. Where cyber, the market&#39;s still very, very juvenile.&quot;</p><p>Because criminal hackers are so proficient and because computer systems are so central to business, some analysts predict insurers could soon face catastrophic losses. But Droege says the industry has to step up.</p><p>&quot;We don&#39;t have a choice as an industry. We have to figure it out,&quot; he says. &quot;If the cyberrisk is so pervasive today, think, 10, 20 years into the future, when we&#39;re even more reliant on technology. Businesses cannot afford to deal with these things by themselves.&quot;</p><p>&mdash; <a href="http://www.npr.org/sections/alltechconsidered/2015/10/12/445267832/as-cybercrime-proliferates-so-does-demand-for-insurance-against-it?ft=nprml&amp;f=445267832" target="_blank"><em>via NPR</em></a></p></p> Tue, 13 Oct 2015 13:17:00 -0500 http://www.wbez.org/news/cybercrime-proliferates-so-does-demand-insurance-against-it-113315 Seniors tend to quit Medicare Advantage when health declines http://www.wbez.org/news/seniors-tend-quit-medicare-advantage-when-health-declines-113204 <p><p>Senior citizens are switching from privately run insurance plans for traditional Medicare when they face serious, long-term health conditions, a study shows.</p><p>Researchers at Brown University found that 17 percent of Medicare Advantage patients who entered nursing homes for long-term care chose to switch to traditional Medicare the following year. Only 3 percent of similar patients in Medicare made the decision to go to a private Medicare Advantage plan.<br /><br />The story is the same for patients who required short-term nursing care or home health care. A larger number switched out of Medicare Advantage plans than chose to move into them from traditional Medicare.</p><p>The results suggest that the private Medicare Advantage health plans are managing to get rid of patients once their care becomes too costly, says economist&nbsp;<a href="https://vivo.brown.edu/display/mrahman">Momotazur Rahman</a>, the study&#39;s lead author. &quot;When the plan finds out this patient is very costly, there are incentives for the plan to get rid of the patient,&quot; he says.</p><p><img alt="" class="image-original_image" src="http://www.wbez.org/system/files/styles/original_image/llo/insert-images/insurance-switches-after-nursing-home-care_chartbuilder_enl-f04caa0a4fe0e4c938aaae0f8fa3fb6eac4c485f-s1400.png" style="height: 320px; width: 200px; margin-left: 10px; margin-right: 10px; float: right;" title="Bars show the proportion of people who left one type of Medicare coverage for the other after receiving either long-term or short-term nursing home care.(NPR/Source: High-Cost Patients Had Substantial Rates of Leaving Medicare Advantage And Joining Traditional Medicare, October 2015)" />The&nbsp;<a href="http://content.healthaffairs.org/content/34/10/1675.abstract?sid=225f9167-0749-445a-a660-80241597bc7d">findings were published</a>&nbsp;in the October issue of&nbsp;Health Affairs.</p><p>The shift of patients who were insured by private companies back to traditional Medicare rolls can cost taxpayers more.</p><p>The government pays&nbsp;<a href="http://www.npr.org/sections/health-shots/2015/09/03/436964368/white-house-takes-aim-at-medicare-and-medicaid-billing-errors">a set monthly fee&nbsp;</a>for each patient in Medicare Advantage plans. The amount varies according to a&nbsp;<a href="http://www.publicintegrity.org/2014/06/04/14865/how-risk-scores-work">risk score</a>&nbsp;for each person. But since the ultimate cost for patient care is borne by the private plans, insurers&#39; profits can suffer if patients are more expensive to care for than expected.</p><p>The private plans don&#39;t kick people out. But they can provide reasons to leave, Rahman said. Those measures include imposing steep cost-sharing as patients need more expensive care, which is common for nursing or home care patients. They can also limit care for expensive treatments, such as cutting benefits for rehab after a hip replacement. And they can restrict their networks in some areas so physicians who care for particularly ill patients are hard to find or get to.</p><p>The Center for Medicare and Medicaid Services has been looking to minimize this so-called adverse selection &ndash; when sicker patients move back onto the government&#39;s health care rolls. The steps include paying more to private plans for sicker patients, and giving them incentives to manage costs.</p><p>These incentives aren&#39;t enough, according to Rahman. The agency should consider imposing penalties on the plans, he says, when patients &quot;disenroll.&quot;</p><p>Medicare Advantage plans &quot;definitely should not be telling people to leave in any kind of way,&quot; says Jack Hoadley, an analyst at Georgetown University&#39;s Health Policy Research Institute. &quot;There&#39;s no evidence in this study that they are.&quot;<br /><br />But limits on care in Medicare Advantage plans that are designed to cut costs can make those plans less appealing to sicker patients, Hoadley says. The Brown study, he says, suggests the incentives in the program aren&#39;t working properly.</p><p>&mdash;<a href="http://www.npr.org/sections/health-shots/2015/10/06/446112458/seniors-tend-to-quit-medicare-advantage-when-health-declines?ft=nprml&amp;f=446112458" target="_blank"><em> via NPR</em></a></p></p> Tue, 06 Oct 2015 13:26:00 -0500 http://www.wbez.org/news/seniors-tend-quit-medicare-advantage-when-health-declines-113204 Insurance CEOs again called before lawmakers http://www.wbez.org/programs/marketplace-morning-report/2015-09-29/insurance-ceos-again-called-lawmakers-113111 <img typeof="foaf:Image" src="http://llnw.wbez.org//main-images/David McNewGetty.jpg" alt="" /><p><div class="image-insert-image ">Top health insurance executives are making the rounds these days in Washington.</div><p>Last week, CEOs from Aetna and Anthem &ndash; who are each looking to complete mega-mergers &ndash; testified before the Senate, and the two return again&nbsp;<a href="http://judiciary.house.gov/index.cfm/hearings?ID=020363B9-F9EF-4623-8E67-28A0B260675A">Tuesday</a>&nbsp;for a hearing in the House.</p><p>Lawmakers have&nbsp;<a href="http://www.c-span.org/video/?328263-1/hearing-health-insurance-consolidation">pressed</a>&nbsp;the executives to detail how consumers will benefit from these potential deals.</p><p>When the companies announced their respective mergers, each promised efficiencies and reduced costs, and last week Senator Al Franken (D-Minn.) asked Aetna&rsquo;s Mark Bertolini whether he would commit to passing those savings on to policyholders.</p><p>&ldquo;It is our intention to make our products more affordable. And we commit to continue to drive affordability across the system in the changing relationship with providers,&rdquo; said Bertolini.</p><p>When Franken said that didn&rsquo;t address his question, Bertolini managed an &ldquo;Okay.&rdquo;</p><p>Instead of the explicit promise Franken sought, the executives hinted that as bigger companies they could negotiate better rates with hospitals and doctors.&nbsp;&nbsp;</p><p>They said the deals would make it easier to pay providers for quality rather than the volume, another way they hope to control costs.</p><p>Leemore Dafny with the Kellogg School of Management at Northwestern says whatever insurers promise on Capitol Hill doesn&rsquo;t mean too much.</p><p>&ldquo;It&rsquo;s not pledges that we want, it&rsquo;s competition that we want to ensure that savings are passed through if they are realized,&rdquo; she says.</p><p>In other words, if the Justice Department believes these mergers don&rsquo;t violate antitrust law, there may be less competition.</p><p>And without competition, Dafny says companies have less reason to lower premiums.</p><p>&mdash; <a href="http://www.marketplace.org/topics/health-care/insurance-ceos-again-called-lawmakers" target="_blank"><em>via Marketplace</em></a></p></p> Tue, 29 Sep 2015 15:10:00 -0500 http://www.wbez.org/programs/marketplace-morning-report/2015-09-29/insurance-ceos-again-called-lawmakers-113111 Health insurers expand marketing and retail as ACA deadline looms http://www.wbez.org/health-insurers-expand-marketing-and-retail-aca-deadline-looms-109390 <img typeof="foaf:Image" src="http://llnw.wbez.org//main-images/ACA retail.jpg" alt="" /><p><p>Ryan and Bethany Christie are healthy newlyweds in their 20s. For the time being, Ryan is a server at The Berghoff, a downtown restaurant, while he searches for a permanent job. Bethany&rsquo;s delayed grad school and works as a nanny.</p><p>They live on a tight budget. And even though it could be cheaper to pay the penalty for not getting health insurance, they&rsquo;d rather pay more to be covered.</p><p>&ldquo;We&rsquo;ve got friends who do that. Or set aside a little money just in case. But we&rsquo;re definitely not risk takers in that sense. So it&rsquo;s really expensive, but we plan on having children not too far off. We definitely want good health insurance for her,&rdquo; Ryan Christie said.</p><p>An estimated 1.8 million people in Illinois are uninsured, but only 7,000 people in the state signed up in the first two months of enrollment under the Affordable Care Act.</p><p>In October, the Christies tried to sign up for health insurance off the federal health exchange. But like many others, they weren&rsquo;t able to get through.</p><p>&ldquo;My parents and a lot of the other people in my family really had negative views about Obamacare and thought it was the worst thing that could happen. I thought it probably won&rsquo;t be great for them, but for me at least I&rsquo;ll have some benefit,&rdquo; Bethany Christie said. &ldquo;But that&rsquo;s not the case.&rdquo;</p><p>The Christies are pretty sure they qualify for a government subsidy, but they&rsquo;re still trying to navigate their eligibility and application. For now, Bethany is on her father&rsquo;s insurance and Ryan&rsquo;s signed up for coverage that&rsquo;s pretty bare bones while they figure things out.</p><p>Insurance companies are expanding their retail and marketing efforts to lure individual consumers like the Christies.</p><p>Andrew Gallan is an assistant professor of marketing at DePaul University. He says insurers are having to expand their focus on individual consumers and not just group plans associated with workplaces.</p><p>&ldquo;Individuals provide a lot more variety in terms of their ability to understand health, their literacy levels, their needs, their understandings, their ability to pay, their language. So that&rsquo;s just a short list of all the variety that health insurers are beginning to see on the consumer side that they hadn&rsquo;t seen before,&rdquo; he said.</p><p>About 10 percent of Blue Cross Blue Shield of Illinois&rsquo; customers were from the individual market. Kurt Kossen, Vice President of Retail Markets says that&rsquo;s growing as the deadline to enroll under the federal law approaches.</p><p>&ldquo;Starting in October, we&rsquo;ve started to experience increased traffic in both our website and in the call center and into customer service and attendance at our community events. This is a very transformational time for the industry and individuals have a lot of questions,&rdquo; Kossen said.</p><p>Kossen says the company has not only upped its telemarketing and internet efforts, but its marketing visibility.</p><p>&ldquo;So from the marketing perspective, we want to be where people live, work, play and shop,&rdquo; he said.</p><p>Kossen says the company has conducted 200 community seminars in the state, and it opened a retail store in North Riverside Park Mall, just outside of Chicago. It also has a mobile store that sets up at community events or outside grocery stores.</p><p>Professor Gallan says these strategies can make a difference to people getting insurance for the first time.</p><p>&ldquo;Especially, younger people are going to be more comfortable on the Internet, and a variety of different sites. And trying to put together information, triangulate on which plan might be best for them. But there are significant numbers of people that need people to fill out forms, that need people to explain things in very basic English or even to translate into other languages. And these things are more easily and more efficiently done in person than they can be on the Internet,&rdquo; Gallan said.</p><p>The Affordable Care Act has also put the pressure on insurance companies to deal more with bad publicity. The problems with the federal website and confusion over health premiums had some consumers backing away from the healthcare exchange.</p><p>Even in Illinois, the state ramped down its marketing efforts to avoid some of the negative associations. Now that things are running smoother, the state&rsquo;s &ldquo;Get Covered Illinois&rdquo; program is boosting its outreach to get people enrolled by the December 23rd enrollment date.</p><p>Professor Gallan says that&rsquo;s what the insurance companies are doing, too.</p><p>&ldquo;People regardless of whether they attribute this to the government or health insurance companies, are going to have to be reassured that any particular website is 100 percent secure, that is efficient, that is going to provide them with the policy as well as protect them from being penalized in the future before they go on and start buying policies,&rdquo; he said.</p><p>For the Christies, that customer service makes the difference.</p><p>&ldquo;Health care is such a confusing topic right now that there&rsquo;s no amount of research I can do to really understand if I&rsquo;m getting a good deal somewhere,&rdquo; Bethany Christie said. &ldquo;So part of it is I have to trust what someone&rsquo;s telling me because there&rsquo;s so much out there.&rdquo;</p><p><em>Susie An reports on business for WBEZ. Follow her @soosion.</em><br />&nbsp;</p></p> Tue, 17 Dec 2013 10:24:00 -0600 http://www.wbez.org/health-insurers-expand-marketing-and-retail-aca-deadline-looms-109390 First day glitches as Affordable Care Act launches http://www.wbez.org/news/first-day-glitches-affordable-care-act-launches-108822 <img typeof="foaf:Image" src="http://llnw.wbez.org//main-images/getcoveredillinois.jpg" alt="" /><p><p dir="ltr">The government may have shut down today, but the Affordable Care Act is marching forward. The state website, <a href="http://getcoveredillinois.gov/">Get Covered Illinois,</a> was up by early this morning. And the <a href="https://www.healthcare.gov/">federal website,</a> where Illinois residents will shop on the marketplace for coverage, was also live. But many people encountered glitches, delays, and error messages.</p><p dir="ltr">Jose Galarza is the billing manager at the Infant Welfare Society on the Northwest side of Chicago. They don&rsquo;t have health navigators in their offices, but staff did receive training to sign people up on the marketplace and the organization is listed on the government&rsquo;s website<a href="http://getcoveredillinois.gov/get-help/"> as an official resource. </a></p><p dir="ltr">Galarza says his organization has been preparing for today for a long time. This morning he says he was full of nervous energy. &ldquo;I was up at 4:30 a.m. this morning, thinking about this the whole process and what to expect,&rdquo; he said.</p><p dir="ltr">When he got to the office the first thing Galarza did was to go to the website and try to fill out an application. &nbsp;He received error messages and never completed the process. Later, he couldn&rsquo;t get to the application at all and instead received a message that the site was overburned by traffic.</p><p dir="ltr">Galarza&rsquo;s experiences were not unique. Organizations and individuals across the city reported similar problems. Before today&rsquo;s launch officials said that some aspects of the site, such as the Spanish language version and small business site, wouldn&rsquo;t be entirely complete.</p><p dir="ltr">By 9:30 a.m. Galarza says three people called to say they would come in for help that day. &nbsp;&ldquo;I put myself in the client&#39;s shoes. If I am excited and I get myself &nbsp;prepared, and then come into a place like this... and [can&rsquo;t fill out an application], it would be very frustrating,&rdquo; he said.</p><p dir="ltr">Illinois Governor Pat Quinn cautioned against judging the Affordable Care Act based on first day problems. &nbsp;&ldquo;We understand with any new program there will be glitches and bumps along the way. When Apple unveils a new device, they may have some minor problems and glitches&hellip; but they go forward. They don&rsquo;t stop and say they will take a year off. They understand how important it is to complete the mission,&rdquo; said Quinn.</p><p dir="ltr">Despite his frustrations, Galarza had a positive message for his clients, one that wasn&rsquo;t that different from the Governor&#39;s. &ldquo;I would say just take a deep breath. We have until December 15th, which is the deadline for your coverage to start on January 1st,&rdquo; said Galarza.</p><p dir="ltr">According to the state, as of 6:00 p.m. more than 76,653 visitors &nbsp;had come to the online marketplace.</p><p>If you run into a problem or need help navigating the website, you can contact the state hotline at 1-866-311-1119.</p><p><em>Shannon Heffernan is a WBEZ reporter. Follow her <a href="https://twitter.com/shannon_h">@shannon_h</a></em></p></p> Wed, 02 Oct 2013 09:35:00 -0500 http://www.wbez.org/news/first-day-glitches-affordable-care-act-launches-108822 Allstate to trim retirement benefits http://www.wbez.org/news/allstate-trim-retirement-benefits-108085 <img typeof="foaf:Image" src="http://llnw.wbez.org//main-images/Allstate_130717_AYC.jpg" alt="" /><p><p>Less than a month after it laid off more than 300 workers, Allstate Corp. announced on Monday plans to trim employee retirement benefits.</p><p>The Northbrook-based company said the move will boost its book value from $1.70 to $2 per share.</p><p>Jim Ryan, a senior analyst at Morningstar Inc., said the move will be difficult for employees but that it&rsquo;s what the market dictates.&nbsp;</p><p>&ldquo;That&rsquo;s certainly something common among a lot of companies,&rdquo; he said. &ldquo;To the extent that if a lot of companies do it and others don&rsquo;t, those [who] don&rsquo;t are disadvantaged on a cost basis.&rdquo;</p><p>Ryan also said he believed that Allstate would have a strong future because of plans to broaden its e-surance and online customer base.&nbsp;</p><p>Beginning this summer, the company will no longer offer life insurance to its retirees and introduce a new formula for employee pensions, reducing its contribution obligation.&nbsp;</p><p dir="ltr" id="docs-internal-guid--6673237-ed63-921a-926c-01b586830a17"><em>Aimee Chen is a WBEZ business reporting intern. Follow her at <a href="https://twitter.com/AimeeYuyiChen">@AimeeYuyiChen</a>.</em></p></p> Wed, 17 Jul 2013 11:06:00 -0500 http://www.wbez.org/news/allstate-trim-retirement-benefits-108085 Uninsured patients sue Chicago nonprofit hospital http://www.wbez.org/news/uninsured-patients-sue-chicago-nonprofit-hospital-104105 <p><p>A lawsuit filed Thursday claims a nonprofit hospital in northwest Chicago failed to provide charity care to two low-income, uninsured patients, reopening a longstanding controversy in Illinois over whether hospitals are doing enough charitable work to qualify for lucrative tax exemptions.</p><p>Swedish Covenant Hospital repeatedly lost one patient&#39;s financial assistance application and threatened to send her bill to a collection agency, according to the lawsuit. The hospital incorrectly told another patient she was ineligible for assistance and demanded cash from her, the complaint alleges.</p><p>The practices amount to &quot;bureaucratic barriers&quot; that prevent eligible patients from getting free care, according to the lawsuit, and the hospital has a policy of attempting to collect from &quot;even the poorest of patients&quot; through bill collectors and wage garnishment.</p><p>The hospital gets about $8 million in annual tax breaks and owes the community a more reliable charity care system, the plaintiffs&#39; attorney Alan Alop of the legal services group LAF said at a press conference Thursday in Chicago. The lawsuit claims unfair practices under the Illinois consumer fraud law and seeks $50,000 in punitive damages and a change in hospital policy.</p><p>Swedish Covenant spokeswoman Leigh Ginther said Thursday she couldn&#39;t comment on the lawsuit, but she said every patient who is identified as uninsured is given an application for charity care and a personal explanation of the process.</p><p>&quot;It is the patient&#39;s responsibility to return the completed paperwork,&quot; Ginther said. The hospital reported $6.2 million in charity care expenses last year, nearly 3 percent of its net revenue.</p><p>Nearly 2 million Illinois residents are uninsured, or about 15 percent. The state constitution, court decisions and state law require Illinois hospitals that receive tax exemptions to provide charity care, but until this year the definition of charity wasn&#39;t clear.</p><p>The lawsuit comes as Illinois Attorney General Lisa Madigan is writing new standards on hospital charity care as required by a law passed earlier this year.</p><p>A Chicago-based advocacy group, the Fair Care Coalition, wants Madigan to recommend that a standard, universal financial assistance application be used by all Illinois hospitals. The group also wants a thorough reporting mechanism so the public can check that hospitals are obeying the law, said Janna Simon of the coalition.</p><p>At the press conference, plaintiff Ramona Ortiz-Patino described filling out multiple applications for financial assistance and later being told the hospital hadn&#39;t received them. An unemployed diabetic, she was facing charges for emergency room visits for extreme pain in her right leg.</p><p>After Ortiz-Patino submitted a third application, a hospital employee telephoned her and &quot;let me know that my bill would be going to collections because I hadn&#39;t paid it,&quot; she said. &quot;I didn&#39;t understand why the hospital was threatening me when they knew I had zero income and I submitted three applications&quot; for financial assistance.</p><p>How much charity care should nonprofit hospitals provide? The issue has been brewing for years in Illinois.</p><p>In 2009, two large Illinois hospital systems settled class-action lawsuits that claimed they had overcharged uninsured patients. In separate settlements, Resurrection Health Care and Advocate Health Care agreed to pay refunds to tens of thousands of individuals.</p><p>Next, a 2010 Illinois Supreme Court ruling suggested nonprofit hospitals that behave like businesses shouldn&#39;t qualify for tax exemptions. Citing that court decision, the state Department of Revenue denied tax exemptions to three hospitals in 2011 and signaled more denials for other hospitals could follow.</p><p>That set off a storm of controversy the Legislature addressed this year.</p><p>Nonprofit hospitals won a broad definition of charity care from Springfield in a new state law that will allow them to continue their tax-exempt status. Hospitals were required to provide free care to patients of certain income levels, and the attorney general was directed to write standards for hospital financial assistance applications.</p></p> Thu, 29 Nov 2012 10:56:00 -0600 http://www.wbez.org/news/uninsured-patients-sue-chicago-nonprofit-hospital-104105 Helping keep dancers on their (healthy) toes http://www.wbez.org/sections/art/helping-keep-dancers-their-healthy-toes-100857 <p><p>A social service group for performers is trying to increase the number of dancers with health insurance in Chicago.</p><p>The Actors Fund says nearly one in every three dancers is uninsured. &nbsp;</p><p>Christina Gonzalez-Gillett is assistant director of The Seldoms, a small dance company here that can&rsquo;t afford to provide health insurance.</p><p>&ldquo;If there is coverage for individuals, I think the dancers would be really happy about that because we have to work so many jobs just to be able to afford stuff,&quot; Gonzalez-Gillett said. &quot;Starbucks is like the ultimate &#39;dream job&#39; because they offer health insurance.&rdquo;</p><p>The Actors Fund is holding a <a href="http://eighteenthstreet.org/blog/2012/07/12/at-work-forum-health-insurance-options-in-chicago/">forum</a> Monday evening at the Chicago Cultural Center to talk about new options under health care reform and how to get insurance here.</p><p>James Brown, who directs the Fund&#39;s Artists&#39; Health Insurance Resource Center, said health care coverage would allow dancers to focus on their art. He said by 2014, insurance companies won&#39;t be allowed to deny coverage because of old dance injuries.</p><p>&quot;Just a few days in the hospital could put them a few thousand dollars in debt,&quot; Brown said. &quot;So that anxiety and that threat that&rsquo;s there from being uninsured is removed.&rdquo;</p><p>Brown said dancers are more likely to be uninsured because they are young and often have low incomes.</p></p> Mon, 16 Jul 2012 05:14:00 -0500 http://www.wbez.org/sections/art/helping-keep-dancers-their-healthy-toes-100857