Posted on 01/29/2006 9:31:25 AM PST by Conservababe
Wal-Mart pursues Shank's trust fund Sunday, January 29, 2006 RUDI KELLER ~ Southeast Missourian
A case before the U.S. Supreme Court could determine whether Wal-Mart can take the trust fund Debbie Shank uses to pay for long-term care for severe injuries from a traffic accident. Shank, who suffered brain damage and other injuries when a tractor-trailer slammed into her minivan in 2000, is being sued by Wal-Mart for every dollar remaining in the trust fund. The federal lawsuit contends that because Wal-Mart's employee health insurance plan paid for her hospital care following the wreck, it is entitled to the money she was awarded in a settlement with the trucking company.
She understands little of what is happening in the lawsuit, husband Jim Shank said Saturday. She has almost no short-term memory and requires constant care, he said.
"She's read about it in the paper but it hasn't sunk in," Shank said.
Last week, Wal-Mart decided to pursue the money, about $417,000, in Debbie Shank's trust fund. Wal-Mart is asking for $459,000.
When Wal-Mart filed the lawsuit in August, the company said it hadn't decided whether to pursue the case. The lawsuit helped the company examine its options while preserving its legal rights, a spokesman said at the time.
Jim Shank doesn't believe Wal-Mart ever intended to do anything but try to get the money. "That was just corporate babble," he said. "It is a line they've got to use. Blah, blah, blah, we are protecting our interests. Well, I'm protecting my interests, too."
Jim Shank visits his wife two or three times a day. If they lose the trust fund, he said, she will lose the personal-care assistant "who is like a part of the family." She will also be forced to share a room and he might have to divorce her so she would be eligible for increased Medicaid and Medicare benefits to support her care, he said.
The basis of Wal-Mart's claim is that by agreeing to participate in the employee health plan, Debbie Shank agreed to reimburse the plan if it paid for medical expenses that were later compensated by a lawsuit award or settlement.
Wal-Mart can't give up its rights in this case, even if it disrupts Debbie Shank's care, spokesman Marty Heires said Friday.
"This is a very, very sad case, and many people will have an emotional and sympathetic reaction," Heires said in a prepared statement. "But the reality is that part of Mrs. Shank's legal settlement included reimbursement for medical costs which had already been paid by her Wal-Mart health plan."
The plan's trustees had no choice, Heires said in an interview. "Our hands are really tied."
Cases like the Shanks' turn on an arcane principle of law that has a huge impact on individuals. In a 2002 case, the high court ruled that a health insurance company was not entitled to seize a trust fund set up for an accident victim in a settlement.
The Supreme Court agreed in November to hear another similar case from Maryland. A couple was injured in an automobile accident and put the proceeds from their settlement into an investment account. Lower courts ruled their insuror could recover the money paid for their care.
The Bush administration, working through the U.S. Department of Labor, supported the insurance company's assertion that it was entitled to reimbursement.
Attorney Maurice Graham of St. Louis, who represents the Shanks, believes the high court will rule against the insurance company. Such a ruling, he said, would immensely help the Shanks.
"There has been a substantial amount of litigation around the country as the enforcability of these types of agreements," Graham said. "It is our position that because of the nature of this settlement, we don't think the money is payable to Wal-Mart's health plan."
If the case goes to trial, Graham said, it will likely be early 2007 before a decision is reached. "We are now gearing up to aggressively defend it."
I know that if someone in Illinois has medicaid pay their hospital bills and then receives a settlement through the courts there is a lien filed on that settlement so that the state can recoup whatever funds were paid out. As much as I sympathize with this family as to their situation I can see why Wal-Mart expects the contract that was signed by this lady to be honored.
Uffda! If a jury hears this, Walmart will lose. This is an ugly case, and Walmart will not gain from it. Bad publicity will cost them far more than this $400K.
If she signed it, then Walmart SHOULD be reimbursed. Seems harsh, but why should they pay for everything if she signed this and then recieved a large settlement?
The amount of her settlement isn't Walmart's fault.
This problem is caused by a tax code that allows employers give health insurance tax free to their employees but doesn't allow employees to deduct health insurance premiums from their taxable income.
Many individuals sue the person that injured them claiming their health care costs as part of the damages. Where a third party insurance company actually paid those costs, that insurance company is normally entitled to that portion of the settlement money which is based on the medical bills.
The government does the same thing when it is in Wal Mart's position. If a soldier gets injured in a traffic accident etc. the military will seek to get money from the person that injured the soldier to pay for medical care. Although the military is pretty good about waiving all or part of its claim in favor of the injured soldier if the soldier or his family is facing a financial hardship.
This is why employers should stop offering health insurance and let employees pay for their own individual/family plans.
Consider if it were your employee that was injured. You as an employer had purchased insurance coverage for your employees. Then an employee is hurt in a wreck and the insurance company of the owner of the truch that hit you paid your employee. And your insurance also paid your employee's bill.
Now your insurance company sues your former employee and the headline says Conservababe sues former employee. hu
It is pretty common in law. One can not make two insurace companies pay a person for the same damages.
It would be like buying two insurance polices on your car. If your car was totaled in a wreck you would get two cars. The law generally does not allow that.
There could be some question as to whether the trust fund was to compensate for past espenses or to provide for future ones.
The way I understand it- if you sue and win money for medical expenses- both future and past then if someone else had already paid for medical expenses (past) that were incurred then they are rightfully owed part of the money to reimburse themselves.
As always- since Wal-Mart is big- they are portrayed as the evil doer- however morality is not based on being big or little. It sounds like the trust is trying to keep money that is not theirs- and if that is true then that is immoral and wrong- no matter who is owed the money.
Sounds like her lawyers didn't ask for enough in the settlement. They should have known about the WalMart policy.
With crap like this, who needs PR reps?
That was exactly my reaction when I read the article.
Given the paucity of information about the argument of the DOL I would surmise that an adverse ruling by the SCOTUS would drive insurance rates through the roof.
You are correct. Let it lie, Wal-Mart. Sometimes taking a loss on paper is better than taking a loss in public relations.
Insurance companies do the same thing. I guess it's only bad when eeeeevil Wal-Mart does it, eh?
Link?
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