My grandfather had a saying when he would ask, "What does insurance cover?" The answer? EVERYTHING BUT THE LOSS. Isn’t that the truth?
What happens to our premium money when we pay for our insurance? Well, some of the money goes to overhead for the company which includes rent, salaries, office equipment, etc. Some of the money goes to pay claims. Some of the money gets invested. And, some of the money goes to lobbyists, legislative campaigns, and judicial campaigns to have laws passed in states and federally which make it more difficult for people to make claims.
Take the collateral source rule in Alabama. The collateral source rule said that a defendant could not ask the plaintiff in front of the jury if she had health insurance. The theory was that the defendant should not be entitled to get the benefit of the fact that the plaintiff had health insurance. However, our Supreme Court abolished the collateral source rule several years ago. So, now, instead of telling the jury that the medical bills were $10,000 and letting the jury decide the value of the case, they are told that Blue Cross Blue Shield paid $4,000 for the $10,000 medical bills, and if the plaintiff wins, the plaintiff only has to pay back $4,000 because Blue Cross has a contract with the provider whereby the provider will take $4,000 for the $10,000. In effect, that reduces the claim from $10,000 to $4,000.
What’s wrong with that you may say? Well, first, it lowers the value of the case so insurance companies can pay less on claims. Second, what if you have two individuals with the exact same injuries in the exact same car wreck, and one has health insurance, and the other one doesn’t? One can tell the jury that his bills are $10,000, and he may obtain a $40,000 verdict. The other has to tell the jury that her bills were paid by Blue Cross and Blue Shield, and she only has to pay them back $4,000. She is more likely to get a verdict in the amount of $10,000 or less. Consquently, you have two cases with different values when they should be exactly the same.
In workers compensation cases, the insurance carriers have come up with a new plan to stop paying for a person’s medical bills for their injuries. After several years (when the case has been concluded several years earlier), the workrers compensation carrier sends the medical bills to an "independent" doctor, and they call this "Utilization Review". The "Independent" doctor ALWAYS says that there is no documentation to support the need for further medical treatment based upon the injury, and they refuse to authorize any further medical treatment. This "Independent" doctor has never seen the patient, has never treated the patient, and is typically in another state. Why do they do this instead of asking the treating physician they authorized to treat the patient? Because, they don’t want to pay any longer.
FOLLOW THE MONEY!! It, unfortunately, always comes down to money. These companies want to pay out as little as possible. That is where an attorney comes in. Unfortunately, everyone has bought into the fact that we attorneys are leeches on society when, in reality, we have been hand tied, and we have no recourse to protect against these unscrupulous actions. The only thing that talks to these companies is money, and when jury verdicts are reduced, they don’t listen.