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Beware! Your employer may grab your personal injury compensation! (Wal-Mart did)
Using a technicality in her health insurance policy in effect at the time, her former employer, Wal-Mart, sought to get its hands on the money. They sued and succeeded. The money is now slated to go to Wal-Mart, leaving Mrs. Shank dependent upon what she can get from Medicaid and Social Security. “I don’t understand why they need to do this. This girl needs the money more than they do.” her husband declared. (Of course, anyone familiar with Wal-Mart’s business practices will hardly have trouble “understanding” why the company would grab cash from a defenseless invalid.) As the Wall Street Journal further reports, Wal-Mart was able to go after Mrs. Shank’s meager trust fund because of
In effect, this practice serves to negate the value of health insurance, which by definition is intended to insure individuals against the catastrophic effects of high health care bills. Bu using “subrogation,” the insurance company can, in effect, insure itself against risk, and transfer its losses back onto the shoulders of the insured. Given the high cost of health care, and the willingness of all-too-many companies like Wal-Mart not only to exercise mere greed, but to compromise even the most basic human decency, we can expect cases like this one to proliferate in the future. |
52-year-old Deborah Shank became permanently brain damaged and confined to a wheelchair in a collision with a tractor-trailer 7 years ago. She received a $700,000 settlement from the trucking company. After attorneys’ fees and other expenses, she was left with $417,000. This was far too little to cover her ongoing medical needs, but at least it was something. The money was placed in a special trust to partially fund Mrs. Shank’s care.
4 Responses to “Beware! Your employer may grab your personal injury compensation! (Wal-Mart did)”
Jenna
30 Nov 2007 at 12:43 pm
This is so disgusting. I want to say I’ll never shop at Wal Mart again, and I try to avoid it, but I need to save money like everybody else. So I’ll probably go there again. Everybody else does the same thing. That’s the problem.
Jim
04 Dec 2007 at 5:38 pm
Why shouldn’t the people that paid the medical bills get the money won in a suit to pay them? It even says in the article “like most companies”. Wal Mart is being singled out because it’s “in” to hate Wal Mart.
Ken (Webmaster)
05 Dec 2007 at 12:41 pm
JIm wrote:
> Why shouldn’t the people
> that paid the medical bills get the
> money won in a suit to
> pay them? It even says in
> the article “like most
> companies”. Wal Mart is
> being singled out because
> it’s “in” to hate Wal Mart.
I think what you’re saying is a half-truth.
The true half: “Subrogation” is indeed intended to allow insurance companies to be reimbursed if the incident they’re covering is paid somewhere else, for example, if your collision insurance pays for car repairs and you subsequently are able to recover the money from the other driver. This prevents the insured person from making a profit by collecting twice (if this were allowed, there would be a huge incentive to create situations in which it occurs, which could bankrupt the whole system.) Most companies do indeed do this.
The false half: though we don’t know all the inner workings of the case, it seems reasonable to assume that Mrs. Shank’s settlement was intended to cover all her losses from the accident. Alongside out-of-pocket medical expenses, it was intended to compensate her for her permanent loss of earning ability, her drastically reduced quality of life, and her pain and suffering. Of course, in comparison to all these things, the amount she received was paltry–but at least it was something. Such settlements are quite common. Despite the public perception that people who sue make out like bandits, most, in reality, end up only receiving a fraction of the true financial value of their loss, if it can even be calculated.
So in this case, a megarich corporation swoops in, and uses the language of the fine print to “reimburse” itself at close to 100 cents on the dollar, which eats up Mrs. Shank’s entire settlement, reducing her to destitution. The letter of the law (which Wal-Mart’s highly paid attorneys probably wrote) is being fulfilled, but the spirit of it is being made a mockery of.
And this, of course, is part of a pattern of behavior of Wal-mart toward its employees in which the company never hesitates to take the last penny away from the poorest of the poor if that penny can be added to the corporation’s bottom line. So what’s not to hate about them?
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