New Insurance Tactics: Intimidating Doctors that Support Plaintiffs’ Injuries

Allstate Insurance Company is seeking to recover $5 million in its fourth insurance fraud lawsuit of 2011. The company said it is seeking reimbursement for personal injury protection benefits that it paid on behalf of its customers.

The lawsuit alleges that New York medical professional corporations were fraudulently incorporated using the names of licensed physicians although laypersons actually owned and controlled the corporations; it is a violation under New York law for non-medical professionals to own a medical company. Allstate also contends that the laypersons submitted fraudulent insurance claims for unnecessary medical tests. The claims were filed under patients’ insurance policies as "no-fault” which would allow Allstate to quickly pay injured policyholders for their injuries without going to court. Since 2003, Allstate has filed 31 fraud lawsuits in New York, seeking more than $170 million in damages.

Allstate would have us believe that New York is in an insurance fraud crisis and no-fault fraud is costing New Yorkers hundreds of millions of dollars each year. Krista Conte, spokesperson for Allstate’s New York office, said “we need lawmakers to enact meaningful “insurance reform” (buzz word for another corporate bailout for billion dollar insurance companies) that puts the citizens of New York first."

Not so fast, ladies and gentlemen; the problem is that Allstate has zero credibility on these issues. Since when has this anti-citizen company ever put citizens first? Allstate has always put its’ profits over the interest of its policy holders, ALWAYS. What Allstate is attempting to do here is to intimidate those doctors who have the audacity to actually put the interests of injured citizens first and Allstate profits second. This is the same “delay, deny, confuse and refuse” tactic that Allstate has used for years in defending personal injury claims. Instead of taking on its citizen/policy holders directly in litigation (where it usually loses), to “delay, deny, confuse and refuse”, it is now attacking those doctors who treat (rather than whore their services to Allstate, so that claims can be denied) patients who happen to be insured by the “good hands people”. Those in the know call the company “Allsnake”.

Was Allstate dealt the same “bad hand” they deal their policy holders? Unlike what Allstate wants the general public to believe, fraud in the insurance industry in not a one-way street. While claims fraud should be addressed, Allstate’s “good hands” need to be thoroughly washed to clean the filth of unreasonableness and dishonest claims handling perpetrated on its own policy holders and those its policy holders seriously injure.

This is how Allstate’s (and other insurance companies’) deceptive tactics work: A policy holder files a no-fault claim or an injury victim files a tort claim. Allstate hires its own doctors, which the company calls "Independent Medical Examiners" (IMEs) to perform an examination of the plaintiff and review medical records and tests. The IME will also testify at trial, if necessary. If these physicians were truly “independent”, this might be a reasonable way to evaluate the validity of a claim. Unfortunately that is not the case; Allstate (and its ilk) retains the services of the same doctors, over and over, in communities all across the country, and instructs them to perform “cursory” evaluations of injury victims, typically lasting no more than 15 minutes to a half hour. These doctors are rarely in current practice (often retired); they often do only defense exams, and are paid millions of dollars a year to produce negative results. Millions of dollars added to the cost of litigation (instead of toward the compensation of the victims) are used to pay doctors for hire, whose sole purpose is to provide test results and testimony that plaintiffs have not suffered injuries or that the accidents at issue did not cause their health problems. This tactic gives Allstate “cover” when it denies a claim and forces litigation. A “win at all cost” mentality exists, even if it means mistreating its own policy holders.

Allstate has made an art form of manipulating the justice system to rake injury victims and its own policy holders out billions of dollars, first through denying, delaying, and defending legitimate lawsuits, then by low-balling the victims that its tactics have made financially desperate. And now, its new tactic is to claim that insured’s and their treating doctors are defrauding the company.

If you are injured in an auto accident, Allstate will likely challenge your claim, drag you into court, and take as long as possible, often years, before making an offer; an offer that is usually significantly less than the value of your claim. You are in “Greedy Hands with Allstate”; this is a company that believes its money is better spent dragging innocent victims through court rather than helping them in a time of need. Remember, the bottom line for Allstate is profit, profit, and more profit.

Tactics like this “fraud lawsuit” are designed to intimidate treating doctors and send a message that cases are “frivolous” and claims are “fraudulent”; the reality is that the tactics of Allstate and other insurance companies that engage in similar claims avoidance conduct are far more costly to the litigation process than anything done on the claimant side. Politicians should be screaming about “frivolous defenses”, not about so-called “frivolous lawsuits”. One case at a time, one jury at a time, a trial lawyer can attack these tactics, expose corporate greed, and show each jury that bought and paid for medical testimony is, simply, not credible. Trial results often reflect that. But public spectacles like the effort in New York put “fraud” and “frivolous” in the minds of the public (prospective jurors) and it is hard to compete, financially, with billion dollar insurance companies and other industries that would rather spend profits on phony “lawsuit abuse” campaigns than pay seriously injured accident victims. And until the general public wakes up and realizes the wool is being pulled over its eyes, access to justice for our fellow citizens will continue to be denied.

Imagine being seriously injured; you visit an emergency room or your family doctor. You are referred to a specialist and incur thousands of dollars in medical treatment expenses. You submit the claim to your own insurance company (the one you have been paying premiums to for years, despite a spotless claims record) only to have the claim denied because the company sent you to its so-called “expert”, and paid this “independent doctor” a significant amount of money to favor the insurance company’s position on the claim. These defense exams are for the sole purpose of a “little or nothing is wrong” diagnosis. My friends, what is your definition of “fraud”?

Using phrases like “lawsuit abuse”, “citizens against lawsuit abuse”, “tort reform”, “liability reform”, “frivolous lawsuit”, “jackpot justice”, and “insurance reform”, these companies and their lobbying arm, the U.S. Chamber of Commerce, are falsely linking personal injury litigation to the cost of health care in this country. In reality, litigation is an irrelevant percentage of the overall cost of healthcare. Google ™ any legitimate, independent, study (not one by trial lawyers, insurance companies, or corporate interests), those conducted by or for Public Citizen, for example, on this issue and you will find that industry claims of any kind of "litigation crisis" in America is an absolute myth. You will find that the cost of litigation in relation to health care is miniscule. Corporate interests are pumping millions (instead of paying appropriate benefits to policy holders) into a deceptive marketing campaign and into the political campaigns of conservative politicians like Rick Perry and Mitt Romney to say that “corporations are people” and need our assistance against the “greedy trial lawyers”. This, of course, is nonsense, but it has had some success, especially in the political arena, where some politicians will cozy up to the devil himself if it means a steady flow of campaign dollars.

So, how do you stop this corporate takeover of our civil justice system? How do you prevent insurance companies from deceiving its policy holders? How do you prevent corporate interests and their political hacks from trampling on your constitutional rights? With your voice and with your vote; that is how you must beat them. And you should act before you become an accident victim, forced to go toe to toe with an insurance company that will use its economic power (achieved with your own premium dollars) to crush you. Contact your local, state and federal elected representatives; find out where they stand on these important issues. If they stand with the corporations and the tort reformers, tell them they can’t have your vote. And if they refuse to see things your way, vote for the “other guy”. Together, we must combat and put an end to the deceptive corporate takeover of our precious civil justice system.

Mark Bello has thirty-three years experience as a trial lawyer and twelve years as an underwriter and situational analyst in the lawsuit funding industry. He is the owner and founder of Lawsuit Financial Corporation which helps provide legal finance cash flow solutions and consulting when necessities of life litigation funding is needed by plaintiffs involved in pending, personal injury litigation. Bello is a Justice Pac member of the American Association for Justice, Sustaining and Justice Pac member of the Michigan Association for Justice, Business Associate of the Florida, Tennessee, and Colorado Associations for Justice, a member of the American Bar Association as well as their ABA Advisory Committee, the State Bar of Michigan and the Injury Board.