Posts Tagged ‘Ohio’

Insurance industry scandal watch

Tuesday, August 9th, 2005

Joe Paduda has been doing so much heavy lifting in his diligent tracking of the many investigations into insurance wrongdoing that we are thinking he may need to change his blog name to “Scandal Central.” It’s almost like one of those whack-a-mole carnival games – new developments seem to keep popping to the surface daily.
Today, Joe reports on a guilty plea filed by an underwriter from a Liberty Mutual subsidiary who was submitting unattractive bids to Marsh McLennan. This enabled the broker to steer clients to insurers with the best commissions.
Yesterday, Joe reported on similar charges being levied against Arthur Gallagher & Co, the offshoot of a probe into practices involving several large public entities, an investigation that Florida’s Attorney General says may involve bid rigging. This follows on the heels of other Florida problems that surfaced in Broward County involving Gallagher Bassett and Corvel.*
Last Friday, Joe blogged about 14 insurance execs from Marsh, AIG, and Zurich who pled guilty to various charges in the Spitzer investigations.
He’s also recently updated the Ohio coingate developments, a many-headed hydra of scandal that is now ensnaring Governor Taft. Some other problems have been bubbling to the surface with the Ohio Bureau of Workers Compensation, too, in the form of unusual markups paid to servicing hospitals.
A collective black eye
Whether we want to or not, all of us who work in the industry have front row seats to these sorry spectacles since they involve some of the industry “leaders.” As an industry, we will be years restoring good faith with clients. And though I have no sympathy for the malefactors, I do feel badly for some of the decent, conscientious workers in the scandal-riddled firms. If things follow the patterns of other recent corporate scandals, a few bigwigs may or may not be called to account, but the real price may well be paid by the hundreds, if not thousands, of honest workers when the inevitable job reductions and reorganizations ensue.
Many of these firms were the trusted vendors that employers turned to as stewards of their loss experience and as watchdogs for fraud. Ironically, while the back door was being guarded by pit-bulls to prevent a few wayward employees from making off with the piggy bank, the front door was wide open so the serious thieves could saunter off with the safe.
The bottom line: caveat emptor
We’ve long been proponents of the idea that employers need to be active, savvy buyers and managers of their workers comp programs, but never more so than now. For most employers, workers comp is not simply a matter of dollars and cents (although that is reason enough to pay attention), it is also a matter of employee relations and reputation management. When hiring vendors to assist in these matters, we’ve always encouraged employers to buy for quality, not for price, but the fact that these scandals are tarnishing some of the “quality” names in our industry says that employer scrutiny doesn’t reach deep enough. And, for the most part, we aren’t talking about the mom and pop employer here – many of the employers who were gouged are large corporations with legions of lawyers and accountants. It sure looks like it’s time for buyers to step up due diligence in the “trusted vendor” selection process.
*edited on 8/10. The second news item dealt with Gallagher Bassett, not Arthur Gallager & Co.

State resources – Ohio, Utah, Pennsylvania

Wednesday, March 17th, 2004

UtahDavid Fletcher’s Government & Technology Weblog is a weblog that describes itself as “news and perspectives from a long-time egov advocate.” Among other things, David tracks how technology is making the government in the state of Utah more accessible to the people, and how technology is being used by governmental sites in general.

PennsylvaniaPAWC is a weblog by Judge Robert Vonada, a workers’ compensation Judge in the Altoona Field Office of the Bureau of Workers’ Compensation Office of Adjudication. He blogs development’s in the state’s workers’ comp practice and procedures.

Lifting guidelines and RTW

Monday, December 15th, 2003

The Ohio Bureau of Workers Comp and Ohio State University have teamed up on a research project that studies back injuries and reinjuries that can occur when people return to work. As an offshoot of the research, they developed an interactive lifting resource with guidelines intended to help employers and physicians in developing realistic transitional work programs. Considering that back injuries cause more time away from work than anything besides the common cold, it’s a resource worth checking out.

A cautionary tale

Wednesday, October 15th, 2003

More than 1,000 small employers in Ohio were left in the lurch for workers compensation and health care coverage when Team America Inc., a Professional Employer Organization (PEO), filed bankruptcy last week. Employers take note: engaging a PEO does not release you from your responsibility to cover workers by a valid workers’ compensation policy.

Check these useful tips from the California Department of Industrial Relations that will help in determining the legitimacy of your workers comp coverage under a PEO.