Texas Journalist Explains Medicaid Flaw In Asbestos Lawsuits, Calls For Change

Photo Credit: File photo, Dallas Observer article, August 13, 2017

A Dallas-based journalist who pioneered coverage of asbestos lawsuit issues is calling for changes while explaining a “Catch 22” that could be shortchanging states’ Medicaid coffers. Christine Biederman, writing as a contributor to The Hill newspaper in Washington D.C., explains that “… Medicaid secondary payer laws provide states potential funds. For example, if a Medicaid enrollee is sickened by asbestos, and Medicaid pays the healthcare bills, Medicaid is entitled to a share of any future personal injury settlement. Medicaid is theoretically required to recover part of the settlement.”

Biederman, who wrote a landmark Dallas Observer investigative story “Toxic Justice” 19 years ago, adds that “… in practice, this means that unless a lawyer, a defendant or another party to a personal injury claim is located in the same state as a Medicaid beneficiary, and thus required by state law to report payments, the state Medicaid agency will likely never learn about the money. Of course, the enrollee is supposed to report the windfall. If you think that usually happens … please get in touch, because I have an investment opportunity for you.”

The story benefits from the fact that Biederman is herself a Texas attorney and will be must-read material in the asbestos world. (Disclosure: Ms. Biederman contributed reporting to the documentary UnSettled by Canadian journalist Paul Johnson; the Courts Monitor has shared resources and research with producers of that film, scheduled for release this fall.)

Medicaid Catch-22: It’s time for the asbestos trusts to do what’s right

CM Publisher Updates AG Probe Into Asbestos Trusts

Sara Warner, Founding Publisher of the National Courts Monitor & California Courts Monitor

Posting at The Huffington Post, Courts Monitor Publisher Sara Warner updates an investigation by 13 state attorneys general into what they are calling potential abuse and mismanagement in four of the nation’s largest asbestos bankruptcy trusts. Billions of dollars are held by dozens of trusts and a key issue is is required re-payments to Medicare and Medicaid programs may have been missed.
See the HuffPo blog here:

Asbestos Trusts Strike Back, Calling AGs Medicaid Fraud Probe ‘Overreach’

Asbestos Trust Filings An Issue In California Legislative Push

Photo credit: Northern California Record report, 4/10/17

Tort reform advocates are pushing a new California proposal that would require victims’ attorneys to disclose filings with asbestos bankruptcy “trusts,” or face longer times awaiting trial in the state’s crowded civil court docket. The Norcal Record, a legal-issues newspaper owned by the U.S. Chamber of Commerce, reports that the new law is scheduled for a vote in the Judiciary Committee of the California Assembly on April 25.

The Record explains that AB105 “… would require lawyers to reveal that they have filed for awards with asbestos bankruptcy trusts, established to compensate victims of exposure, before receiving ‘preference’ when filing a separate action in a civil court. Absent preference, a civil action in California’s  overburdened courts can take three years for a case to come to trial, legal experts say.”

Nothing under current California law requires a lawyer to reveal to a court that a separate action for compensation has been filed with a trust, resulting in documented cases of lawyers and their clients receiving awards both from the trusts and the courts. The so-called ‘double dipping’ leaves trusts with fewer funds for those with legitimate exposure claims, critics of the practice say.

Asbestos victims’ cases are the nation’s longest running civil tort litigation, lasting more than four decades. The trusts are a special aspect of federal bankruptcy laws that allows companies facing asbestos liability to form special trust funds that operate separately from the civil courts system. Recently, those trusts have come under fire for offering victims a chance to tell one exposure story in the trust system and another in the separate civil courts system.

Some states have passed, and the U.S. Congress is considering, new laws aimed at reconciling how the trust funds interact with the civil courts.

See the Record story here:
Asbestos transparency legislation set for committee vote next week

Health Care Funds Enough To Warrant Trust-Fund Lawsuit?

Photo credit: Legal News Line online report, 3/29/17

The U.S. Chamber of Commerce-backed Newsline website has published a deep-dive (well, “deeper” anyway) into the mushrooming state attorney generals investigation into asbestos trust funds, including speculation that U.S. Justice Department attention would be a “whole new ballgame.” The story broker recently when Forbes’ Daniel Fisher wrote about the probe.

(Sara Warner, publisher of this website, echoed some of his reporting in a Huffington Post piece.)

The Newsline report quotes Mark A. Behrens, who co-chairs Shook, Hardy & Bacon’s Washington, DC-based public policy group: “If these cases get the attention of the Department of Justice, then it’s a whole new ball game.” That report background that “… In one case, Utah’s Attorney General recently sued four of the largest asbestos bankruptcy trusts to make them comply with civil investigative demands from 13 states on whether they are failing to reimburse states for Medicare and Medicaid. Federal law requires those who oversee settlements to pay outstanding bills for Medicare coverage” and added that “… the federal government and the states may have similar interests with regard to reimbursement of health care costs, business interests believe. It is estimated that some 30 percent of asbestos cases involve veterans. Many of these individuals would receive treatment at VA hospitals at the government’s expense. Given the age of many asbestos plaintiffs, many also would receive Medicare benefits, a federal health care coverage program.”

The Newsline piece is here:

http://legalnewsline.com/stories/511099428-business-lawyers-expect-spillover-from-actions-against-asbestos-trusts-plaintiffs-lawyers

Forbes: State AGs Probe Asbestos Trusts Over Medicaid Payments

Asbestos wallboard on a job site: Who pays when workers get sick? (Shutterstock)

Daniel Fisher at Forbes is reporting that attorneys general from 13 “Republican-leaning states” are involved in a lawsuit against several big national asbestos bankruptcy trust funds, seeking “… information on whether they are squandering money and failing to reimburse states for Medicare and Medicaid expenditures.”

Fisher’s report says that the lawsuit follows “… demand letters to the Armstrong World Industries, Babcock & Wilcox, DII and Owens Corning/Fibreboard bankruptcy trusts on Dec. 12. So far none have responded, Utah says in the complaint filed March 7 in state court in Salt Lake City.”

The report also notes that “… The AGs cite the Medicare Secondary Payer law, a little used federal statute that carries stiff penalties for insurers and others who arrange for lawsuit settlements to be paid directly to claimants without making sure they first settle outstanding bills for Medicare coverage. Penalties can include double damages and even plaintiff attorneys can be liable, said Frank Qesada, an attorney with MSP Recovery, a Miami law firm that has filed numerous national class actions on behalf of private Medicare providers.”

Asbestos lawsuits represent the nation’s longest-running personal injury civil litigation and has been ongoing for about 40 years. Read the Forbes story here: State AGs Probe Asbestos Bankruptcy Trusts To Recover Medicare Payments