WTF:
Debbie Shank suffered severe brain damage after a traffic accident nearly eight years ago that robbed her of much of her short-term memory and left her in a wheelchair and living in a nursing home.
Two years after the accident, Shank and her husband, Jim, were awarded about $ 1 million in a lawsuit against the trucking company involved in the crash. After legal fees were paid, $ 417,000 was placed in a trust to pay for Debbie Shank's long-term care.
Wal-Mart had paid out about $ 470,000 for Shank's medical expenses, but in 2005, Wal-Mart's health plan sued the Shanks for the same amount.
The Shanks didn't notice in the fine print of Wal-Mart's health plan policy that the company has the right to recoup medical expenses if an employee collects damages in a lawsuit.
Michelob86: I thought you were full of hot air until I found this.....
Wal-Mart isn't alone in such behavior. Insurance companies seizing lawsuit winnings from catastrophically injured Americans is a common practice that gives lie to the notion that anyone gets rich off a personal injury lawsuit these days, as insurance companies often get first dibs on any judgment or settlement in such cases.
But Wal-Mart's cruelty, as always, is extreme in this case. Not only is Shenk profoundly disabled, but while her family was fighting off the company in court, her son was killed while fighting the war in Iraq. Not even bad PR like this, apparently, can eke out a drop of compassion from the retail giant.
michelob86
All companies have that.
Princess
Big companies always win. Little people never do.
open4one
Wal-Mart did a stand-up thing and covered their employee, despite not being at fault. So, when the actual person at fault is made to pay, and some of that payment is attributable to things Wal-Mart already covered, why should they NOT be entitled to recoup that money?
Darren E
Yes, I did.
So you're suggesting that a company that pays out a HALF MILLION dollars for ONE person's medical care should just eat that amount, after funds become available from settlement to pay for her medical care?
How many premiums from $ 9.00 / hr. workers do you think would be necessary to cover that, IF they had no other health care expenses that year as a company?
Please tell me you're joking. Subrogation is quite normal in the insurance industry, and for the stated reason in the WSJ piece: Why should a person's medical expenses be paid twice over? The family might have wanted to use that money for future care, but that doesn't mean that they get to do that. If they wanted more, they should've upped the claim beyond the insurance limits and/or gotten a lawyer who took less money. (2/3rds of the settlement to legal fees??? C'Mon!)
The Shanks also appear to have ineffective counsel, as the WSJ coverage indicates that Wal-Mart had asked for notification BEFORE any settlement occurred. Maybe they would have told their lawyer THEN that the settlement would be insufficient from Wal-Mart's perspective. It reads to me like their 2/3rds-taking-lawyer tried to pull a fast one in setting up a trust, and got caught with his hand in the cookie jar. Maybe the addidtional expenses should come out of his legal fees?
It also glosses over that Mr. Shanks was paid $ 120,000 personally. He spent that money, then his wife goes into nursing home care, paid for by Medicare/Medicaid?
Don't get me wrong - I feel sorry for them. It sounds like it was very stressful. But there's much more to that story than what your slant gives it, sorry.
Orignal From: Tips: Did you know Walmart has the right to recoup medical expenses if an employee collects damages in a lawsuit?
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