Analysis of Labor Department data found that insurers had denied about 44 percent of all serious injury claims — those involving more than four days of lost work. The companies also turned down about 60 percent of contractors who claimed to suffer psychological damage such as post-traumatic stress disorder. The Times sued the government for access to Labor Department records.
“There are clearly serious deficiencies in the health coverage of civilian employees who have been injured while working overseas to keep us safe here at home — costing not only the men and women who are being refused coverage for the treatment they need, but also for the American taxpayers who are footing the bill for their coverage,” Cummings said.
This looks like some good legislation. Thanks to the work of Propublica and others, these insurance loopholes and wasteful practices will hopefully be shut down. It is also atrocious that at one point in this war, up to 44 percent of all serious injury claims were being denied. It is appalling that contractors were treated like this.
So hopefully this law get’s passed and it actually fixes the problem. I like the language in the bill in regards to assessing the law’s effectiveness after one year. If you have anything to add, either in support or against, let us all know.
If you want a great primer on what spurred on this legislation, check out Propublica’s work and there is lot’s of great info on this industry there. If you have any nightmare DBA claim stories, feel free to put that up in the comments section as well. –Matt
Cummings Introduces Legislation to Reform Defense Base Act Insurance Program
June 6, 2012
Rep. Elijah E. Cummings, Ranking Member of the House Oversight and Government Reform Committee, introduced legislation today that would save taxpayers huge sums of money by transitioning the existing workers’ compensation insurance system for overseas government contractors away from private sector insurance companies to a federal self-insurance program.
“There is absolutely no reason American taxpayers should be lining the pockets of private insurance companies,” said Cummings. “This bill would save billions of dollars while improving the ability of contractor employees who risk their lives in war zones to obtain the medical care and support they deserve.”
According to a 2009 Pentagon study, Congress could save as much as $250 million a year by transitioning the existing Defense Base Act (DBA) insurance program to a government self-insurance program. The study found: “In the long run, the self-insurance alternative may have the greatest potential for minimizing DBA insurance costs, and it has several administrative and compliance advantages as well.”
Cummings’s legislation, H.R. 5891, The Defense Base Act Insurance Improvement Act of 2012, would direct the Departments of Defense and Labor to establish a self-insurance program in which the government would pay directly for medical benefits and disability benefits rather than utilizing private insurance companies.
The existing system has been a boondoggle for private insurance companies, who have reaped enormous profits under the program. According to an Oversight Committee investigation, insurance companies providing DBA insurance in Iraq and Afghanistan have made enormous underwriting profits that are significantly higher than those of traditional workers’ compensation insurers.
The current DBA system requires contractors to purchase workers’ compensation insurance for employees working overseas from private insurance carriers, and the contractors and insurance companies negotiate their own rates. Since the costs of the insurance premiums are often built into the price of the contract with the government, there is little incentive for contractors to limit insurance costs.
Cummings’s bill would set a six month deadline for the Departments of Defense and Labor to develop an implementation strategy to transition to a self-insurance program, and it would require the strategy to be executed within a year after the bill is enacted.
The legislation would also require the Departments of Defense and Labor to issue a report one year after the program is implemented to assess its effectiveness in terms of cost-savings and the delivery of benefits.
In addition to cost concerns, the current system has failed to ensure that all injured workers obtain health care services, disability payments, or death benefits they and their families deserve. An analysis by ProPublica found that private insurance companies had denied about 44% of serious injury claims and about 60% of claims by employees suffering psychological damage such as post-traumatic stress disorder.
At the request of Congressman Cummings, the Domestic Policy Subcommittee held a hearing in 2009 to evaluate these findings, which confirmed that the Defense Base Act is in desperate need of reform.
Link to press statement here.
When my husband was blown up in July of 2003 Iraq we landed in this second war zone with the Defense Base Act Insurance Company CNA.
The military took him to Dogwood and on to Landstuhl. CNA abandoned him at Landstuhl though the docs there wanted him out immediately. Every day delayed reduced the chances of saving his leg.
It was the military, not CNA, who finally medivaced him after five days to Walter Reed. I spent over $600 on phone calls to Landstuhl trying to first find him, and second get him home. I was headed out the door for the airport to go to Germany and find him when I finally got a phone call.
I got a call at 10pm Saturday night when he arrived at WRMAC that I needed to arrange for a private medivac immediately as they could not accept him there. Better sense finally prevailed and the docs at Walter Reed went to work on him
When CNA did not pay the bills for this they went on our credit rating as a “serious delinquency” to the Treasury Department.
My husbands recovery was a long series of battles with CNA to provide qualified medical care. When I complained they threatened to remove my husband from our home claiming I was endangering his life. Distraught wives are often bullied and threatened in this manner while their husbands are fighting for their lives.
By early 2005 they were providing no medical care at all.
Despite the many injuries/permanent disabilities, years of litigation and finally an order to provide medical signed by an Administrative Law Judge and the DoL 19 mos ago, CNA is still not providing his medical care. Paper games are all they provide. The DoL refuses to find them in default which would allow us to take them into a court system with some teeth.
CNA knows their are no consequences.
I hope that more of the injured and widows will comment here. Most of them are litigating their way through this system that was set up to prevent litigation, and told not to speak up publicy by their attorneys. As you can see from our story the litigation never really ends. The attorneys on both sides contribute to this.
Rep Cummings proposed legislation would certainly cure much of the corruption and war profiteering that is currently rampant under the present system. We are grateful to him, Dennis Kucinich, Bernie Sanders, and all who worked on this.
The Insurance Companies have a pretty firm grip on our elected repesentatives which makes passage of this Bill unlikely.
In fact there is a Bill in the Senate right now that gives the Insurance Companies even more ways to screw the injured and widowed that not one elected official will stand up and oppose it. It is winding it’s way through committee like the snake in the grass that it is.
Marcie Hascall Clark
http://www.defensebaseactcomp.wordpress.com
Comment by dbacasualty — Monday, June 11, 2012 @ 10:57 AM
@dbacasualty Marcie, thanks for telling your story and for putting in all of the hard work on your blog about the issues of DBA. I certainly hope this stuff is getting better. If anything, the lessons learned in the beginning of the war are, and should be applied to contractors now.
On the bright side, I have talked with several contractors whom were injured, and have not had issues with their DBA claims in the last couple of years. So maybe the attention given to the matter by folks like yourself and Propublica are making some headway?
Either way, it is good to keep up the fight and continue to press for the best treatment with as little hassle as possible for injured contractors and their families, and to also press for the government to get the best value for the tax payer dollar for this whole process.
Comment by feraljundi — Friday, June 15, 2012 @ 2:04 AM
When my husband was blown up in July of 2003 Iraq we landed in this second war zone with the Defense Base Act Insurance Company CNA.
The military took him to Dogwood and on to Landstuhl. CNA abandoned him at Landstuhl though the docs there wanted him out immediately. Every day delayed reduced the chances of saving his leg.
It was the military, not CNA, who finally medivaced him after five days to Walter Reed. I spent over $600 on phone calls to Landstuhl trying to first find him, and second get him home. I was headed out the door for the airport to go to Germany and find him when I finally got a phone call.
I got a call at 10pm Saturday night when he arrived at WRMAC that I needed to arrange for a private medivac immediately as they could not accept him there. Better sense finally prevailed and the docs at Walter Reed went to work on him
When CNA did not pay the bills for this they went on our credit rating as a “serious delinquency” to the Treasury Department.
My husbands recovery was a long series of battles with CNA to provide qualified medical care. When I complained they threatened to remove my husband from our home claiming I was endangering his life. Distraught wives are often bullied and threatened in this manner while their husbands are fighting for their lives.
By early 2005 they were providing no medical care at all.
Despite the many injuries/permanent disabilities, years of litigation and finally an order to provide medical signed by an Administrative Law Judge and the DoL 19 mos ago, CNA is still not providing his medical care. Paper games are all they provide. The DoL refuses to find them in default which would allow us to take them into a court system with some teeth.
CNA knows their are no consequences.
I hope that more of the injured and widows will comment here. Most of them are litigating their way through this system that was set up to prevent litigation, and told not to speak up publicy by their attorneys. As you can see from our story the litigation never really ends. The attorneys on both sides contribute to this.
Rep Cummings proposed legislation would certainly cure much of the corruption and war profiteering that is currently rampant under the present system. We are grateful to him, Dennis Kucinich, Bernie Sanders, and all who worked on this.
The Insurance Companies have a pretty firm grip on our elected repesentatives which makes passage of this Bill unlikely.
In fact there is a Bill in the Senate right now that gives the Insurance Companies even more ways to screw the injured and widowed that not one elected official will stand up and oppose. It is winding it’s way through committee like the snake in the grass that it is.
Marcie Hascall Clark
http://www.defensebaseactcomp.wordpress.com
Comment by dbacasualty — Monday, June 11, 2012 @ 11:56 AM