Subject: Good News/Bad News

   BAD NEWS first:

1)UNUM's response to my Order to Show Cause is in. Basically they just repeat over and over that I have "utterly failed" to prove that 1)I will succeed at trial, 2) I am suffering irreparable injury, 3) the doctrine of ambiguities is in question, or that 4) all the case law I cited doesn't prove anything. They totally ignore my physician's affidavit indicating how they lied about what she said, Judge Lett's opinion that the mere fact of having to cash in and use retirement money constitutes irreparable harm, and all the case law which indeed does relate to my situation. If the District Court judge finds in UNUM's favor, it will be unsupported by the facts, the law and case law (but it's happened before to many others).

2) For those of you having formatting problems with the Coollist and having to scroll sideways. I'm sorry, I don't know how to fix it because the problem is not showing up on this end.

3) I've been pretty much exhausted and bedridden since Monday afternoon. I finally revived at 5:30 pm today (Wednesday) and have enough steam and concentration to catch up on some work. As much as I love your jokes, anecdotes and messages of support, I'm going to ask you all to please take my address off lists and not to correspond with me unless a)it's an emergency, b)it's information that pertains to the insurance racket.

I'll let you know when I'm caught up so you can start sending jokes and health tips again but for now, I'm spending too much time reading jokes, health tips and chat, time that I need to get caught up.

GOOD NEWS (lots of it):

1) UNUM loses in the Supreme Court. This was a case where UNUM won at the District Court level, lost on appeal and lost in the Supreme court. Although Mr. Ward is still going to have to fight for his benefits, he has been granted the RIGHT TO APPLY for them even though his application was filed past the guidelines in the policy (because he had forgotten about the policy and his HR department at work didn't tell him. So he didn't know about the DI insurance until he happened to find his booklet some months later.) The opinion can be viewed at:

There are a few of you on this list who were wondering if you could APPLY for benefits after the deadlines. At least in California, the answer is now officially YES. But more importantly the Supreme Court held that since California's "notice-prejudice" rule COMPLEMENTS RATHER THAN CONTRADICTS ERISA, this should pave the way for being able to sue for punitive damages in states whose insurance laws allow punitive damages. Basically what the court is saying is, as I've said all along, ERISA provides MINIMUM guidelines for group health insurance claimants. States can still enact STRONGER LEGISLATION to protect policyholders and in fact most states do have stronger penalties than provided by ERISA. These stronger penalties COMPLIMENT ERISA's basic mandate of protecting policyholders and beneficiaries from unscrupulous claims procedures.

2) First RICO Class Action against an insurer for QUALITY OF CARE issues. THE RACKETEERS AT AETNA

The first major racketeering suit against a HMO has been filed. May there be more.

April 19, 1999

Aetna Sued Under Racketeering Law

By The Associated Press

PHILADELPHIA (AP) -- Three Aetna Inc. members and a consumer group on Monday
sued the giant health maintenance organization for false advertising. It was
the first lawsuit against an HMO under a federal anti-racketeering law.

The lawsuit, which seeks class-action status, claims Aetna attracted
potential customers by saying it was dedicated to quality medical care.
Instead, the company encourages system-wide cost-cutting that undermines
medical care, the lawsuit alleges.

The lawsuit was filed by Joseph and Jo Ann Maio of Philadelphia and Gary
Bender of suburban Philadelphia on behalf of nearly 6 million people who
enrolled or renewed HMO membership in Aetna from July 1996 to the present.
The Foundation for Taxpayer and Consumer Rights, a Santa Monica, Calif.,
consumer group, is representing the HMO members.

The lawsuit seeks unspecified monetary damages and asks that Aetna stop
misleading customers.

Officials with Aetna, based in Hartford, Conn., refused to comment on the

``Aetna should no longer be able to advertise and represent that they are
primarily committed to quality, when in fact they have systems in place that
eviscerate quality medical care,'' said Jamie Court, advocacy director for
the consumer group.

The lawsuit, filed in U.S. District Court in Philadelphia, is believed to be
the first filed against an HMO under the federal Racketeer Influenced and
Corrupt Organizations Act. A series of Supreme Court rulings in the past
year has permitted broad use of RICO, a law originally aimed at mobsters,
and allowed lawsuits by anyone allegedly harmed by a pattern of illegal
activities. The law has been invoked to accuse numerous huge corporations of

The lawsuit accused Aetna of undermining medical care, in part, by offering
financial incentives to doctors who see more patients and penalizing doctors
who do not.

3) Over in the Allstate Arena, there appears to be a stockholders revolt in the making as reported by Jim Mooney and Paula Moran

4) There is an investigation by a major TV expose show. I don't want to say which show at this point, but here's the letter that went out to the CEO of Provident Insurance Company, J. Harold Chandler. The letter is genuine, real, and confirmed. Whether or not a story will ever see air time remains to be seen.

March 22, 1999
Mr. J. Harold Chandler
President and Chief Executive Officer
The Provident Companies
1 Fountain Square
Chattanooga, TN  37402

Dear Mr. Chandler:

We are investigating claims that some insurance companies may have been engaging in massive bad faith practices. Specifically, our investigation seems to reveal a pattern of using biased and inexperienced so called "hired gun" IME's who provide inaccurate medical opinions, which are then used to terminate own-occupation disability policies written in the 1980's which have become liabilities for their company.

Some former claims examiners have stated that D.A.M. (drug, alcohol, mental-health) claims have been targeted because these insureds would be less likely to tolerate litigation and be less sympathetic to a jury. In addition, after using these hired gun IME's to contest legitimate claims, lengthy delays ensue while they allegedly "investigate" the claim, asking for information (frequently irrelevant and not required by the contract) leading to an ultimate DENIAL. These tactics, if factual, show a complete disregard for the "good faith" obligations they have for the insured and possible RICO violations.

These bad faith practices apear to be known, tolerated, and possibly supported by the Commissioner of Insurance in the state of Tennessee, where your company is domiciled. Also, initial reports indicate the existence of business connections between Commissioner Sizemore and Provident, and which would seem to be a conflict of interest.

We hope that your company would like the opportunity to respond to these issues. The Tennessee commissioner and several physicians used by Provident will be contacted over the next few weeks.


5) The other good news is that my friend and assistant Jack Artale is now out of the hospital (he had a severe flare-up of his Chron's disease resulting in two hospitalizations) and seems to be finally on the mend. In the future, if I become overwhelmed you may receive some messages from Jack on this list. Although his typing skills are not as sharp as mine, much of the research, especially finding legal cases, for my lawsuit was done by Jack and I couldn't have substantiated my allegations without them.

6) So it looks like the Supreme Court is beginning to address the problems of ERISA and massive claims fraud by allowing RICO and lessening ERISA pre-emption. The expose shows are waking up. May the tide continue to turn.


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Created: May 4, 1999
Last Updated: May 28, 2000