Adoption reform advocate Craig Mills provides illustrative prospective Texas class action lawsuit of collateral source abuse on auto accidents.

State Sen. Barrow Peacock as he sponsored an amendment to remove collateral source from the recently-passed tort reform initiative in Louisiana.  His colleague, Sen. Sharon Hewitt, would later explain the move as the football equivalent of a flea flicker with the intent all along to add collateral source language back in when the bill went to conference committee, thus leaving staunch tort reform opponents to essentially have it crammed down their throats with no ability to oppose the language’s inclusion in the bill.

One Sound Off Louisiana subscriber, Craig Mills, who is arguably Louisiana’s strongest advocate for major adoption reform in Louisiana after he alleged he was a victim of an adoption scam, closely followed our features on tort reform in Louisiana.  He was particularly intrigued by our feature on collateral source and the extreme degree that Louisiana’s trial lawyer cabal went to in order to keep that aspect of tort reform from becoming law in Louisiana.

The trial lawyers’ resolve to keep collateral source the way it is in Louisiana is best illustrated by Sen. Sharon Hewitt’s revelation that, as outlined on the preceding link, House Speaker Clay Schexnayder and Senate President Page Cortez felt they had little choice but to engage in the football equivalent of a flea flicker and remove the collateral source language from the bill with the full knowledge that they would add it back in conference committee with no time remaining for it to then be removed again.  Senate President Cortez called upon Sen. Barrow Peacock to serve as halfback in that football flea flicker move as illustrated by the following seven-second video of Peacock removing the collateral source provision of the bill on Monday, June 22, 2020.

State Sen. Barrow Peacock removes “collateral source” from HB-57 on the Senate Floor on Monday, June 22, 2020.

Don’t let the words “collateral source” sound complicated because it’s not.  The important thing to remember is that Louisiana’s present collateral source provisions essentially legalize the deployment of what amounts to otherwise-fraudulent collections entailing hospital billings for traffic accidents.  Accident victims in Louisiana have, for years, through the Louisiana trial lawyer cabal, been compensated for accidents based on hugely-inflated hospital billings vis-a-vis the amount actually paid to the hospital by a health insurance company, which is often a tiny fraction of the amount billed.  The lawyer and the accident victim simply pocket the difference, which is then passed on to us in the form of outrageous automobile liability insurance premiums!  That makes it about as simple as we know how to make it.

Texas too had a similar system in place until that state enacted tort reform years ago.  In at least one instance, Mills, who has extensive experience with hospital billings as a result of his own vocation, has provided us with recent news of a proposed class action lawsuit in Texas wherein alleged straight-up fraud entailing allegedly-inflated hospital billings has been deployed to bilk auto insurance companies and potentially the victims themselves out of the difference between the allegedly-inflated hospital billings and the amount companies like Blue Cross and Blue Shield would approve and pay.  Basically the suit alleges that the billing partner and hospital simply told victims it was mandatory to bypass the health insurer altogether or else the claim would not be paid!

While that angle offers a different twist in that it’s the hospital and a billing partner which are seeking to benefit, there’s nothing to keep a similar scheme from being deployed wherein an added “incentive” is introduced to the victim (naturally, explained away so as to appear innocuous, of course)  to simply go along with the whole arrangement so that everyone ends up with a piece of the “fraud pie,” all to the detriment to the auto insurance company.  From the preceding feature:

A proposed class action lawsuit pending in a Texarkana federal court accuses the company that operates Wadley hospital and a medical billing company of violating state law and engaging in fraud in auto accident injury cases.

“However, during the screening process, defendants had in place their unlawful system, which upon identifying plaintiff as having been involved in an automobile accident, listed defendant MRA as the ‘Primary insurance.’ Further, defendants’ unlawful system omitted plaintiff’s health insurance plan as the source for payment, listed her as ‘Self Pay,’ and further coded her financial status as ‘Legal,'” the complaint states.

After being treated, Williams’ bill came to $9,750.79. The complaint alleges that amount is higher than the total of what Blue Cross would have been required to pay through its contract with the hospital plus the amount Williams would have been responsible for out-of-pocket in co-pay and deductible. The complaint alleges MRA and Steward are guilty of charging a higher price for services than allowed by Williams’ coverage under her Blue Cross policy.

The complaint alleges that after Williams’ lawyer sent a letter to MRA in February 2019 directing them to bill her health insurance, MRA responded by claiming the medical coverage “will not process” if services were rendered subsequent to an auto accident. The complaint alleges the response amounts to a full admission of the “deceptive scheme” of falsely declaring health insurance will not cover auto accident injuries, intentionally not billing health insurance plans and seeking payment of an inflated bill from the patient or a third party.

The complaint asks the court to declare the billing practices violate Texas law, for an injunction halting the conduct, for restitution of monies collected in violation of Texas law, for damages and certification as a class action.

We welcome anyone who would like to do so to read the actual lawsuit by clicking here.

So, once Louisiana’s tort reform collateral source provision kicks in on January 1, 2021, we’ll all have to keep a close eye out for situations similar to the preceding Texas matter, lest auto liability insurance rates continue to be through the proverbial roof in Louisiana.

We express sincere appreciation to Mills for his tip on this development in Texas, and we look forward to updating subscribers on his ongoing efforts to reform the adoption industry in Louisiana to help ensure other prospective adoptive couples are not scammed in a manner similar to the way in which he alleges that he was scammed.

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