The Ohio Legislature recently passed legislation beneficial for injury victims. If we represented you in the past, you may recall at the conclusion of the case, we discussed the various parties requiring payment. Health insurers, auto insurers and disability insurers all have their hand out to get any money back they paid to an injury victim. In the past insurance companies did not have the right to be reimbursed. Changes in insurance company contracts and legislation ushered in an era of subrogation, a right on behalf of insurers to “re-coop” their expenses, and obtain reimbursement, from their insured, when their insured recovered money for an injury. We think it’s unconscionable that insured’s have to pay for coverage for unforeseen events and then insurers on top of their hefty profits try to seek reimbursement for what they were obligated to pay.
Has anyone ever been refunded the premiums they paid for coverage when an insurance company gets reimbursed? Contact our office if an insurance company willingly refunded money. When subrogation and reimbursement policies started, the Ohio Supreme Court developed a Make Whole Doctrine. Quite simply it states that before any insurance company can seek money the injured party has to be fully compensated. We think that only seems right. The insurance companies, however, were not happy. They demanded the first dollar and every dollar until they were fully paid. Then if any money remains, the injured party could retain what was left.
The insurance industry poured a great deal of money into judicial and other political campaigns to assure their position carried the day. The Make Whole Doctrine was cast aside and the law of the land became: insurance companies first. This created scenarios where people who sustained severe injuries and huge medical bills recovered nothing because the health insurer took all of the available recovery leaving the injured party with a shattered life, inability to work and no compensation. We are shocked that insurance companies could look at an injured party and take all the money even though the victim has to live with a horrible injury. They argue that this policy helps keep premiums down. Have any premiums gone down?
The unacknowledged problem with that approach is that society will pay the tab for the injured person to be on social security, welfare, Medicaid and Medicare while the health insurance industry executives pull down big salaries and donate big money into elections.
So what has our legislature done recently to ameliorate this problem?
They passed House Bill 64, which provides that insurance companies can only receive their proportionate share of the recovered funds available when the injured party is confronted with a less than full recovery. The law went into effect this fall. It is not nearly as good as the Make Whole Doctrine, but it is a far sight better than what has been the law. After about a decade and a half of the law consistently and repeatedly diminishing the rights and recovery abilities of injured people there is finally a change for the good. The insurance industry has fought this bill. Several states have outright banned subrogation and reimbursement. Ohio is behind the curve but at least we have finally turned the corner.