Class Action Suit Filed Against Bankers Life


April 4, 2013 in U.S. District Court in Portland


Lorraine and Charles Bates; Eileen Burk, and David Youngbluth


Bankers Life and Causualty Company, CDOC, Inc., CNO Financial Group, Inc., Conesco Life Insurance Company of Texas, Doe Corporations I-X and James D Peterson

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The four plaintiffs filed the suit against Bankers Life on the grounds that the insurance company committed elder abuse by wrongfully denying and delaying long-term care insurance claims and raising premiums without improving benefits. The suit also alleges breach of contract, breach of promises, fraud, negligence and intentional misconduct.

The suit is currently seeking a judge’s approval to represent a class of 9,000 people in the state of Oregon.

According to Lorraine Bates, Bankers Life claimed the adult foster home Bates moved into in 2009 didn’t match policy requirements. The Oregon Insurance Division, however, said in 2011 that Bankers would pay her claim, 19 months after she first filed it.

David Youngbluth decided to take legal action after trying to file a claim for his mother in 2008, who moved into assisted living after a fall. According to Youngbluth, Bankers still owes him three months’ worth of unpaid benefits.

The lawsuit also claims that Bankers sold policies without disclosing large premium hikes without a similar increase in benefits. According to Eileen Burk, her premiums nearly doubled in 2010.

Class Action Suit Filed against John Hancock


January 30, 2013, in the Boston federal court.


Richard Feingold


John Hancock Financial Services

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Richard Feingold filed a class action suit against John Hancock Financial Services on the grounds that the life insurance company doesn’t work hard enough to pay out life insurance benefits. According to the lawsuit, the life insurance company regularly used the Social Security Administration’s master death list to check whether annuity holders had died in order to halt insurance payments. However, the company failed to routinely use the list to see if policy holders had died in order to promptly pay beneficiaries.

According to Feingold, his mother had purchased a life insurance policy in 1945 and died in 2006. However, Feingold, who was the beneficiary of the policy, didn’t receive the benefits until 2010 when he discovered them on the Illinois Treasurer’s unclaimed property website. Feingold filed the suit on behalf of himself and others whom Hancock had failed to notify of life insurance benefits.

This lawsuit follows a recent settlement by John Hancock and other major insurers on a lawsuit filed by the government for similar allegations. Hancock agreed to pay a settlement of $13 million dollars and to use the Social Security database more frequently to search for unpaid beneficiaries.

Offsetting of Current Health Care Claim Payments by Health Insurers is an Unlawful Money Grab

In the ongoing battle surrounding audits by health insurers of medical providers, health plans and health insurers are now employing the unlawful technique of offsetting.  This involves the health insurer issuing EOBs that show that payments would be due — but no check is issued — because the insurer offsets the payments with debt it alleges to be due in connection with a past audit.  These are prohibited and unlawful acts under the Employee Retirement Income Security Act (“ERISA”).

Health insurers are typically unaware that they are “claim fiduciaries” under ERISA.  When they process and handle health insurance claims, they are dealing with ERISA governed benefits under employee benefit plans.   Thus, ERISA is the governing law.  Health insurers have been engaging in conduct that they either don’t know is unlawful or do not think that the medical providers will hire ERISA experts to discover their illegality.

We are pressing these issues throughout the United States, with great success, on behalf of medical providers facing audits and various associated aggressive and unlawful tactics by health plans (self-insured) and health insurers (insured plans).

For more information, contact Richard Quadrino at or by calling him at 1-800-745-1755.


Health Insurer “Hijacking” of Health Care Providers’ Claims is Unlawful

Many health insurers who have conducted post-payment audits of medical providers and decided that money is due to repaid to the health insurer have unilaterally decided to stop all payments to the provider.  This “hijacking” of current claims is nothing more than an effort to extort a repayment from the medical provider for alleged “overpayments”.

The hijacking causes even more legal problems for the health insurer.  In the first instance, the post-payment audits in the commercial insurance arena are typically prohibited. Demands for repayment due to alleged “overpayments” are usually not authorized under ERISA governed health plans.  Thus, the demands for repayment are unlawful.  By stopping all claims payments after an audit, the health insurers are merely compounding their legal troubles and subjecting themselves to various remedies.

Medical providers who have the proper ERISA counsel can stop this unlawful activity by the health insurers.  ERISA provides for an injunction to be issued by a federal judge to stop practices and acts that are unlawful under ERISA.  A federal court can also direct that all unpaid claims be paid immediately.

For more information, contact Richard J. Quadrino of Quadrino Schwartz at or by calling him at 1-800-745-1755.

Quadrino Schwartz Assembling Legal Teams to Push Back at Unlawful Health Insurer Practices

Most medical providers are not aware of their ability to use ERISA to protect and enhance the profitability of their practice.  Having proper counsel on your side is essential to addressing problems with commercial payors or administrators for all privately funded health plans.

Richard Quadrino of Quadrino Schwartz is assembling teams of attorneys across the country. The firm is contributing its many years of successful ERISA litigation and claims experience to these teams.  In addition, Quadrino Schwartz brings decades of insurance industry claims, litigation, and class action experience to the endeavor.

With Quadrino Schwartz on the team, the group and their clients can use all of the ERISA and insurance industry legal tools available to address health insurer refund requests and audit requests.  These legal teams also pursue denied claims where the claim denials are governed by ERISA.

For more information, see


Blue Cross Blue Shield Waging a National Campaign Seeking Refunds From Doctors

The various Blue Cross Blue Shield entities are contacting doctors all over the United States seeking to conduct “audits” or “retrospective reviews” on health insurance claims that have already been paid to the doctors, long ago.  These audits do not involve allegations of fraud, but rather efforts by Blue Cross Blue Shield to attempt to recoup monies that they believe they should never have been paid in the first instance.

Richard Quadrino of Quadrino Schwartz is involved in resisting and defeating such audit and “recovery” efforts by health insurers.  He is working with groups of attorneys across the country, lending his experience in ERISA litigation and claims and using the various legal tools available to address these refunds requests and audit requests.

For more information, see

Revised Opinion by Federal Appeals Court Affirms Key Part of Its Ruling in Health Insurance Case

A California appeals court decided to take a second look at its opinion in a case against health insurer Blue Cross Blue Shield.  The insurance company had asked the entire group of appeals court judges in California to review the case.  That request was denied, but it prompted the second review.  In the Court’s prior decision, the Court ruled in favor of a woman suffering from anorexia nervosa by ruling that Blue Cross had to pay for her inpatient treatment.

One key part of the prior decision was the Court’s conclusion that Blue Cross could not raise a defense of medical necessity in court because it failed to raise it during the claims process. While the Court revised its analysis on another, unrelated point, it left unchanged the key ruling as to the forfeiture of untimely asserted defenses.

Quadrino Schwartz is pressing this issue and others in the health insurance arena on behalf of medical providers and hospitals on their denied health insurance claims.

For more information contact Richard J. Quadrino at or call 1-800-745-1755.


Federal Appeals Court Deals a Blow to Aetna on Various Issues in Health Insurance Case

The United States Court of Appeals for the 5th Circuit ruled in favor of a health plan’s HMO member and against Aetna regarding a claim for out of network benefits.  In an extensive opinion, the court ruled against Aetna on various legal issues that could set a precedent for the benefit of health plan members under HMOs and other plans nationwide.

The Court, in Koehler v. Aetna, first ruled that Aetna’s summary of the health plan violated ERISA, the federal law that governs most group health insurance in the United States. The language was difficult, vague, and confusing, so the court ruled that any benefit of the doubt when interpreting the summary should go to the plan member and not Aetna, the drafter of the unlawful summary. The Court then ruled that pre-approval for certain medical services was not required because the pre-approval terms in the plan’s summary were not clear and understandable, in violation of the ERISA regulations.

The Court also barred Aetna from raising late defenses and indicated that the plan member did not have to appeal Aetna’s denial because of the regulatory violations.

Quadrino Schwartz is in the forefront in representing medical providers and hospitals in pursuing denied health plan claims and addressing “audits” on closed and paid claims.  For more information, please contact Richard J. Quadrino at 1-800-745-1755 or at

Home Assessment Visits on Long Term Care Insurance Claims Can Be Improper “Functional Capacity Examinations”

Long term care insurance  companies will often request a field visit: an in-home assessment by a nurse to evaluate what types of assistance is needed by the long term care patient.  These visits are typically not required under the terms of a long term care insurance policy, but claimants often agree to have these visits take place.  The claimants and their families should be aware, however, that testing or rehearsal of various Activities of Daily Living are actually improper Functional Capacity Evlauations.

Functional Capacity Evaluations are improper for a variety of reasons.  First, the ability to perform a function on one occasion, for a few seconds, does not mean that a person can repeatedly perform that function on an hourly or daily basis.  There are published journal articles — internationally — that have commented upon the limited or poor level of usefulness of such tests.  Second, the particular test or command requested usually seeks a person to use an infirm or compromised body part or mechanism and the claimant may be hesitant or fearful of injury or pain and then can be easily accused of  what the insurance companies call “sub-maximal effort”.  And finally, there is a possibility of injury during these exercises and the long term care insurance company is unlikely to take financial responsibility for any injuries.

Claimants with long term care insurance claims should be armed with legal knowledge as their rights and as to what is proper or improper in the handling of their long term care claims.  You can contact us with any questions at

Health Insurers Improperly Rely Upon NY Statute Re: Alleged Overpayments

Effective January 1, 2007, New York passed a law entitled: “Rules relating to the processing of health claims and overpayments to physicians”.   At first blush, the new law appears to give a free 2-year look back period to the insurance companies in which they can freely request what they believe to be “overpayments”, without a need for establishing fraud.  On closer examination, however, the law appears to only set standards for when the insurance company can begin an audit process and it contains some of the standards and situations in which the insurance companies can “initiate overpayment recovery efforts.”

The law states that the insurance company or health plan cannot initiate an overpayment recovery effort more than 2 years after the doctor received the original payment from the insurer or health plan. The exception to the 2 year rule is when the insurer or health plan has a reasonable belief of fraud, intentional misconduct, or abusive billing or when the request for an audit is made by a self insured plan or there is a state or federal government program requiring the audit. The law defines “abusive billing” as billing practices that result in the submission of claims that are not consistent with sound fiscal, business, or medical practices and are engaged in at such frequency and for such a period of time as to reflect a consistent course of conduct.

Rather than answering questions and setting real standards, this new law actually raises a number of issues. The law only determines when an insurer or health plan can “initiate” an overpayment “recovery effort.” It does not state that after an audit is initiated and an effort has been made, that a refund must be paid by the doctor just because the insurance company has requested the refund. In short, while the insurance companies appear to be using the existence of the new law to accelerate their conduct of audits,  the law has not given the insurers or the health plans additional legal rights.  The law has not overruled the court decisions requiring proof of actual fraud in order for a refund to be due.

The law only addresses, in this writer’s view, the timing for the initiation of an audit or overpayment recovery request, not whether the doctor will indeed owe a repayment under any particular circumstance. For those doctors who are participating in a number of plans, there should be a review of the contract the doctor entered into with the insurer or health plan to see whether there are specific audit procedures and a delineation of significant rights granted to the insurer or the health plan. If the doctor has agreed in a contract to make a repayment under defined circumstances, the written agreement would supersede the fraud court decisions and control the relationship between the doctor and the insurer or health plan. The language in these contracts needs to be reviewed carefully, and qualified legal counsel may indeed identify numerous barriers that would prevent the insurer or health plan from obtaining a repayment from the doctor. Out-of-network plans present an entirely different legal situation, since the doctor has not entered into a contract with the insurer or health plan. There is no right to an “audit” in such cases and the doctor is in a stronger position when dealing with an audit request from an out-of-network insurer or health plan.

There are many additional legal issues involved and thus medical providers should seek highly qualified counsel when dealing with requests for medical records by insurers, health plans, or their affiliates on claims that have already been paid.