If this isn't a conflict of interest, I don't know what is !!
Read the text in bold , whattya think ?
More questions than answers seem to be arising from the recent revelation of how BP oil spill claims are being handled by the Gulf Coast Claims Facility and its Director Ken Feinberg.
A former claims adjuster clarified one major issue, which has come to light in the processing of claims and how claimants are classified on a scale of zero to ten.
“A lot of things depend on what category you are classified in,” said Kelly Johnson, a former large loss adjuster working with BP who now is helping claimants with his own business, Northwest Florida Consultants. “You are being classified on the scale depending on your profession like a doctor, dentist, wholesale grocery supplier, casino worker, cashier, waitress, etc.
“As they are putting the information in the category chosen will stop the claim and not let them go any further.”
This kind of transparency is just one of the issues noted in a Feb. 4 letter to Feinberg from Thomas J. Perrelli, who is with the U.S. Justice Department in Washington, D.C.
“I urge you once again to make the GCCF’s process more transparent,” said Perrelli in the letter to Feinberg on page two. “The period you have provided for public comment on the final payment methodology is important, and I know that you will take the feedback received on that proposed methodology very seriously.
“It is similarly important the claimants have an understanding of why their claims are handled as they are, and I ask the GCCF find ways to provide additional information about its decisions.”
Johnson pointed out the rating system used by the GCCF is a violation of the Oil Pollution Act of 1990.
He also explains how the process used by the GCCF is greatly different than what was employed while he was working with BP.
“Every claim stood on its own merit,” Johnson said. “I would fill out my forms and do my math to calculate what I figured the claimant deserved. These would be reviewed by an accountant and BP management and then finish building the claim.
“If my calculations were wrong they would tell me why and explain why the claim would be less or if there was a mistake and in favor of the claimant, then they could have me correct my paperwork and the process the request form to get them a check.”
Johnson pointed out the claims have far reaching effects due to the nature of some businesses.
One such business he is working with was a now closed Gulf Seafood Shop in Branson, Mo.
“This business would send trucks to south Alabama to get seafood and then drive back to Missouri in their refrigerate trucks with its product,” Johnson said. “They turned in a claim and had it denied because they do not have a commercial fishing license.
“In the beginning of this process each claim stood on its own and there was no line drawn to determine who should and who should not receive a check from a claim.”
Emergency payments is just one of the concerns, which the justice department took issue with, as does Johnson.
“The interim payment process must be efficient, fair and straight forward,” Perrelli said. “When a small business files for its interim claim every three months, and then waits 90 days for the claim to be resolved, its cash flow is already running six months behind.”
Representative Doug Broxson, who’s trip to Dublin, Ohio on Monday, brought more questions to light about the claims process wants everything to be crystal clear with the GCCF.
“We have been through major disasters here and dealt with insurance claims,” Broxson said on Monday. “We need the adjusters here to make the decisions on the ground.
“Doing that would help bring more transparency to the process and establish some level of fairness.”
Feinberg himself set a date for emergency (interim) claims as Nov. 23, but he did not set a date for document evidence. The U.S. Justice Department set that date as Dec. 14.
“Mr. Feinberg has said that 75 percent of all claims denied were for no or not enough documents,” Johnson said. “Around Dec. 4, I read an article in NOLA.com that said 65,000 claims has been denied. Two weeks later that number grew to over 350,000.
“How can you accurately process that many claims in that short of time? From my understanding at the time the GCCF were already two to three weeks behind entering in the documentation they had received.”
Amy Weiss, who handles media requests for Feinberg, responded about the large jump in a span of two weeks.
“We denied thousands of claims that either lacked any documentation or had woefully inadequate documentation,” Weiss said. “We also have at least 7000 claims filed that are seemily fraudulent.”
Back on Jan. 6, Rep. Broxson held a town hall meeting at Oriole Beach Elementary School in Gulf Breeze, prior to that meeting the figures from the GCCF website there have been 156,366 claimants in the state of Florida. Of those 122,160 were individual claims.
So far the GCCF claims they have paid out 68,172 claims with payouts nearing $1.1-billion in the state.
In a separate fund of Real Estate Brokers and Agents $29-million has been deposited, while over $1.040-billion has been paid to the claimants.
Most of these payments have been in the form of an emergency advance payment to individuals where roughly 33% of the claims have been paid.
Of the 149,516 only 54,928 have been paid, while business have fared better with 21,174 of the 41,327 business claims have been paid.
Broxson even went so far to address a letter to Feinberg on Jan. 24, following this meeting and had three requests of the BP Claims Fund Administrator, which went unanswered.
· Close down your Dublin, Ohio, office and open a central claims office on the gulf coast.
· Allow your 33 claims offices the complete authority to adjust and pay claims up to $50,000. Refer claims over $50,000 to your newly created Gulf Coast central claims center. Please note that such a system has worked for dozens of major insurance companies for decades in paying claims resulting from major catastrophes, particularly hurricanes in our area.
· Create a regional advisory committee to advise you on how to continually perfect the claims paying system.
A copy of the letter Perrelli wrote to Feinberg on Feb. 4 is available online at www.srpressgazette.com
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