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Our subrogation decisions affect more than our own bottom line. Risk managers know that the premiums they will pay three years from now depend on how aggressive and successful we are in subrogating large losses. Whether we value and invest in subrogation is the true test of our desire to optimize the recoveries we make and the lengths we will go to fulfill the service – and in some states the “duty” – we owe to our insureds, for it is often our insured which pays the price for missed subrogation opportunities.

Health insurance subrogation involves more than making demands on negligent tortfeasors. Coordination of Benefits (COB) is a subset of health Plan subrogation. It primarily concerns itself with situations where two different health Plans, or a health Plan and a no-fault auto carrier, cover the same person or loss. With two sources of coverage, the question becomes: Who pays what? The answer lies in the COB clauses contained in the competing insurance Plans.

Carriers and adjusters are all too familiar with the “judgment-proof uninsured at-fault motorist.” Unless your insured happened to be driving in the Tampa area and was t-boned by Tom Brady, the same day his auto coverage lapsed, the question always becomes “is it worth pursuing subrogation?” Initiating subrogation against uninsured and judgment-proof drivers is often nothing more than an exercise in futility. However, it can be a lucrative and rewarding subrogation endeavor if handled appropriately and with the right tools.

Matthiesen, Wickert & Lehrer, S.C. is pleased to welcome Timothy D. Edwards as senior counsel to the firm’s Wisconsin office. Tim is an experienced litigation lawyer who brings with him a wealth of insurance and complex litigation experience to MWL’s subrogation arsenal. Tim is licensed in Wisconsin, Arizona, and Florida, and has extensive experience in State and Federal court litigation and appeals, including the preparation of pleadings, dispositive motions, and complex electronic discovery plans. He has served as lead counsel in complex federal class action lawsuits. We look forward to the vast amount of experience and insight Tim brings to the firm, and eagerly welcome him to our growing family of subrogation professionals here at MWL.

Successful subrogation against power companies is not a given. The Texas Supreme Court is currently reviewing whether ERCOT will be granted governmental immunity. The potential exposure from the losses sustained by property owners as a result of power outages will be in the hundreds of millions of dollars. The Texas Supreme Court ruling will have overreaching implications for Texas residents and their insurance companies. A favorable ruling will open the door for subrogation claims to proceed forward. An unfavorable ruling will shut that door completely. Given the six-month notice requirement, companies will need to act fast in putting ERCOT on notice of their claims, so as to protect any potential right they might have in the future.

All too often insurance claims professionals assume that cold weather in a southern climate is an “Act of God”, excusing any third party responsible for not protecting the home from the foreseeable flooding. In Texas, insurance claims resulting from water damage from frozen pipes alone could be in the tens of millions of dollars. Ice on the roads does not excuse drivers from exercising caution and will also lead to tens of millions of dollars in property damage claims. Plumbers will be in high demand and homeowner insurance claims will certainly be on the rise. While frozen water itself may be an act of nature, care should be taken to investigate what caused the water to freeze. Good investigation may reveal a liable third party and subrogation may be available.

Injury and workers’ compensation cases involving slips and falls on snow and ice during winter in America’s northern states, and southern states this year, continue to be a perplexing subrogation puzzle for insurance claims and subrogation professionals. During the winter months, our office sees a flood of cases involving slips and falls on ice, snow, and slush during winter conditions. It is important to understand when and how liability attaches in such cases – and when it does not.

Matthiesen, Wickert & Lehrer, S.C. (“MWL”) is pleased to welcome Matthew M. Spolsky, a new litigation associate, to the firm. Matt has been employed with MWL for the past two and a half years, serving as a hearing representative in our California office. He studied for and took the difficult California State Bar Exam while working at MWL and was sworn in on January 15, 2021. Matt brings with him a wealth of administrative workers’ comp experience with the W.C.A.B. and will now be handling additional subrogation cases throughout California. Matt’s practice will focus on workers’ comp lien matters, property and casualty, workers’ comp, and auto subrogation cases throughout California and across the country. His understanding of the workers’ comp case in chief will provide welcome assistance to the subrogation practice here at MWL.

California is one of the most complicated states when it comes to workers’ comp subrogation. In California, workers’ comp is mandatory for all employers, even if the company has one employee. We will discuss the many nuances of California workers’ comp subrogation, including statutory rights, who can bring a third-party action, notice requirements, when to intervene, allocation of third-party recovery, how employer negligence effects allocation, Exclusive Remedy Rule, and many other issues affecting subrogation. This webinar will be beneficial to claims professional in all levels of experience who have subrogation responsibilities in the Golden State.

Effective October 1, 2020, Maryland did the unthinkable, sending a signal to all Maryland residents that while obtaining liability insurance as a prerequisite of exercising the privilege of driving is the law, if you break that law there will be no consequences. Maryland’s new House Bill 280 now eliminates the ability of the Motor Vehicle Administration to suspend a judgment debtor’s driver’s license at the request of a judgment debtor. But it does much more than that.

Given the confusing and unusual nature of Alabama wrongful death and survival actions, it is only natural for there to be confusion when the concept of workers’ compensation subrogation in death cases enters the picture. Alabama approaches this somewhat differently than most states. It requires an understanding of the law regarding and the difference between survival actions and wrongful death actions.

The Delaware Supreme Court recently affirmed a ruling which constitutes a potentially very dangerous and confusing opinion. Some might read the decision in ACW Corporation v. Maxwell as a major departure from both the Delaware workers’ compensation subrogation statute and well-established subrogation law, interpreting it as declaring that lump-sum workers’ compensation settlement payments are not recoverable via subrogation from a third-party tortfeasor, but this would be an overreaching and incorrect interpretation of the decision. Nonetheless, a thorough understanding of the ruling is necessary for any subrogation professional practicing in this jurisdiction.

Ashton Kirsch will be presenting this webinar webinar on February 10, 2021 at 10:00 to 11:00 a.m. (CST). We will discuss the basics of cyber claims and provide an introductory analysis of how these claims may appear in a day-to-day context along with a basic framework to identify subrogation potential. Additionally, we will analyze best procedures for maximizing recoveries on cyber subrogation claims and the best protocols for enhancing your carrier’s security protocol and protecting key information. This webinar will benefit claims professionals in all levels of experience.

One of the appealing aspects of working in the subrogation industry is that cases come in all sorts of shapes and sizes. Some involve clear liability, others involve a very complicated piece of machinery, but no case sticks out more than those darned, “he said, she said” cases. The thoroughness of your early investigation efforts will have the greatest impact on your ability to successfully resolve a claim down the road. Save your future self the trouble and go through the steps of a thorough investigation during the beginning of a claim. You will thank yourself when your subrogation investigation efforts make proving a case elementary.

An obscure and unpublished circuit court order from Buckingham County, Virginia, is being circulated by trial lawyers across the Old Dominion State for the proposition that a workers’ comp carrier is not entitled to subrogation for or reimbursement of any amounts it “voluntarily” pays as compensation pursuant to a lump sum settlement of the workers’ comp claim for future benefits. The order created quite a stir because it appears to contradict many years of established Virginia workers’ compensation subrogation law and provide injured employees with the ability to reduce liens which included compromised workers’ compensation claims.

Nothing in life is free. The common saying is especially true for medical services. Most states provide hospitals with unique statutory ways of ensuring that they are reimbursed for the services they provide—especially in the case of patients without health insurance. In general, public policy dictates that this medical care is important to our overall society – so it is also important for a hospital to be able to ensure that it is reimbursed for health care services it provides. Hospital liens are also often referred to as “health care provider liens” or “medical liens.” Every state handles them differently; and Florida is no exception.

Matthiesen, Wickert & Lehrer would like to thank our clients and local counsel for a wonderful year and wish you all a Merry Christmas, Happy Hanukkah, and a blessed Holiday Season. Regardless of what Christmas means to you, we hope your Christmas is full of holiday cheer shared with family and friends. For us at Matthiesen, Wickert & Lehrer, S.C., Christmas is just the beginning – a simple, yet wonderful reminder of Christ’s humble beginning as a human child in this world. It’s only a beginning because His birth merely set the stage for the power, glory, and salvation that would be revealed in His life, death, and resurrection come Easter morning. An important part of the holiday season is remembering those who make the holidays meaningful to us. We would like to wish you and your family all the happiness and prosperity this Season can bring and may it follow you throughout the coming year!

Release Language, Indemnity, Hold Harmless, and Other Concerns. The bane of any subrogation professional’s existence is the dreaded release. It is no coincidence that when Zeus uttered the words, “Release the Kraken!” in the 1981 fantasy adventure film The Clash of the Titans, he chose the word “Release.” The meme itself connotes setting loose utter destruction on one’s enemy—a description which can be woefully accurate to describe the potential aftermath of signing releases which are overbroad and contain terms, conditions, and obligations which a subrogated carrier has no business agreeing to or assuming. If you’re not careful, you will wish you had never settled the case in the first place.

The War Hazards Compensation Act (WHCA) applies to DBA employees who are injured as a result of hostile actions. While WHCA claims can be substantial, the statute provides a detailed set of procedures and requirements which, if performed properly, allow the employer or carrier to see 100% reimbursement of such claims including allocated and unallocated expenses—not from a responsible tortfeasor, but from the government itself.  

In the continuing struggle between recovery of medical expenses billed vs. recovery of discounted medical expenses paid by insurers, an Arizona federal court has sounded off on the duty and obligation of a Med Pay carrier with respect to paying its insured for medical bills. The implication of this evolving area of law is having a profound impact in the area of subrogation, and recovery professionals would do well to be aware of these laws from state to state.

MWL is proud to announce the opening of its new Florida subrogation law office located at 1301 Riverplace Blvd., Ste. 800, Jacksonville, FL 32207. MWL is also pleased to announce that Florida attorney Elizabeth Hernandez has joined the firm as the managing partner of the new office, which opened October 12, 2020. We are excited about the experience and insight Elizabeth brings to the firm, and eagerly welcome her to our new Jacksonville office, which is already very busy. The increased need for subrogation representation of our Florida clients has long pointed to this expansion into Florida. Jacksonville joins New Orleans, Los Angeles, Hartford, and Austin as the latest MWL branch office.

Despite the good intentions of the Florida Legislature, no-fault insurance has created the problem of PIP insurance fraud throughout the state. In an effort to hold down premiums—an effort which has clearly failed—Florida’s no-fault scheme requires the insured to meet certain verbal thresholds before suing. As a result of PIP fraud and high insurance premiums, there has been a legislative battle brewing over the PIP insurance system.

Florida PIP subrogation is a pain in the butt. PIP insurance covers the insured – regardless of fault. To file suit against a negligent tortfeasor who caused an accident, Florida’s no-fault law requires the insured to meet verbal thresholds. As an indirect result of limitations on tort actions, the general rule in Florida is that PIP benefits may not be subrogated, but there are two exceptions.

Florida is a property subrogation mecca and understanding how to effectively document, inspect, and preserve subrogation potential in the Sunshine State is indispensable knowledge for any recovery professional. When a property damage loss occurs, subrogation possibilities should be at the forefront of any insurance professional’s mind. Experts must be qualified and thoroughly vetted to be sure that the judge in a subrogation suit will allow them to testify.

Subrogation professionals must be aware that Florida’s collateral source statute contains a trap for the unwary. Under F.S.A. § 768.76 (6), if a provider of collateral source benefits does not respond to the insured’s request for a statement asserting the subrogated lien amount within thirty days, the carrier may be barred from recovering its subrogation lien in the matter. The fine print is buried in Florida’s collateral source laws thousands of pages away from laws and case decisions authorizing Med Pay and health insurance subrogation in Florida. Not being aware of it can be fatal to your subrogation aspirations.

Following a storm or other natural disaster, canvassers hired by the “hail cartel”—lawyers or opportunistic general contractors—can be found blanketing a neighborhood and knocking on doors. They locate and fabricate damages which either did not exist or were pre-existing and ask the homeowner to sign an Assignment of Benefits (AOB) and promise them a new roof at no cost and with no hassle on their part. Claim solicitation efforts such as these have ensnared innocent homeowners in unnecessary lawsuits in recent years by promising big payouts at no cost. The result of the widespread scheme is higher insurance premiums and less choice in insurance companies throughout many states.

Workers’ compensation subrogation has another growing adversary—one that can slip in during the cover of night, gutting subrogation, and reimbursement rights, even after an insurance company or third-party administrator has spent thousands of dollars in recovery efforts. It is known as an OCIP, CCIP, or CIP, acronyms which spell trouble for workers’ compensation carriers which zealously pursue recovery opportunities on behalf of their insureds.

The Court of Appeals has held that even requesting that plaintiff prove the employee wasn’t made whole can lead to liability for plaintiff’s attorneys’ fees. This decision lays bare the anti-subrogation atmosphere in Arkansas, which places large jury verdicts and injured workers’ rights ahead of statutory subrogation rights of Arkansas small businesses for whom subrogation success means lower experience modifiers and lower workers’ compensation premiums.

Effective workers’ compensation subrogation requires a complete knowledge of all aspects of workers’ compensation law, and an aggressive recovery program must necessarily involve a carrier holding out its hand for reimbursement from an employer whose intentional acts caused the work-related injury. Knowing when and under what circumstances this can be done is an obvious necessity of successful subrogation.

Kansas Decision Introduces Concept of “Statutory Deficit”. The Kansas Court of Appeals is holding class on why it is important to have subrogation counsel in workers’ compensation subrogation third-party cases, even in states which are favorable to carriers, and it’s not the first time it has tried to warn the industry of the importance of being represented in third-party lawsuits.

This new decision doubles down on the fact that simply because an insurance company is subrogating against one of its own insureds, the Anti-Subrogation Rule will not bar a subrogation action if the “risk” for which the defendants were insured by the subrogee was different than the risk for which the subrogee insurance company is suing.

In its widest sense, “no-fault insurance” is a term used to describe any auto insurance coverage under which policyholders are paid for personal injuries and property damage they sustain in accidents through their own insurance company, regardless of fault. Not only is no-fault confusing and dysfunctional, it also contradicts basic American principles such as individual responsibility and accountability. By eliminating “fault”, the law treats good drivers and bad drivers the same. This weakens the deterrent effect of tort law. It also eliminates full compensation. In an effort to avoid the abuse of claims for pain and suffering and other non-economic damages, the experiment has thrown the baby out with the bathwater.

Good first-party claims practice requires prompt repair of damaged vehicles. Cost-conscious and profit-minded auto insurers aggressively pursue subrogation upon being notified of a physical damage claim. They provide carriers for culpable tortfeasors with police reports, witness statements, and evidence of the claims damages they have paid. With increasing frequency, liability carriers are refusing to take such damage “evidence” at face value. Instead of simply paying the claim, they are arguing that promptly repairing the vehicle without giving them the opportunity to inspect and verify the damages is tantamount to spoliation and is a defense to the claim against them. But are such claims of “spoliation” legitimate?

In most states, laws and regulations governing subrogation and/or reimbursement rights of a workers’ comp carrier and its insured are virtually non-existent. Insurer claims for reimbursement from their insured and disputes over who gets reimbursed what, when there is a successful subrogation recovery, often hinge upon the parties’ rights under the policy. Because carriers file their individual deductible program with each state, no two are alike, and these agreements become very important in determining recovery rights.

The federal government employs nearly 9.1 million workers – nearly 6% of total U.S. workforce. Every year, the government pays an estimated $35 billion annually because of vehicle crashes alone, an estimated 12.6% of the total economic cost of crashes (Federal 7.1%, State/Local 5.5%). For limited government advocates, the numbers are astonishing. For subrogation professionals, the numbers should represent a tremendous opportunity.

In California, until you have received permission from the court to intervene, a party lacks any standing to the action. Filing a motion to intervene can be equated to filing a Notice of Lien because you have yet to receive court approval to intervene. Filing a Notice of Lien does not make you a party to the action nor does it give you any rights to actively participate in the underlying lawsuit. You are standing in California’s intervention line.

On May 12, 2020, the New Jersey Supreme Court answered a long-standing subrogation question regarding whether a workers’ comp carrier is entitled to reimbursement from a third-party tortfeasor who is covered by New Jersey no-fault insurance, even though the employee does not otherwise meet the verbal threshold allowing them to sue the tortfeasor. The Supreme Court confirmed that the subrogation rights of a workers’ comp carrier are not affected by New Jersey’s no-fault and verbal threshold requirements.