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A prominent collection agency for Medicare services targets an estimated 60 viable asbestos trust funds, citing a failure to disclose settlement payments and provide reimbursements to health service providers.
MSP Recovery LLC, a leading Medicare/Medicaid recovery specialist, filed its first lawsuit against the JT Thorpe Settlement Trust last week, according to a report in The Wall Street Journal.
JT Thorpe Inc. is a former industrial equipment manufacturer that filed for bankruptcy in 2002. The lawsuit has been filed in the US bankruptcy court in Los Angeles.
Attorney John Ruiz, chief executive officer of MSP Recovery, told The Mesothelioma Center on Asbestos.com that he expects to file a lawsuit against five more trusts by the end of the month, and all 60 asbestos trusts in the coming months.
“If these companies don’t pay, it costs taxpayers money,” Ruiz said. “We have the right to collect.”
Ruiz believes that the lack of transparency regarding the trusts has weighed on the to treat patients to the general public through Medicare.
The lawsuit alleges that the lack of reporting on payouts is causing “huge financial losses” for Medicare Advantage programs, health care payers and physician groups, who are not properly compensated.
Confidential officers say complaint makes no sense
Asbestos trusts are not required to disclose payout amounts, although business groups have advocated federal legislation that would require more reporting and better protections against potential fraud.
Steven Bray, executive director of the JT Thorpe Settlement Trust, told The Wall Street Journal that the trust “believes that the complaint filed by MSP Recovery and the allegations associated with it are unfounded and will defend itself vigorously.”
The trusts were created by negligent businesses filing for Chapter 11 bankruptcy protection and include rigorous court-reviewed payout estimates to accommodate current and future claims.
They are companies that knew or should have known that asbestos was toxic and that exposure to asbestos can lead to serious health problems. Trusts are often created by solvent companies that have been flooded by lawsuits.
According to various accounts, there are currently 60 asbestos trust funds with estimated assets of $30 billion, intended to be paid in the coming years.
Since the early 1980s, the trusts have paid approximately $20 billion to claimants. Mesothelioma trust claim payouts can range from $7,000 to $1.2 million, with a median value of $180,000. Many claimants seek money from more than one trust.
occupationally exposed blue collar workers are the most common claimants against former employers. Family members who have been exposed to second-hand asbestos are also eligible to make claims and family members who have lost someone to an asbestos disease.
Some of the more prominent asbestos trust companies include:
- Owens Corning Corporation
Armstrong World Industries
Pittsburgh Corning Corporation
United States Plaster
WR Grace and Company
Babcock & Wilcox
Disclosure of settlements at issue in a lawsuit
According to the lawsuit filed earlier this month, the JT Thorpe Settlement Trust has paid more than 5,000 claims worth $167 million since 2006.
Correspondence between MSP Recovery and the JT Thorpe trust was included in the filing of the lawsuit. Trust executors said confidential settlement claims could not be made public and they were not bound by the Medicare registration and reporting obligations MSP Recovery wanted.
As part of the filing, MSP Recovery’s own investigation determined that in 284 of the trust claims, medical expenses were paid by Medicare, the government agency, and no reimbursement was granted.
MSP states that when Medicare provides care to patients, the asbestos trusts are required to report compensation and reimburse the Medicare providers.
“These are pretty simple cases,” Ruiz said. “Hopefully something has changed in a year or a year and a half.”
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