On a warm summer day, Jim Ridler was riding his motorcycle on a southwestern Minnesota highway when an oncoming car swerved into his lane.
With broken bones in his neck, collarbone, pelvis, ribs and legs, Ridler spent seven months in the hospital and endured 18 surgeries.
The one comfort: His future would be secured with a $450,000 insurance settlement. But his health plan stepped in and took 90 percent of it to recoup what it paid to cover his medical bills.
State lawmakers are trying to make sure that doesn't happen to money they want to give to survivors of the Interstate 35W bridge collapse.
In response to rising health care costs, certain types of health plans are increasingly laying claim to money members have won in court or in other settlements -- whether it's for medical bills, pain and suffering, or other reasons, attorneys said.
"I don't think any of us are interested in setting up a fund to pay off insurance companies," said Rep. Ryan Winkler, DFL-Golden Valley, who has introduced a bill to create a 9/11-style compensation system.
About 40 percent of Minnesotans are covered under such plans, according to Minnesota Department of Health estimates. Such plans are typically self-insured and company sponsored, and therefore governed by federal rules.
Depending on how their contracts are written, those plans can take almost any damages recovered by individuals until the plan is paid back.
Minnesotans who have health insurance governed by state law have more protection -- those insurance plans can recover money only after a victim has been fully compensated.
Attorney Chris Messerly, part of a consortium representing about 80 bridge survivors for free, said "the vast majority" of the clients he's seen are under the federally governed policies.
A form of cost control
The practice, "subrogation," has been around the insurance industry for decades.
With health care costs rising, health plans have been trying to recover money more often, attorneys said. Some plan administrators say they are obligated to recover the money for the benefit of their members. Businesses have popped up to go after money on behalf of the plans, attorneys said.
"Anything that can be done today to help keep costs down ... is a good thing in terms of being able to provide health care coverage for all those who need it," said Mohit Ghose, a spokesman for the Washington-based industry group America's Health Insurance Plans.
The philosophy behind the practice is to prevent victims from getting compensated twice for the same thing -- once by insurance and again by a settlement.
For people like Ridler, who sue and get only part of what they won, it feels like robbery. "That should have gone into his pocket to compensate him for his pain and suffering, and how this accident altered his life," said Jim Lord, Ridler's attorney.
Ridler said he thought his premiums covered him. "I couldn't believe they could do something like that," he said.
Now Ridler works full time at an adult foster care group home -- the same type of work he was doing before the accident -- but said he doesn't have health insurance. His employer offered to pay a portion of an outside plan. But even if he could find a company to cover him, he said, he couldn't afford his share of the premiums.
Lawmakers, who are trying to make up for bridge collapse survivors' financial losses and out-of-pocket expenses, are brainstorming with attorneys about how they can keep health plans from recovering money meant for victims.
Federal laws trump state laws, they acknowledge.
"Fortunately most folks in America go through their lives without a serious personal injury ... but for those who have an injury, this scheme adds insult to injury," said Minneapolis attorney Thomas Conlin, who said he has been fighting to get the rules changed ever since one of his clients -- a Hormel Foods meatpacker from Austin, Minn., and his wife -- were hit head-on by a wrong-way driver and had much of their settlement recovered by the company's health plan.
A Hormel executive said the company's subrogation program, "to our knowledge, is standard in the industry. The purpose of the program is to manage insurance costs for the company and all our employees."
The company first works with an employee to determine a compromise, said Julie Henderson Craven, Hormel's vice president of corporate communications, and its "actions in this case are consistent with those policies."
Earlier this month in Wisconsin, a federal judge ruled in favor of a company trying to recover $25,000 a woman had received in a settlement. A Missouri case involving Wal-Mart making claim to an award for an employee is being appealed to the U.S. Supreme Court.
Local attorneys say they are working more often to strike deals with health plans before deciding whether to sue in the first place. That may be more difficult in the case of the bridge collapse if claims against the state are settled from a fund.
Sen. Ron Latz, DFL-St. Louis Park, who is also sponsoring a bridge fund bill, said lawyers have mixed opinions on how to proceed. "All we can do is try our best to formulate this compensation in such a way that the money will be able to stay with the victims," he said.
Ideas include depositing the money in a way that it's not directly in the survivors' hands, getting waivers from health plans before paying victims or writing the law to bar health plans from recovering money and hoping it would withstand legal challenges.
Kenneth Feinberg, who calculated victim payments as special master to the federal government's 9/11 fund, said he took into account what was owed to insurers and gave victims enough to cover that, plus what victims were owed.
Under both I-35 bridge fund bills, however, the money would be capped in some way.
Ultimately, some hope health plans and employers will yield to political pressure and realize the bad publicity they could face by going after bridge victims for the money.
"If [health plans] want to come into federal court and sue survivors to try to take away some of the compensation which they've received, they should be ashamed of themselves," said attorney Jim Schwebel, who represents two dozen bridge victims. "And we'll do our best to make them ashamed of themselves."
Pam Louwagie • 612-673-7102