Defense Base Act Compensation Blog

The Modern Day DBA Casualty

AIG Exec Called to Congress to Answer for Handling of War-Injured Contractor Claims

Posted by defensebaseactcomp on June 18, 2009

Disabled Workers Say Insurance Giant Still Owes Thousands in Unpaid Expenses

Two civilian contractors who have accused AIG of making their recoveries from war-related injuries a “living nightmare” will have the opportunity to come face-to-face with company executives at a hearing today before the House oversight subcommittee on domestic policy.

Former KBR truck drivers John Woodson and Kevin Smith were called to testify after coming forward on 20/20 and Good Morning America to describe their battle to get AIG to cover basic medical treatment after they were seriously injured in Iraqi insurgent attacks.

Their stories were featured in a joint investigation between ABC News, the Los Angeles Times and the non-profit group ProPublica that revealed how AIG had engaged in a pattern of “delaying and denying” claims of disabled contractors while rewarding its executives with millions in bonuses, and hundreds of the thousands of dollars in lavish retreats.

Kristian Moor, the president of AIG’s massive insurance operation, AIU Holdings, is expected to receive tough questions about the company’s handling of the contractors claims. He is expected to appear with assistance of the company’s Chief Claims Officer, Charles Schader.

“They have cheated the people who have been injured,” said Woodson, who lost his left leg below the knee and most of his eyesight in a roadside bomb blast in Iraq. “Just a blatant disregard for a human being, no compassion at all for what we’re going through.” Woodson had to fight for months to get AIG to provide him with an improved prosthetic and wheelchair ordered by his doctor. His case has now been turned over to the Department of Labor, which oversees the program, but he says that AIG still owes him thousands of dollars in unreimbursed expenses.

Kevin Smith has been waiting for nearly six months for AIG to approve a course of treatment for his post-traumatic stress disorder, even though a judge ruled that the insurance giant was responsible for covering those costs last December. He says that AIGs refusal to approve treatments and fully pay his doctors bills have dragged out his recovery and strained his family’s finances.

“No matter how hard we try, we can’t move forward,” said Smith, who was severely injured in the leg five years ago. “We’re stuck spinning our wheels trying to make ends meet.”

AIG declined to comment on Woodson and Smith’s cases.

Injured contractors who worked overseas are entitled to medical and disability benefits under a federal law called the Defense Base Act. Under the program, AIG has handled 36,000 since 2002, about 90 percent of all claims.

The Labor Department claims that the law does not provide it with much enforcement authority to hold AIG accountable, though attorneys for the injured contractors point out that the department can impose civil fines on insurance carriers for late payments to contractors, like the expenses Woodson and Smith say they are still owed.

It is a power the DOL has used only “sparingly,” according to a memo prepared by congressional staffers for today’s hearing. AIG told the committee that it has only been fined 50 times for delaying payments to injured contractors over the past seven years.

The deputy secretary of the Department of Labor, Seth Harris, is also scheduled to testify.

4 Responses to “AIG Exec Called to Congress to Answer for Handling of War-Injured Contractor Claims”

  1. In February of 2005 the Dept of Labor (Ron Cusinski
    in New York City) told me that AIG “automatically denies every claim put in front of them.”

    I had to contact my Congressman to get my case open. Thank God my Congressman was on the Defense Committee in the House of Representatives.
    His name is John Hostettler of the 8th Dist of Indiana.

    At that time he called Joe Johnson, Chief Adjuster for AIG, to Washington,D.C. and read him the riot act for three days straight.

    I’ve been home almost 4 1/2 years now. So far I’ve gotten examined and treated for one ruptured disk in my back. I know there are at least two more that AIG will not permit doctors to check, much less treat.

    I could have had the disks removed, healed, and been back to work within six months. That time passed four years ago. Now, I’m permanently crippled, and will suffer excrutiating pain for the rest of my life.

    AIG is nothing more than an elite criminal interprise.
    They should be charged with thousands of counts of TORTURE , the persons responsible jailed, and the Company closed permanently!

    I’m always hearing Politicians say that “Americaq doesn’t Torture.” That’s a lie. It may be true for our CIA and Military guys, but it’s not true for American Insurance Companies!

    The DBA says that insurers have to pay 2/3’s of the average weekly wages earned. So, why am I, and thousands of other Military Contractors , being paid LESS that HALF? I get $692.00 a week. In kandahar, Afghanistan I was making $1700.00 a week.

    I worked a minimum of 84 hours a week. I have worked as many as 100 hours, but was not allowed to log or be paid for those hours.

    I was on the Concrete crew. In any other trade, you just drop your tools and leave whenever it’s convienient. Not Concrete, you leave when IT IS READY, not a minute before. If you have to stay all night, then that’s what you do.

    After 35 year in the trade, at the top of my trade, I’m now finished forever. And my service has been ended.
    I know our troops need me. Even if I can’t lift, pull ,or walk well, I feel I’m still a exceptionally needed resource because of my experience and “problem solving skills.

    I guess I’ll spend the rest of my life in a chair, in the dark doing my imitaion of a mushroom! What else is left? I’m of no use to society, or my country, because of the illegal acts of Joe Johnson and AIG.

    God Bless our Military and the Contractors that make their service possible!

    Jim Mallett

  2. Krash said

    Thank you Avni for continuing to keep our stories active.

    I too have been waiting for treatment. My back and neck injuries were incurred in September 2005. I continued to work until October 2006 when I couldn’t take the pain any more and returned home. My claim with the DBA was filed in April 2007, because I didn’t even know that I had medical benefits until another co-worker called me. I didn’t even get to the “informal hearing” stage until February 2009. I still have not received any benefits/treatment and will never be able to perform the job I was hired to do overseas or at home again.

    I also had to write to Senator Carl Levin in order to get my records from KBR and most of the medical records were missing. I am still trying to find them, because without them my claim cannot be processed. It seems that my word that I was treated in country is not good enough, even with substantial documentation from stateside medical providers, the attorneys for AIG say that I have to prove that I was seen by the “medics” in Iraq, within 30 days of the accident/incident.

    I wonder how long it will take KBR to start shipping the container loads of documents that are scattered all over Iraq stateside or will they just “disappear” in the “sandbox”?

  3. defensebaseactcomp said

    They’ve probably already hit the burn pits….

  4. Marlo Hone said

    What we can hope for is that Congress will appoint someone to go get them for us. Damn send me I will go get them. Give me the ticket and the my husband to guard me and I will go pick them up. I am so fed up with the companies getting away with hurting our contractors. I am not even a contractor. I am an injured Soldier. That is a whole different box of worms. LOL But at least I know I can walk into the VA hospital and get help.
    I have no issues if The House will write up the papers to give the right to walk onto all the medical bases to get the file I will go get them. Let them try and tell me no. I am a Pissed off woman that they truely don’t want to tell NO to anymore. CNA AND AIG you dragged on the poverty in my families life long enough. My kids have suffered long enough for your Greed. My mouth will not shut up.
    You lies, You dragging your feet and you playing games has Pissed off the wrong woman. I will let everyone know about all of you. My next step will be to start standing in the middle of the House with a sign. Every day with my kids to show that you all have done to my family. You might be able to keep my husband quiet but you can’t shut me up.

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