Defense Base Act Compensation Blog

The Modern Day DBA Casualty

Posts Tagged ‘Congressional Investigation of Defense Base Act Insurance Companies’

P&C Insurers Seek Exemption From Federal Oversight

Posted by defensebaseactcomp on March 22, 2010

ACE, Chubb, CNA, Zurich, all DBA insurers,want exemption from Federal Oversight !!!

WR Berkley is applying to be approved to sell DBA

NU Online News Service, March 19, 2:07 p.m. EDT

P and C National Underwriter

WASHINGTON—Ten large property and casualty insurers today asked leadership of the Senate Banking Committee to exempt the industry from federal oversight in financial services reform legislation that will be marked up starting Monday.

In a letter to the committee, the 10 insurers, calling themselves the Property & Casualty Leaders Coalition, said they oppose “misdirected” provisions of the legislation “that would shift the cost of failures of financial institutions outside of our sector to our customers.”

They are talking about a provision of the legislation proposed Monday by Sen. Chris Dodd, D-Conn., that would make insurers and other large, complex financial services companies subject to oversight by the Federal Reserve Board and a new Financial Stability Oversight Council.

Under the bill proposed by Sen. Dodd, federal oversight, in addition to current state oversight, would be applied to nonbank financial companies—determined by a two-thirds majority vote of the Financial Stability Oversight Council—to be subject to prudential supervision by the Board of Governors of the Federal Reserve System. The reason is that “material financial distress” at the company “would pose a threat to the financial stability of the United States.”

The House financial services reform legislation passed last December contains a similar provision. Both bills would also create an Office of National Insurance.

The latest letter was written by the new Coalition to Sen. Dodd and Sen. Richard Shelby, R-Ala., the ranking minority member of the committee.

The companies signing the letter were the Ace Group; Allstate; Chubb; CNA; Liberty Mutual; Nationwide Insurance; State Farm; Travelers; W.R. Berkley Corporation; and Zurich Financial Group.  Full Story here

Posted in AIG and CNA | Tagged: , , , , , , , | Leave a Comment »

!! Junket Time in New Orleans !!

Posted by defensebaseactcomp on March 15, 2010

AIG, CNA, their defense lawyers and claims adjusters, their third party medical providers,  DoL ALJ’s, DoL District Directors  and some of the plaintiff’s lawyers gather for another Dol sponsored conference.  A few days to get to know each other better, discuss how to better “work together”……

Loyola Annual Longshore Conference 2010- Overwhelmingly for the Defense again

March 18 – 19, 2010
Sheraton New Orleans Hotel
New Orleans, Louisiana

Though overburdened with DBA claims the DoL is still sending four Administrative Law Judges to New Orleans with taxpayer money.  Even the new sitting Chief ALJ Purcell has time for this  defense speaker  bloated gathering.

Judge Gee continues her Conference Circuit this week while DBA claims on the West Coast wait as long as a year for a decision after a hearing.

All will  get to play Jeopardy with Rosenow, a privilege normally reserved for the injured unfortunate enough to live within the Cabal’s jurisdiction, or whose lawyers take it upon themselves to put them there because THEY live there.

A few possible answers……

Who is Dr. John Dorland Griffith?     Why is it not PTSD?   Why we call it an IME even though it isn’t?

Posted in AIG and CNA, Department of Labor, Racketeering | Tagged: , , , , , , , , , , , , , | 1 Comment »

Dennis Kucinich: Remember who is fighting for YOU

Posted by defensebaseactcomp on February 8, 2010

Whether your views swing left or right remember that Dennis Kucinich is

One of a very few politicians who gives a damn about the Injured Contractor

Go here and vote for Dennis Kucinich for Fire Dog


Thanks for casting one of 110,000 votes for the first round of the FDL Fire Dogs contest. And the winners are…

First Place: Dennis Kucinich, 24,967 votes
Second Place: Alan Grayson, 17,296 votes
Third Place: Anthony Weiner, 13,160 votes

Why did these members win?

It’s simple: these members of Congress treat online supporters like others treat lobbyists. Whereas some Representatives call up their bankster donors before taking a vote, Kucinich, Grayson, and Weiner go online and make their case to activists like you.

Posted in AIG and CNA, Department of Labor | Tagged: , , , , , , , , , , | Leave a Comment »

Defense Base Act Compensation Blog Most viewed posts in 2009

Posted by defensebaseactcomp on January 1, 2010

These are based on statistics from Jan 1 2009 through Dec 31 2009

Tangiers International Updates

And still awaiting the outcome of the Department of Labor and the Department of Justice investigations into Tangiers International.

We’ll report on our own findings at the same time.

More on this below     On your toes Tacticor

DBA CNA Casualty Anniversary

Is it just the photo of these really good looking guys or do people have a problem with CNA  and ‘He who must not be named’  tactics used for dragging claims out for six and more years while denying medical and cutting off payments?

KBR has blocked MsSparky from their Servers

Tag Teaming to keep the info train rolling

The Defense Base Act Compensation Blog was soon blocked as well !!

Fluor did not waste anytime following suite

Danny Fitzsimons Discharged From Army with PTSD

This is a tragic tale of two dead contractors, Darren Hoare and Paul McGuigan,  at the hand of a third contractor who was fighting a “War within his head”.   He was hired by several different security companies despite his diagnoses of PTSD and known drug and legal problems.

It took the publicity and outrage of the world but the company who last hired him has since starting doing background checks.   And yet, due to the DBA sanctioned right to deadly negligence, the burden will be borne only by the dead, injured, their families, and what’s left of Danny Fitzsimons tortured mind.  Danny awaits trial in Baghdad.

Civilian Contractors Toll in Iraq and Afghanistan Ignored by Defense Dept

by T. Christian Miller, ProPublica – October 9, 2009

Despite the importance of civilian contractors to its mission, the Defense Department hasn’t been measuring their sacrifice. More than 5,200 soldiers have died in the two war zones, meaning that one civilian contractor has died for every three soldiers.

Dropping the DBA Ball
CYA Statement of the year from the one in charge of the ball

“The problem that we see a lot is where injuries occur overseas the knee-jerk reaction is the insurance company says,‘I can’t pay right now. I don’t have documentation,’ ” said Miranda Chiu, Labor’s director of policy for Defense Base Act claims.“They drop the ball.”

AIG Faces Hearing on Denial of Medical Claims by Contractors Injured in Iraq and Afghanistan

Kucinich, the chair of the committee’s domestic policy panel, said earlier that he was “alarmed” by a joint investigation [4] by ProPublica [5], ABC News [6] and the Los Angeles Times [7], which found that the troubled insurance giant routinely denied medical care to civilians injured in the war zones. Rep. Elijah Cummings [8], D-Md., first requested [9] a hearing after the reports aired earlier this year. Kucinich’s panel will be joined by Sen. Bernie Sanders [10], I-Vt.,

Independent Medical Evaluations AIG and CNA

Dispelling the Myth that insurance company Defense Medical Evaluations are in someway unbiased Indpendent Medical Evaluations.   Only the DoL can arrange for an Independent Medical Examination under the DBA.    The insurance company is entitled to have you see a doctor of their choice, under certain restrictions,  but this is a Defense Medical Evaluation.

Tangiers International DBA “Medical Providers

Tangiers International , AIG’s Medical Provider/Spy Kids Caught Lying

Tangiers Vice President a Dept of Labor Employee

Remember Them Too

Don’t Contractors Count When we Calculate the Cost of War? By Steven Schooner

Despite the light that Memorial Day will shine, briefly, on the U.S. death tolls in Iraq and Afghanistan, don’t expect an accurate accounting of the real human cost of our military actions abroad. The numbers you’ll see — mostly likely just under 5,000 fatalities — won’t tell the whole story.

How CNA Treats Foreign Claimants

“I arranged for a meeting with CNA Global and Donna Sprags. The nursecase manager Jody Mcewan arranged the meeting In Chicago at the offices of CNA Global. I left South Africa with a Medic, a Nurse and my wife.

When  I arrived at the building of CNA I was told that “she will not see me and was thrown out of the building by security”. The trip cost me $15 000 and I have outstanding medical debts of $150 000.

AIG their IME, PTSE, The Saga Continues

The Infamous Dr. Griffith and those who enable him

In Memory of Tim Eysslinck

We lost Tim to PTSD five years ago April 23.  Tim’s wife and children have been denied DBA benefits in a most disturbing series of events replete with fraudulent statements.  And his widow paid the original lawyer who allowed this to happen.

Texas District Court Rules Iraq War not Life Threatening

Casualties not Counted

Eysslinck Files

Posted in AIG and CNA, KBR, Misjudgements, PTSD and TBI, spykids, Uncategorized | Tagged: , , , , , , , , , , , , , , , , , , , , , | Leave a Comment »

Help Wanted: Top Ten Worst DBA offenses of 2009

Posted by defensebaseactcomp on December 30, 2009

While there was no shortage of fraud, criminal intent,  negligence, or just plain meanness and disrespect  carried out against  injured contractors this year we’d like your help in remembering them here.

Recommended categories:

AIG and CNA and looks like Zurich needs to buck up, DBA Insurance Company Defense Lawyers, Our own DBA Lawyers, Claims Adjusters, Claims Examiners, ALJ’s, Dirty Tricks by Defense Lawyers.   Name names only if you have documentation but feel free to tell your story so everyone else will know what to look out for.

Include previous years offenses up to this point as this is our first edition.

Add your entries as a comment here.

Posted in AIG and CNA, KBR, PTSD and TBI | Tagged: , , , , , , , , , | 14 Comments »


Posted by defensebaseactcomp on November 20, 2009

Thanks to DC Bureau and Adam Lichtenheld

In late August 2003, medical testing of KBR employees at Qarmat Ali found elevated levels of total chromium in their blood. Total chromium is comprised of trivalent chromium—an essential and naturally occurring nutrient—and hexavalent chromium, the cancer-causing industrial component of sodium dichromate. In order to adequately determine if its workers were poisoned by sodium dichromate, KBR needed to separate out hexavalent chromium from the blood tests—a difficult and time-consuming process that usually requires a special laboratory.

But no such effort was even attempted. The reason, according to KBR Medical Director Robert Conte, lies in an archaic legal precedent, one that has forbidden sick KBR workers, such as Mr. Blacke and Mr. Langford, from seeking legal redress.

Under the Defense Base Act of 1941, private contractors working for the military are protected from legal liability for injuries suffered by their employees. Under the DBA, contractors transfer a work-related claim to a government insurer, which handles the claim and determines compensation. For KBR workers who became too sick to work at Qarmat Ali, this meant that their appeals for unemployment and disability benefits were turned over to American International Group, Inc, the world’s largest insurance company and the government’s handler of 90 percent of all DBA cases.

Since AIG retained full responsibility for KBR’s claims, it was at their discretion—not KBR’s—whether to follow up by ordering further blood tests. Determining the amount of hexavalent chromium in workers’ blood would have been critical to link their illnesses to the exposure at Qarmat Ali, thus making them eligible for worker’s compensation. AIG decided against it.

“When AIG picked it up, we figured they’d just follow up and do what they thought necessary at that point,” said Dr. Conte in a sworn deposition videotaped last year.

The Defense Base Act is a lucrative and low-cost deal for companies like AIG. Since the insurance giant works for the government in DBA cases, both premiums and payout claims are paid for by public funds. As a result, when AIG overcharged KBR tens of millions of dollars for DBA insurance in the first several years of the Iraq war—as the Army Audit Agency eventually discovered—U.S. taxpayers footed the bill. The findings of the audit investigation surfaced last fall, around the time that AIG was rescued from financial ruin by an $85 billion taxpayer bailout.

KBR, meanwhile, continues to use the DBA to shield it from accountability.

“KBR took the attitude…that there was nothing anyone was going to be able to do about [Qarmat Ali] because they were immune from lawsuit and/or any other accountability,” Langford said.

Original Story here

Posted in AIG and CNA, KBR, Toxic Exposures | Tagged: , , , , , , , , , , | 1 Comment »

The DBA’s Exclusive Remedy-A License to Kill? KBR defends it’s actions

Posted by defensebaseactcomp on November 20, 2009

KBR is claiming that the DBA’s Exclusive Remedy excuses them from knowingly sending their employees into deadly danger.

And you know what……  legally,  IT DOES

The Exclusive Remedy was intended (Congressional Intent ?) to be a trade off to ensure the injured worker did not have to bring legal action against their employer in order to receive medical and disability benefits.  The employee would “forthwith” receive medical care and partial replacement of the their income, but they and their family members could not bring legal action against the employer, for any reason.

With absolutely no incentive to provide the safest possible working conditions, profit will usually win over the  lives put on the line.  Pleasing the customer, clearing ordnance from under the power lines asap, getting those supplies to the airport, no matter the danger, are the bottom line.

When a casualty occurs the company sends in another warm body.

On the other hand, the casualty normally has to retain an attorney and fight for their very lives  with AIG, CNA and others ( carrier/employer ) for the benefits that were intended to be their part of the trade off.

What happened to the casualties end of the trade off?

This is an ongoing injustice right in the face of Congress, the Department of Labor, the Department of Justice, the Department of State, the Department of Defense, the White House

and frankly it appears that no one gives a damn.

KBR defends its actions

The article entitled “KBR aware convoy in harm’s way” (Page A1, Thursday) does not address some of the paramount issues in the convoy cases. KBR would like to set the record straight.

The events of the April 2004 convoy attack were tragic. We remain mindful of those who lost their loved ones as they were members of the KBR family. However, the assertion that KBR deliberately placed these men in harm’s way or failed to warn of the dangers of working in Iraq is simply false. KBR takes great care in warning and in training employees about the dangers they will face working in a war zone before they depart for Iraq.

It is important to understand the framework in which KBR and other government contractors perform their work in Iraq and Afghanistan. The executive branch and Congress decided many years ago to use civilian contractors to support the military during wartime in order to save costs in peacetime and because they could not recruit enough soldiers to meet all of their logistical needs without resorting to a draft. The Defense Base Act (DBA) was established by Congress as the process to provide coverage to civilians who are injured while supporting the military during war time. Given this exclusive remedy under the DBA, in order for these lawsuits to proceed, the plaintiffs must prove that KBR specifically intended to have the insurgents injure or kill KBR’s employees on the April 2004 convoys. The evidence does not support this allegation.

The e-mails that were the basis of the article do not tell the whole story. In context, the internal communication between KBR and the military evidence the concern KBR had for its employees. Further, the U.S. military alone decided to deploy the military supply convoys at issue here; they decided when, where and how the convoys were to be conducted. These military decisions were made based on the intelligence about insurgent threats that the military compiled through its unique capabilities and resources. Under the Political Question Doctrine and other established principles of law, it is not appropriate for courts — as litigation in these cases would require — to second-guess such wartime decisions and actions by the military that are reserved by the U.S. Constitution to the elected branches of government.

The men and women who work for KBR in Iraq do so at great sacrifice to themselves and their families. It is on their behalf that we will continue to defend the company and its actions. In turn we would hope that the media and others remain mindful that a presentation by the plaintiffs’ lawyers does not accurately reflect all of the facts.

William C. Bodie, president, KBR North American Government and Defense

Posted in AIG and CNA, KBR | Tagged: , , , , , , , , , , , , , , | 5 Comments »

Workers’ Comp in Iraq

Posted by defensebaseactcomp on November 18, 2009

Workers’  Comp Insider

Workers’ Comp in Iraq

June 13, 2005

A mere four and a half years and two congressional hearings ago Workers Comp Insider wanted to know:

Where’s OSHA ?

A fascinating article by staff writer T. Christian Miller in today’s Los Angeles Times (registration required) focuses on the cost of providing workers comp insurance to non-military employees in Iraq. Under a WW II era program called the Defense Base Act, private insurers charge the government for comp premiums. These private carriers are at risk only for the non-combat related injuries, illnesses and deaths. The government reimburses the carriers for all combat-related incidents, plus a 15% admin fee. Overall, costs for comp in Iraq are somewhere around $ 1 billion, but no one seems to know for sure.

Currently, two carriers dominate the market: AIG and ACE. The Pentagon is talking about awarding all the business to a single carrier, in order to contain the escalating costs. The counter argument seeks a continuation of the “free market approach.” I’m not sure how “free” the current market is and as for the rates, they appear to be headed in the wrong direction.

Comp in Iraq
There are about 30,000 Americans and third-country nationals and more than 40,000 Iraqis working on U.S. contracts in Iraq. To date, about 300 contractors have been killed and 2,700 injured. When the program began, insurance rates ran between $4 and $8 per hundred dollars of payroll. Now they are up to $20 per hundred — a pretty hefty rate by most measures.

Salaries in Iraq, as you would expect, are much higher than those in the states. It’s not unusual for workers to pull down $100,000. (The pay is good, but you would have to characterize the working conditions as marginal.) Comp premiums at the $20 rate would average about $20,000 per employee — a very high rate indeed. Because of the high salaries, death claims are averaging between $1.2 and $1.8 million — significantly higher than death claims for workers in the states.

How do rates for insurance in Iraq compare to other locations in the world? Here’s one striking example cited by Christian: In Colombia, a contractor flying helicopters in support of State Department drug interdiction programs is charged at $3.87 per $100 of payroll — less than a truck driver in the states. In Iraq, however, a contractor flying helicopters runs $90 per $100, with comp payments almost the equal of payroll (only iron workers above the 6th floor reach anywhere near comparable rates in the states). Keep in mind that if the helicopter pilot dies in a combat-related incident, the carrier is not on for the loss. The carriers respond by saying they have to establish these high rates, because even if they are eventually reimbursed for a combat-related incident, it could take several years to actually get the money and there is no guarantee that the government will accept the liability.

Conventional Cost Control, Unconventional Conditions
Employers in the states have learned the hard way that the best way to control comp costs is to contain losses. Cost containment means committing to good safety programs and setting up a system for immediately responding to injuries. You need to establish a relationship with an occupational medical provider and set up a comprehensive return-to-work program that uses temporary modified duty to speed recovery. That’s all well and good stateside, but I have to wonder how well that kind of a system will work in Iraq. Is anyone motivated to implement modified duty? Do employees really want to go back to work, or would they prefer to collect 2/3 of their (inflated) average weekly wage at a safe distance from the turmoil? If you were an Iraqi national, would you risk your life going back to work on temporary modified duty? With U.S. taxpayers ultimately footing the bill, does anyone over there really care if an injured employee goes back to work? When you think about it this way, you wonder why carriers would want any of the risk.

Where’s OSHA?
I wonder what OSHA would say about the working conditions in Iraq. (Given the reduced number of inspectors, they probably haven’t gotten there yet.) Under the General Duty Clause, employers must provide a workplace free from the risk of injury and illness. How does Iraq stack up? As a spokesman for one of the carriers stated, in response to questions about the high rates, “it’s 130 degrees. There is a lot of dust. There is a lack of hospitals.” Not to mention the fact that strangers are constantly trying to kidnap or kill you. Stress claim, anyone?

Ubiquitous AIG
It is indeed interesting to find AIG in the middle of this high-risk mess. Just as they were challenged by New York Attorney General Elliot Spitzer for “risk transfer” transactions that apparently involved no risk at all, it appears that here in Iraq they are collecting possibly inflated premiums where, once again, a substantial portion of the risk lies with others (you and me, to be exact).

Ultimately, my sympathies here are with the workers. I can hardly imagine a more difficult place to work. Here in America it’s rare to dress for work with a prayer that you will survive another day (rare but certainly not unheard of). In Iraq, every breath in that hot, dusty place is accompanied by just such a prayer. Here’s wishing a safe return to our civilians and a lasting peace for the Iraqi people themselves

Posted in AIG and CNA, PTSD and TBI | Tagged: , , , , , , , , , , , , , | Leave a Comment »

Pentagon Study Proposes Overhaul of Defense Base Act to Cover Care for Injured Contractors

Posted by defensebaseactcomp on September 15, 2009

Pentagon Study Proposes Overhaul of Defense Base Act to Cover Care for Injured Contractorsdba-report-475

by T. Christian Miller, ProPublica – September 15, 2009 6:52 pm EDT

WASHINGTON, DC – Congress could save as much as $250 million a year through a sweeping overhaul of the controversial U.S. system to care for civilian contractors injured in war zones, according to a new Pentagon study.

In the most extensive review ever of the taxpayer-financed system, the Pentagon suggested that the government could issue its own insurance to cover the skyrocketing costs of medical care and disability pay for injured civilians.

Currently, the U.S. pays more than $400 million annually to AIG and a handful of other carriers to purchase special workers compensation insurance policies required for overseas civilian contractors by a law known as the Defense Base Act, the study found.

By cutting out insurance company profits as high as 35%, the government could self-insure the contractors for less money, according to a copy of the study obtained by ProPublica [1]. The study is due to be released Friday.

The Pentagon’s suggestion would require a massive legislative revision of the government’s 60-year-old system to care for injured civilians, which has been criticized as expensive and ineffective for modern war zones where civilian contractors account for half the work force.

Despite the possible savings, it remains unclear whether anyone in Congress will champion such a bill. And the Pentagon hedged its bets by saying that it would pursue reforms to the current system of private insurance while “considering” the pursuit of legislative authority to change to a system of self insurance.

Such a proposal could also improve the delivery of care to injured contractors, the report found. Civilian contractors have faced protracted battles with insurance carriers to obtain medical treatment and disability pay, according to an investigation [2] by ProPublica, the Los Angeles Times and ABC News.

“In the long run, the self-insurance alternative may have the greatest potential for minimizing DBA insurance costs, and it has several administrative and compliance advantages as well,” the report said. A Pentagon spokeswoman declined comment since the report has not yet been made public.

Under the proposed system, the U.S. would pay directly for medical benefits and disability benefits rather than relying upon private insurance providers. The government would hire an outside firm to administer the claims to avoid the expense of training and hiring examiners.

The report makes clear, however, that such a fundamental change to the system would face a battle from the insurance industry. AIG dominates the market for the insurance, which exploded from an $18 million a business to more than $400 million per year after civilian contractors flooded into war zones in Iraq and Afghanistan, the report said.

AIG controls about 75% of the market, followed by Chicago-based CNA and Bermuda-based ACE Group. Together, the three firms collect 97% of all premiums paid by defense contractors for the insurance, the cost of which is reimbursed by the government.

Changing to a self-insurance system “has the potential to have the most financial benefit, if implemented government-wide,” the report found. However, under the heading “Cons,” the report said that legislation to change the current private insurance system “has potential for significant political pressure from those most directly affected by such a change (carriers, brokers, etc.)”

AIG and ACE did not immediately return requests for comment. The industry has said that profits are reasonable and that claims are handled fairly.

CNA said it was examining the recommendations. “We are in the process of carefully reviewing and digesting the DOD report. As previously stated, we welcome changes and improvements to the DBA program,” the company said in a statement.

The chance for such fundamental reform is uncertain. The Obama administration has not put forth a specific bill, though the Pentagon and Labor Dept., which administers claims, worked together in producing the report. A Labor Dept. spokesman said Tuesday that the agency was not prepared to comment on the report.

In the House, Rep. Ike Skelton [3], (D-Mo.) chair of the House Armed Services Committee, called the report’s findings “interesting, surprising, and worth considering for next year’s defense authorization bill.”

“The House Armed Services Committee will closely examine the report as we seek ways to lower the costs associated with Defense Base Act insurance,” Skelton said in a statement.

The Senate Armed Services Committee, chaired by Sen. Carl Levin [4], (D-Mich.) would wait for the Defense Dept. to suggest changes in its spring legislative proposal, a spokesman said.

Rep. Elijah Cummings [5] (D-Md.) has announced plans for cutting costs and improving the delivery of care for contractors, but has yet to offer details. Sen. Bernie Sanders [6], (I-Vt.) has also called for change.
Sen. Bernie Sanders (I-Vt.) “The current system for providing health insurance and workers compensation for our military contract workers in Iraq and Afghanistan is broken and wasting millions of dollars in payments to companies like AIG,” Sanders said in a statement. “If the Pentagon, the Department of Labor and Congress modernize the current insurance system, we can save up to $250 million and finally give these workers and their survivors the basic health care and support they need and deserve.”

In the absence of a major legislative overhaul in the next three years, the report recommends reforms to the current system of paying private insurance carriers for policies. Chief among them is a proposal that the government collect information on how much such claims cost.

Unlike state workers compensation systems, where rates are regulated and based on years of occupational injury data, the federal system for contractors relies upon individual insurance carriers to set rates. In the early years of the war, rates skyrocketed but the government had no way of determining whether such increases were justified.

The Pentagon tried to reduce rates by creating a umbrella program in 2005 in which one carrier, CNA, won a bidding contest to issue insurance for all contractors working for the U.S. Army Corps of Engineers. The State Dept. and the U.S. Agency for International Development have similar programs.

While initial studies by the Army Corps found significant cost savings, the current Pentagon report said that CNA’s rates in the umbrella program were higher on average than policies purchased by individual defense contractors.

Using a formula which weighed factors such as the size of the contract, CNA charged contractors in the umbrella program 8.3% of payroll costs on average, while individual contractors paid about 5.3% of their payroll for the insurance, the report found. That means the Army Corps paid $8,300 to purchase worker’s compensation insurance for a civilian contractor making $100,000 a year, compared with $5,300 for a civilian working for a different agency.

“The department’s overall conclusion, based on its comprehensive analysis of the current DBA premium data, is that the open market—when it involves adequate price competition among carriers—results in rates that are lower than those in a single-provider program,” the report said.

No matter which program, however, the report found that insurance carriers “may be achieving significant” profit from selling the insurance.

The Pentagon attempted to determine exactly how much money private carriers made from the taxpayer-financed policies, but insurance companies refused to turn over any data, the report said.

Previous investigations by the House Committee on Oversight and Government Reform found that carriers made more than 50% profit from some polices—far in excess of normal workers’ compensation insurance.

Written by the Pentagon’s Defense Acquisition and Technology Office, the report was based on interviews and data from industry players, including two insurance carriers, six brokers and seven defense contractors.

The Pentagon has denied [7] a Freedom of Information Act request by ProPublica to release documents submitted by the firms as part of the review, claiming that the information is proprietary business data.

A recent insurance industry study [8] confirmed that companies paid far more for workers compensation insurance in Iraq and Afghanistan than other countries. The higher rates have drawn criticism since the government reimburses carriers for the cost of combat injuries.

Posted in AIG and CNA | Tagged: , , , , , , | Leave a Comment »

Undercounting deaths in Iraq, Afghanistan

Posted by defensebaseactcomp on September 10, 2009

Undercounting deaths in Iraq, Afghanistan

Posted by: Bernd DebusmannUSA/

Bernd Debusmann is a Reuters columnist. The opinions expressed are his own –

By most counts, the death toll of U.S. soldiers in America’s wars in Iraq and Afghanistan stood at 5,157 in the second week of September. Add at least 1,360 private contractors working for the U.S. and the number tops 6,500.

Contractor deaths and injuries (around 30,000 so far) are rarely reported but they highlight America’s steadily growing dependence on private enterprise. It’s a dependence some say has slid into incurable addiction. Contractor ranks in Iraq and Afghanistan have swollen to just under a quarter million. They outnumber American troops in Afghanistan and they almost match uniformed soldiers in Iraq.

The present ratio of about one contractor for every uniformed member of the U.S. armed forces is more than double that of every other major conflict in American history, according to the Congressional Budget Office. That means the world’s only superpower cannot fight its war nor protect its civilian officials, diplomats and embassies without support from contractors.

“As the military operations in Iraq and Afghanistan have progressed, the military services, defense agencies and other stakeholder agencies…continue to increase their reliance on contractors. Contractors are now literally in the center of the battlefield in unprecedented numbers,” according to a report to Congress by the bipartisan Commission on Wartime Contracting in Iraq and Afghanistan.

“In previous wars, the military police protected bases and the battle space as other military service members engaged and pursued the enemy,” said the report. In listing the 1,360-plus contractor casualties, it noted that criticism of the present system and suggestions for reforming it “in no way diminish their sacrifices.”

So why are they not routinely added to military casualty counts? And why should they? A full accounting for total casualties is important because both Congress and the public tend to gauge a war’s success or failure by the size of the force deployed and the number of killed and wounded, according to George Washington university scholar Steven Schooner.

In other words: the higher the casualty number, the more difficult it is for political and military leaders to convince a sceptical public that a war is worth fighting, particularly a war that promises to be long, such as the conflict in Afghanistan. Polls show that a majority of Americans already think the Afghan war is not worth fighting.

Figures on deaths and injuries among the vast ranks of civilians in war zones are tracked by the U.S. Department of Labor on the basis of claims under an insurance policy, the Defense Base Act, which all U.S. contracting companies and subcontractors must take out for the civilians they employ outside the United States.


The Labor Department compiles the statistics on a quarterly basis but only releases them in response to requests under the Freedom of Information Act. This can take weeks. The Department gives no details of the nationalities of the contractors, saying that doing so would “constitute an unwarranted invasion of personal privacy” under the U.S. Privacy Act.

Writing in last autumn’s Parameters, the quarterly journal of the U.S. Army War College, Schooner said that an accurate tally was critical to any discussion of the costs and benefits of the military’s efforts in the wars. What’s more, the American public needs to know that their government is delegating to the private sector “the responsibility to stand in harm’s way and, if required, die for America.”

Schooner wrote it was troubling that few Americans considered the deaths of contractors relevant or significant even though many of them performed roles carried out by uniformed military only a generation ago. “Many…concede that they perceive contractor personnel as expendable profiteers, adventure seekers, cowboys, or rogue elements not entitled to the same respect or value due to the military.”

That’s not surprising after a series of ugly incidents involving armed security contractors. They make up for a small proportion of the total (about 8 percent) but account for almost all the headlines that have deepened negative perceptions and prompted labels from mercenary and merchant of death to “the coalition of the billing.”

In the most notorious incident, two years ago, employees of the company then known as Blackwater opened fire in a crowded Baghdad square, killing 17 Iraqis. Five of the Blackwater shooters, who were working for the Department of State, have been indicted on manslaughter and weapons charges.

The Pentagon describes private contractors as a “force multiplier” because they let soldiers concentrate on military missions. Some of the actions of private security contractors could be termed a “perception multiplier.” Such as the after-hours antics of contractors from the company ArmorGroup North America guarding the U.S. embassy in Kabul.

Shaking off the image of rogues became even more difficult for private security contractors after a Washington-based watchdog group, the Project on Government Oversight, accompanied a detailed report on misconduct and morale problems among the guard force with photographs showing nearly nude, drunken employees in a variety of obscene poses and fondling each other.

Whether contractors, even rogue elements and cowboys, should not be counted in the toll of American wars is another matter. Doing so would be part of the transparency Barack Obama promised when he ran for president.

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Labor Day Message to Hilda Solis, Secretary, US Department of Labor

Posted by defensebaseactcomp on September 6, 2009

Having just read your  Labor Day Statement,  we are convinced that Injured Overseas Contractors and their imagesfamilies are nowhere on your radar screen.

You say that over the last seven months you have met with many individuals and organizations.   We were disappointed that you did not respond to our requests to meet with you.   We had asked to discuss, in a helpful and positive way, the inequities these Injured Contractors suffer under the Defense Base Act which your department oversees.

You ask us in your statement to personally commit to play a role in the recovery of our economy and our nation. To reach out to those needing help.  To do the work that will keep America Working.

Hilda Solis we ask you to personally commit that your/our Department of Labor allow us the opportunity to recover physically, mentally, and economically as the law provides under the Defense Base Act.

Reach out to your Department of Labor who is charged with ensuring that Defense Base Act Workers’ Compensation benefits are provided for covered employees promptly and correctly.

Do the work, get to know your OWCP/DHWLC/DBA,  your OALJ’s, and BRB’s.

Open your eyes to who is standing in the way of ensuring that DBA benefits are provided for covered Injured Contractors promptly and correctly.

Read some of the decisions your ALJ’s make based on the testimony of questionable doctors, witnesses, and evidence.

Question  the person who was put in charge of Policy, Regulations and Procedures for the Defense Base Act who cut her teeth with AIG and CNA’s defense lawyers and helped promote their biased book via this position of public service.

Look into the knee jerk, biased recommendations that come from some of your District Directors and some of their Claims Examiners.

Do they work for you, the injured contractor, the taxpayer or do they serve their own purpose?

Ask why CNA and AIG are never fined as the law requires for multitudes of blatant infractions of the law year after year.

Ask why CNA, AIG and the lawyers get away with relentlessly continuing hearings, thus dragging claims out for six years and longer while refusing to pay for medical and disability to the injured worker but buffing up their own financial award.

Some of these hearings will make public record of damning information vital to many other claims, including many that were already denied and will have to be re-examined.

Is your DoL helping to keep this information in the dark?

Will your legacy be the continued abuse of thousands of Injured Americans and Foreigners working on US Contracts when you personally could have stepped in and made this CHANGE?

What a stimulus to the economy it would be to get Injured Overseas Contractors and/or their families back to being the contributing members of America that they were working on behalf of when they were injured or killed working in countries all over the world.

The only stimulus the DBA currently provides is to insurance companies like  AIG and CNA, hordes of lawyers,  and your department facilitates it.

You came to us with the promise that there was a new sheriff in town and that you would be heard.

Make our Labor Day, be heard, speak up about these abuses to Injured Contractors and demand that they stop.

Maybe then, hopefully together, we can assure that the Defense Base Act is implemented as Congress intended.

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Practicing Medicine Without a Licencse

Posted by defensebaseactcomp on August 26, 2009

Without a medical licenseWhen Donna Sprags refuses to approve surgery ordered by the injured contractors doctor on a destroyed shoulder because it won’t help the injured contractor get back to work, it will only relieve his constant pain……….

When CNA and Mr Lawyer  refuses TBI screening to someone who took the full blast of a bomb……….

When Samin Papa refuses to approve medication ordered by a doctor to relieve nightmares because it is also used to treat high blood pressure……….

When AIG’s claims adjusters and lawyers refuse to have bullets removed from bodies, deny diagnoses and treatment of PTSD, and deny countless MRI’s and treatment  for back injuries causing permanent nerve damage…………

Are they not making medical decisions for patients without a license?

By Ricky in Texas on CNA’s John Little

John Little is my new workman’s comp adjuster. He has refused my medication refills (I’ve been seeing the same doctor since my injury started)and now claims that he WILL NOT Pay my benefits. I DO NOT ABUSE my medications and I AM TRULY DISABLED.

My doctor is very GOOD and he has been trying to atleast keep me out of a wheelchair. John Little called me last month as “The New Adjuster” and IS trying to practice Medicine in the state of Texas without a Medical Degree .

I’ve also received a “SHAM REVIEW” by Dr. John Hite. I’ve NEVER seen this doctor and my personal doc knows Dr. John Hite as Dr. Hite has referred patients to my doc, Dr. Edward Talmage.

On advisement of my doctor, I’m filing a”Harrassment Complaint against John Little for calling the pharmacy and telling them that he WILL NOT pay my claims as I’m on too many medications. Dr. Hite has written a “Sham Review” acting as my doctor and has NEVER sen me. Dr. Hite was a Neurological Surgeon, then retired and went on the wkman’s comp gravy train.

I’ve NEVER refused to see any doctor that workman’s comp has sent me to. I have NOTHING to hide and now I’m left detoxing (unnecessarily) because of BOTH of THEM. I need Assistance and I need it NOW! Those people are going to kill someone and I have a disabled wife and grandson to worry about.

I CAN NOT pay for my medications, treatments,etc. that I AM entitiled to by John Little. I’m trying not to use a  lawyer (The Truth SHOULD be on my side) but these 2 men are trying to kill me. PLEASE HELP NOW!!!

Rosenberg, Texas

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Really Big Fishing

Posted by defensebaseactcomp on August 20, 2009

We don’t have Waxmans list of insurance companies but AIG and CNA are bound to be on it.369326654_1347a48dfd_o

Democratic Investigators Target Health Insurers

House Democrats are probing the nation’s largest insurance companies for lavish spending, demanding reams of compensation data and schedules of retreats and conferences.

Letters sent to 52 insurance companies by Democratic leaders demand extensive documents for an examination of ‘extensive compensation and other business practices in the health insurance industry.” The letters set a deadline of Sept. 14 for the documents.

Rep. Henry Waxman (D-Calif.), chairman of the House Energy and Commerce Committee, and Rep. Bart Stupak (D-Mich.), chairman of the Subcommittee on Oversight and Investigations, signed the three-page letter dated Monday.

An industry source replied when asked for comment: “This is nothing more than a taxpayer-funded fishing expedition designed to silence health plans.”

By Sept. 4, the firms are supposed to supply detailed compensation data for board members and top executives, as well as a “table listing all conferences, retreats, or other events held outside company facilities from January 1, 2007, to the present that were paid for, reimbursed, or subsidized in whole or in part by your company.”

For employees or officers making $500,000 or more, the committee wants information on salary, bonus, options and pension.

And by Sept. 14, the firms are supposed to provide copies of reports from compensation consultants, plus board drafts of compensation plans and information about market share.

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In Memory of Wade E Dill

Posted by defensebaseactcomp on July 15, 2009

We lost Wade to PTSD three years ago today July 16. 2006

Wade Dill Family photo 22

Wade was working for KBR,  AIG continues to deny benefits to his family

Thinking about you today and everyday

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Risk Transfer Without Risk

Posted by defensebaseactcomp on June 22, 2009

As always Jon Copplelman at Workmans Comp Insider puts it in words like no one else

“Something cruel, heartless and cynical took place in the back rooms of carriers with responsibility for civilian claims. If you like Edgar Alan Poe, you’ll love the claims files of AIG and CNA.”

Risk Transfer Without Risk

The Defense Base Act (DBA) was enacted in 1941, to cover the injuries to civilian employees – primarily a few hundred engineers – during the second world war. The act might have worked then, but it certainly is not working now, nearly 70 years later. As we have blogged in the past, the DBA is a boondoggle, generating huge profits for a small number of insurance carriers and routinely devastating both the civilian workers wounded or killed in war zones and their families. There are over 10,000 claims filed each year: the medical only claims are usually paid; the indemnity claims are dissected, inspected, detected, and ultimately, rejected. A handful of insurers (AIG, CNA among others) are making big bucks at the expense of the wounded and the dead.
NOTE: As bad as the situation is for U.S. citizens wounded and killed in Iraq, it is far worse for foreign nationals.

The Domestic Policy Subcommittee of the House Oversight and Government Reform Committee held a hearing last week on the DBA. The title of the hearing betrays an (understandable) prejudice: “After Injury, the Battle Begins: Evaluating Workers’ Compensation for Civilian Contractors in War Zones.” The hearing focused on the handling of workers’ compensation insurance for federal contractors working overseas, specifically on the inordinate delays in compensation running parallel to the enormous profits for insurers. Among those testifying were Deputy Labor Secretary Seth Harris; Timothy Newman, Kevin Smith and John Woodson, former civilian contractors in Iraq; Kristian Moor, president of AIU Holdings, Inc., a division of AIG; George Fay, executive vice president for Worldwide P&C Claims, CNA Financial; and Gary Pitts of Pitts and Mills Attorneys at-Law.

Kristian Moore defended AIG’s decisions and motives, pointing the finger at a lack of Labor Department oversight and a system overtaxed with cases. “We are doing everything we can do,” suggested Charles Schader, senior vice president and chief claims officer for AIU Holdings. Yeah, everything you can do to make money.

At the conclusion of the hearing, Dennis Kucinich (D-Ohio) warned AIG executives that he plans to demand copies of internal memos and documents that will link claims denials to the company’s profits. Most of us do not get terribly excited by the prospect of reading claim files, but these will undoubtedly provide some compelling reading. While I doubt that the subcommittee will find a direct, written link between denials and profits, the rationale for the individual claim denials – in the face of compelling evidence of compensability – should prove riveting. Was it incompetence or was it greed? Something cruel, heartless and cynical took place in the back rooms of carriers with responsibility for civilian claims. If you like Edgar Alan Poe, you’ll love the claims files of AIG and CNA.

Risky Job, Risky Work
Seth Harris, the new deputy secretary at the U.S. Department of Labor, is in charge of this mess for the government. He’s been on the job for 3½ weeks. Congratulations on the new job, Seth! (You might want to keep your resume circulating.) Seth has been working less than a month, but he has already figured out that the system is in need of fundamental change.

The work of insurers usually involves risk transfer. Under the perverse incentives of the DBA, the risk is absorbed by taxpayers, the pain falls on civilian workers and their families, and the profits – running from 37 to 50 percent of premiums – are pocketed by the carriers. Risk without transfer. It’s amazing that AIG can generate this level of profit in one division and still only trade at $1.40 a share. I guess that they have been looking for risk in all the wrong places.

Editors note:  CNA Financial just changed it’s name to CNA Select Risk

Posted in AIG and CNA | Tagged: , , , , , | 7 Comments »

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