Wednesday, April 24, 2013

Getting nickled and dimed to death makes doing the right thing harder to do

I have an insurance company client that recently began sending me work.

This should be a good thing.

So far, though, it's been a decidedly mixed blessing.

I recently wrote about a vendor billing problem -- I didn't pick the vendor -- the client requires me to use it -- but the bills are totally out of whack.

After wringing my hands here, I wrote my corporate contact and laid the problem out. I haven't heard back. I fear I may have given offense. But I believe I did the right thing and I tried to do it in a positive way.

The vendor bills wouldn't be as much of a problem if the insurer were paying my bills. But it's not. The insurer requires me to 'post' bills through some Third Party Interloper that has somehow sold this insurer (and a number of others around the country, from what I'm hearing) a bill of goods about this somehow being a way to save money.

As Col. Potter used to say on M*A*S*H (mainly because the CBS censors wouldn't him use the actual barnyard epithet), "Horse hockey."

Quibbling over bills just breeds resentment between lawyer and client, just like sneezing uncontrollably in a crowded subway car breeds germs. And maybe even faster.

Look: If you think your lawyer is out to cheat you on his or her bill, maybe you should use another lawyer.

If you enter into the relationship with the assumption that your lawyer will cheat on your bill (else why would you need a Third Party Interloper?) you will actually encourage the lawyer to cheat. Or at least not to accord you the little courtesies and economies that we might otherwise cheerfully provide in an effort to build goodwill -- and more business.

Case in point: I got a new assignment from the insurer a week or so ago about a possible underinsured motorist claim. In Illinois, UIM coverage kicks in if -- but only if -- the party responsible for your injury has less liability coverage than you have in UIM coverage. In Illinois, UIM coverage does not 'stack.' Thus, if you carry UM (uninsured motorist) or UIM coverage with a $50,000 limit and the responsible driver has only a statutory minimum (in Illinois, $20,000 per person) policy, then you have up to $30,000 in additional UIM coverage in the event the responsible party's insurance is insufficient to cover your loss.

Still with me?

This coverage does not kick in automatically. The responsible party's insurer has to put its own policy on the table (or, sometimes, something pretty darn close thereto -- but let's not quibble here) before your insurer gets to decide whether to allow you to take the money or (much less often) advance you the money the other insurer is offering. Then, and only then, can you begin fighting with your own insurer over how much of the UIM limit should be awarded you.

The flip side here is that, if you carry $20,000 in UM/UIM coverage, you probably don't have UIM coverage at all... maybe if the responsible driver comes from a state (if there is one) where the statutory policy liability limit is less than $15,000.

Anyway, in comes this new assignment -- a supposed UIM claim. I spend the time to read the file provided and it becomes obvious that (a) the claim with the primary carrier has not yet been resolved and, therefore, the UIM claim is at least premature and (b) there isn't likely to be a UIM claim anyway because the insured's policy does not appear to be for more than the statutory minimum.

I 'wrote up' seven-tenths of an hour for reading the file; it took longer than that, of course, to acknowledge it through the third party interloper and set up a physical file and enter it into my system. I didn't call the adjuster immediately, but when I did I was prepared to explain why there was not much for me to do on this matter, and maybe nothing at all.

And, as it happens, when I did call, I promptly verified there was nothing to do: The responsible driver's carrier tendered its policy limit, that limit being in excess of the UIM coverage of our insured's policy, and our possible UIM claim vanished like a soap bubble in the breeze.

I congratulated the adjuster on her splendid victory and we had a nice chuckle and, in the ordinary course, I would close my file with no bill. Sure I wasted some time reading the file and doing the administrative tasks in setting the matter up. But I shouldn't resent that because I have hopes, or (in the ordinary course) I should have hopes, that this client will send in more and better business in the future.

Right now, I'm not so sure. This morning I opened up my email to find a notice from the Third Party Interloper advising, in a generic way, that another of my bills to this carrier has been rejected. I have to log into the Third Party Interloper's system to find out why.

And, next week, I am supposed to pay Third Party Interloper $275 for the continued privilege of allowing it to delay my billing.

And the icing on the cake is that the carrier has paid only two of my fee bills this year -- two very little bills. Many more than two remain open, although "approved" by the Third Party Interloper (albeit not without a struggle on several of them).

I will close this file without a bill -- I will have to figure out a way to let the Third Party Interloper system allow me to, of course. It will ask for all sorts of information that does not apply before it will allow me to "close" the matter insofar as it is concerned. I can look forward to wasting an hour or more on that thankless task.

But, still. The right thing to do is close this file without a bill. So I must do the right thing. But I don't have to be happy about it.

1 comment:

Empress Bee (of the high sea) said...

the thing i detested most when working at the law firm was billing. besides not being able to read the handwriting (he never turned his computer on) the .1's and .2's would take pages of typing to add up to any kind of money at all. blech. then collect? yeah. that's when the "negotiation" began. this was on big commercial leases, the sales of property were easy. flat fee usually. paid at closing, yay!

i was in his office the other day and that old computer was still on his desk. still not turned on. but he sure is a nice guy!

smiles, bee