State of the Union

[dean_martin]

I do know a bit about the asbestos thing, as I've been in the insulation industry for many years. The vast majority of folks affected by mesothemania were also heavy smokers. I met a couple of these old timers. Horrible disease.

Agreed there were/are some real slimy characters involved in the stuff, and it's still being sold by US and Canadian companies into the third world and developing countries.

Unfortunately there is a lot of truth that companies that never sold it are being sued by folks never exposed/sick. My company has passed on a number of otherwise excellent acquisitions because of possible exposure to asbestos liability. So this one issue is causing a big problem for this industry - just about every player has sold asbestos (it is an EXCELLENT insulation/fireproofing product).

Yes, there are some gravy trainers and with the sheer numbers of injured it's difficult to weed them out early on in the process. We've referred a couple of cases to a large firm in Dallas, TX that screens cases thoroughly by requiring the plaintiff to get forms signed by doctors. There are two serious issues that must be addressed up front: 1) The latency period for disease is often 20-30 years and most states have a "discovery rule" which tolls the statute of limitations until the harm or injury is or should have been discovered, and 2) by that time the company that employed the plaintiff or manufactured the product with asbestos is often either no longer in business or has been aquired by another company (a successor company generally aquires liabilities along with assets).

Here's a timeline of asbestos-related events:

1918-1929:
Medical articles describing asbestosis first appear in scientific literature.

Dr. E.R.A. Merewether, medical inspector of factories in Great Britain, publishes a landmark article on asbestosis describing the clinical characteristics of asbestosis, the dust control requirements to prevent the disease, and the importance of educating workers about the hazards of asbestos.

1932:
Manville Corporation, a major producer of asbestos, settles first asbestosis lawsuits.

1933:
Dr. Anthony Lanza of Metropolitan Life Insurance Company discovers more than 300 cases of asbestosis at the Johns-Manville plant. The cases are never published.

1934:
Two doctors publish the first major medical article associating asbestosis with lung cancer.

1948:
Owens-Illinois Glass Company (parent company to Owens-Corning Fiberglas Corporation) gets results of study on Kaylo, a 15% asbestos-containing pipecovering product. The lab director, Dr. Vorwald, concludes: "...since Kaylo is capable of producing asbestosis, it is better to discover it now in animals rather than later in [humans].... the company, being forewarned, will be in a better position to institute adequate control measure for safeguarding exposed employees and protecting its own interests."

The final report on Kaylo (1952) shows Kaylo dust can produce a peribroncheolar fibrosis typical of asbestosis. No brochure warning about Kaylo's health hazards was ever published.

Owens-Corning (OCF) becomes a national distributor of Kaylo (1953) and publicizes Kaylo in a 1955 sales brochure as: "Light weight, pleasant handling and non-irritating and non-toxic nature contribute to worker well- being."

1949:
Johns-Manville Corporation adopts policy not to tell employees when their medical exams show they have asbestosis.

1953:
Dr. O. A. Sander, medical consultant for Southern Asbestos Company, publishes an article stating, "Asbestosis is compatible with good health and a feeling of well-being."

1962-64:
Philip Carey Manufacturing Company, a producer of asbestos pipecovering, hires Dr. Thomas Mancuso to investigate asbestos. Mancuso reports, "there is an urgent need to protect the company's employees and customers from the danger of Philip Carey asbestos products." Mancuso is immediately fired. His report is buried. No warnings are placed on Philip Carey products.

1964:
Many major asbestos manufacturers attend an international conference (organized by Dr. I .J. Selikoff, Environmental Sciences Lab director at Mount Sinai School of Medicine in New York) about asbestosis, lung cancer and mesothelioma (a unique asbestos cancer of the lining of the lung). Copies of the proceedings and scientific papers and findings were widely distributed. From a study of 117,000 industrial workers in the NY/NJ area: Up to 80% of asbestos insulators were contracting asbestosis after a latency period of 20 years.

1964:
The Manville Corporation recommends the placement of an asbestos caution label on boxes of asbestos products. The labels were 2" square, stamped in small print on the bottom of 3-foot cardboard boxes.

1965:
The Director of Safety for OCF writes a confidential memo to top management: "Our present concern is to find some way of preventing Dr. Selikoff from creating problems and affecting sales."

1966:
A letter from E.A. Martin, the purchasing director of Bendix Corporation, states: "My answer to the problem is: if you have enjoyed a good life while working with asbestos products, why not die from it. There's got to be some cause."

1967:
Louis P. Gray, assistant head of the Pipecovering Department at Newport News Shipyard, writes a memo to four foremen advising respirators are "mandatory" when working with or around asbestos. Gray gives no reason for the respirator use. Workers never see the memo, which is not enforced. Twelve years later Gray testifies: "...it boils down to the fact that if you tell 300 people that what they are working with might cause cancer, you might not have anybody show up the next morning."

1968:
OCF's medical director, Dr. Jon Konzen, responds to an inquiry from OCF lawyers: "Asbestosis was well known and well-documented in the literature... [since the early 1940s]." OCF lawyers later state under oath: "OCF has no information or belief that prolonged use of its products containing asbestos fibers will cause asbestosis."

1969:
OCF's sales manager asks Dr. Konzen about a memo regarding the use of warning labels on Kaylo: "Are you saying that we have to do this now? I naturally would like to delay this requirement as long as possible."

1975-present:
2,500 Newport News Shipyard workers contract asbestosis, lung cancer and/or mesothelioma.

1989:
The EPA issues a ban on the manufacture, importation and distribution of most asbestos-containing products. The industry challenged the ban and it was partially overturned.

1990:
John Thomas, former president of OCF in the 1960s and top executive of OCF since the 1940s, testifies the company knew all the way back to the beginning of his employment that asbestos products were dangerous, that respirators should be worn when working with asbestos products, and that OCF should have warned workers about the dangers of its Kaylo asbestos products.

1999:
Asbestos companies ask Congress for liability relief


I'll leave it for you guys to figure out! - It's not easy but with current public awareness a filing cut-off date is a certainty.

Honestly I don't like Dean, not because he's a moderate, but because he plays like he is athough he's not. I don't trust him.

I'm not sure how the top of the Democratic Party is handled, but down here we would call it the "good ol' boy network".

Interesting that premiums are still going up in those states. What can we do, short of nationalising the insurance industry (shudder)?

Pete

According to a Congressional Budget Office report, there are 3 main problems causing medical malpractice insurance rates to increase. Although the number of medical malpractice claims and payouts has remained steady for more than 10 years, the dollar amounts of the payouts have increased. I can think of 2 reasons for this - better lawyering and increased health care costs. Most patients injured by medical mistakes require further and future medical care. The payouts are based on the stated prices of certain medical treatments and projected medical inflation. Interestingly, when someone with health insurance goes to the ER or hospital for a particular procedure, their health insurance company is not charged what an individual without health insurance would be charged. But, damages for future medical expenses are not based on the prices contracted between health care providers and insurers.

The second problem is that between 1993 and 2002, insurers' return on investments have decreased from a whopping 44% to 18%. Much of this has been made up by increasing premiums. (But I don't think 18% is all that bad, do you?)

The third problem identified is Greek to me but has something to do with the cyclical nature of insurance including the mysterious reinsurance industry which brings into play all insurance, not just medical liability. Therefore, catastrophes such as hurricanes and 9/11 are dragged into the mix.

Here are some interesting quotes from insurance industry execs. and tort reform leaders:

"We have not promised price reductions with tort reform."

~Dennis Kelly, American Insurance Association spokesman, Chicago Tribune, January 3, 2005.


"There is no question that it is very rare that frivolous suits are brought against doctors. They are too expensive to bring."

~Victor Schwartz, General Counsel of the American Tort Reform Association, Los Angeles Times, October 22, 2004.

“Non-economic damages are a small percentage of total losses paid. Capping non-economic damages will show loss savings of 1.0%.”


~GE Medical Protective regulatory filing with Department of Insurance (TDI), October 30, 2003. The revelation was contained in a document submitted by GE Medical Protective to explain why the insurer planned to raise physicians’ premiums 19% a mere six months after Texas enacted caps on medical malpractice awards.

"I don't like to hear insurance-company executives say it's the tort system - it's self inflicted."

~Donald J. Zuk, chief executive of Scpie Holdings Inc., a leading malpractice insurer in California, Wall Street Journal, June 24, 2002.

"No responsible insurer can cut its rates after a [medical malpractice tort 'reform'] bill passes."

~Bob White, President of First Professional Insurance Company, the largest medical malpractice insurer in Florida, talking about a proposed $250,000 cap in the January 29, 2003 Palm Beach Post.

"I don't think we would argue that the premiums are likely to go down. We believe it will have the effect of reducing the increases in the future. And one of the reasons the premiums won't go down is that even if noneconomic damages are capped, the losses for economic loss, medical expenses, for example, are still in this current environment escalating at, medical inflation is running in the double digits. I forget exactly what it was last year. So even if you were to cap noneconomic damages, the economic damages will still cause acceleration in the premiums. So it would not go down, I want to clarify if I misspoke and said I thought the premiums would go down."

~Cliff Webster, representing the Washington State Medical Association & Chairman of the Washington Liability Reform Coalition, testifying before the Washington State Legislature, House Judiciary Committee, Feb. 21, 2003.

"Insurers never promised that tort reform would achieve specific premium savings..."

~From a press release published March 13, 2002, by the American Insurance Association (AIA).

"[M]any tort reform advocates do not contend that restricting litigation will lower insurance rates, and 'I've never said that in 30 years.'"

~Victor Schwartz, General Counsel of the American Tort Reform Association, as paraphrased and quoted in "Tort Reforms Don't Cut Liability Rates, Study Says," published in Business Insurance July 19, 1999.

"We wouldn't tell you or anyone that the reason to pass tort reform would be to reduce insurance rates."

~Sherman Joyce, President of the American Tort Reform Association, as quoted in "Study Finds No Link Between Tort Reforms and Insurance Rates," Liability Week, July 19, 1999.

"Insurance was cheaper in the 1990s because insurance companies knew that they could take a doctor's premium and invest it, and $50,000 would be worth $200,000 five years later when the claim came in. An insurance company today can't do that."

~Victor Schwartz, general counsel to the American Tort Reform Association, "Dose of Legality," Honolulu Star-Bulletin, April 20, 2003.

"While MICRA was the legislature's attempt at remedying the medical malpractice crisis in California in 1975, it did not substantially reduce the relative risk of medical malpractice insurance in California."


~James Robertson, Assistant Vice President and Associate Actuary, SCIPIE Indemnity Company (California's second largest medical malpractice insurer), in written testimony responding to a question from an administrative law jugdge who is overseeing a case in which SCIPIE has requested a 15.6 % rate hike. April 30, 2003

To answer your question what can we do, I think all interested parties should honestly identify the problems first.