Huge insurance scam

[UpInArms]

http://www.nydailynews.com/business/story/242274p-207755c.html

Marsh & McLennan, the world's largest insurance broker, was the mastermind of an $800 million a year fraud — rigging prices and taking kickbacks from big insurance companies, state Attorney General Eliot Spitzer charged yesterday.

The scam in property and casualty insurance, which included AIG, ACE, and Hartford Financial Services, could also affect health and other personal lines of insurance, Spitzer said.

<snip>

Here's how the scam worked: Small and large businesses, and even schools, would ask a Marsh broker to find the best insurance policy. The broker would speak to several insurance companies and would often give the business to the insurance company that gave it the biggest kickback, rather than the cheapest price for the customer.

At the same time, Marsh would ask the losers, who wanted other business down the road, for false, higher bids to convince the customer he had gotten the best deal.

The company did this so frequently that its total kickbacks, called "contingent commissions," mounted to $800 million last year, or more than half of the firm's total profits, Spitzer said. Spitzer, who accepted guilty pleas to criminal charges from two AIG execs, wants Marsh to pay penalties for its actions, disgorge money, and end these practices.

...more...

I bet this is why "doctors can't practice their love" - malpractice insurance is definitely a part of all of this.

Go Eliot! :yourock:

[truthisfreedom]

1. i just heard this story on NPR. absolutely amazing. suddenly, malpractice

insurance rates seem explainable.

[UpInArms]

4. it definitely does explain the high cost of

malpratice insurance - that cost has nothing to do with trial attorneys - it has to do with greed and fraud on the insurers' part.

See my post #2.

:hi:

[UpInArms]

2. related article: Two hospitals announce layoffs

http://www.newsday.com/news/local/wire/ny-bc-ct-brf--hospitalcuts1014oct14,0,2545809.story?coll=ny-ap-regional-wire

MANCHESTER, Conn. -- Two hospitals have announced layoffs to offset medical malpractice insurance costs they say have increased 500 percent since 2002.

The parent company of Manchester Memorial and Rockville General hospitals is laying off 34 employees and eliminating 60 vacant positions to save $4.5 million this fiscal year. The hospitals also lost $1.8 million because of declining Medicare reimbursements, company officials said.

About half the laid-off employees will be moved to other jobs, said Marc H. Lory, the president and chief executive officer for Eastern Connecticut Health Network.

Lory said doctors are also leaving hospitals or retiring because they can't afford increasing insurance costs.

"We are going to have a crisis here east of the river," Lory said.

...more...

[annabanana]

3. well, WE all knew it wasn't the lawyers, didn't we..................n/t

[slor]

5. There you guys go again, hatin' freedom...

the freedom of corporations to screw the little people!

[kanrok]

6. Hank Greenberg from AIG

is one of the biggest tort "reformers" on the planet. Now it seems his company is directly responsible for increasing costs to consumers. What a world.

[Rockholm]

11. His son is MMC CEO.

On Edit: Dem supporter too.

[Cooley Hurd]

7. Eliot Spitzer - our next Governor (in NY)...

Recently, he also filed suit against the ghouls who are making & marketing that "Freedom Tower" commemorative coin (that Lewis Black skewered on the Daily Show a few weeks ago) over their claims of it being made of silver found at Ground Zero.

:thumbsup:

[Rockholm]

10. Next US Attorney General!

[MsUSA]

12. Got that right,

Kerry's AG. Gawd I love this guy.

[corker]

8. Spitzer is the man

we need a couple hundred spitzers....

[tooncesj0nes]

9. I lived with an ins underwriter for 2 years...

..always got a kick out of the monthly golf outings they took under the guise of doing 'business' that were really parties at the expense of the consumers....I sensed that alot of these guys were ex-frat boys....low moral in the underwriting dept was never-ending....

[AP]

13. It's amazing that the low bidders who got screwed, rather than tell cops,

played along so they could get big profits down the road.

What were they thinking?

You have got to believe that you're so far above the law if you think the best route is to participate in the fraud rather than do a favor for the insurance marketplace and blow the broker in.


Lord.

This is no doubt this is only the tip of the tip of the iceberg in terms of describing the sort of fraud that goes on in American marketplaces which ultimately serves to shift a LOT of wealth from the middle to the very top.

Thank god for Eliot Spitzer.

[yellowcanine]

14. BaBaBaBut it's the lawsuits that are driving up malpractice rates!

Scowl, smirk, giggle, pound the podium.....

[Southpaw Bookworm]

15. Wasn't Paul Bremer

Working for them right before 9-11?

[Southpaw Bookworm]

16. Answering my own question

http://www.disinfopedia.org/wiki.phtml?title=L._Paul_Bremer

[saigon68]

17. "doctors can't practice their love"

Its the Trial Lawyers fault </Sarcasm>

I wonder how much these crooks skimmed off to the Bush Criminals