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Here’s why Wal-Mart doesn’t have to take Debbie Shanks’ money
By Lauren | March 30, 2008
Yesterday, I made pretty clear what I think of Wal-Mart’s suit against a former employee, Debbie Shanks, to recover medical insurance payments that Wal-Mart’s health insurance plan made to Ms. Shanks after a serious automobile accident. This morning, one of my regular readers opined that I had been too hard on Wal-Mart. She pointed out that the company had an obligation to protect the other participants in the health insurance program by reclaiming money wherever it can and argued that, if Wal-Mart relinquished a claim once, it could be setting a bad precedent for the future. Here’s what I told her:
Without having access to Wal-Mart’s health insurance plan documents, I’ve had to rely on the press for the specifics. It’s my understanding from news reports that the damages awarded to Debbie Shanks in her suit against the trucking company that was involved in the crash were not intended to reimburse her initial medical expenses, but to fund her future care. That makes sense given the relatively low damages awarded to Ms. Shanks (it’s not as though she got ten or twenty million dollars). It looks as though the trial court believed that Debbie Shanks’ original medical expenses had been paid off. Otherwise, the $750,000 damages award would have been eaten up completely by legal fees and her early medical bills, and the court would have had to award Ms. Shanks a lot more money to pay for the nursing home care that she’ll need for the rest of her life.
Under the circumstances, I think Wal-Mart could relinquish its claim against Debbie Shanks without tying its hands in the future by reading its health insurance documents to provide for recovery of compensatory damages for medical expenses awarded in a lawsuit, but not necessarily to allow recovery of damages that were awarded to cover future care. That way, Wal-Mart could continue to recoup medical expenses paid to injured employees who were reimbursed for those expenses in lawsuits without putting Debbie Shanks in the impossible position she occupies now.
Alternatively, Wal-Mart could set up its own trust fund for Ms. Shanks as a goodwill gesture. It would probably cost the company far less than the public relations gymnastics it will have to do in the wake of its ill-conceived lawsuit. There’s currently about $277,000 left in Debbie Shanks’ trust account – that might not be a bad baseline for Wal-Mart’s contribution.
Topics: Business Ethics, corporate responsibility |
March 30th, 2008 at 8:59 pm
A friend of mine just emailed me one of your articles from a while back. I read that one a few more. Really enjoy your blog. Thanks.
Jason Whitmen
April 2nd, 2008 at 2:07 am
[...] Lauren has something worth reading today (Hereâ??s why Wal-Mart doesnâ??t have to take Debbie Shanksâ?? money)Here’s a brief bit, but follow the link for the rest.Yesterday, I made pretty clear what I think of Wal-Mart’s suit against a former employee, Debbie Shanks, to recover medical insurance payments that Wal-Mart’s health insurance plan made to Ms. Shanks after a serious automobile accident. … [...]