Some insurers waive liens on Station settlements

 

PROVIDENCE — A lawyer representing more than 100 of the Station nightclub fire victims told a federal magistrate Tuesday that some medical insurers have agreed to waive liens they have on the settlements that will go to victims who incurred hospital and doctors’ bills.

 

This means that some of the most badly burned victims stand to receive much more money than they might have received if the insurers insisted on repayment from the personal injury awards.

Lawyer Mark Mandell told Magistrate Judge David L. Martin that some Blue Cross organizations and Cigna have agreed to waive 100 percent of the charges their clients incurred as a result of the injuries they suffered from the Feb. 20, 2003 fire.

 

And he said Rhode Island Medicaid and Massachusetts Medicaid have agreed in most cases to waive 40 to 50 percent of the tab they incurred for low-income fire victims. The plaintiffs’ lawyers have hired a firm to help negotiate lien waivers from the insurers, he said, hoping to ensure that the clients get to keep more of their settlement money. Negotiations are continuing.

Mandell discussed the medical waivers during a status conference on the nightclub fire cases that are still pending in U.S. District Court here. He did not disclose how much insurance has paid for all of the people injured in the fire or any breakdown of liens waived.

 

Some of the fire victims spent months in hospitals recuperating from burns and respiratory injuries. For example, Joe Kinan, a Massachusetts resident, was hospitalized for 10 months and 17 days. Gina Gauvin, a Johnston single mother of three, was hospitalized for 133 days and suffered burns over 60 percent of her body. Her in-patient expenses for care at UMass Memorial Medical Center, in Worcester, totaled $450,000.

 

In lieu of a trial, all of the current defendants have agreed to contribute a total of $176 million in settlement money to those who were injured or who lost a family member in the catastrophic blaze. The money, minus attorneys’ fees and expenses, is to be divided up among more than 300 people, including dozens of minors who lost a parent in the fire.

 

Those who were most badly burned and were hospitalized the longest stand to become millionaires as a result of the settlements, but most of the victims will receive less.

Mandell told Martin Tuesday that a court-appointed neutral verification expert from Minnesota and his team of workers — which included nurses — has just finished an initial review of medical records. Additional information is being requested from some of the victims, he said, and is due within two weeks.

Mandell told the court that by May 6, the neutral verification expert will assign each plaintiff a number of points that will then be calculated into separate grids that have been devised for awards for death and injury claims. Once all of the plaintiffs have been assigned points, all of the points for all of the victims will be totaled, and this total will be divided into the $176 million to determine a dollar amount for each point.  Mandell said that the goal is to have final point calculations completed for each victim by May 27.

 

The grids have been designed by a Duke University law professor, Francis E. McGovern, who is donating his services. Mandell also told Martin he is working with Rhode Island’s probate judges to “streamline the process” of getting estates closed and probate approval for the money that will go to the estates of the deceased victims and their minor children.

 

Lawyers are hoping to get the settlement money to the victims this summer.