Injured workers living in limbo

The accident also has altered the lives of his parents, his wife, son and stepson. The family faces medical bills of $45,000 per month.

The safety net for those medical bills — workers’ compensation — ripped apart in November when Whitey’s employer’s insurer, Atlanta-based Southeastern U.S. Insurance (SEUS), was declared insolvent and taken over by state insurance regulators.

SEUS’ failure placed Kenny Whitey and 87 other Georgians with workplace injuries in insurance limbo. None are covered by the state’s insurance insolvency pool. Funded by insurers, the pool is designed to cover claims if an insurance firm fails. The pool had $136.9 million at the end of 2008, the most recent audit, and $77 million is earmarked for workers’ comp insurance.

Because of the way SEUS was originally organized, the company was not initially required to pay into the insolvency pool. As a result, employers of the 88 affected workers are legally responsible for their medical bills.

Eight of those 88 workers, including Whitey, the most severely injured, are categorized as catastrophically injured and will need medical care for life.

Their employers said paying those medical claims will bankrupt them.

Help wanted

Victims’ families, their attorneys and employers have lobbied state legislators and the Georgia Department of Insurance to change the law so those workers, particularly the eight who are the worst injured, are covered by the insolvency fund. Their fates could rest on a judge’s ruling in a pending lawsuit by one company in Fulton County against the state insurance department and insolvency pool.

“We’re not trying to demand big settlements,” said Pat Whitey, Kenny’s wife. “We just want my husband taken care of. I’m expecting a miracle and I know he’s going to get better. But I know he’s not going to get better unless he gets the medical care that he needs.”

Kenny Whitey’s case is so severe the family received coverage exceptions from federal Medicare and Medicaid, which are now paying for some of his medical needs. Taxpayer dollars normally are withheld from workplace medical claims in favor of workers’ compensation.

Still, Pat Whitey recently held off buying some of her husband’s eight medications at a local drugstore because she couldn’t cover them all at once. The failure of SEUS put an end to the one luxury for the family: a specialized van to take Kenny Whitey to his son’s baseball games, the movies and church. He has access to a van now, but only for doctor visits.

“We’re doing the best we can,” she said. “I’m grateful for the Medicaid and Medicare. Without it we would have been ruined financially.”

Former machine operator Kenny Crowell, who lost a leg after a 2005 workplace accident, said he’s already there.

Crowell, 45, who lives in the northeast Georgia town of Lula, needs a new prosthetic leg that costs $70,000. He receives $260 per week from his employer as a lost wages benefit, a big drop from the $400 to $500 a week he netted when healthy. SEUS’ failure ended a lot of medications and doctor visits for his hip and back pain. He owes $10,000 in back rent, but his landlord hasn’t evicted his family of six.

“I was going to settle with SEUS and then they went bankrupt with no warning, and life’s been miserable since then,” he said. “Now I have no doctor, no medication, nothing. I’m starting from the bottom again.”

Meanwhile, 778 injured Georgians whose employers had workers’ comp coverage through SEUS are covered by the insolvency pool. Their injuries occurred after SEUS became a traditional insurer.

Yet their coverage isn’t guaranteed. Only workers whose employers have less than $25 million in assets are covered by the insolvency fund. How many of them are included in the pool could be determined by pending court action in DeKalb County. “I’ve been a licensed attorney since 1978 and I would have bet these kind of scenarios were not even possible,” said Marvin Price, representing the Whitey family.

Weak safety net?

Insurance failures in Georgia are rare. The state Department of Insurance is investigating SEUS and its owner and chief executive, M. Clark Fain III.

SEUS’ demise raises questions regarding Georgia oversight of workers’ comp operators.

John W. Oxendine, state insurance commissioner since 1994 and a gubernatorial candidate, did not respond to several requests for comment.

Employers are aware they’re on the hook for their employees’ workers’ comp claims but said the cost of those claims will force them into bankruptcy if they have to pay.

“We had to try to come up with a Plan B for his sake and ours,” said Chad Jones, Leon Jones Feed & Grain president and Kenny Whitey’s employer. “We’re a trucking company that faces pretty high risk and we’d be crazy to go with any possibility of not being covered.”

The company pays $200,000 to $300,000 a year in workers’ comp premiums for its 100 employees. Adding another $45,000 per month to cover Whitey would put the firm out of business, Jones said.

“I didn’t think it was even possible for this to occur,” Jones said. “We’re not that big of a company to be able to take on that kind of cost.”

That’s not lost on the Whiteys and other workers without coverage for their injuries. They don’t want employers forced into bankruptcy. Yet the workers and their families don’t want to be forgotten, either.

“It’s been tough to see him suffer like he did,” Shirley Whitey said in her kitchen, measuring and mixing a pink-colored medicine to give her son. “He can’t tell us when he’s hungry; he can’t tell us when he’s thirsty. The only thing that matters to me is him getting taken care of and him getting the care he needs.”