11 August 2006
A US health insurance company which has already paid $15 million to compensate people it allegedly carried out improper medical assessments on, and which has agreed to reopen another 215,000 claims, has been put at the centre of welfare reform for disabled people in the UK.
UnumProvident is represented on both the Mental Health and Physical Descriptors Technical Working Groups, which are set to make sweeping changes to the way people's incapacity for work is assessed. Any tightening of the rules on incapacity could have financial advantages for the insurance industry.
Take the money and run
UnumProvident is a multibillion, multinational American based health insurance company. A large part of its business involves providing cover for individuals who wish to protect their income if they become too ill to work, temporarily or permanently. It also provides insurance for companies who have to meet the cost of staff going sick. Often both employers and employees contribute to the same insurance policy.
However, thousands of people in America have discovered that whilst UnumProvident were happy enough to take their money, they resorted to allegedly unfair tactics to avoid paying out when legitimate claims were made.
Whilst some policyholders were not paid at all, others found that UnumProvident paid out for a few months and then the payments stopped. Many people with mental health conditions, back problems and illnesses such as fibromyalgia and ME/CFS feel that they have been particularly singled out for unfair assessment, as accounts on websites such as www.lawyersandsettlements.com show.
As one disgruntled UnumProvident customer with severe back problems explained:
"As far as I am concerned, they just took my money and ran. No matter how many medical records I sent, stating I could never work again, they made up another excuse. They said that 'I don't meet the requirements set out in our guidelines'. And in another letter, said that I don't meet their 'criteria'. Well, what does? I was in a hospital bed! How do they set their guidelines?"
Following many such complaints an investigation was launched by the regulatory body for US insurers. The inquiry found that UnumProvident had:
- used its own in-house doctors to deny people's claims rather than using independent doctors with no interest in the outcome;
read independent doctors reports too narrowly in order to find reasons to refuse claims;
failed to look at people's overall health when deciding claims;
placed too much of the burden of proof on policyholders to prove that they were ill.
As a result UnumProvident has already had to pay out $15 million to deal with current claims against the company. It has also set aside a further $86 million to settle future claims as it reopens around 215,000 cases that have been closed since January 2001.
Unique sales opportunities
All the criticisms listed above could equally be aimed at the Department for Work and Pensions (DWP) and the way it assesses incapacity for work in the UK. But then that may not be surprising, as the doctors who set up and evaluated the Personal Capability Assessment (or the All Work Test as it was originally known) in the UK were recruited and trained by a team that included a prominent member of UnumProvident's board. Dr John Le Cascio, Vice President of UnumProvident at the time, was hired by Conservative Secretary of State Peter Lilley in 1993, when the government set out to slash the benefit budget by cutting payments to the sick and disabled.
Dr Le Cascio's boss, Ward E Graffam, was certainly pleased about the changes his company was helping to implement in the UK, happily proclaiming that "The impending changes to the State ill-health benefits system will create unique sales opportunities across the entire disability market and we will be launching a concerted effort to harness the potential in these."
Companies such as UnumProvident stand to gain in two ways from tightening up of the rules around sickness and disability benefits. Firstly, if it becomes harder to be found incapable of work, fewer people will be able to claim on their insurance policies for loss of earnings. Secondly, the less confidence people have in the state benefits system, the more likely they are to feel the need to take out private insurance policies.
Having helped the Conservatives with their changes to the benefits system in 1993, UnumProvident were only too happy to be of assistance to the Labour party too. In 1993 they were one of the corporate sponsors of the Labour Party conference, putting up cash for a meeting on disability with Employment Minister Andrew Smith and Health Minister Rosie Winterton.
Since then the links between Labour, the DWP and UnumProvident have grown ever closer. They became particularly apparent in 2005, when a new benefits related research centre was set up at Cardiff University, funded entirely by £1.6 million of Unum Provident's cash. The person running the centre is Professor Mansel Aylward CB. Professor Aylward was, until last year, Chief Medical Officer at the DWP and author of the now largely discredited Disability Handbook used by Decision Makers when deciding awards of disability living allowance.
The aim of the UnumProvident Centre for Psychosocial and Disability Research is to find out why so many people go off sick with what it refers to as "complaints which cannot be understood in the same way as more identifiable diseases". The kinds of conditions they have in mind are stress, depression and ME/CFS. The centre is particularly interested in "the doctor/patient relationship and how this affects an individual's reaction to their illness".
One of those present at the opening of the centre was Dr Peter Dewis, Customer Care Director at UnumProvident and a former colleague and co-author of Mansel Aylward's at the DWP. According to Dr Dewis the centre aims, within the next five years, to "facilitate a significant re-orientation in current medical practise in the UK" . This is intended to "bring benefits to employers, insurers and to society as a whole; but more importantly, it will benefit the individual who is healthier and happier when actively involved in work."
Or, to put it another way, the research centre hopes to persuade GPs to stop signing so many people off sick with conditions like stress, depression and ME.
Dr Dewis is now sitting on the Physical Descriptors Technical Working Group, helping to decide how the Personal Capability Assessment should be 'improved'.
The opening of the £1.6 million centre was also attended by Wales' First Minister Rhoddri Morgan and former Work and Pensions Minister Alan Johnson. Johnson heaped praises on the new centre and on Professor Aylward in his speech, in which he appeared to be on close, first-name terms with the professor. (For more about Mansel Aylward, see the Benefits and Work article MPs misled? Stress, depression and ME cured? 26.07.05)
It is clear that both the DWP and UnumProvident see the possibility of financial benefits from changes in the way that incapacity for work is assessed. It is also clear that, in America at least, UnumProvident's willingness to deal fairly with sick and disabled people has been called into question. That such a company should be placed in a central position in shaping the UK benefits system is a cause for grave concern. Perhaps even more so because, in a recent article (September incapacity test change shambles 14.07.06) Benefits and Work revealed that the process of changing the PCA is currently in disarray. Many of those on the committees have little idea of how the benefits system works and few constructive ideas are being put forward.
The possibility of more knowledgeable members of the Technical Working Groups being able to exercise very considerable influence on the outcome, perhaps with detailed last minute proposals, is one which should concern anyone with an interest in the UK benefits system.