Elected Officials Want Answers from Claims Czar Ken Feinberg


Following a string of emotional town-hall meetings on the Gulf Coast, BP claims czar Kenneth Feinberg will return to the national spotlight this week with a scheduled Thursday grilling by the “Senate Homeland Security Committee’s Ad Hoc Subcommittee on Disaster Recovery,” chaired by Louisiana Sen. Mary Landrieu (D).

Now, I’m a longtime suporter of Sen. Landrieu, but I don’t think anyone would accuse her of being less than sympathetic to oil industry interests. But, perhaps signaling a political shift on the BP issue, we have a Republican issuing what amounts to an accountability agenda for Mr. Feinberg.

U.S. Rep. Steve Scalise, R-Jefferson, according to reports in the Times-Picayune, sent Feinberg “… a letter criticizing his performance and demanding more information on claims and payments made to date. He also questioned the proposed transfer of 150 local claims processors from the Gulf region.”

What’s even more interesting than doing away with 150 local jobs after saying we need more local presence, the letter takes aim at the ongoing lack of transparency in the claims process – an issue we’ve long noted is at the core of much victim anger and frustration.

Mr. Scalise writes in his letter, which will be a de facto agenda for Mr. Feinberg’s testimony, that “… the GCCF’s opaque nature detracts from its credibility and adds to claimants’ frustration as they try to understand why their claim was denied or underpaid.”

At the risk of running a bit long in this post, and because I’m fairly sure that much of this information won’t be forthcoming, let’s list what Scalise is asking Mr. Feinberg to provide (from the Times-Picayune report):

  1. All metrics on claims and payments, including the total number of both submitted and paid claims, broken down by state, city, industry, and job classification, and the average payment to individuals and businesses in each category;
  2. The formula for how payments are calculated;
  3. The total number of people employed by GCCF and working on its behalf at affiliate entities, broken down by specific geographic location and employer;
  4. Any job transfers or lay-offs in claims processing that GCCF has executed or is planning to execute, including justification for such moves.
  5. Specific information and documentation on the decisions leading to the removal of 150 jobs at the Hammond claims processing facility, including where those jobs are being transferred; and
  6. The number of unprocessed six-month emergency claims and justification for why these claims remain unresolved.

Just the payment formula and details on claims paid would be a red-letter day. Transparency has been a big problem. To a certain degree, Congress initially acknowledged that it was early going and things needed to get worked out – but that time has come and gone.

And, to add even heavier political overtones, it will be telling who emerges as the claims process apologist in the hearing. Because without champions on the committee running interference, it will be a long day for Mr. Feinberg. The only way to dodge this sort of heat is to agree to everything, promise whatever moves the questions along, then just drag your feet on meeting the demands.

Coming in the considerable wake of the president’s State of the Union address, Mr. Feinberg’s testimony could easily be a true milestone, one of those national media pivot-points. Republicans could begin using the Obama-appointed claims administrator’s shortcomings as an example of the president’s shortcomings – and that will increase the already intense pressures on the Gulf Coast.

Read the John Tilove story at nola.com here: http://www.nola.com/news/gulf-oil-spill/index.ssf/2011/01/oil_spill_fund_administrator_t.html

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Stuart H. Smith is an attorney based in New Orleans fighting major oil companies and other polluters.
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