Time running out to improve claims process


How do you spell “relief”?

For a while, many people on the Gulf Coast would’ve answered F-E-I-N-B-E-R-G. Now, most of their answers wouldn’t be suitable for spelling, much less printing.

And unless claims czar Kenneth Feinberg can fix the month-old-and-already-broken claims process, and do it soon, his name will be spelled M-U-D.

So-called “emergency claims” are being paid too slowly, if at all, and the checks are for amounts considerably smaller than claimants requested.

The process itself is confusing and inefficient, and Feinberg’s criteria for deciding which claims will be paid and which ones won’t are apparently a state secret.

Neither reporters, accountants nor elected officials can pry out of him a clear and thorough explanation of his staff’s methods.

Take the example in Saturday’s Press-Register of the contractor who builds high-end vacation and retirement homes on the Alabama coast. As customers started canceling contracts after the oil spill began in April, he had to lay off his 15-man crew.

When his crew supervisor filed a claim for lost wages, he eventually received most of what he requested. But when the contractor filed a business claim, it was denied.

To add insult to injury, the letter he received gave no reason for the denial. According to the news story, when a staffer in Congressman Jo Bonner’s office inquired, Feinberg’s office said the claim was denied because it was from a building contractor.

Say what?

How and why would a contractor’s business be deemed less worthy than a restaurant, gift shop, cleaning service, real estate management company or seafood processor? They all employ people and generate economic activity in the community.

If they all have been damaged by the oil spill, what sense does it make to reimburse one and not another?

Saturday afternoon, Feinberg seemed to acknowledge the problem, declaring in a news release that he has “heard from the people of the Gulf” and will “make this program more efficient, more accelerated and more generous.”

Sounds good — if he’ll follow through on his promise. He can make a good start by explaining the criteria his staff uses to evaluate claims.

He can also school himself more deeply in the dynamics of coastal economies. They aren’t all the same, even on the same coast.

In Alabama’s beach communities, seasonal businesses make their big money in the summer, from Memorial Day to Labor Day, and use it to stay open in the off-season. They won’t be able to do that this year.

Pay their claims, Mr. Feinberg, as well as the claims of the employees whose hours they’re having to cut.

Pay quickly and generously. If you find later that you overpaid some claims, you can ask for the difference back.

We understand that you’re worried about fraud. It’s a fact that cheaters come out of the woodwork after disasters. Let people know that if they file false claims, you’ll come after them with the FBI at your side.

But don’t let “the perfect be the enemy of the good,” Mr. Feinberg. Fix the claims process, and fix it now.

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

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