USAA Sued in Class Action Case

Posted by Jason Van Steenwyk

Alleged Wrongful Denial of Medical Coverage in Auto Accident Claims

car accidentIf you are a USAA Auto Insurance customer – or you were hit by one – and USAA denied coverage of medical expenses arising from an auto accident, an Oregon law firm would like to have a word with you.

The law firm of Gatti, Gatti, Maier, Sayer, Thayer, Smith and Associates, out of Salem, Oregon, has announced that it is pursuing a class action lawsuit against the United Servicemembers Auto Association (USAA), alleging the wrongful denial of legitimate claims to cover the cost of medical care following auto accidents involving USAA auto insurance customers.

Specifically, the plaintiff firm accuses USAA of “breach of contract and the breach of the duty of good faith and fair dealing to its insureds.”

At issue is USAA’s relationship with a third party firm hired to review case files of claimants. The suit alleges that file reviewers at Auto Injury Solutions (AIS), which was hired to help USAA control or reduce fraudulent claims, were “routinely” denying reasonable and necessary care, as determined by usual and customary practice and the recommendations of medical personnel.

The suit claims that these file reviewers made their decisions based on “bogus” criteria and “authorities which are not appropriate to the individualized injuries.”

The complaint cites a number of cases from actual plantiffs. In one case, Brittney Bathurst, a 17-year-old daughter of a retired military veteran, was severely injured when her car was t-boned by another car travelling at high speed. Emergency responders had to use the “jaws of life” to extract her from her ruined vehicle, and transport her to the hospital.

Ms. Bathurst’s mother, who owned a USAA policy, filed a claim. However, according to the complaint, USAA sent Bathurst’s medical claim file to an AIS file reviewer, who rejected the claim as not medically necessary. The case file contained a note saying a physician’s review had been completed. But the file reviewer was Leslie Kancir, an acupuncturist in Lakewood, Colorado.

The Gatti Law Firm is seeking plaintiffs with similar stories to tell, as well as evidence and testimony supporting the allegations against USAA.

The case follows a similar class action case, Horton vs. USAA, an Arizona case which was concluded last year. It is too late to join this case. Another similar case was concluded in Illinois in the mid-2000s.

For its part, USAA’s position is that the use of third-party case reviewers such as Auto Injury Solutions is a vital safeguard against insurance fraud. They also assert that preventing fraud is certainly in the interests of their policyholders and association as a whole. USAA believes that the use of third-party case reviewers assists them in validating billing data and preventing overcharging – allowing them to keep rates at affordable levels, which benefits all USAA members.

USAA is a mutual association, jointly owned by members. As such, any savings or profits that USAA realizes accrues ultimately to the benefit of plan members, rather than stockholders on Wall Street. As a mutual association, USAA does not have the obvious conflict of interest between owners and customers, because in mutual insurance associations, the customers are ultimately the company owners.

However, even mutually owned insurance organizations are bound by the terms of their contracts. The Gatti Law Firm is alleging that when USAA, acting on the recommendations and findings of their AIS vendor, denied or reduced claims based on flawed or irrelevant data or guidelines, that they were acting in violation of their contracts with their insureds.

The Gatti Law Firm specializes in insurance litigation, including bad faith and class action lawsuits against insurance companies. Daniel Gatti, the lead plaintiff attorney, told a San Antonio daily that USAA was once one of the most honorable insurers in the country – but was now focusing on cost containment, at the expense of our military. USAA countered by pointing out that they had paid out more than $1.3 billion to USAA members in dividends in 2010 – practically all of whom were military, veterans or family members of military members.

If you are a USAA member, and you believe you may have been wrongly denied a medical claim as a result of a covered auto accident – or if you are not a USAA member, but you were involved in an accident with a USAA customer, and your claim was wrongly denied, contact the Gatti Law Firm.


3 Comments | Read Comments | Write Comments

3 responses to “USAA Sued in Class Action Case”

  1. TSGT Larry J Semmel USAF RET says:

    Identical to VA Claims processing 
    history 1991 Gulf War Illnesses. 
    What else is new?

  2. Greg Rogers says:

    15 August 2014
    McAlester, OK- It is unusual for astronauts to be called as witnesses in a civil trial for a water damage insurance claim but the presence of a former NASA mission commander will be but one strange twist in what it expected to be a highly remarkable case at the Pittsburg County courthouse. However, Eileen Collins, former U.S. Air Force colonel and NASA astronaut, will be included in the witness list for this intriguing trial.
    The case will pit the United States Automobile Association (USAA), Americlaim®, and Mr. Ken Mettler against Doctor and Mrs. Gregory Rogers. On September 1, 2011, the Rogers’ family had a home water event that they allegedly reported to their household insurance company, USAA. What happened next will be what the trial will seek to clarify. The Rogers’ allege that USAA and Americlaim® sent out unlicensed adjusters, began extensive background investigations before even assessing the extent of damage to the home, and even reported a false fire claim to a consumer credit agency. USAA and Americlaim® respond by claiming that they acted in good faith to settle all issues.
    However, Dr. Rogers used to be the U.S. Air Force Chief of Aerospace Medicine at the 45th Space Wing and served as a rescue flight surgeon for the astronauts at Kennedy Space Center. As such, he had the opportunity to work in coordination with COL Collins prior to her first spaceflight. She later became the first woman to pilot a space shuttle and then became the first woman to command an American space mission. The link, for this story, was that COL Collins later joined the Board of USAA. Collins was still in that capacity when the water event happened at the Rogers’ home. Rogers, having been covered by USAA insurance for over 27 years, reports suffering many frustrations in working with numerous adjusters and officials at USAA. At the end of his rope and having recognized that she was on the Board of USAA, he then attempted to get in touch with Collins to assist his family in dealing with their losses yet was not able to reach the former astronaut. During the subsequent dealings, nevertheless, the Rogers’ were shocked to learn that USAA had allegedly reported a substantial fire claim to a consumer credit agency in New Jersey even though no fire had ever occurred to their home.
    The pre-trial hearing date has been set for October 17, 2014, at the Pittsburg County Courthouse in McAlester, Oklahoma.
    [Contact is The Edwards Law Firm – lead attorney Mark Edwards, associate lawyer Matt Patterson, legal assistant Brooke Steeley 918-302-3700]

  3. John says:

    As a healthcare provider I have had numerous issues with USAA and their Auto Injury solutions group for denying claims using guidelines that do not apply to these kinds of injuries. They attempt to use whatever guidelines would support their agenda in closing cases.
    They do not see the patient yet can tell me they should be better because some doctor stated simple neck sprains all recover in 4-6 weeks. That is very dishonest and all about cost savings.
    Of all the insurance companies I have dealt with USAA is the worst.
    Every time they have pulled this I have won the appeal, but they are hoping doctors don’t have time to fight it.