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CompGroup AGC Earns $333K Dividend AUGUST 27, 2003 - The CompGroup AGC workers’ compensation purchasing group will receive a group dividend from Texas Mutual Insurance Company of approximately $333,000, according to Texas MutualSM President Russ Oliver. The dividend, which still requires Texas Department of Insurance approval, will be the fifth group dividend that CompGroup AGC has earned since it partnered with Texas Mutual Insurance Company in 2000. “We’re very pleased with CompGroup AGC’s safety efforts,” said Ken Lauber, Texas MutualSM vice president of Field Operations. “With continued focus on safe workplaces and accident prevention, as well as managed growth of the group, we’re optimistic that CompGroup AGC can improve its overall loss ratio, increase its premium volume, and possibly earn future Texas MutualSM group dividends.” A group’s volume and loss ratio are key components in determining whether it qualifies for a dividend. The greater the group’s volume and the lower its overall group loss ratio, the higher its dividend percentage will be. CompGroup AGC members are eligible for group dividends and general dividends that Texas Mutual Insurance Company has paid to select, longtime policyholders the past five years. Although state law prohibits insurance companies from guaranteeing future dividends, Lauber said that Texas Mutual Insurance Company’s philosophy is to reward its top groups when money is available. CompGroup AGC provides the group purchase program for the Associated General Contractors’ Texas members. For more information on Texas MutualSM purchasing groups, CLICK HERE. Lone Star Auto Dealers Earn Group Dividend AUGUST 27, 2003 - Lone Star Auto Dealers, a workers’ compensation purchasing group, will receive a group dividend from Texas Mutual Insurance Company worth approximately $49,000, according to Texas MutualSM President Russ Oliver. The dividend, which still requires approval by the Texas Department of Insurance, was announced during today’s board meeting. “With continued focus on safe workplaces and accident prevention, as well as managed growth of the group, we’re optimistic that Lone Star Auto can improve its overall loss ratio, increase its premium volume, and possibly earn future Texas MutualSM group dividends.” said Ken Lauber, Texas MutualSM vice president of Field Operations. A group’s volume and loss ratio are key components in determining whether it qualifies for a dividend. The greater the group’s volume and the lower its overall group loss ratio, the higher its dividend percentage will be. Some Lone Star Auto members may also qualify for a general dividend. This year, Texas Mutual Insurance Company paid approximately $25 million in general dividends to over 22,000 qualifying policyholders. This marks the fifth consecutive year that Texas Mutual has paid dividends. Although state law prohibits insurance companies from guaranteeing future dividends, Lauber said that Texas Mutual Insurance Company’s philosophy is to reward its top groups when money is available. The Lone Star Auto Dealers group provides a group purchase program for its new truck and auto dealer members. For more information on Texas MutualSM purchasing groups, CLICK HERE. Texas Mutual Website Wins Again AUGUST 20, 2003 – For the second year running, Texas Mutual Insurance Company’s website took top honors in an international competition hosted by the American Association of State Compensation Insurance Funds (AASCIF). Since launching its website in 1996, Texas Mutual Insurance Company has introduced a host of online tools for its customers. In January, Texas Mutual Insurance Company redesigned the site, making it easier to navigate. In the new site design, agents and policyholders can access the company’s most popular online tools directly from the homepage. The new design also provides news updates, fraud reports, and special sections for injured workers and the health care providers that treat them. Customer response to the award-winning site has been positive. In the first few months after the redesign, user logons increased by 50 percent, use of the online loss run feature rose by 62 percent, and customer viewing of online claim detail increased by 22 percent. Despite the international recognition and the site’s success, Texas Mutual Insurance Company isn’t resting on its laurels. The company recently added several new features, including online preauthorization for health care providers, online interim payroll reporting for qualifying policyholders, and account information management for insurance agents. In the AASCIF communication competition, Texas Mutual Insurance Company also won first place for its 2002 annual report, a digest of which is available on its website, plus four second-place awards and a third-place award. AASCIF members include workers’ compensation insurance companies from 27 states and 11 Canadian workers’ compensation boards. Jones Indicted for Workers’ Comp Fraud  AUGUST 5, 2003 - The Travis County Grand Jury indicted Jimmy L. Jones on workers’ compensation fraud-related charges today. Jones was an employee of Jen’s Oilfield Service in Edinburg when he allegedly suffered an on-the-job injury. According to Jones’ testimony at a Texas Workers’ Compensation Commission (TWCC) benefit review conference, he was unable to work for almost four months after his alleged injury. After the hearing, TWCC ordered Texas Mutual Insurance Company to pay Jones over $3,100 in temporary income benefits. Later, Texas Mutual Insurance Company received information suggesting that Jones had given false and deceptive testimony at the hearing. A Texas MutualSM investigation revealed evidence alleging that Jones was not only able to return-to-work, but had actually been employed during the period he claimed he could not work. If convicted, Jones may face a jail term of up to two years, and may have to pay a fine not to exceed $10,000. The Jones investigation was part of the Texas MutualSM Zero Tolerance for Fraud program. Texas Mutual Insurance Company maintains three teams of investigators permanently assigned to investigate every report of suspected fraud. Note: A grand jury indictment is a formal accusation--not a conviction--of criminal conduct. July 30, 2003—Over 22,000 Texas employers will receive a share of a $25 million dividend from Texas Mutual Insurance Company. The Texas MutualSM board of directors unanimously approved the general dividend plan, which includes an annual component for qualifying customers whose policies expired in 2002 and a retention component for select, longtime customers. “The general dividend plan will reward our loyal policyholders whose low claim losses have contributed to our success,” said Texas MutualSM Chairman Martin Young Jr. “We hope these dividends will contribute to their success, too, which will ultimately help the Texas economy.” Only Texas MutualSM policyholders enrolled in either the Small Business Injury Protection Plan® or the Cornerstone® programs may qualify for the plan, which still requires Texas Department of Insurance approval. State law prohibits policyholders enrolled in the company’s insurer of last resort (Start) program from receiving dividends. Mr. Young also noted that the general dividend plan is separate from the company’s group purchase dividend program. Texas MutualSM purchasing groups have received over $268,000 in dividends this year. Today’s announcement marked the fifth consecutive year for Texas Mutual Insurance Company to offer general dividends. Insurance companies cannot guarantee annual dividends; however, Mr. Young said, “Our philosophy is to share the company's financial success with our good customers.” July 25, 2003 - The Texas Oil and Gas Association (TxOGA) has received Texas MutualSM group dividends worth over $138,000. TxOGA President Robert Looney and Vice President of Financial Affairs Jim Sierra accepted the dividend checks on behalf of the purchasing group. “This has been a challenging year for some TxOGA members, but they have continued to focus on accident prevention and making their workplaces safer,” said Ken Lauber, Texas MutualSM vice president of Field Operations. “Add that to their managed growth of the group, and we’re optimistic that TxOGA will continue to improve its overall loss ratio and increase its premium volume.” The Texas Department of Insurance allows employers in similar businesses to form purchasing groups in order to reduce their workers’ compensation insurance premiums. A group’s volume and loss ratio are key components in determining whether it qualifies for a dividend. The greater the group’s volume and the lower its overall group loss ratio is, the higher its dividend percentage will be. According to Lauber, TxOGA members are eligible for Texas MutualSM group dividends and possible general dividends. Although insurance companies cannot guarantee future dividends, Lauber said that Texas Mutual Insurance Company’s philosophy is to reward its top groups when money is available. TxOGA is the oldest and largest organization in the state representing petroleum interests, and it continues to serve as the only organization in the state that embraces all segments of the oil and gas industry. Texas Mutual Insurance Company is the state’s leading provider of workers’ compensation insurance and also the state’s leading provider of group purchase programs. ESO’s Focus on Safety Earns Dividend July 25, 2003 - The Emergency Service Organization (ESO) workers’ compensation purchasing group received a $57,081 dividend from Texas Mutual Insurance Company. It is the second group dividend that ESO has earned since it partnered with Texas Mutual Insurance Company in 1999. “We’re very pleased with ESO’s safety efforts,” said Ken Lauber, Texas MutualSM vice president of Field Operations. “With continued focus on safe workplaces and accident prevention, as well as managed growth of the group, we’re optimistic that ESO can continue improving its overall loss ratio, increase its premium volume, and possibly earn future Texas MutualSM group dividends.” Volume and loss ratio are key components in determining whether a purchasing group qualifies for a dividend. The greater the group’s volume and the lower its overall group loss ratio is, the higher its dividend percentage will be. ESO members are eligible for Texas MutualSM group dividends as well as possible general dividends. Although insurance companies cannot guarantee future dividends, Lauber said that Texas Mutual Insurance Company’s philosophy is to reward its top groups when money is available. ESO works through VFIS of Texas/Regnier & Associates, the leading insurer of emergency service organizations in the state. Texas Mutual Insurance Company pays group dividends in three stages over a period of 42 months. The July 2003 dividend represents just one stage of the group dividend process. Former San Antonio Councilman Disbarred for Fraud July 23, 2003—The Texas State Bar has permanently disbarred Bernardo Eureste, a Houston attorney and former San Antonio city councilman. Eureste has not practiced law since June 2002, when he was sentenced to three years’ probation for workers’ compensation fraud-related charges. Eureste’s legal problems began when Texas Mutual Insurance Company (then called the Texas Workers’ Compensation Insurance Fund) uncovered billing irregularities by Eureste’s law firm. The investigators shared their findings with the Texas Workers’ Compensation Commission (TWCC) and the FBI. The investigation revealed that Eureste had devised a scheme to defraud his clients by submitting false claims and often billing identical hours on different clients without any variation. “Eureste used a computer software program to fly under the radar, so to speak, and bill for an average of 90 hours per day, seven days per week, including weekends and holidays,” explained Elliott Flood, vice president of Special Investigations for Texas Mutual Insurance Company. The scheme allowed Eureste to receive up to 25 percent of his clients’ temporary income benefits (TIBs) after TWCC approved his bills for file reviews. At last week’s hearing, Assistant Disciplinary Counsel Michael E. McClendon said Eureste had stolen from his clients, many of whom were poorly educated, lower income injured workers. McClendon used Flood’s testimony to support his call for disbarment. Responding to McClendon’s questions, Flood estimated that Eureste had over-billed his clients by as much as $1.4 million in a one-year period. “This case was unique in my experience,” said Flood, after the hearing. “As a carrier, we were not damaged by Eureste’s actions, but some of our policyholders’ injured workers were. We pay the same amount of TIBs regardless of whether the injured worker retains an attorney. The attorney’s fee is deducted from the injured employee’s TIBs check. So really, Eureste wasn’t bilking Texas Mutual; he was cheating his own clients, injured workers who could least afford it.” State Bar to Discipline Former San Antonio Councilman July 18, 2003—The Texas State Bar held a hearing today to determine if Houston attorney and former San Antonio councilman Bernardo Eureste should be disbarred because of his 2002 federal conviction for fraud. In June 2002, U.S. District Court Judge Lee H. Rosenthal sentenced Eureste to three years’ probation for workers’ compensation fraud-related charges. He also ordered Eureste to pay $108,486 in restitution to Texas Mutual Insurance Company and pay restitution to three former workers’ compensation clients, in amounts ranging from approximately $975 to $2,067. At today’s hearing, Assistant Disciplinary Counsel Michael E. McClendon said Eureste had stolen from his clients, many of whom were poorly educated, lower income injured workers. McClendon declared that Eureste’s offenses must be met with disbarment. “Did you do less work than you billed for?” McClendon asked pointedly. “No, sir,” answered Eureste; however, when a bar panel member asked if Eureste agreed with Judge Rosenthal’s finding that he had charged “unconscionable fees,” he answered, “Yes.” Another bar panel member compared it to “charging lawyer fees for paralegal services.” McClendon used testimony from Elliott Flood, vice president of Special Investigations at Texas Mutual Insurance Company, to support his call for disbarment. Responding to McClendon’s questions, Flood estimated that Eureste had over-billed his clients by as much as $1.4 million in a one-year period. The bar panel determined to take the matter under advisement. They are expected to issue a decision next week. Editor's note: The State Bar had already decided to discipline Eureste. The hearing's purpose was to determine the extent of the disciplinary action. Anonymous Informant Awarded $1,000 July 10, 2003 –Thanks to a recent anonymous tip, Texas Mutual Insurance Company will recover over $8,200 in restitution and save over $26,000 in estimated future income benefits. Additionally, the confidential informant will receive a $1,000 reward. Without the tip, Texas Mutual Insurance Company might still be paying income benefits to an Austin company's worker who claimed he could not work, but secretly was working at a new job. State law requires injured workers to report any change in work status to the insurance carrier. Despite being asked several times, the worker continued to claim to his doctor and to Texas Mutual Insurance Company that he could not work or participate in any physical activity. The worker’s manager reported his suspicions about the claim last year. He requested a review by Texas MutualSM fraud investigators. Although the investigation supported the employer’s concerns, the investigators could not establish enough evidence to prove fraud. About two months later, the manager received new information on the claim. A confidential informant told the manager that the worker was working a new job while still collecting temporary income benefits. Based on the tip, a new Texas MutualSM investigation uncovered clear evidence that the claimant was physically active and working at another job. Texas Mutual Insurance Company discontinued the worker’s income benefits and asked the Travis County District Attorney’s Office to prosecute the case. While most Fraud StoppersSM rewards begin with an anonymous call directly to the Fraud StoppersSM hotline at (800) 488-4488 or an email to fraudstoppers@texasmutual.com, the program is flexible enough to reward other informants who provide information that leads to a fraud-related indictment or conviction. In this case, Texas Mutual Insurance Company has authorized the maximum award, $1,000, to the confidential informant who provided the case-breaking tip. The Fraud StoppersSM award is part of the Texas MutualSM Zero Tolerance for Fraud program. Texas Mutual Insurance Company maintains three teams of investigators permanently assigned to investigate every report of suspected fraud. |
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