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Allstate sins 3 & 4: Running doctors out of business and using alleged "corporate irregularities" as reason to refuse payment of No-Fault benefits

Our No-Fault insurance attorneys explain how Allstate has attempted to ruin medical care providers who care for auto accident victims

I’ve been writing about how Allstate has a lot to make up for, and why that may be prompting the latest “satisfaction guarantee” commercials. Last week, I wrote about Allstate’s second “sin,” targeting injury victims who hired auto accident attorneys to help them when they were injured in car accidents.

Today let’s discuss Allstate’s third and fourth sins.

Allstate has repeatedly tried to run medical care providers who treat car accident victims out of business. The auto insurance giant would also allege corporate irregularities as justification to deny payment to these doctors treating auto accident victims. This includes in Michigan, payment for No-fault insurance benefits.

These two sins could also be reasons as to why Allstate has started its “claims satisfaction guarantee.” They do, after all, have a lot to make up for. Pretty ironic how Allstate can guarantee us the sun and the moon now in its television ads, after agreeing to pay a very large settlement for improper auto accident claims handling and mistreatment of accident victims and customers.

Allstate sin No. 3: Running medical care providers out of business

Allstate has proved that it can target doctors who regularly care for and treat auto accident victims.

For example, in one case, Allstate Insurance Company v. Jon H. Dodson, MD, Allstate got slammed with a $21 million jury verdict for its defamation of Arkansas medical provider, Dr. Jon H. Dodson. Dr. Dodson had committed the “crime” of providing care and treatment to people who had been injured in auto accidents.

The case was designed to drive the doctor’s existing patients away and to scare injury lawyers who had clients that were receiving care from him; and to further scare lawyers from referring auto accident victims to the doctor for care and treatment. Ultimately, Allstate’s smear campaign worked and the doctor was forced to shut his medical practice.

However, a jury and then the Arkansas Supreme Court gave Allstate the final word on this practice. The jury awarded the doctor $21 million in defamation damages and the Arkansas Supreme Court upheld the verdict on appeal.

Allstate Sin No. 4: Using alleged corporate irregularities to refuse payment of No-Fault benefits

A great example closer to home of Allstate refusing to pay doctors treating auto accident victims by alleging irregularities can be found in Miller v. Allstate Insurance Company, et al. The Michigan Supreme Court’s ruling stopped Allstate from trying to get out of paying a physical therapist’s $29,000 bill for services rendered to a Michigan auto accident victim, by claiming the physical therapist’s practice was not properly incorporated.

Another example is the Allstate lawsuit that was filed and subsequently dismissed in federal court this year against 24 medical providers and doctors who also treated Michigan car accident victims. Allstate filed its lawsuit deliberately on Christmas Eve, December 23, 2009. They also issued a press release, where the defamatory allegations of fraud against these 24 Michigan doctors and medical clinics was run all through the long holiday weekend. This was part of a deliberate campaign to drive out of business the doctors who Allstate doesn’t like – those that provide medical care for auto accident victims who suffer expensive, long-term injuries like traumatic brain injury and neck and back disc injuries.

Read why Allstate won’t be targeting Michigan doctors any more.

Allstate’s refusal to pay No-Fault bills from doctors who treat auto accident victims, and alleging “irregularities and fraud” as a deliberate campaign to intimidate, bully, and ultimately drive these doctors out of business doesn’t sound like “good hands” to me.

I don’t think Allstate will put these lawsuits in their customer service pledge commercials anytime soon.

Next week, I’ll write about Allstate’s fifth sin (the last of my series), on how the insurance company sued for money it had already received.

Steven Gursten is recognized as one of the nation’s top No-Fault insurance attorneys handling serious auto accident cases. He writes about insurance company abuse and the Michigan No-Fault laws, and is available for comment.

– This blog was written by Steven Gursten and Todd Berg, esq.

Related information to protect yourself:

Top 6 worst auto insurance companies

Free book: Guide to Michigan No-Fault Law

How to read your insurance policy

Michigan Auto Law is the largest law firm exclusively handling car accident, truck accident and motorcycle accident cases throughout the entire state. We have offices in Farmington Hills, Detroit, Ann Arbor, Grand Rapids and Sterling Heights to better serve you. Call (800) 777-0028 for a free consultation with one of No-Fault insurance attorneys.

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