The Dentists Insurance Company - Insurance claim which should have been subrogated, mismanaged
The Dentists Insurance Company (TDIC) Didn't replace all damaged equipment, remediate mold or pay loss of income to restore water damaged dental practice in Phoenix, AZ.
Does TDIC actually protect you and your practice better than other property and professional liablility insurance companies?
If you ask the two doctors and graduates of LLUSD who experiences a loss that should have been subrogated and paid, they would say absolutely not. There are others who also had had similar experiences. Keep in mind that the two doctors appealed to the CDA, ADA AZDA and various other individuals and entities to help facilitate a reasonable outcome. No one was able to step forward and help. You can view supporting documents, photos and the original disclosure (filing of the lawsuit) on http://facebook/protectdentists and soon at http://www.protectdentists.com/.
Here is their story
Both had TDIC as their main insurance carrier and between them had acquired 3 dental practices in Arizona and one in California. In April 2010, the main office in Phoenix was flooded by a water leak from the dental practice above their suite. Water ran for 2-3 days before the leak was found. The original insurance adjustor and environmental clean-up company wanted to gut the suite to dry, clean and rebuild. TDIC fired the original adjustor and clean-up company and after a two day delay in 90+ degree temperatures and 90% humidity in the office, replaced them with a new adjustor and clean-up company who subsequently wanted to do a much smaller scope of work. Keeping that in mind, the doctors became suspicious about the intent of the new on-site adjustor and the behavior of TDIC when TDIC began to deny the replacement of wet and damaged equipment, yet paid for some of the most durable equipment in the office to be replaced, the doctors chairs.
After much debate TDIC agreed to pay for the replacement of the E4D crown milling machine and half of the Biolase MD. TDIC said to get the other half of the money for the biolase, the doctors must actually purchase a new laser. The check the doctors were given had so many names on it that it took 4 months to be able to cash. TDIC however did not approve payment for a digital panorex, ScanX, Biolase diode laser, myotronics K7 and J5 or the brand new still in boxes pulse oximeter and AED all of which had different degrees of wetness from soaked to lighter water damage. The main supply storage area for the practice was also damage and no money was ever paid for the supplies--TDIC never even address them. TDIC also insisted that the doctors go back into the un-repaired facility and use the "damaged and undamaged equipment" to treat patients even though they had another office 8 miles away and were already mitigating damages by seeing as many patients as they could at their other office. The doctors visited the facility and found black mold growth on many surfaces. After contacting TDIC (who said everything at the office was great), they hired an environmental company to examine office. This company found the office contained a great deal of black mold and coliform bacterial and was unsuitable for habitation. This report was sent to TDIC who sat on the report for 4 months.
During this time, the doctors were making double payments on the new E4D and the damaged one. Because things were going so poorly with the equipment replacement, cleaning and rebuilding the office, they felt they needed to hire their own public adjustor. This did not remedy the situation and they actually had to engage their attorneys in order to get a check for loss of income which should have been coming in monthly with out having to make an effort to receive the check. This came after the practice had been closed for 3 months and with no attempt to move forward with reconstruction. When the TDIC representative heard the doctors were going to hire representation, he stated TDIC would give them exactly how much TDIC wanted to pay and if attorneys or public adjustors were engaged, the reimbursement would be whatever TDIC wanted to pay minus the attorney or public adjustor fees. Therefore the TDIC representative suggested the docors should take whatever he approved or else it would be a lot less. During the course of preparation for trial, the doctors found out that two of TDICs adjustors in charge of the case were let go from the Orange County Police Department on apparent ethic violations. It was also found that TDICs representative had copied the doctors database and server hard drive and left it unsecured. This copy of the database was analyzed and found to have been access multiple times during the 1.5 years it was unattended. When the doctors approached TDIC about a potential HIPAA violation, they were rebuffed and threatened with legal action, forcing them to report the issue to the Office of Civil Rights.
The doctors. still figured TDIC would make it right at some point, yet at mediation in December 2011, TDIC offered $75,000 for a settlement. During deposition, TDIC admitted they had not paid for several damaged pieces of equipment. Fast forward to 2013, after the Drs had spent $700,000 in attorney fees, and one month before trial TDIC finally offered a settlement of $275,000 on a practice that had $1.2 million in loans and was essentially destroyed by the lack of restoration by TDIC.
Surprisingly TDIC won in court because the judge tossed out so much evidence that the jury could not find a breach of contract and therefore could not award any money. The judge would not let the doctors bring in evidence on practice production, profit and loss, loans, manufacture reports stating equipment was damaged beyond repair, amount of money needed to repair the office or replace equipment, yet let TDIC present every bit of evidence TDIC and the defense wanted. Even with so much evidence thrown out, the jury was split on the verdict almost swinging the doctors way and the veterinarian and nurse on the jury refused to sign the verdict stating that "this was such a case of bad faith and breach of contract that they could not in good conscience sign the verdict." No breach was found even though no loss of income had been paid after the three month mark when TDIC was contractually obligated to pay for two years and TDIC had admitted that damage equipment had not been replaced during depositions.
BREAKING NEWS UPDATE
One of the doctors ran into one of the jurors at the gas station about a month after the trial ended and spent 45 minutes talking to that juror. The juror said that the whole jury wanted to find damages against TDIC, however since the judge did not allow the doctors to present our numbers (losses, damages to equipment, loss of income, etc.) the jury had difficulty finding numbers to apply for damage. They all wanted to deliberate another day to try and find an award for us but one juror refused to return for another day. Since they had no hard numbers to work with from the doctors side, they had to let the case go.
To add insult to injury, TDICs counsel requested and amendment to the original filing requesting attorney fees and court cost totaling over $350,000. Talk about kicking a guy when he is already down.
The doctors believed whole heartedly that at some point TDIC would make them whole again. They put their entire personal and professional careers and 3 remaining dental practices on the line with the goal of being made whole again. In order to get to trial and make sure loans, and vendors got paid and patients were protected, sacrificed personal income, homes, automobiles, marketing budgets, an endodontic residency, potential business ventures, worked up to 6 days per week and drove over 1500 miles per week between locations when bills took priority over flying. Their stellar personal credit is currently in a downward spiral as they are forced to prepare for bankruptcy or debt reorganization. The justice system failed them so far. The cost of getting to trial put all three remaining practices and their personal finances in jeopardy and without immediate action there will likely be bankruptcy proceedings to discharge this debt. This debt would have easily been avoided by restoring the practice at a cost of less than $1 million. Instead the collateral damage is approaching $6 million just to make things even, not even to restore the income streams of the practices. TDIC should have easily been able to restore this practice--after all, they had other insurance companies to go after who would ultimately foot the bill.
The doctors recommend you examine your insurance policies and decide if TDIC is right for you. You can check out the case at Maricopa County Superior Court CV2010-018419 or the doctors can provide you with the filing if you have interest. Can you risk having your lives turned upside down like theirs were. If you wish, ask TDIC about the case, their response would be interesting. If you chose to change your insurance, on your exit interview please say that this case was a deciding factor.
We have written letters to Governor Jan Brewer of AZ, Representative Paul Gosar DDS of AZ, Senator John McCain of AZ and Senator William Emmerson, DDS of CA. We also plan on sending correspondence to the CDA Executive Committee, Management and Board of Trustees as well as TDIC Board of Directors. Some of the CDA and TDIC board members and deans of the California dental schools may have gotten emails regarding this case early in 2012. We plan to resend to those individuals as well.
THIS JUST IN
TDIC was offered the opportunity to walk away and let us all go on with our lives. We were willing to offer a walk away, even though TDIC did not manage this situation right during much of the course of the claim and definitely did a lot of damage to the two doctors during the course of the last 3 years. TDIC did offer us an opportunity to settle today, Monday the 20th of May, 2013--they want us to pay them $130,000 right now or $50,000 per year for the next three years. I guess that seals the deal, appellate court here we come.
All the facts posted on this topic are factual and true unless they were statements of opinion. No false statements were made. Some opinions were expressed. To the best our knowledge every fact provided in the story is true. If anyone can provide evidence that any of the statements were made in error or are false, the original posting will be revised once the evidence has been provided.
Information about this case was shared to educate TDIC board members and CDA leadership about the management of a property damage claim and the court case that arose out of that claim. CDA leadership was addressed because of their ownership of TDIC. The doctors wondered how high in the chain of command the review of the claim went and if the evidence was represented factually during the course of that review. Therefore, the doctors felt that it would behoove them to present the information to TDIC and CDA leadership. The information is also provided to fellow dentists as a cautionary tale showing what can happen during the course of a property damage claim and lawsuit. All information was shared to educate those in organized dentistry about the facts of a case and not to harm any company or individual involved.
Dentists from TDIC and CDA leadership are welcome to respond. The doctors would probably be willing to have a confidential meeting with two dentist board members from TDIC and CDA if they are interested in exploring the events surrounding the case.
All information was written by one of the doctors. The intimate knowledge of the case and trial were acquired due to his financial ties to the property that was damaged. One of the doctors did not have anything to do with any of these postings nor did he instruct the other to post these on his behalf. The tense of the story written to appear as coming from both doctors was because it has impacted both of them deeply.
Postings on Dentaltown forum and facebook.com/protectdentists
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