Scourge of insurers faces cover problems

Controversial filmmaker Michael Moore hit a snag in making his latest movie--finding an insurer willing to provide coverage for the picture's production.

"Sicko," Mr. Moore's new film--which takes a scathing look at the American health insurance industry and calls for a switch to a free, universal health care system--premiered at the 60th annual Cannes Film Festival in France and is set for wide release at the end of June.

"Every major insurance company turned me down and I finally found a little insurance agency in Kansas City, Mo., to actually insure the film," Mr. Moore said last week during a television appearance on the "Oprah" show, though he did not provide any additional information on the agency or insurer on the risk.

Furthermore, Mr. Moore said that health insurance company employees were warned to steer clear of him.

"They sent out memos to their staff: 'Do not talk to him' and they had in-service training sessions: If he shows up, don't run, don't flee, don't put your hand in front of the camera," Mr. Moore said.

"One of the pharmaceutical companies set up a Michael Moore hotline. If I were to show up at any of their regional offices, the employees were to call this hotline," said Mr. Moore, whose prior credits include "Bowling for Columbine," and "Fahrenheit 9/11."

California Insurance Commissioner Steve Poizner credited insurance coverage with allowing his Jaycee chapter to fight gender discrimination in a precedent-setting U.S. Supreme Court case.

In 1982 while a Silicon Valley businessman/entrepreneur, he was elected president of the Palo Alto Junior Chamber of Commerce. The group considered a bylaw requirement limiting membership to only men as "nonsense," so it invited women to join and the chapter grew quickly, he said at the opening session of the National Assn. of Insurance Commissioner's recent meeting in San Francisco.

The Tulsa, Okla.-based national Jaycee organization caused "a crisis" when it sued his chapter in state and federal courts, Mr. Poizner said.

"We were outgunned," but discovery of a defense clause in the chapter's general liability policy provided "a very small legal defense budget" to fight the suit.

Ultimately, that case and others reached the nation's highest court, which voted unanimously in 1984 to overturn the Jaycees' ban on women members after two justices recused themselves because they were former Jaycees.

Roberts vs. United States Jaycees "became the precedent-setting case" for other organizations such as the Lions Club, Rotary Club and Kiwanis Club, Mr. Poizner said. "They all changed their membership policies after that."

"What's the moral of the story? It wouldn't have happened without insurance," he said as the audience laughed and applauded.

"A wooden leg is a man's property, not part of his person," a Colorado court ruled in 1926.

Therefore, an employer didn't have to compensate an employee that damaged his wooden leg while working, the court said.

Fast forward 81 years, and the wooden leg argument doesn't stand up in a case involving hip replacements, according to a Colorado appellate court.

The case involved American Appliances Inc.; its insurer, Liberty Mutual Insurance Co.; and an appliance repairman. The repairman stepped out of a company truck in June 2005, heard a pop, fell, and felt intense pain from his left prosthetic hip shifting inside of him.

The employee underwent prosthetic hip replacement surgery and an administrative judge in Colorado's Industrial Claim Appeals Office ruled that his employer, American Appliances, had to pay for the hip replacement even though the claimant had several non-industrial left hip replacements before June 2005.

The employer challenged those findings and cited the 1926 wooden leg argument.

The appeals court, however, found in favor of the employee noting that Colorado in the 1990s amended workers comp laws to distinguish between external and internal prostheses. The 1926 court decision now applies only in cases involving external devices.

And the Oscar goes to...UnitedHealth Group Inc. shareholders.

A shareholder lawsuit filed against the Minnetonka, Minn.-based health insurer resembles the plot in "The Sting," a 1973 Academy Award-winning movie starring Paul Newman and Robert Redford as con artists who avenge the murder of their friend through a scheme involving "past-posting" or betting on horse races after the results are known, according to the federal judge overseeing the case. In fact, he even encouraged all parties to the suit to watch the film.

In denying a motion by the insurer to dismiss the complaint, which seeks to recover billions of dollars of alleged investor losses, the judge said the plaintiffs' claim was based on the theory that the defendants were awarded stock options with selected grant dates that were already in the money, meaning that they were playing a game they knew they could not lose.

"The court expresses not the slightest opinion as to whether such shenanigans occurred here, but such is the essence of the plaintiffs' theory," wrote James Rosenbaum, U.S. chief district judge in the U.S. District Court of Minnesota, in his ruling last week.

As for the judge's movie tip, "I'm going to go see it now," said Karl Cambronne, an attorney with Minneapolis-based Chestnut & Cambronne who is representing 10 pension fund plaintiffs in the case.

Contributing: Roberto Ceniceros, Meg Fletcher, Gloria Gonzalez, Rupal Parekh