Update: Wal-Mart no longer seeks money from disabled ex-worker

Posted on Tuesday, April 01, 2008 6:26 PM ET

By Rich Gardella and Lisa Myers, NBC News

On Saturday's Nightly News, NBC News Senior Investigative Correspondent Lisa Myers reported on Deborah Shank, a former employee of Wal-Mart permanently disabled in a car accident eight years ago. Wal-Mart's health plan had moved to collect some of the settlement money she won in a lawsuit against a trucking firm in order to reimburse itself for the more than $470,000 in medical expenses it had paid for Shank.

Although it had just contacted Shank's attorney to begin the process of actually collecting the money from Shank and her husband, Wal-Mart announced Tuesday it had reversed its decision and said that it no longer will seek any reimbursement from the Shanks.


Wal-Mart had won its case in several courts over the past few years.  Recently, the Supreme Court declined to hear Shank's appeal.

Both CNN and NBC News broadcast Shank's story last week, generating a large viewer response.

"We have decided to modify our plan to allow us more discretion for individual cases, and are in the final stages of working out the details," Wal-Mart's statement, released Tuesday, reads. "Wal-Mart will not seek any reimbursement for the money already spent on Ms. Shank's care, and we will work with the family to ensure the remaining amounts in the trust can be used for her ongoing care."

Wal-Mart ended its statement with an apology  "for any additional stress this has put on the Shank family."

Jim Shank, Deborah's husband, released a statement in response: "I am grateful that Wal-Mart has seen their error and decided to rectify it. I just wish it hadn't taken them so long, this never should have happened. I sincerely hope no other family ever has to go through this.

"My thanks go first and foremost to my lord and savior Jesus Christ for the strength to bear up under all this. Thanks also to the citizens of the United States - it wasn't me who made this happen, it was the outcry of the people, and if there's a lesson in this story it's that 'we the people' still means something."

Read more on this story here.

Comments

Great! Wonderful news. I't's incredible how dumb corporate america can be sometimes. This might very well prevent other families from being bullied by a giant corporation that all too often forgets that we the consumers have the last word. Let's not forget this. Awesome.

Mark Davis, Falls Church (Tuesday, April 01, 2008 9:13 PM)

This is why people have to stick together! Also, read your own health insurance policy, they all have a subro clause and will try to get their money back if you win a settlement, or worse, refuse to pay for treatment because the injuries are the result of third party negligence. Then you are in a real catch 22 - your health insurance won't pay, the at fault insurance doesn't have to pay while you are incurring your medical expenses - they only pay at the end when there is a judgment or settlement. Now you need treatment, can't work and no one will pay for your medical expenses. WE NEED INSURANCE OVERHAUL!

Kacie Jay, Macon, GA (Tuesday, April 01, 2008 9:15 PM)

We the people need to keep the sunshine shining on issues like this. What's $278,000 compared to the millions in bonuses that a CEO and executive board can make each year? Shame on Wal-Mart.

Paul, California (Tuesday, April 01, 2008 9:18 PM)

My co-workers have made a promise not to shop at walmart again. It is really sad to see such a huge company try to take away money from a family in need. What difference does it make to them when it means the world to that poor family. I know two people that are employees and have been told that there is a program set up so familys in need can get help when its needed. Where is that program for them?

SL (Tuesday, April 01, 2008 9:25 PM)

Wal-Mart is not doing this out of the kindness of their hearts. Unfortunately, since it became a public issue, they realized their losses would be greater if they persued this. My heart goes out to this family.

Cindy W., Knoxville, Tennessee (Tuesday, April 01, 2008 9:27 PM)

Good Job Wal-Mart! This shows that your company has compassion for their workers and circumstances they faced. Well done! After all money isn't everything when you have billions..this family needed it the most. So thank you for being there for them when they needed you the most. Remember the Golden Rule it is better to give than to recieve.

Kay, Southfield, MI (Tuesday, April 01, 2008 9:28 PM)

I don't shop at Walmart for a host of reasons, but at least they did the right thing this time; albeit, after much pressure

Erik M, San Marcos, TX (Tuesday, April 01, 2008 9:28 PM)

When walmart does something right it goes and changes it because of bad public relations. Walmart had the right to seek reimbusement for the funds. It is sad of what did happen to this person ,but this is something that is in most health insurance policies. Walmart health plan does have it flaws but as a company is donates millions of dollars every year. Thats all i'm going to say.

Tim salem, or (Tuesday, April 01, 2008 9:31 PM)

Wal-Mart saw the "error of their ways" and corrected it after torturing this family (loss in sales would probably exceed anything they could collect from Shanks).  Is this a corporation you want to patronize?  Express your opinion with your wallet, don't shop Wal-Mart.

Jim Perez, Massachusetts (Tuesday, April 01, 2008 9:35 PM)

God please bless this family and relieve their suffering. My family and I had decided we would no longer shop at Wal-Mart. Corporate greed is out of control in this country. One other thing that needs to be addressed is that this poor man actually had to divorce her so that she could get more medicare benefits. That is so sad. Marriage is still sacred to some of us despite the high divorce rate in the U.S. That must have been terrible for this good and decent man who intends to keep his marriage vows no matter what.

H.L.Pitts (Tuesday, April 01, 2008 9:37 PM)

I agree with Mike.  Walmart is the big guy who just got caught picking on the little guy and was exposed.  Another customer service nightmare.

Jim Walters, Colorado Springs, CO (Tuesday, April 01, 2008 9:38 PM)

With no more than a self-congratulatory summary from NBC you make Wal-Mart out to be the bad guy. Wrong. Like most Americans (say sub-prime nightmare, say Katrina) the Shanks didn't pay attention; specifically the policy they had through employment at Wal Mart clearly stated what would happen in their situation. They signed up for the policy...now like every other person who doesn't like the outcome they didn't prepare for, they want to change the terms.

I am extremely saddened by Mrs. Shanks medical situation, but that's not the point here, is it?

Diamond Head Tony (Tuesday, April 01, 2008 9:43 PM)

I don't like Wal-Mart very much.  I try really hard not to shop there; I don't think much of their business practices.  In this case however, Wal-Mart's position was correct, as evidenced by the fact that their position was upheld in court after court.  The practice of suborgation is  widespread in this country, allowed by current law, and likely to spread as healthcare costs continue to increase.  While it pains me to admit it, the Shanks are wrong and relied on the currently fashionable anti Wal-Mart hysteria to drum up public support for cheating Wal-Mart out of what they were entitled to under current United States tort law.  By the way, I thought nobody at Wal-Mart had health insurance?

Dan NY (Tuesday, April 01, 2008 9:44 PM)

Not to be too cold in the face of the woman's tragedy, it should be remembered that these unreimbursed medical costs will be shared by the health plan's participants.  Without knowing the terms of the court ruling, it is probable that a portion of the settlement was for medical costs resulting from the accident.  It is not unreasonable that any plan would want to get reimbursed for these costs.  The few times I have gone to the emergency room, they always ask if the condition was the result of an accident and if so who was involved.

Jay, Hampton, VA (Tuesday, April 01, 2008 9:52 PM)

The $470,000 should have been part of the lawsuit.  It's Walmart's insurance company's fault for not suing the responsible party with Ms. Shank.  

Richard Atoka, TN (Tuesday, April 01, 2008 10:02 PM)

I think it is a sad state of affairs that Wal-Mart caved in and allowed this individual to back out of a contract that plainly stated that the money would be repaid, in the event of a lawsuit payout.

RR, North Carolina (Tuesday, April 01, 2008 10:06 PM)

Walmart should feel bad and give this Lady double that amount for putting her Family thru this ordeal.  That would show kindness of Walmart and maybe help with the negative publicity.

Thank you,

Brenda Washington Terrell, Texas (Tuesday, April 01, 2008 10:08 PM)

It still doesn't change my mind.  Neither my wife nor I will ever shop at a Wal-Mart or Sams Club.  We joined Costco right after reading about Wal-Mart's greed and will not be renewing our Sams membership.  I may reconsider if they pay the legal fees that this family has had to pay to try to keep their money.

Dalton Rawson, Atlanta, GA (Tuesday, April 01, 2008 10:11 PM)

Walmart has the right to reclaim their expenses for the paid medical costs. This expenses are typically included in the settlement awarded to plaintiffs in their judgements. Large claim payouts like these are the reason why health insurance premiums are as high as they are and the reason why health care costs will continue to climb. Walmart has just as much as a right to this claim as any other insurance carrier. Your car/homeowners insurance would do the same, so you can't fault Walmart.

Jen, Philly PA (Tuesday, April 01, 2008 10:14 PM)

I think Wal-Mart should have stuck to their guns on this one.  This opens up a big can of worms for them.  But the bad publicity was obviously costing them.  The Shank's shouldn't have settled with the trucking company for such a small amount.  At the very least their lawyer should have been competent enough to read the fine print on the insurance policy provided through Wal-Mart and told them that this was going to happen.

John, Tulsa, OK (Tuesday, April 01, 2008 10:18 PM)

i'm just glad that walmart decided to let this poor family keep this money.  

cathy vesely, sparks nv (Tuesday, April 01, 2008 10:21 PM)

I personally have made a decision for my business and myself not to ever shop at Walmart ever again.This was a disgrace. How much more shameful behavior have we never heard about?

Greg Kessler , New Oleans ,LA. (Tuesday, April 01, 2008 10:23 PM)

By rolling over on this, Wal-Mart employees will find their medical insurance costs increasing. The fact is that the money Shank won from the trucking co. was determined in part by looking at her medical expenses. Expenses paid by the Wal-Mart insurance trust!

Roger Seattle, WA (Tuesday, April 01, 2008 10:23 PM)

I am still upset that Walmart that would not support their (people)employees in their time of need.  If companies negates their responsiblity to help their people - why should people help support their companies? Walmart being the largest US retailer should have taken care of one of it's own, not sueing them.

Gerry - Clinton Twp MI (Tuesday, April 01, 2008 10:27 PM)

I had stopped buying from Walmart because of this court case.  Since Walmart is not seeking money from this poor woman, I'm a return customer.

Suny5, Kansas City, MO (Tuesday, April 01, 2008 10:30 PM)

"Husband" is spelled incorrectly.

Al, Texas (Tuesday, April 01, 2008 10:31 PM)

Wal-Mart has so much money.  Why not let these people keep what they have gotten so they can have a better life.  They have suffered enough already.  Glad to hear Wal-Mart got over their greed.  Good luck to the Shank's.

Shirley Coleman, Pioneer, Ohio (Tuesday, April 01, 2008 10:31 PM)

It wasn't Wal Mart seeking to recover the amount. It was the health insurance company that Wal Mart chose.  The health insurance company sought to enforce a subrogation clause. These are very common in health insurance plans (probably any kind of insurance actually)  

The "theory" (right or wrong) is that when an insurance company pays out under an insurance plan (for example for medical bills) and then the insured person recovers a damages award for those SAME injuries the insured person has recovered twice.

I wonder why the lawyers for the Shanks didn't seek a higher settlement.  

Donna (Tuesday, April 01, 2008 10:31 PM)

Why is it that people nowadays think the legal documents they sign are worthless?

I've been  seeing people cry the blues because they lost six figure incomes and now had to live on $1800 a month and because they signed mortgage contracts they couldn't have possibly paid for under normal conditions. Do you really think these people thought about us when they were living the high life?

If these people were so important in their field why is it they're out of work for so long?

How could someone making $25,000+ a month make the rest of us feel sorry for them when their pyramid scheme busines went bust?

Just like every working person in the country this woman signed papers before being hired that sets down the rules for employment.

This womans husband should be thankful to Walmart first that they are not pursuing the money and thankful to God he doesn't have to pay it back.

Walmart doesn't worry about bad publicity because everyone will forget about it by next week anyway.

Kim Huggard (Tuesday, April 01, 2008 10:32 PM)

I'm certainly glad Wal-Mart decided to end this
fiasco with the Shank family.  I'm sure it has
saved them millions of dollars as the public was
very upset and threatened to stop shopping at their stores.  I was one of them.

Joann Mittelsteadt (jrmitt@ccaonline.com) (Tuesday, April 01, 2008 10:37 PM)

Walmart has shown their true colors. Despite their change of mind, I will not change mine. They will get NONE of my hard earned money.

Mike S, Oakland Park, FL (Tuesday, April 01, 2008 10:39 PM)

Walmart made no "error" - they were legally entitled (and legally obligated less they get sued for preferntial treatment) to collect the money.  The terms were laid out clearly.  They backed off only because of the negative publicity.  I think Walmart did the right thing because they could afford to, but the husband really should re-think his choice of words.

Mike, Dallas, Texas (Tuesday, April 01, 2008 10:41 PM)

In all reality, I think Wal-Mart should be reimbursed.  This is how the system really works.  You can't get in an accident anywhere else, have your basic health coverage pick up the tab & then get to keep all of the settlement.  
Walmart backed down because of the publicity...the lady, as unfortunate the accident left her, should legally & ethically pay Walmart back for the medical coverage that was supposed to be covered by the settlement.

yeah, yeah - Walmart is big. Walmart has money. yadda yadda yadda....  I get that much

Part of the lady's settlement is for medical bills - Which Walmart has covered. Why shouldn't she have to pay it back???

Paula, Idaho (Tuesday, April 01, 2008 10:43 PM)

I give Wal-Mart credit.  I do think they gave in to this publicity nightmare but they didn't have to and could have kept on fighting.  I still don't care to shop there but they did the right thing.  

Rob Atlanta, Ga (Tuesday, April 01, 2008 10:45 PM)

This isn't great news for the "little guy."  This family's double-dipping - taking money from both the truckin company and the health plan for the same medical bills - ripped off all of the "little guy" Wal-Mart employees who contributed to the health plan, and all the "little guys" who shop at Wal-Mart because they can't afford Macy's.
No, this is a victory for Big Media sensationalism.  All you bleeding hearts stand up and applaud for that.

Josh, Saint Paul, MN (Tuesday, April 01, 2008 10:55 PM)

Walmart did the same thing that health insurance companies have been doing for years.  Why are they suddenly the villian of the piece?  If Walmart employees were covered under Blue Cross or Aetna, bet your bottom dollar that those companies would have been asking for reimbursement from the settlement. Just because Walmart is a giant doesn't make them wrong.

J., Virginia Beach, Virginia (Tuesday, April 01, 2008 10:55 PM)

Looks to me as if Wal-Mart is trying to toss a steak on the black eye the story gave them.  I have to wonder though how much this story has cost Wal-Mart at the cash register I have talked to a lot of people that shop there and after this story aired were asking me about my boycott because of their labor practices.

Howard, Raymond, Wash. (Tuesday, April 01, 2008 10:56 PM)

The greed within Walmart continues to astonish me.  I used to be a faithful customer and I actually knowingly pay more for my groceries to avoid feeding into that greed.  We the people can change things.
I think SAM is probably rolling in his grave.

Elizabeth, Atlanta, GA (Tuesday, April 01, 2008 11:01 PM)

Wal-Mart the world's largest retail store and the HUNDREDS OF BILLIONS OF DOLLARS they make in revenue from their customers every year, they don't even have compassion for a disabled employee.  This is why I will won't shop at a Wal-Mart.  Why should I give them my money when they don't care to help people in need.  Even now the decline for the reimbursement of the money, it still shows how much Wal-Mart doesn't care for their employees.  This issue shouldn't have even come about if they weren't so greedy for money!

Bob, CA (Tuesday, April 01, 2008 11:02 PM)

this was a sad case, but they did sign and agree to the plan. it's just a shame that people cry fowl when something doesn't go there way - I guess personal responsibility doesn't exist anymore.  

reality check, Iowa (Tuesday, April 01, 2008 11:04 PM)

This is a very common occurence. My health insurance company would do the very same thing if I received a settlement after they laid out money for my medical care. Whoever the Shanks lawyer was should never have accepted a settlement that didnt cover ALL medical costs, including those already paid by her insurance company. It is immoral(not to mention bad business) for Wal-Mart to do what they did, but they are just acting like every other insurance company in the country.

Jeff, Seattle, WA (Tuesday, April 01, 2008 11:06 PM)

Too little, too late.  Shame on a multi-billion dollar company like Walmart to ever have made the initial decison to take this families' money, let alone to ignore appeals made by this family to keep the monies they won for the long term care this poor woman and caregivers will be enduring for the rest of their lives.  The addage, "this is business, not personal" has been taken to a new low.  Until computers take over for the human relations that all companies succeed by, it is personal.   Equally, shame on the judicial sytem that would allow this giant to take away from this family that will never be the same.  Walmart, never will you see my money in your revenues. EVER.

Rita W, Oakland Park, FL (Tuesday, April 01, 2008 11:10 PM)

I think it's junk that her husband divorced her to get her additional care.  Is anyone else seeing what the real story is?  He divorced her and put her in a health care facility and now he is sole caretaker of what is left of the money she was awarded in the lawsuit.  There is more to this story and to make walmart the bad-guy in all this is just the tip of the iceberg.  I want to see more on this story and don't let this be the last one on it.  She is a human being with feelings and too many men are abandoning their families these days.

Jay, asheville NC (Tuesday, April 01, 2008 11:14 PM)

Wal-mart finally did the right thing. But the emotional and mental toll this had on the Shanks is unforgiveable.

Look for the Subrogation provision. Even Medicare and Medicaid have this clause and unlike private companies that are willing to negotiate a percentage of the cost the federal government will not. Look out if you are on Medicare and Medicaid and get a settlement.!!

Chris Michigan (Tuesday, April 01, 2008 11:21 PM)

Do you people who are cheering this situation realize who is paying for this ... it is You and I ... Joe Public who shops at Wal-Mart.  Wal-Mart paid out $470,000 for her care and when the responsible party was made to pay $700,000, Wal-Mart got $0.00.  The only way Wal-Mart can afford this is to ultimately add into the expected cost of doing business and raise the prtice of the goods to cover for these type of expenses.  So you and I pay for it through higher prices at their stores, or worse yet, to save this they demand more price concession from ther suppliers which depress American wages or force these companies to move overseas.  Try putting your small business in these situation, one of your employees get hurt and it someone else's fault but you provide health insurance to them and it costs your company $200,000.  That employee gets a settlement for $500,000 and you get nothing to reimbuse you for the money you spent caring for them ... and people still wonder why business don't want to provide health insurance.

Eric, Toledo, Ohio (Tuesday, April 01, 2008 11:28 PM)

To Wal-Mart,
Even thought it was in Wal-Marts' best interest to drop the suite at least there was someone who was listening.  
I have a MUCH better feeling about the company even though you were put in a bind  by the media...you did the right thing. This helps to change the attitude of some about Big Business...being ruthless and uncaring...you helped your image and did the right thing...

Bob Walters LaGrange, GA (Tuesday, April 01, 2008 11:33 PM)

I'd like to know how much Walmart spent in legal fees.  Considering this case was appealed all the way up to the Supreme Court, I would imagine not only did Walmart spend a pretty penny on legal fees but it may have caused Ms. Shank to spend money on lawyers that could have been better suited for her care.

James, NYC (Tuesday, April 01, 2008 11:33 PM)

Thank God for news reports that picked up this story. For once the media helped someone.  Without this story being broadcast Wal-Mart probably would have made them pay back the money that they don't really need.  Wal-Mart should be ashamed of themselves for even pursuing this woman's money.  When a big, powerul company such as Wal-Mart is willing to stiff its own disabled worker, do you as a person really want to still shop there?  

Tina Schoenen, Sacramento, CA (Tuesday, April 01, 2008 11:35 PM)

Virtually all insurance companies and health plans seek reimbursement for people who receive personal injury settlements based on treatment that the health insurance company paid out.  The rationale is that they don't want people "double dipping" in the funds.  It is written pretty much into everyone's contract, which no one bothers to read.  This is just another way that the insurance industry has done a fabulous propaganda job in convincing the world that lawsuits are to blame for increased insurance rates for everyone, when in fact personal injury lawsuits put more money back into the hands of the insurance companies.  Without these lawsuits and subsequent settlements, the insurance companies would recive millions upon millions less per year.

Lola, San Francisco (Tuesday, April 01, 2008 11:37 PM)

Bad precedent.  While this was a sad situation,WalMart should have been reimbursed from the settlement money.  Now everyone will pay for the recovery instead of the person or company that caused the problem

Pete, Lake Forest, CA (Tuesday, April 01, 2008 11:49 PM)

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