Are “Quick Pay” Discounts Really Worth Anything?

    In recent years, many insurers have decided to take “quick pay” discounts for paying legal bills sooner, rather than later.  I have written about this issue before in a short Q&A piece.  However, I think that the issue deserves more attention. 

     As a starting point of reference, “quick pay” discounts generally involve taking up to a 3% to 5% discount if an attorney’s legal bill is paid within a certain timeframe.  The timeframe is usually within 10-15 days of receipt.    

     It should come as no surprise that attorneys I have talked to do not like the having their bills cut by 3% to 5% just to have the bills paid sooner rather than later.  As one attorney put it, “I would rather see them take an extra 15 days to pay my bill rather than take a ‘discount’ for paying it within 15 days.” 

     Attorneys’ feelings aside, the real bottom line question for insurers is do quick pay discounts really pay?  To be charitable, I think that the results can be characterized as mixed at best. Continue reading

Are Your Attorneys Always Hearing a Consistent Message From Your Company on Legal Billing?

Whether your company has a legal bill review unit or everyone in the claims department reviews legal bills, attorneys may be getting inconsistent messages when it comes to knowing what they can and cannot bill for.

Inconsistent messaging will likely occur if all who review legal bills have not been properly trained and calibrated on what to look for in legal bills and when to make deductions. Continue reading

Uncovering the Hidden Costs of Good Legal Service

Back in my staff counsel management days, I sometimes got a complaint from claims managers about having to use staff counsel over outside counsel.   It was not because the claims managers felt they got better results from outside counsel (and we had the statistics to prove otherwise).  Rather, it was because they felt that outside counsel gave them “better service” than staff counsel.

When I asked for examples of “better service” that outside counsel gave, I was invariably given examples of things that outside counsel did for the claim file handlers the file handlers should have been doing!

What was happening was very clear.  We in staff counsel management were taking very seriously and managing to the claims department’s own litigation guidelines that stated that “tasks to be done in a litigation work plan that can be done by a non-lawyer should be done by the claims handler.”  Obviously some claims managers were not taking this part of their own litigation guidelines as seriously. Continue reading