The city is seeking general and punitive damages, including the roughly
Riverstone is no longer operating and an independent fiduciary appointed by the court is resolving the unpaid claims among the more than 100 employers, including
That raises the question of whether
Deputy City Manager Caluha Barnes said she could not answer that because of the city's lawsuit against
The lawsuit states the city started receiving complaints about a year ago from employees that medical claims were not being paid. The city followed up with
"Unbeknownst to the (city), the real cause was that Riverstone did not have sufficient funds to pay claims because it was sham insurance, that was underfunded, mismanaged, and its funds misappropriated," the lawsuit states.
The lawsuit also alleges
The millions in unpaid medical claims has caused stress and uncertainty for the employees and their families who used Riverstone.
The wife of a city worker said her family has more than
"We are in collections for three of these claims," said the woman. She and her husband asked that their names not be used for fear of retribution from the city. "And the others have told me they are heading to collections."
She said they worry this eventually could hurt their credit rating. "My husband says we don't want to lose our credit over something that was not our fault."
The woman says she understands the city's human resources department must be inundated with requests from employees and their families. But she said human resources has not responded to her emails and phone calls.
"With a crisis of this magnitude they should do something, hire temp workers just to answer the phones," the woman said. "... We don't feel there is anyone we can call to get an answer."
But the woman said she wonders whether the employees and their families will have to pay the claims if settlements cannot be reached. "Are we going to be responsible?" she asked. "That is something the city has not communicated to us."
Barnes, the deputy city manager, said the independent fiduciary has clearly stated the claims are the responsibility of the employers and
She expects that will get better now that the fiduciary recently and directly notified all health care providers that claims cannot be sent to collections and that the work to resolve claims involving all employers should start soon. She said the work to settle the claims could not start until all unpaid claims had been submitted to the fiduciary by the
"We definitely understand employees' frustration and their desire to get this over," she said.
Barnes said the city is asking employees to continue to be patient, and the city expects this matter to be wrapped up by the end of the year. She added the city has been updating employees about every two weeks or as soon as it learns about new developments.
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