Bloomberg News

Allstate Sues Florida Brain-Injury Center, Claiming Fraud

August 27, 2012

Allstate Corp. (ALL:US), the second-largest U.S. auto insurer, is seeking fraud damages in a lawsuit alleging that a Florida brain-injury facility warehoused patients who were beaten and abused by staff.

The suit, filed Friday in U.S. District Court in Tampa, seeks $7.6 million that the insurer says it paid the Florida Institute for Neurologic Rehabilitation to treat its claimants, as well as triple damages under federal racketeering laws and other costs.

Allstate alleges patients from Michigan, which mandates unlimited lifetime medical benefits for automobile injury coverage, were recruited to the Florida facility through an aggressive marketing campaign that promised an array of services that were never provided.

Some patients washed the cars of the center’s employees, an activity that was considered vocational training, according to the lawsuit.

Wayne J. Miller, an attorney representing the facility, known as FINR, said the company would not comment on matters in litigation.

The lawsuit, which also named FINR owner Joseph Brennick as a defendant, follows a Bloomberg News report last month on dozens of cases of alleged abuse at the facility. Patients’ families or state agencies have accused FINR of abuse or care lapses in at least five residents’ deaths since 1998, two of them in the last two years. Three former employees face criminal charges of abusing FINR patients -- one of whom was allegedly hit repeatedly for two hours in a TV room last September.

Removals Ordered

Last week, the Florida Agency for Health Care Administration said FINR was treating people without brain injuries -- in breach of its license -- and ordered the company to move dozens of patients to other facilities.

Allstate said it began investigating the treatment of its insured patients at FINR in 2011. Its review included interviewing patients, hiring experts to study medical records and ordering exams with a neuropsychologist. The lawsuit covers the cases of a dozen patients -- identified only by initials in the legal filing -- whose care was paid for by the Northbrook, Illinois-based insurance company.

In some cases, patients were kept too long at the facility or shouldn’t have been there in the first place, the lawsuit alleges.

Jail Preferred

Two patients described the facility, one of the largest of its kind in the country, as “a prison” and added that they would have rather been in jail because there they would know when they were getting out, according to the lawsuit.

The lawsuit says FINR tried to block patients from leaving the center through a combination of threats and incentives. One patient was promised her own apartment and a trip to the Busch Gardens amusement park if she stayed. A FINR representative told her that if she left, Allstate would stop paying her claims.

Allstate said it interviewed several former patients, most of whom complained of abuse at the facility. One patient, identified by the initials A.A., said three staff members held him down, beat him until he was unconscious and dragged him across a room. He suffered severe bruising, scars, and a rug burn from the incident, the lawsuit charges.

Another patient claimed staffers threatened to “throw him to the alligators” that lived in ponds on the 900-acre campus in Wauchula, about 50 miles southeast of Tampa.

The lawsuit alleges patients were largely confined to their living quarters and that rehabilitative services were limited and of poor quality. Vocational training included picking weeds in a greenhouse as well as the car washing, the lawsuit claims.

Other patients did not get physical, occupational or speech therapies that were promised, the lawsuit alleges.

The case is Allstate Insurance Co. v. Florida Institute for Neurologic Rehabilitation Inc. and Joseph Brennick, 8:12CV01935, U.S. District Court for the Middle District of Florida (Tampa).

To contact the reporter on this story: David Armstrong in Boston at darmstrong16@bloomberg.net

To contact the editor responsible for this story: Gary Putka at gputka@bloomberg.net


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