Deborah Shank's story would have been sad enough, considering the devastating injuries she suffered in a traffic accident seven years ago. Nevertheless, Wal-Mart found a way to add a brutal coda.
As chronicled in Tuesday's Wall Street Journal, Shank, a former overnight shelf-stocker for Wal-Mart in southeastern Missouri, was driving her minivan when she was broadsided by a semi and suffered permanent brain damage. Unable to walk without help, she lost the ability to care for herself or interact meaningfully with her family. Now 52, she lives in a nursing home.
Wal-Mart started out as one of the good guys in this story, paying almost $470,000 of her initial medical bills. But three years after Shank's husband sued and settled with the semi driver's employer, the retail giant changed hats. It demanded every penny back, plus interest and legal fees -- more, in fact, than the $417,477 the settlement had placed in a special-needs Medicaid trust fund for Shank's future healthcare expenses.
The company persuaded a federal district court judge and the U.S. 8th Circuit Court of Appeals to award it the full amount, even though Shank's family had paid for the lawsuit. Nor did it matter that the settlement covered a fraction of her expenses and losses. Wal-Mart's healthcare plan clearly states that it gets first dibs on any money recovered by injured employees. Such provisions aren't uncommon in health plans, and Wal-Mart isn't the first to enforce one.