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NoDak state fund – be VERY careful what you ask for…

WSI, the North Dakota state work comp fund, is suing AON for an alleged failure to deliver a new claims system.

AON’s response included the statement “We look forward to telling our side of the story in court.”  This may seem innocuous at first read, but it isn’t; far from it.  WSI’s leaders are heading down what will likely be a very dangerous path.

The legal process will undoubtedly include substantial discovery efforts on the part of AON, efforts that will show WSI’s current senior management (with a couple exceptions) is in way over its head.  System change requests, poor oversight, and a lack of specificity on the part of management will be highlighted, publicized, and poured over.  Attempts will be made to place the blame squarely on the shoulders of former boss Sandy Blunt, but those attempts will show the process – which had just begun when Blunt was ousted – was moving along on schedule and on budget until he was terminated in a horrendous miscarriage of justice.

The suit will be very important to AON, as it will be highly visible to their customers, prospects, and competitors.  A loss, or even slightly unfavorable ruling, would damage the giant broker, while a well-documented win will show they did everything they could to deliver.

For AON, this isn’t be about the state fund in a tiny state, but about their reputation and brand.

Whether WSI’s decision to sue AON is due to a mis-guided attempt to save face, naiveté or political pressure is irrelevant; the outcome of the suit will further damage WSI.

I’m of two decidedly different minds on this.

I’ve come to know well and deeply respect Sandy Blunt, a true gentleman, workers’ comp expert and ultimate professional.  What current WSI CEO Bryan Klipfel and his cronies did to Sandy is a travesty, a character assassination that should make everyone’s blood boil.  For Klipfel and his buddies to be exposed for the incompetent fools that they are is, in some small way, payback for their sins.

Rest assured, AON’s discovery will make that all too obvious.

But.  That payback comes at a high cost.

WSI is responsible for workplace safety and claims for the vast majority of the state’s workers, and the agency’s continued downward spiral is a gross disservice to those workers, their employers, and North Dakota’s taxpayers, not to mention those WSI staffers who are really trying to do the right thing.

What does this mean for you?

Nothing good for NoDak’s employers and the many good folks at WSI.  And a well-deserved public humiliation for Klipfel and those who put him in the job.

(note – Klipfel was a state trooper who investigated Blunt, then got the job as WSI Executive Director)

Joe Paduda is the principal of Health Strategy Associates



A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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