What’s going on with the CRM managed trusts?

You might have heard in the news that Poughkeepsie-based group Compensation Risk Managers (CRM) is going to surrender their license to run self-insured workers' compensation trusts in New York.  It’s a good thing, too because their failures at managing eight self-insured workers’ comp trusts have left New York with a shortfall of at least $59 million.

 

Somebody has to come up with this money so that workers’ comp claims can be paid.  Who do you think is going to do that?  The New York Workers’ Compensation Board (WCB) already tried to get non-CRM trusts to make up the difference, but those trusts responded with a lawsuit and now New York is trying to float a bond to cover the difference.

 

What makes this all the more interesting is that CRM hired the services of one Robert R. Snashall between 2004 to 2007.  Snashall, a former chairman of the WCB, has found new employment with his own Snashall Associates consulting firm, providing his expert consulting advice to groups like CRM.

 

What we’re wondering is how an 8 year veteran of the WCB could advice a group that is now surrendering its license and is responsible for a $59 million shortfall.  It’s something that makes us go, “hmm!”  You can read more about this situation in our library article, “The Incestuous Relationship between Government and Private Industry”.