Insurance - O'Donnell Law

Insurance Companies Want Addictions to Cost Injured Workers More Than Their Good Health

Michael O'Donnell — Tue, 26 May 2026 14:10:22 +0000

Can Workers’ Compensation Benefits Be Lost for Smoking?

Insurance companies want addictions to cost injured workers more than their good health.

The Pennsylvania Supreme Court Takes Up a Major Workers’ Compensation Issue

The Pennsylvania Supreme Court is considering argument from an employer and its workers’ compensation defense team that an injured worker forfeits her workers’ compensation wage loss benefits when she fails to quit smoking.

The argument is rooted in Section 306(f.1)(8) of the Pennsylvania Workers’ Compensation Act, which provides that an injured worker forfeits all rights to compensation for refusing reasonable medical services.

The Wegman’s Case and the Worker’s Injury

Wegman’s Food Markets, Inc. attacks the work injury benefits of a woman who suffered significant on-the-job fracture injuries to her right leg, ultimately resulting in below the knee amputation. Prior to the amputation the worker was advised by her doctor to stop smoking and offered a prescription medication that could help with quitting smoking. She attempted the medication, was unsuccessful, and decided to stop the medication. She continued smoking and her condition worsened. Eventually amputation was required. Wegman’s sent the worker to a doctor who offered testimony that her amputation became necessary, in part, due to her failure to quit smoking. Wegman’s sought forfeiture of the woman’s workers’ compensation benefits.

How the Pennsylvania Courts Responded

The argument was successful a the trial court level before the Workers’ Compensation Judge. The worker appealed and the decision was reversed. The Appeal Board reasoned Wegman’s did not present evidence that there was a high probability of success with the prescribed smoking cessation treatment. On further appeal by the employer the Commonwealth Court affirmed the Board holding that it is the employer’s burden to first present medical evidence that the medical treatment or services at issue are reasonable, meaning, they involve minimal risk to the patient AND have a high probability of improving a worker’s work-related condition. While the trial court focused on the injured worker’s conduct, the Board and Commonwealth Court determined that the issue of a worker’s refusal of treatment really doesn’t matter and is irrelevant until the employer first meets its burden on reasonableness and high probability of success.

Why Benefit Forfeiture Is Viewed So Harshly

Importantly, forfeiture of benefits remains viewed by Pennsylvania’s Courts as one of the harshest consequences to an worker under the Pennsylvania Workers’ Compensation Act. The Commonwealth Court notes that “medical advice” without providing a means to accomplish the medical objective is not enough. Cases have passed through our judicial system on similar arguments involving detoxification from heavy medication doses, losing weight in order to increase success with a surgical procedure, and attending physical therapy. All would agree that this advice is sound. But, human beings must be viewed in the context of their injuries, pre-injury lifestyles, and where substances are at issue, addictions. Simply saying “you need to quit smoking”, which nearly everyone now agrees is a good idea, is not enough to forfeit one’s disability benefits in the face of an otherwise disabling work injury.

What Injured Workers Should Know Moving Forward

What the Supreme Court will do with Wegman’s arguments remains to be seen. But a word to the wise: if a doctor offers medical advice, provides a reasonable means to accomplish the objectives of the recommendation, and the injured worker unreasonably refuses without a good faith attempt or justification, their workers’ compensation benefits ARE at risk. This is true even in the face of addiction to substances like nicotine, alcohol, and prescription medication.

About the Author

Attorney Michael A. O'Donnell represents injured workers and negligence victims throughout Northeastern Pennsylvania. Recognized by the Pennsylvania Bar Association as a certified specialist in workers’ compensation law, Michael focuses his practice on helping injured individuals navigate complex claims and protect the benefits they deserve. At O'Donnell Law Offices, he advocates exclusively for injured workers and their families — never insurance companies or employers.

About O'Donnell Law Offices

For more than 35 years, O'Donnell Law Offices has represented injured workers and accident victims throughout Northeastern Pennsylvania, including Wilkes-Barre, Scranton, and surrounding communities. The firm’s attorneys are committed to protecting the rights of individuals facing serious injuries, workplace accidents, and workers’ compensation disputes. Consultations are always free—and you never pay a fee unless we win.

Questions About Your Workers’ Compensation Rights?

If you were injured at work and are concerned about your benefits, medical treatment, or how your claim is being handled, the attorneys at O'Donnell Law Offices are here to help. Our team has spent decades fighting for injured workers throughout Northeastern Pennsylvania.

Consultations are always free — and you never pay a fee unless we win your case.

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Beware of New Scams for Older Adults

O'Donnell Law Offices — Thu, 16 Apr 2026 16:21:28 +0000

Authors: Attorney Neil O’Donnell and Attorney Connor Graham

Scammers are increasingly targeting adults over the age of 60.

The FBI reports that scams on the elderly have amounted to $4.9 billion in losses, a 40% increase from a year prior.¹

People perceive victimhood as shameful, prompting many analysts to suggest that the actual figure of losses is much higher. The advance of AI is heavily contributing to the increase in scams. So it is important to know how to identify a potential scam and take prevented measures to protect your hard-earned financial assets.

Set limits on withdrawals.

Banks will let you place these agreed-upon limits and set up fraud alerts as a method of protecting yourself. Establish a contact banks can reach in case of suspicious transactions. Also, always independently verify the phone number you are dealing with when discussing financial matters.

Reporting potential fraud to the police may also be helpful.

Discard documents with important financial information by shredder. One dark, albeit odd, example occurred where a widower in his 90s noticed a lower than expected figure in his account balance. Upon investigation, a man was going through the elder’s garbage and found voided checks with banking and routing numbers, and used that information to forge and cash phony checks.

Scammers may attempt to build confidence with their victim, or pretend that exigent circumstances exist that necessitate handing over important financial information. If you ever find yourself speaking with an unknown entity about financial matters, make sure to stay calm and ask yourself if this is a legitimate scenario. Oftentimes, a clearer mind will prevail.

Sources

¹ Clare Ansberry, Protect Yourself From Scams that Target Older Adults , The Wall Street Journal (March 12, 2026).

About O’Donnell Law Offices

O’Donnell Law Offices has been serving families throughout Wilkes-Barre, Scranton, and communities across Northeast Pennsylvania for over 35 years. The firm is dedicated to protecting the rights of individuals and families, with a focus on holding insurance companies accountable and securing the compensation clients deserve.

If an elder in your life—such as a parent or grandparent—has been injured due to negligence, unsafe conditions, or another preventable incident, it is critical to understand your legal options. Cases involving elderly injury, nursing home negligence, or personal injury in Wilkes-Barre, Scranton, or anywhere in Northeast Pennsylvania require experienced legal guidance and a firm that knows how to stand up to insurance companies.

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State Farm Scrutinized for Its Response to the 2025 California Wildfires

O'Donnell Law Offices — Thu, 16 Apr 2026 01:15:44 +0000

Authors: Attorney Neil O’Donnell and Attorney Connor Graham

State Farm has become the focus of scrutiny due to its response to the 2025 California wildfires.

The 2025 wildfire season was particularly destructive in California. The January Eaton and Palisades fires ranked as two of the most destructive wildfires in State history.¹

For State Farm, California’s largest insurer, this meant dealing with claims amounting to billions of dollars.²

Insuring a historic wildfire season is not a cheap endeavor. Insurers take pains to assess whether each claim is covered under the insurance contract.³ To date, State Farm has paid around $5.7 billion in claims relating to the fires, and that figure is expected to rise to $7 billion. State Farm obtained an emergency 17% increase in homeowner’s insurance premiums. According to the insurer, State Farm’s California unit was stressed to the brink of collapse.

Not every insurance customer is satisfied with company performance. The disaster’s magnitude translates to delays and denials of claims in affected regions. Those negatively affected by the insurance process turn to their politicians for solutions to this growing crisis. The politicians’ solution was to ask for aid from Federal authorities. This resulted in the Trump Administration taking a greater focus on the issue.

The EPA was tasked to list insurers that acted “swiftly, courageously, and bravely in order to make their clients happy[.]” Apparently, the EPA is building this list based on feedback from locals and their leaders. It “is for the President to decide” what happens to the insurers rated unsatisfactory. Unfortunately for State Farm, many insureds are unsatisfied, claiming State Farm had acted in bad faith.

As for now, State Farm denies allegations of bad faith in the handling of these devastating fire claims. In the coming months we will see if the assertions of State Farms’ bad faith misconduct will hold water.

Sources

¹ American Red Cross, California Wildfires 2025, May 2025. View Report . Accessed on April 9, 2026.

² The total damages were roughly $40 billion.

³ Laura J. Nelson and Jean Eaglesham, Trump Rebukes State Farm Over Wildfires, The Wall Street Journal (April 3, 2026).

About O’Donnell Law Offices

O’Donnell Law Offices has been serving the Wilkes-Barre and Scranton communities for over 35 years, advocating for individuals and families when it matters most. The firm specializes in fighting insurance companies to ensure clients receive the full and fair compensation they are entitled to under the law. When insurance companies delay, deny, or underpay claims, O’Donnell Law Offices is committed to standing by your side and fighting to get you the justice you deserve.

The post State Farm Scrutinized for Its Response to the 2025 California Wildfires first appeared on O'Donnell Law.

How is AI Impacting the Insurance Industry?

O'Donnell Law Offices — Mon, 02 Mar 2026 00:40:06 +0000

Authors: Attorney Neil O'Donnell and Attorney Connor Graham

How Artificial Intelligence Is Transforming the Health Insurance Industry

The health insurance industry has been integrating AI into their processing systems. Debate has begun on how to regulate it. While the ultimate effects on society remain nebulous, AI has proven to be transformative in certain fields. One of the most affected areas is data processing. The AI is capable of analyzing through thousands of pages of documents in a fraction of the time a human would take. Its outputs can flag important information missing from documents, and flag the important documents or information amidst hundreds of thousands of words. Health insurance companies have begun to move with gusto to take advantage of these perceived benefits.

Use of AI in Utilization Review, Prior Authorization, and Claims Processing

Many health insurers use AI in utilization review to determine whether coverage is applicable in a given case. Utilization review involves: Prior authorization (Physician preapproval of health procedures), concurrent review (assessing whether current health procedures are warranted), and decisions about claims for prior services rendered.¹ Other AI use cases involve fraud detection and risk adjustment.² In total, the National Association of Insurance Commissioners believes that 84% of health insurers use AI, or some form of machine learning, across their product lines.³

Public Trust Concerns Surrounding Artificial Intelligence in Health Care

The move to AI is not without issues, and chief among them is public trust. A recent survey found that roughly two-thirds of adults reported low trust in the health care system to responsibly utilize AI.⁴ For general trust in the health care system, that survey sample had a mean trust of 5.38 out of 12.⁵ A recent Fox poll finding 63% of votes are “very” or “extremely” concerned about AI, including majorities across the political spectrum.⁶

Legislative and Regulatory Scrutiny of AI in Health Insurance

Lawmakers in the House Ways and Means Committee summoned various health insurer executives to address affordability back in January. In that meeting, insurer executives were adamant that AI is not used in the claim denial process. Still, they were forthcoming when it came to AI use in the prior authorization process, which one executive described as having “friction.” These statements come as multiple states enact legislation restricting use of AI in health insurance, including California and Texas.⁷

Rhode Island, for example, is attempting to pass a bill restricting AI use in coverage denials. That bill failed to pass last year, with one Democratic State senator stating that insurers formed “tremendous opposition” to regulation targeting prior authorization and identifying intermediaries such as private insurers or pharmacy benefit managers. A renewed push for that bill is expected this year.

Federal Executive Orders and the Future of State AI Regulation

Under this umbrella of uncertainty, the Trump administration is issuing executive orders that restrict federal funding for any state that enacts “excessive” state regulation of AI. The constitutionality of that order notwithstanding, it shows a desire in higher echelons of government to curtail state regulation of the burgeoning AI sector.

Footnotes

¹Michelle M. Mello, et al., The AI Arms Race In Health Insurance Utilization Review: Promises of Efficiency and Risks of Supercharged Flaws, 45 Health Affairs 1, 6-13 (2026).

²National Association of Insurance Commissioners, Health insurance artificial intelligence/machine learning survey results, Kansas City (MO): NAIC; c 2025 [accessed Feb. 27, 2026]. Available from: https://content.naic.org/sites/default/files/inline-files/NAIC%20AI%20Health%20Survey%20Report%20.pdf .

³Id.

⁴Paige Nong, PhD; Jodyn Platt, PhD, Patients’ Trust in Health Care Systems to Use Artificial Intelligence, 8 JAMA Network Open 2, e2460628 (2025).

⁵Id.

⁶Darius Tahir and Lauren Sausser, Should AI weigh in on your insurance?, The New York Times, (Feb. 24, 2026), at 2.

⁷Id.

About O'Donnell Law Offices

O'Donnell Law Offices has served individuals and families throughout Northeastern Pennsylvania for over 35 years. With offices in Wilkes-Barre and Scranton, the firm focuses on personal injury, workers’ compensation, and disability claims, advocating for clients facing serious injuries, workplace accidents, and complex insurance disputes. Led by experienced trial attorneys, the firm is committed to protecting the rights of injured Pennsylvanians and helping clients secure the compensation and benefits they deserve.

If you have questions about your rights or need legal guidance, contact O'Donnell Law Offices today to schedule a consultation. Call 570-821-5717 or visit our contact page to get started.

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Big Tax Cuts For Insurance Comapnies

O'Donnell Law Offices — Wed, 12 Nov 2025 21:21:47 +0000

BIG TAX CUTS FOR INSURANCE COMPANIES

Author: Neil T. O’Donnell , Founder and Managing Attorney, O’Donnell Law Offices .

As reported recently in The New York Times , the Trump Administration handed out hundreds of billions of dollars in tax cuts to some of the country’s most profitable insurance companies, crypto companies, and other multi-national corporations.

The Treasury Department and Internal Revenue Service (IRS) , through a series of new notices and proposed regulations, are giving giant tax breaks to insurance companies.

The Administration is rapidly gutting a 2022 law which ensured that the country’s most profitable insurance companies would pay at least some Federal Income Tax. The “Corporate Alternative Minimum Tax” was passed to stop giant corporations, including insurance companies, Microsoft, Amazon, and others, from being able to report big profits to shareholders yet low tax liabilities to the Federal Government.

The 2022 law projected to raise $220 billion over a decade. But the Treasury Department and IRS have issued notices beginning this summer which means the tax could bring in only a fraction of that amount.

These breaks to insurance companies come in addition to the roughly $4 trillion package of cuts enacted by the Administration in July, 2025.

These tax cuts to insurance companies and other large corporations will add trillions of dollars to the federal deficit, and bring steep cuts to healthcare for the elderly and cuts to food stamps for the poorest Americans. By doing it through the Treasury Department, Daniel Hemel , a law professor at New York University, said that:

The Administration “can just give away the goodies to one group, without having to take back anything from another.”

These new regulations provide flexibility for insurance companies in using so-called “tax losses.” The new rules permit some insurers to use those losses to reduce their bills under the minimum tax – even for prior years.

“They’re effectively repealing the statute,” said Monte Jackel , a tax lawyer and former IRS official.

At O’Donnell Law Offices, we stand up to greedy insurance companies every single day. And when you are injured, we will make those insurers pay fair compensation.

ABOUT NEIL T. O'DONNELL

Neil O’Donnell is the founder of O’Donnell Law Offices. As an experienced trial lawyer, he has been fighting for his clients since 1987, after graduating with honors from King’s College and the University of Pittsburgh School of Law. An NEPA native, Neil was born and raised in Wilkes-Barre.

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Why More Drivers Without Insurance Poses Serious Risks on the Roads

matt — Fri, 02 Aug 2024 14:43:00 +0000

By: Neil O’Donnell –

As reported in the Wall Street Journal, the Insurance Research Council confirmed what many have suspected — more drivers have absolutely no automobile insurance. The IRC released a report demonstrating that the number of uninsured drivers rose 14% in 2022, a significant increase from past years. J.D. Power, which bases its research on consumer surveys, confirmed this trend last year. Uninsured drivers pose real concerns on our roads when they cause severe injuries because no insurance exists to help with the costs of recovery.

In nearly every state, including the Commonwealth of Pennsylvania, driving without insurance coverage is illegal. States and cities are attempting to crack down on the rise of uninsured drivers by increasing penalties.

What Can You Do to Protect Yourself and Your Family?

The simplest answer is to protect yourself with adequate amounts of uninsured and underinsured motorist coverage. Contact your automobile insurer today and obtain a quote to increase uninsured and underinsured motorist coverage to match your liability insurance limits. Also, purchase “stacking,” a fairly inexpensive option that allows you to multiply the limits of this insurance by the number of vehicles on your policy

Responsible drivers need to protect themselves and families from uninsured motorists, particularly with the dramatic increases seen of uninsured motorists on the road.

If you’ve been in a collision with an uninsured driver, let us guide you through the process so you can focus on recovery. Call us today at (570) 821-5717 or fill out our contact form below:

The post Why More Drivers Without Insurance Poses Serious Risks on the Roads first appeared on O'Donnell Law.

The Good Neighbor Leaves the Neighborhood — State Farm Discontinues 72,000 Home Insurance Policies

matt — Thu, 04 Apr 2024 20:17:30 +0000

By: Neil O’Donnell –

State Farm recently announced that it would stop coverage for 72,000 houses and apartments in California, citing rising costs and increased catastrophic risks as the reason. The decision affects 30,000 houses and 42,000 apartments. The announcement comes nine months after State Farm announced it would not issue new home policies in California. And now, beginning in July, State Farm will cut the 72,000 policies.

State Farm said that “the decision was not made lightly”. The insurer blamed increased risks from catastrophes for its decision to scale back.

But for these 72,000 policyholders, the jingle “Like a Good Neighbor” no longer applies, and similar cuts may come to other states. It’s a precarious time for homeowners affected.

If you are impacted by these types of insurer decisions, act quickly to obtain replacement coverage and never allow a lapse in coverage.

The post The Good Neighbor Leaves the Neighborhood — State Farm Discontinues 72,000 Home Insurance Policies first appeared on O'Donnell Law.

An Important Win for Our Clients by Neil O’Donnell and Gerard Gaughan

matt — Wed, 02 Mar 2022 18:27:35 +0000

Neil O’Donnell and Gerard Gaughan secured an important Win for Our Clients. The regular use exclusion unfairly limits insurance coverage. Please learn more about this important win below.

Another Federal District Court Finds that the Regular Use Exclusion is Invalid And Makes a Prediction…..

On the heels of the Western District Court decision in Johnson v. Progressive Adv. Ins. Co. summarized on Friday here on Tort Talk (See that Tort Talk post at this LINK), comes Judge Malachy E. Mannion’s decision out of the Federal Middle District Court of Pennsylvania denying a carrier’s motion for summary judgment based upon an effort to rely upon a Regular Use Exclusion. Judge Mannion predicted that, if faced with this same issue, the Pennsylvania Supreme Court would rule in the same fashion.

In the Federal Court case of Evanina v. The First Liberty Ins. Corp., No. 3:20-CV-00751-MEM (M.D. Pa. Feb. 25, 2022 Mannion, J.), the Court denied a carrier’s motion for summary judgment on a Plaintiff’s UIM claim in which the carrier was attempting to rely upon the Regular Use Exclusion.

According to the Opinion, the Plaintiff, who was a home health worker, was in a motor vehicle accident and secured the minimal policy limits available under the tortfeasor’s policy. At the time of the accident, the Plaintiff was operating a vehicle that was owned by her employer. That vehicle was insured by Philadelphia Indemnity Insurance Company.

At the time the Plaintiff was also covered under another UIM policy issued by First Liberty Insurance Company, which presumably covered her personal vehicle (the Opinion does not so state or specify).

The Plaintiff settled for the minimal policy liability limits possessed by the tortfeasor.

The Plaintiff then submitted a first-tier UIM claim to Philadelphia Indemnity and a second-tier UIM claim with First Liberty.

The second-tier carrier, First Liberty, denied coverage to the Plaintiff under the Regular Use Exclusion contained in its policy.

Thereafter, the Plaintiff commenced this breach of contract claim against First Liberty. A motion for summary judgment was eventually filed by First Liberty which resulted in this decision being issued by Judge Mannion.

Judge Malachy E. Mannion M.D.Pa

The court confirmed that the issues in this case were being addressed after the previous issuance of the Pennsylvania Superior Court’s decision in Rush v. Erie Ins. Exchange, 256 A.3d 794 (Pa. Super. 2021), in which that court held that regular use exclusions were not enforceable because they run counter to Pennsylvania’s Motor Vehicle Financial Responsibility Law.

In this Federal Court matter, the carrier attempted to argue that the regular use exclusion was still valid even though the Superior Court invalidated it in Rush. The insurance company attempted to cite to the Pennsylvania Supreme Court Opinion in Williams v. Geico Govt. Emp. Ins. Co., 32 A.3d 1195 (Pa. 2011).

Similar to Judge Schwab’s decision in Western District Court case of Johnson v. Progressive Adv. Ins. Co., Judge Mannion in this Middle District Court case of Evanina decided not to follow the Williams decision and found that the Williams decision was only a public policy based decision and not statutorily based decision as the more recent Rush decision was relative to the MVFRL.

Judge Mannion noted that the Pennsylvania Supreme Court had not yet addressed the validity of the Regular Use Exclusion in the context of whether that exclusion runs afoul of Pennsylvania’s MVFRL. As such, Judge Mannion stated that he was required to attempt to predict how the Pennsylvania Supreme Court might rule on this issue if faced with this issue.

Judge Mannion reviewed certain recent Pennsylvania Supreme Court decisions such as the Gallagher v. GEICO decision and the Donovan v. State Farm decision in both of which the Pennsylvania Supreme Court had ruled that the household exclusion was invalid and, therefore, unenforceable. The Court in this Evanina case noted that the houshold exclusion was “a substantially similar exclusion [as compared] to the regular use exclusion.” See Op. at p. 15 [bracket inserted here].

As such, Judge Mannion predicted that, “considering the trend of the Pennsylvania Supreme Court in its rulings,” if faced with the issue of the validity of the Regular Use Exclusion, the Pennsylvania Supreme Court would find this exclusion to be invalid and, therefore, unenforceable. See Op. at p. 16.

Accordingly, Judge Mannion ruled in the same fashion and denied the UIM carrier’s motion for summary judgment as a result.

Anyone wishing to review a copy of this decision may click this LINK.

I send thanks to Attorney Scott Cooper of the Harrisburg, PA law office of Schmidt Kramer for bringing this case to my attention. I note that the Plaintiff’s attorneys in this Evanina case were Neil O’Donnell and Gerard Gaughan of the O’Donnell Law Offices in Kingston, PA.

Authored by Daniel E. Cummins, Esq.

torttalk.com/2022/02/another-federal-district-court-finds.html

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