Bates White Study Finds Asbestos Fund Unfair to Victims

Study also shows the Asbestos Fund is bound to fail.

In September 2005, the research and consulting firm Bates White released a study of the proposed asbestos trust fund which found that there is a substantial financial shortfall with the proposed legislation. Key findings include:

• The study predicts the proposed asbestos trust fund of $140 billion will fail in the first three years. Shut out of the courts, victims who are sick and dying will receive no help to cope with the devastating health and financial consequences of their asbestos poisoning.
  
  
• The trust fund will face a long-term shortfall of $161 billion over 30 years, leaving 383,000 to 913,000 potential future victims with no compensation.
  
  
• The Bates White study predicts that the proposed fund will be deluged by claims totaling $300 billion based on conservative assumptions that would:
  • exclude thousands of victims with lung cancer and other cancers;
  • exclude all dormant claims; (those filed before 2000)
  • prohibit claims from family members of eligible victims;
  • make unrealistically low estimates of the exposed population;
  • omit environmental asbestos-exposure claims and claims of victims from Libby, MT
    
    
• After the fund fails in the first three years, it will add $45 billion to the public debt. This is using a conservative estimate of claims.
  
  
• If higher levels of victims with lung and other cancers are compensated, if all of the other categories described above are not excluded, and more realistic claims estimates are used, the fund would total as high as $695 billion.
  
  
• The study predicts a range of between 350,000 to 875,000 victims with lung and other cancers who will qualify for compensation under the fund.
  
  
• If these cancer claims come in at the lower number that's at least a ten-fold increase in claims from the number of victims that currently win court cases.
  
  
• The study concludes that the only way the fund can survive is if only 41-percent of future eligible asbestos victims file claims - that's far below the number of victims who take their cases to court.
  
  
• The Bates White study doesn't even take into account the impact of delays that are inevitable - such as a major funding shortfall on the front end and an initial rush of at least 500,000 valid claims, forcing victims to face long delays in compensation.
  
  
• Nor does the study analyze the financial impact of lengthy delays in starting the fund caused by the inevitable constitutional and other legal challenges.
  

September 19, 2005