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BP Oil Spill Claims Administrators Backs Off Promise of Quick Reimbursements

Sep 13, 2010 | Parker Waichman LLP

The administrator of the BP oil spill compensation fund is backing off his promise to cut down response times. Kenneth Feinberg had initially promised that decisions on emergency payments to individuals would be made within two days of submission, while similar payments to businesses would be available within seven days.

Feinberg made those promises last month, when he took over the claims process from BP. But a spokesperson for Feinberg told ProPublica last week that, among other things, the lengthy and complex supporting documentation claimants are required to submit “requires careful scrutiny and attention to assure that each claimant will be afforded the benefit of the most generous payment.”

“The announced 48-hour claim determination rule for individual claims, and the 7-day claim determination rule for business claims will be extended as necessary and appropriate,” Feinberg’s spokeswoman Amy Weiss said. “The policy remains to review all individual and business claims as quickly as possible.”

Last week, Feinberg apologized to those affected by the delays. He told the New Orleans Times-Picayune that many claims could not be processed because people hadn’t submitted required documentation, but acknowledged that his staff was having trouble keeping up with fully documented claims. He said that he has 25 people working in shifts around the clock to review the claims, and they are able to get through an average of about 1,000 a day

So far, more than 55,000 compensation claims have been filed. As of September 8, Feinberg’s staff had paid 10,252 claims for nearly $80 million. Most claims paid are small, with payouts of $5,000 or less.

According to information released by the Gulf Coast Claims Facility, Florida claimants have received the most payments: 4,323 for $25.8 million. Louisiana claimants got the most money: $43.8 million from 3,580 claims. Alabama is third in both regards, with 3,279 claims paid worth $19.6 million. Mississippi is fourth, with 1,154 claims paid worth $10.3 million.

The claims facility has approved 13,462 claims and denied one. It has sent 3,420 back to the claimants with a request for more paperwork. The remaining 38,481 are waiting to be reviewed.

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