Incoming paymaster for spill claims outlines changes to BP's system

By Sasha Chavkin, ProPublica

Kenneth Feinberg, the independent administrator appointed by President Barack Obama to oversee compensation for the Gulf oil spill, last week described broad changes to BP's claims system that he will put in place when he takes over the process.

At a public meeting in Panama City, Fla., Feinberg pledged improvements including a quicker approval process in which claims are evaluated and checks written within a week after an application is submitted, an electronic tracking system that allows applicants to check the status of their claims online, and a policy that a single adjuster will handle a claim throughout the process.

Feinberg is scheduled to take over claims management from BP on Aug. 23.

The changes outlined by Feinberg, reported in The Palm Beach Post and The News Herald of Panama City, target areas that have drawn some of the most persistent criticisms from claimants. Applicants have described being switched among multiple adjusters, having difficulty contacting the right person to follow up on their claims, and in some cases waiting for months without payments after BP placed their claims on hold.

As we previously reported, BP acknowledged that decisions about thousands of claims are being deferred until Feinberg takes over. Claims for indirect damages that are not explicitly covered under a 1990 federal law called the Oil Pollution Act, such as losses by realtors whose property is not on the beach, are not being approved by BP.

At the Panama City meeting, Feinberg criticized the delays by BP and pledged quick action on the claims that the company has left in limbo. He said that he would promptly begin considering damage claims that address losses caused by indirect effects of the spill rather than by the oil itself.

"You do not need to have oil on your beach in order to file a claim," Feinberg said. "People who have been waiting, waiting, we will process those claims immediately."

The changes he described raise questions about how smoothly the Aug. 23 transition will proceed. Feinberg will keep the 35 claims offices that BP has set up across the Gulf, but when the system switches to his control, applicants will have to refile their claims either electronically or in person at these offices. However, they will not have to resubmit the documentation that they provided to support these claims.

"Complete data transfer will take place" when the claims process is taken over by Feinberg, BP spokeswoman Patricia Wright said in an e-mail. News reports of Feinberg's appearance did not address whether he will seek to match BP's existing individual data and documentation with refiled claims or simply set up less stringent documentation standards for the approval of these claims.