Frist, Daschle To Huddle On Asbestos

By Arthur Postal, Washington Bureau Chief

NU Online News Service, July 16, 4:19 p.m. EDT, Washington?Bipartisan Senate discussions to reach a deal on funding asbestos health claims will continue Tuesday, a key senator involved in the discussions said.[@@]

Senate Majority Leader William Frist, R-Tenn., made a counter-offer on the size of a trust fund that would be used to settle claims for injuries from exposure to asbestos in the workplace to his counterpart, Sen. Tom Daschle, D-S.D., yesterday; Sen. Daschle said today that the two would meet Tuesday to discuss the new offer.

However, insurance industry lobbyists familiar with the proposal said there was little likelihood such legislation will be enacted this year.

Under Mr. Frist's proposal, $136 billion would come from the industrial companies involved as well as insurers, and $4 billion from existing trust funds established by firms which entered bankruptcy as part of their efforts to deal with asbestos liability.

He is responding to a proposal from Mr. Daschle two weeks ago that proposed creation of a $141 billion trust fund, plus the $4 billion in existing funds. However, that proposal does not have the support of unions, primarily because only $42 billion would be paid into the fund over the first several years, when most claims are likely to be filed; the unions demand that $60 billion of the total be paid into the fund over the first five years or so in order to insure its solvency.

In comments to reporters today, Mr. Daschle said Mr. Frist's proposal lacked enough details, according to Congress Daily. "It was not a complete proposal," Daschle said. "It was part of what we're going to be discussing next week."

One of the reasons no bill is likely to come to fruition is that at least two key players, unions and insurers, are opposed.

Insurers are divided as to the viability of the trust fund concept itself, and also don't want to be involved in the fratricide over apportioning the contributions amongst themselves.

Moreover, both the Frist and Daschle proposals are likely to require that insurers pay most of their share up front; insurers want to dole it out over the 27.5-years of the fund. It is clear, however, that no one is asking the insurers to ante up more than the $46 billion already proposed as the insurer contribution.

Lobbyists also described the exchanges between the Frist and Daschle staffs when the offer was made yesterday as "prickly." Indeed, one insurance lobbyist described Mr. Frist staff's reaction to the encounter as, "It just doesn't look as if Daschle wants a deal."

Another reason any deal is presumed to be doomed is that trial lawyers, a key constituency of the Democrats, are unlikely to support, under any circumstances, any deal that involves adding existing trust funds to the pot.

Special Reports /

Frist, Daschle To Huddle On Asbestos

Related Stories

Recommended For You