Ray Bourhis, is a partner with the law firm of Bourhis & Wolfson in San Francisco, California, specializing in insurance bad-faith litigation. A graduate of Boalt Hall at the University of California, Berkeley, Bourhis has been a court-appointed Special Master overseeing reforms in the California Department of Insurance and He was appointed by U.S. Senator Barbara Boxer to her Federal Judicial Selection Advisory Committee.
Besides cranking out a steady stream of both fiction and non-fiction books, Jason Hartman’s guest for episode #385 of The Creating Wealth Show, Ray Bourhis, is a partner with the law firm of Bourhis & Wolfson in San Francisco, California, specializing in insurance bad-faith litigation. A graduate of Boalt Hall at the University of California, Berkeley, Bourhis has been a court-appointed Special Master overseeing reforms in the California Department of Insurance and was appointed by U.S. Senator Barbara Boxer to her Federal Judicial Selection Advisory Committee.
Jason and Mr. Bourhis kick off the show with a discussion about the horrific reality of the ERISA Preemption Rule, which relates to workplace disability insurance. The bottom line is that you have no recourse to sue the insurance company if they decide to deny your claim on a capricious or fraudulent basis. You might think you can sue, and certainly you can, but through the fact that there is no controlling federal law on the topic, and state laws don’t protect you a bit – good luck collecting. You NEED to know more about ERISA. Listen to the interview! This is a big deal.
Additionally, with no controlling law on the matter, you will be denied a jury trial, and prevented from pursuing the legal processes of discovery and deposition. Ladies and gentlemen, the corporatization of America is almost complete.
Bourhis spends a few minutes discussing his latest work of fiction, Revolt: The Secession of Mill Valley, which the author is quick to point out is a work of political satire and NOT meant to encourage and actual rebellion against the United States. He compares it to the tone of a Woody Allen. This and Bourhis’s other titles are available through his website and on Amazon.
Jason and Ray conclude the interview talking about why reform movements like Occupy Wall Street and the Tea Party are doomed to fail, as well as how the institutionalization of corruption (especially in the lobbying industry) is a neat way to take what was illegal and make it legal.
Bourhis was recently profiled by Ed Bradley in a 60 Minutes report concerning fraudulent insurance practices. Born and raised in Elmhurst, Queens, Bourhis credits an attempt by gang members to throw him into a blazing bonfire at the age of twelve with helping him develop the survival skills needed to deal with insurance companies. He lives with his family in Kentfield, California.
ANNOUNCER: Welcome to Creating Wealth with Jason Hartman! During this program Jason is going to tell you some really exciting things that you probably haven’t thought of before, and a new slant on investing: fresh new approaches to America’s best investment that will enable you to create more wealth and happiness than you ever thought possible. Jason is a genuine, self-made multi-millionaire who not only talks the talk, but walks the walk. He’s been a successful investor for 20 years and currently owns properties in 11 states and 17 cities. This program will help you follow in Jason’s footsteps on the road to financial freedom. You really can do it! And now, here’s your host, Jason Hartman, with the complete solution for real estate investors.
JASON HARTMAN: Welcome to the Creating Wealth Show. This is your host, Jason Hartman, and thank you so much for joining me today. We’ll be back with today’s guest or segment, in just a moment.
ANNOUNCER: Have you listened to the Creating Wealth series? I mean from the beginning. If not, you can go ahead and get book one—that’s shows 1-20—in digital download. These are advanced strategies for wealth creation. For more information, go to www.jasonhartman.com.
JASON HARTMAN: Hey, it’s my pleasure to welcome Ray Bourhis to the show! He is a political pundit and an attorney in the Northern California area; he specializes in insurance bad faith work, and some other things. But we’re gonna talk to him a little bit about some interesting constitutional issues, and maybe we’ll even dip into the Russia Ukraine Crimea issue as well. Ray, welcome. How are you?
RAY BOURHIS: I’m fine. Thank you very much. Thank you for having me.
JASON HARTMAN: Yeah, it’s good to have you. So, talk to us a little bit, if you would, about—I want to start off with this issue of ERISA. And maybe explain to the listeners what ERISA is, but most specifically, what is ERISA preemption, and why does that matter to people?
RAY BOURHIS: That’s a really good question, and it’s a question that I’ll bet you most of your listeners don’t know anything about. Most Americans don’t know anything about it, even though it has a tremendous effect on all of them. If you get your insurance—let’s say health or disability insurance. Medical or disability—whether it’s through ObamaCare or whatever—at your workplace. You get it at your work, through your employer, or through the participation of your employer. You have no rights at all, under your state laws, for protections. You only have rights under federal laws, and there are no federal protection, because the federal government is not allowed to regulate insurance under the McCarran-Ferguson Act. So, if that sounds confusing and contradictory, it’s because it is confusing and contradictory.
The bottom line is, insurance companies have a license to steal, that they’ve been given by the US Supreme Court, and in a case called Pilot Life vs. Dedeaux, which eliminates state protections—now, when I talk about state protections, every state, has protections involving insurance regulations against such things as fraudulent claims denials by insurance companies, or misrepresenting policy coverage. You have coverage; let’s say that’s supposed to include insurance for bone marrow transplants and chemotherapy and that sort of thing if you have cancer. And you make a claim for one of those covered illnesses. If the insurance company finds some excuse to deny your claim, either some pretext of an assertion that their medical or doctor doesn’t agree with your treating doctor, or that they think your treatment is experimental, because for a long time companies were saying bone marrow transplants, for example, were experimental, and therefore they weren’t covered under the health insurance policies—
JASON HARTMAN: There’s a great John Grisham movie about that, by the way. Yes, of course.
RAY BOURHIS: That’s right. It’s just absurd, that insurance companies can make up whatever they want to make up in order to deny a claim. If their claim is big enough. If it’s a small claim, they’ll pay it and forget about it. Even if it’s a large claim, in order to stay under the radar, they don’t deny all of them. But the bigger the claim, the chance that they’re going to terminate your benefits or that they’re gonna deny your benefits. So, if you obtain your insurance as an individual policy, you can say to the insurance company—and this is not about having a lawsuit, it’s about having leverage—you could say to the insurance company, if you deny this claim, it’s clearly covered under the policy, I’m gonna sue you, and you’re gonna bankrupt me, I’m gonna lose my house, I’m gonna lose my life savings, I’m gonna sue you for every dime that I can get to compensate me for those lawsuits.
And the insurance companies knows you’re gonna be able to do that, and if you’re living in a state that has some remedies for those kinds of violations, then you can sue them, and you can settle your claim, or you can take them to trial and whatever is against them, and that’s it. So, insurance companies understand that you can do that, and they therefore behave accordingly. But if you obtained your insurance in the workplace, the insurance company knows that you can’t do that. You can’t recover a dime. If you’ve been bankrupted, if you’ve been foreclosed on, if you’ve lost everything, you can’t get a nickel of it back. And they are well aware of that. And the reason is because of this ERISA preemption rule that says, if you obtained your insurance in the workplace, all your state insurance protections are eliminated. You have no protections whatsoever from your state laws. So they don’t—the insurance companies aren’t stupid. Quite the opposite.
So they’re not gonna get you on the telephone and say, listen, we owe you this money, and we know it, and we’re not gonna pay it, and you can’t do anything about it, so go fly a kite. They’re not gonna do that. They’re gonna send you a flowery, long-winded letter citing this version of your policy, or that opinion of their medical examiner, or whatever, but the bottom line is, go fly a kite. We’re not gonna pay the claim. And they get away with it. They get away with it, and they have bankrupted people left and right. And it’s gonna happen under ObamaCare, because ObamaCare did not do anything to eliminate this problem under the legislation that was enacted under the Affordable Care Act. And I, as a matter of fact, I spoke to him when he was in the Senate, I spoke to Senator Obama in his office in Washington, D.C. for over an hour about this problem a couple months before he declared that he was running for president, and he indicated at that time that he was well aware of the ERISA preemption problem, and that it was an outrage, and the only reason it wasn’t being reformed was because we had a republican in the White House. Well, low and behold, we don’t have a republican in the White House anymore, and I’m not getting my reminder letters answered by the people that surround him, so nothing’s—
JASON HARTMAN: Yeah, what a surprise, right? What a surprise. So first of all, for anybody who wants to know more about ERISA, Wikipedia has a great entry on it. It stands for Employee Retirement Income Security Act, and so, that’s obviously an acronym, but I don’t understand something. I mean, just very simply, you know, from a laymen’s angle here, Ray, you’re saying that if I got my insurance through my employer, which so many people do, obviously, and I had an insurance claim, health insurance claim, the insurance company found an excuse to deny it, you’re saying that I couldn’t sue them? Of course you can sue them, for insurance bad faith, can’t you? Would it be in federal or state court? I don’t know—
RAY BOURHIS: No. What you—all you can do is you can try to get your policy benefits, your contract benefits. Let’s say they wind up owing you, I’ll round it out, $100,000 for future benefits. You can sue them and spend 50 or $60,000 getting your $100,000 paid up to yesterday. They can deny your claim again tomorrow, your present policy benefits do not have to be paid, and if you lost everything that you own as a result of the denial of the claim, you can’t get any of that back. You don’t have a right to a jury trial. You don’t have a right to conduct any discovery. You don’t have the right to take any deposition. You don’t have the right to do anything, except just sit down and shut up and cry. That’s it.
JASON HARTMAN: Wow. That’s just an amazing loophole. I can’t believe that it’s that easy for them.
RAY BOURHIS: It’s—you know, I’ve been screaming about this for years. I wrote a book about it called Insult to Injury, and another book about it called Preemption, that’s gonna come out in a couple of weeks. And you know, you can—it’s really funny. Ed Bradley interviewed me once for a segment for 60 Minutes. This is like six or seven years ago. And during the course of the interview, when we turned off the lights and the camera after we finished, he said wait a second, I want to find out about this ERISA. Do you mean to tell me that because I get my insurance from CBS, that I’m ERISA preempted? It moves all my rights under state law? I said, that’s right. And he looked at me and he smiled and he said, now this is getting serious! [LAUGHTER]. And of course it is.
JASON HARTMAN: So, what can people do? Anything? I mean, write your congressman? What?
RAY BOURHIS: We have a petition on our website. You know, this is like practically nothing, is the answer to your question. But we’re gonna try to see if we can get enough signatures on there for people to be outraged and convey that to their representatives in Washington. But that leads to—
JASON HARTMAN: What’s the website? Can you give the website out, Ray?
RAY BOURHIS: You can just go to www.RayBourhis.com, or www.RayBourhisAssociates.com, or www.RayBourhisAuthor.com, and the petition is on there someplace. It’s been on there for a couple of years. See, let me just say, all of the stuff that we’re talking about is part of the reason that I wrote the book Revolt, that is just being released within the next week. And Revolt, is the story of a political—first of all, it’s a story of an individual living in Mill Valley, California, that is really fed up with the system and realizes there is nothing he can do about it. The reform movements are a joke. Whether it’s Ross Perot or Ralph Nader or whatever, nothing is gonna happen. So, he decides to put an initiative on the ballot for Mill Valley to secede from the Union and start his own country. And it’s a joke, it’s like a Woody Allen movie, it’s not intended to run around and stir up, you know, civil war—that’s not the idea at all. It’s just, as I say, it’s a political satire.
And that book has gotten some rave reviews. Four and five star reviews—I can’t even believe it myself, to tell you the truth—it’s beginning to have an effect. And I would urge people to take a look at it. You can find it on Amazon, and the name of it is Revolt: The Secession of Mill Valley. Secession. But it’s interesting, that that book is coming out during the same time frame that Mr. Putin is engaged in his activities in Crimea. I just want to make sure that everybody understands that I am not subscribing to the idea of any such thing happening in the United States. But we would like to try to see if we could shake things up a little bit by having people express their opinions about what’s happened to our country.
JASON HARTMAN: Well, you know Ray, that’s interesting. Why aren’t you subscribing to such an idea? I think that’s really the only way any real reform’s gonna happen. And maybe it’s gonna start with the secession of Texas.
RAY BOURHIS: Well, to the extent that it can put pressure on the government bureaucrats and our dysfunctional Congress back in Washington, I suppose there are gonna be some people who say, listen, we want to make our own rules! We don’t want to have to deal with your budget deficits. We don’t want to deal with your criminal contributions to people who are in [unintelligible] of public office. We don’t want to deal with all of the nonsense that goes on in Washington. We want out! We want out. Well, I suppose it’s possible in a nonviolent way, versus [unintelligible] that some experimentation might be permitted in very narrow areas. There are physician movements that are going on in Texas, on one end of the political spectrum, and in Vermont on the other end of the political spectrum, and northern California—
JASON HARTMAN: And Ray, I did a show on that before, actually, on my Holistic Survival Show. And you know, those never seem to—you know, they make the newsmedia a little bit, but they never gain any real traction. I guess the rule was, after Obama’s second election, 25,000 signatures, but then they upped it to 100,000 signatures just to make it even tougher, so the White House doesn’t have to pay attention to anything under 100,000 signatures now, I believe, is the bar you have to pass. But I mean, what do they do? So what? They look at it, and throw it in the trash. You know? They don’t care.
RAY BOURHIS: You know, I’m afraid that’s probably right. The sad reality is, I’d like to compare what’s going on here to what the rules are supposed to be—we’re supposed to have our elected representatives listening to what people are saying. One person one vote, and all that business. That’s as dead as the founding fathers. We don’t have that anymore. We have lobbyists that write the laws, we have big corporations that contribute to our political campaigns, tens and hundreds of billions of dollars at the national level. So you know, people are stuck.
JASON HARTMAN: They don’t listen to the voters, they listen to the lobbyists, and they listen to special interests.
RAY BOURHIS: Exactly, yeah. And the multinational corporations that have just been given permission to contribute to our political campaigns, regardless of whether they’re in a tax haven, or wherever they are.
JASON HARTMAN: It’s unbelievable. It’s just absurd. I mean, our whole system—we’ve sold the American people down the river every which way. It’s unbelievable.
RAY BOURHIS: It is unbelievable.
JASON HARTMAN: Yeah. Any other advice on what can be done?
RAY BOURHIS: Well, I do think as a practical matter, that if communities across the country started expressing the extent of their dissatisfaction with what’s going on in a form of secession movements, then that would get enough publicity that people would have to start finding something to say about it. Maybe that’s optimistic. Maybe, as you say, they’ll just roll it up in a ball and throw it in the garbage can. But I don’t think so. I think that at some point, people have got to recognize that there is a lot of dissatisfaction with what’s going on, and it depends on the level of that dissatisfaction. A big problem has been that as long as somebody’s got a job, and you know, they’re putting their lives together, and putting their kids in school, they’re busy people! They’ve got things to do! They don’t have time to be engaged in political movements of one kind or another, with the exception once in a while you’ll get, on one end or the other of the political spectrum, a group of people get upset enough that they—well, the Tea Party, or you know, there’s another organization aimed at a specific activity.
For example, thinking that, you know, you have movements that are going on in the country right now on both sides of the abortion issue. You have movements that are going on in the country on both sides of the gun control issue, on both sides of all kinds of matters relating to the gays being able to marry, and so on and so forth. So, when you come to movements that are trying to accomplish things, if you’re very narrow in that sense, they can be effective as long as there’s not a lot of money on the other side. But if you want to enact legislation that is going to step on the toes of the oil companies or the banking industry or the insurance end if you have a chemical industry or a manufacturing industry, you may as well forget it, because you’re gonna get buried in an avalanche of multimillion dollar outspending. And that’s the problem that we have. When you have—think about it. We have Congressional campaigns that cost millions of dollars. Where do you think that money is coming from? You hear about $25,000 a head fundraisers. How many people do you know that go to $25,000 a head fundraisers? One right after the other? In Washington, D.C., we’ve got five of them going on at the same time every day! So, obviously, these people are bought and paid for. As [unintelligible] once said, corruption used to be illegal, so they legalized it.
JASON HARTMAN: Yeah. That’s exactly what I like to say, is that the US has legalized corruption. Other countries have it, and it’s technically illegal, and it goes on like crazy, with you know, all sorts of bribes and payola. But we’ve sort of legalized and institutionalized it through lobbyists, and through all the stuff you just mentioned. It’s absolutely crazy, what’s going on. Do you have any thoughts—you know, one way to—well, one thought on that is, you know, you talked about what can people do in terms of organizing, and things like that. I believe that one of the big ways in which the government keeps the people who are most concerned, and most likely to go out and form Tea Parties, and most likely to go out and demonstrate and wreak havoc, those are the educated middle class. At least in my opinion. And the problem is, that’s who the government is putting so much pressure on through the tax code, through regulation, through the ObamaCare disaster. And the more pressure they put on them, the more time they suck out of their lives, making them comply with government edicts, the less likely they’ll be able to do anything to organize and demonstrate! And then, of course, you’ve got this whole other issue of the spying, and you know, all of this type of stuff. And who knows how that will be in 10 years, because the NSA keeps this data indefinitely. And so, what you say now, may seem innocuous, but in a different political climate, five, ten, twenty years from now, who knows how that will be viewed in a different context?
RAY BOURHIS: I think you’re absolutely right. When you look at—obviously, I was stammering around a few minutes ago trying to think of a good example of the other side of the Tea Party, and suddenly, it’s completely—I’ve completely forgot about the Occupy Wall Street group. But you know what happens? You get one of these groups that start to organize, if they start to be effective in any way, they get infiltrated by people who do crazy things and give a bad reputation to the organization! And that’s no accident. Divide and conquer. It’s as old as politics. And I’m—I’m sure that if a secession movement started, a serious attempt to try to occupy the minds of people back in Washington, D.C. would be the alternative to subjecting ourselves to more of this same, that movement would be infiltrated immediately with a bunch of crazies, and as a result, it would go up in flames. So, the reality—I mean, and this is not new. This happened during the Vietnam War!
I’m old enough that I can remember what was going on in those days. And it was a big thing for the FBI to be infiltrating these organizations and all kind of groups to make them seem like they’re crazy. So, the reality of the situation is that it’s a very uphill battle. I think what’s going on now is a little bit different than anything I’ve seen before. It’s that average people that are not political junkies are really getting upset with what’s going on in Washington. You can’t throw a rock without hitting somebody who thinks that Congress is dysfunctional. Same thing with people who are upset about the budget deficit. Same thing with people who are upset about lobbyists. Same thing with people who are upset about multimillion dollar political campaigns. Same thing with people that are upset about corporate corruption and greed that is buying our political system. Same thing with people that are upset about Supreme Court rulings that give blood barons from Ecuador the ability to contribute to US elections, and try to manipulate our political system. People are getting fed up with these issues, and I think that the time may be ripe for something to begin to develop that can change things.
JASON HARTMAN: One of the things you mentioned is how the crazies—well, they’re not crazies, it’s obviously calculated—certain elements will infiltrate these groups and do crazy things to make them look bad, to make them look radical, to marginalize them. But it’s also, they’re also outfiltrated by the corporatized lamestream media! I mean, and this happens on the right, where I got into arguments—intense arguments, with many of my libertarian and right-wing friends, because I supported the Occupy Wall Street movement. And they marginalized me as oh, a hippie, you know, and all these crazy stuff—and that’s not the least of what I am! But it’s interesting—you hear people like Rush Limbaugh and Sean Hannity, who I agree with on many issues, frankly, but they marginalized these people, because they’re part of the corporatocracy! They’re part of the power structure! I watched an interesting documentary a couple years ago about how Ralph Nader was trying to get into the debates, and you know, he was just precluded. I remember talking to two daughters of Steve Forbes, and Steve himself, on the second time—Steve was on the show before, Steve Forbes—and the second time he ran for president was just a total media blackout! They wouldn’t pay any attention to him! And there’s a great—I’m talking about both sides of the aisle here. You look at a left-wing guy like Jon Stewart, who did a great piece a couple of years ago on Ron Paul, and how during the primaries, the mainstream—I want to say lamestream, as if that should just be its name—the lamestream corporate media just ignored Ron Paul, and kept talking about how it was down to, you know, the other candidates! They just kept totally ignoring Ron Paul when he was winning all the straw polls! It’s unbelievable!
RAY BOURHIS: No, that’s right. Divide and conquer.
JASON HARTMAN: Yeah. It’s just amazing. Yeah. So, you think there is some hope, then, it sounds like, right?
RAY BOURHIS: Well, my book, Revolt, the Secession of Mill Valley, I can’t emphasize enough, is a political satire. It’s like a Woody Allen movie. It’s not intended to be a road map for secession. I’m truly not trying to start another civil war. You know? That’s not what the book is about.
JASON HARTMAN: But why should you even have to say that?
RAY BOURHIS: Because I’m afraid not to say that.
JASON HARTMAN: Right, okay.
RAY BOURHIS: It would be audited tomorrow, you know? You know how it works.
JASON HARTMAN: I do know how it works. That’s true.
RAY BOURHIS: Yeah, I want to make that very clear.
JASON HARTMAN: Good stuff. Well, sounds good. That’s a good point. So, check out the books, they’re all on Amazon. By the way, I must say, with very good reviews, so congratulations on that.
RAY BOURHIS: Thank you.
JASON HARTMAN: Now, you do fiction and non-fiction, is that correct?
RAY BOURHIS: Yep, that’s correct. I’m at the—the other book that’s coming out is Preemption, and that’s non-fiction, and it’s about what we talked about at the beginning of the segment, which was about ERISA, and how people are taken advantage of by that, and how it works.
JASON HARTMAN: Right, yeah. Fantastic. Well good stuff; give out your website one more time. The book are on Amazon, just look up your name, Ray Bourhis, and—
RAY BOURHIS: Yeah. B-o-u-r-h-i-s.
JASON HARTMAN: And give out your website, Ray?
JASON HARTMAN: Fantastic. Well, Ray Bourhis, thank you so much for joining us today.
RAY BOURHIS: My pleasure. Thank you very much.
ANNOUNCER: This show is produced by the Hartman Media Company. All rights reserved. For distribution or publication rights and media interviews, please visit www.HartmanMedia.com, or email [email protected]. Nothing on this show should be considered specific personal or professional advice. Please consult an appropriate tax, legal, real estate, or business professional for any individualized advice. Opinions of guests are their own, and the host is acting on behalf of Platinum Properties Investor Network, Inc. exclusively.
Transcribed by David
The Jason Hartman Team