98% of Claims Unpaid – 80% Denied

Claim denials. Refusal to pay. What a racket.

According to Rep. Joe Sestak (D-PA)

only 2 percent of claims have been paid and that four of every five applications have been “rejected for minor oversight.”

And you thought your insurance plan was bad.

Problem is, he isn’t talking about an insurance company. Rather, he is talking about Cash for Clunkers.

In recent days, auto dealers across the country have been complaining that the reimbursement payments are slow to process. And they said some of their applications were being rejected because of apparent procedural issues.

A bunch of whiners?

Not necessarily.

Auto dealers were willing participants in providing interest free loans in the form of trade in rebates to folks who are willingly giving up cars valued around $500 in exchange for a credit against a new car of $3500 – $4500.

I doubt they would have jumped on the bandwagon so soon if they had known the government would run out of money in 4 days and they would end up floating interest free loans on behalf of the government for weeks or even months. Some dealers have already suspended participation due to being on the hook for $1,000,000 or more.

According to sales data summarized by Transportation Department officials, dealers have submitted requests for rebates on 338,659 vehicles sold.

But while Congress just expanded the $1 billion program by $2 billion, the Department of Transportation says a staff of just 225 people is reviewing those claims.

That’s 225 federal employees (wonder how many are new hires) reviewing 338,659 claims. Roughly 1500 claims per employee.

Government inefficiency and stupidity at its’ finest.

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