An ordinance passed last year to crack down on fake-accident fraud has boiled up as a campaign issue in a Hillsborough County commission race because of a last-minute exemption given to a well-known company.
The county ordinance set tough regulations for pain and chiropractic clinics that primarily treat accident victims covered by Personal Injury Protection, the no-fault insurance that all Florida drivers are required to carry.
Phony clinics involved in fake accidents defraud PIP by submitting claims up to the $10,000 coverage maximum. However, legitimate clinics rely heavily on PIP as well, including more than 40 clinics tied to 1-800 Ask Gary, the medical and legal referral service founded by Sarasota chiropractor Gary Kompothecras.
Still, critics say 1-800 Ask Gary does all it can to maximize PIP payouts in claims it files on behalf of clients, including ordering procedures that may not be necessary. One of the stated purposes of the county ordinance, passed last September, was to reduce PIP payouts.
The 1-800 Ask Gary service would have been subject to the new Hillsborough County ordinance until late in the 18-month process of drafting it. The final version, though, included the exemption for the first time, without notice or public hearing.
Now, Republican Margaret Iuculano is challenging the motives of Democratic County Commissioner Kevin Beckner, the prime architect of the county’s PIP ordinance. Beckner sat on a committee that drafted the law and agreed to the exemption.
Iuculano is running against Beckner in the Nov. 6 election.
“I have yet to be able to understand why 1-800 Ask Gary was exempted from the law,” Iuculano said. “If it’s good for one business, it should be good for all businesses.”
Others question the exemption, as well.
A man who provided advice in drafting the ordinance, Dennis Russo of the National Insurance Crime Bureau, said he didn’t know about the 1-800 Ask Gary exemption until after commissioners adopted the ordinance Sept. 21.
“We weren’t crazy about it,” Russo said. “It would have been nice if we had known up front, but things happen. We didn’t support that being in there.”
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The exemption didn’t mention 1-800 Ask Gary by name. Instead, the wording excludes clinics accredited by the Joint Commission, a nonprofit group that sets quality standards for hospitals and other health care providers.
Of the 10 accredited chiropractic clinics in Hillsborough County, however, six are owned by Physicians Group, a subsidiary of 1-800 Ask Gary.
Kompothecras wanted the exemption, said Greg Zitani, the Physicians Group’s attorney. Zitani denied that Physicians Group clinics are geared up to maximize PIP payments.
“I know that some folks may think that way,” Zitani said, “but there’s never been a formal accusation.”
Zitani then cut off the interview and asked that further questions be submitted by email. In response, he issued the following statement:
“Physicians Group has always held itself to strict adherence to the highest quality of care,” he said. “Physicians Group has served thousands of patients without a single malpractice claim, and is accredited by the Joint Commission, a nonprofit standards setter in health care.”
Beckner said a number of groups were granted exemptions, including MRI clinics, clinics where the majority of physicians provide surgical services, and clinics affiliated with medical schools.
The exemptions were granted because the committee wanted to focus on closing down phony clinics tied to criminals who stage fake accidents, Beckner said. They sign up “victims” who agree to stage an accident, then are sent to clinics that bill for fictitious treatments up to the $10,000 maximum.
“We wanted to minimize the impact on businesses that would not be targets of an investigation into staged auto accidents,” Beckner said. “The exemption for the Joint Commission was no different. We, the group, looked at it and there was no opposition.”
Representatives from 1-800 Ask Gary argued successfully that considering the Joint Commission standards, the company’s clinics did not need to meet the tough regulatory oversight other PIP clinics would have to undergo, said Chris Brown, general counsel for the sheriff’s office, who served on a committee that helped draft the ordinance.
“From what I was told, the standards to get that accreditation were more onerous than anything our ordinance was going to put on people,” Brown said.
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The chiropractic and pain clinics tied to 1-800 Ask Gary specialize in treating auto accident victims covered by PIP. In fact, the group’s clinics don’t even accept private insurance, Medicare or Medicaid, said Scott Dutton, a Tampa insurance lawyer who has had frequent dealings with 1-800 Ask Gary.
The clinics derive their income exclusively from PIP insurance payouts or legal settlements obtained by law firms associated with 1-800 Ask Gary, Dutton said.
“Most health insurers’ rates are tied to Medicare rates, plus or minus 10-15 percent,” Dutton said. “Gary’s charges typically exceed that amount.”
Patients and former employees, in statements from lawsuits and news reports, say accident victims referred to the clinics are prescribed treatments that may not be necessary or effective, including adjustments, massages, traction and electrical stimulation.
Candidate Iuculano is raising questions about the manner in which the exemption was inserted into the Hillsborough County law and Beckner’s role in it.
Beckner introduced the ordinance at the Sept. 8 commission meeting and pushed to set it for a public hearing Sept. 21, even though several other commissioners complained they hadn’t had time to study it.
Beckner said the board should act with urgency because insurance fraud was “killing jobs” and putting an additional financial burden on recession-weary citizens and businesses.
Brown, of the sheriff’s office, backed Beckner, saying another delay would encourage opponents of the measure.
Records show the exemption was inserted between the Sept. 8 and Sept. 21 meetings. Senior Assistant County Attorney Paul Johnston, who was on the committee drafting the ordinance, said a meeting with 1-800 Ask Gary representatives took place Sept. 13.
Luke Lirot, a lawyer suing the county on behalf of clinics denied licenses under the new law, described the timing of the exemption as “bizarre.”
“We looked at each draft and what changed, where it changed and why it changed,” Lirot said. “What we discovered is that a few days before the last (version) was brought up, all of a sudden you get this one for people accredited by the Joint Commission.”
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Emails show the county attorney’s office sent a draft of the exemption to a lobbyist for 1-800 Ask Gary for approval before it was added to the ordinance.
“I don’t understand why they were able to write their own exemption clause,” Iuculano said. “It’s just not the way I would have handled it.”
Johnston, the assistant county attorney, said amending an ordinance late in the process is within normal commission procedure. All the commissioners were given copies of the amended ordinance before the Sept. 21 meeting, and Johnston said he met with them or their aides to answer questions about the law.
Several amendments were even proposed and approved by commissioners other than Beckner at the final public hearing, Johnston said.
“Our whole focus in this ordinance was to go after the illegitimate facilities, the ones that were scamming the system,” Johnston said. “We felt with the accreditation required through the Joint Commission that they were a legitimate clinic and it was not one we were targeting in this PIP ordinance.”
Beckner said he did not give undue consideration to 1-800 Ask Gary even though he received a total of $2,000 in campaign contributions from people with business connections to Kompothecras.
“As a fiscal conservative who makes tough calls, people invest in my campaign all the time,” Beckner said. “All those campaign contributions came well after we passed this.”
Although critical of the exemption, Russo said the law has already begun reducing fake-accident fraud in the county. “We have clinics closing daily, moving to surrounding counties,” Russo said. “It’s had a huge effect in a positive manner.”
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