If at first you don’t succeed, try, try again. That famous quote, a favorite of moms everywhere, may never have been so true as when applied to the multi-year effort to pass reforms to our state’s personal injury protection insurance law (PIP).
Despite many unsuccessful attempts over the years, Gov. Rick Scott, Chief Financial Officer Jeff Atwater, Insurance Commissioner Kevin McCarty, Rep. Jim Boyd and Sen. Garrett Richter made one last Herculean effort to reform this portion of our automobile insurance system that provides easily accessible medical benefits for accident victims. Since its inception, PIP has become riddled with fraud, and it costs Floridians too much money.
Under House Bill 119, approved by the Legislature in the just-completed regular session, in order to be reimbursable by PIP a victim must be initially treated by a physician, osteopath, dentist, chiropractor, physician’s assistant or advanced registered nurse practitioner, or the services must be provided in a hospital or in a facility wholly owned by a hospital, within 14 days of an accident. Initial care must be administered within 14 days of the accident, and subsequent approved care may be given beyond that window. For conditions the approved medical providers determine are not an emergency medical condition diagnosis, $2,500 is available for care. Massage and acupuncture are not
reimbursable. There is a $5,000 death benefit included.
The bill also allows a 90-day time period for investigation of claims where a reasonable suspicion of fraud exists and, in such cases, insurers’ legal representatives can ask questions of the insured under oath. Caps were not placed on the fees of lawyers representing policyholders, but common-sense limitations were included.
It is estimated that PIP fraud costs Floridians an estimated $1 billion annually, and McCarty has pledged to aggressively scrutinize insurer filings to make sure that any reduced insurer losses are passed along to policyholders. Under the law, he will also have an independent consultant calculate the anticipated financial impact of the reforms.
Additionally, insurers that do not file rates that include at least a 10 percent PIP rate cut for rates taking effect on the first of next year will have to explain in detail why they cannot. And if insurers do not reduce PIP rates by 25 percent for rates taking effect on Jan. 1, 2014, they will have some explaining to do to the commissioner. The legislation also provides a funding mechanism for CFO Atwater to expand his efforts to prosecute PIP fraud. It also includes enhanced and new penalties and fines for clinics and providers that unlawfully seek to obtain PIP reimbursement or obtain licensure.
Knowledgeable observers agree this is a very solid reform measure that aggressively attacks fraud while upholding consumer protections. It is long overdue.
Bob Lotane is the communications director for the National Association of Insurance and Financial Advisors-Florida. He is a former communications director for the Florida Office of Insurance Regulation.