Florida House Passes PIP Fraud Bill
A bill aimed at cracking down on rampant fraud in the state’s personal injury protection insurance was passed Friday in the Florida House of Representatives.
The bill (HB 119) was approved largely along party lines on an 85-30 vote. It’s favored by state CFO Jeff Atwater and Gov. Rick Scott, who made cracking down on PIP fraud one of his top priorities this session.
The House passage sets up a showdown with a competing Senate proposal (SB 1860).
The House version caps attorney fees in payment disputes and requires those hurt in a wreck to go to a hospital emergency room or hospital-owned walk-in clinic within seven days for personal-injury coverage to kick in.
State investigators say many independent pain clinic owners have no prior health care experience and some even opened them because they heard they could make a lot of money.
The Senate bill puts no time limit on treatment and also eliminates massage therapy and acupuncture, now covered under PIP, after an accident.
The House measure “takes a good first step in ensuring those injured in an automobile accident receive the medical attention they need … and helps to ensure Floridians aren’t absorbing the high costs of automobile accident fraud,” House Speaker Dean Cannon, R-Winter Park, said in a statement.
“We are encouraged by the House passing PIP fraud legislation,” added Jose Gonzalez, vice president of Associated Industries of Florida, a business lobby. “We are hopeful that the House and Senate will work together.”
But Bill Newton, who heads the Florida Consumer Action Network, said consumers lose under the House plan because they’ll face “severe limitations” in their health care choices.
“Rather than toughening penalties on the criminals committing fraud, the plan creates new special loopholes for insurance companies to avoid paying claims, or deny them all together,” Newton said.
PIP fraud results in higher costs to customers through increased premiums. In some places, that translates into hundreds of extra dollars per year.
The Florida Office of Insurance Regulation on Friday released preliminary data showing “PIP costs … have continued to increase as a percentage of the premium dollar for Florida’s insurers,” according to a report.
Lawmakers passed PIP coverage in 1972 to ensure that anyone hurt in an automobile wreck could get medical treatment. The legislation mandated that a driver’s insurance company pay up to $10,000 to cover medical bills and lost wages after an accident _ no matter who’s at fault. All Florida drivers are required to carry no-fault insurance.
Over the years, however, fraudsters turned Florida into the top state for staged accidents, especially in the Tampa and Miami-Dade metropolitan areas.
Some estimates show PIP fraud nearing $1 billion in the state this year, though Sen. Joe Negron, R-Stuart, has called that “hyperbole.” Negron, who is sponsoring the Senate bill, says it was more like $100 million to $125 million a year.