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Scott, Cabinet Members Target PIP Fraud Bill

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(Source: AP)

(Source: AP)

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Legislative Session Coverage

TALLAHASSEE (CBS4)- On the eve of legislative testimony, Gov. Rick Scott and Cabinet members joined forces Tuesday to call on lawmakers to enact significant changes to curb fraud they say is costing motorists nearly $1 billion a year in higher premiums.

Flanked by law enforcement officers in a fourth floor Capitol rotunda packed with industry lobbyists, Scott said staged crashes, bogus clinics and unnecessary medical procedures are raising the cost of personal injury protection insurance to the point where many motorists are choosing to illegally go without the mandatory coverage, the News Service of Florida reported.

“It’s a $900 million tax on consumers,” Scott told reporters and lobbyists representing physicians, hospitals, plaintiff’s attorneys, providers and insurance companies. “.. Crashes are down but costs are up. That makes absolutely no sense. It’s happening because our current laws are being taken advantage of.”

The House Insurance and Banking Subcommittee is scheduled to be briefed Wednesday on a proposal that would make a number of changes to rules surrounding the $10,000 benefit created in the 1970s to encourage injured motorists to seek medical attention and stay out of court.

A series of workshops, set up by Chief Financial Officer Jeff Atwater and held throughout the state were met with motorists who could no longer afford to purchase the mandatory coverage, with premiums in some locations having nearly doubled in recent years.

“They looked us in the eye and they said ‘It can’t go on much longer,’” Atwater said Tuesday. “They said they would go bare, they would go without.”

According to the News Service of Florida, a House proposal calls for a number of changes including closing loopholes that now leave many providers that cater to crash patients – such as some pain or imaging clinics – to be largely exempt from significant state oversight.

For providers, the bill would set rates once a year based on Medicare reimbursement rates in place Jan. 1 in an effort to stem lawsuits filed on behalf of providers over fee schedules that now change throughout the year. The proposals limit to 24 the number of chiropractic or massage treatments within a 12 month period for victims whose care is being paid for by a PIP claim.

Attorneys would see tighter restrictions on fees. They would be allowed a cap of $200 an hour for legal services and face a cap of $15,000 on a $10,000 claim. Class action lawsuit fees would be capped at $50,000.

To prevent fraud, the bill would ban any benefits- even for some that might be legitimate – to recipients who submit any fraudulent or exaggerated claims.

Insurance companies would be required to offer discounted rates to motorists who agree to enter a preferred provider network. They would also be subject to full rate hearings if they want to raise premiums.

Committee chairman Rep. Bryan Nelson, R-Apopka, said lawmakers are patterning reforms after similar changes made in 2003 to the state’s worker’s compensation system, which ultimately led to rates dropping by nearly 60 percent.

“It’s going to be a war,” Nelson said of the upcoming debate. “It’s not a bill that everybody is going to say yes, yes, yes…. the chiropractors won’t like it, the docs maybe won’t like it, the trial attorneys won’t like it.”

 

(©2011 CBS Local Media, a division of CBS Radio Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. The News Service of Florida contributed material for this report)

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