Bill Summary: CS/HB 13C–The Re-enactment of Florida’s Motor Vehicle No-Fault Law

Below is a summary of CS/HB 13 – The re-enactment of Florida’s Motor Vehicle No-Fault Law.

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Short Summary

• Reenacts the No-Fault Law on January 1, 2008 and requires all vehicle owners to have PIP on that date. Insurers must send premium notices by Nov. 15, 2007, to policyholders who do not already have PIP coverage.
• Provides a fee schedule for PIP benefits;
• Limits the health care providers who must be reimbursed under PIP.
• Provides additional time for PIP insurers to respond to a demand letter for payment before a suit may be filed.
• Requires insurers to reserve $5,000 of benefits for 30 days for physicians providing emergency services or care or inpatient hospital care.
• Requires that all PIP claims related to a single provider for the same injured person be joined in a single lawsuit.
• Makes it an unfair trade practice for an insurer to refuse to pay valid claims as a general business practice, and allows the Attorney General to investigate and initiate actions, in addition to the Office of Insurance Regulation.

Detailed Summary

Reenacts and Revises No-Fault Law on January 1, 2008
• The no-fault law, as revised, is effective January 1, 2008. All vehicle owners must obtain personal injury protection (PIP) by that date. Insurers must add PIP to policies in force on that date.
• Vehicle owners are not required to have PIP from Oct. 1, 2007, until January 1, 2008, But the requirements to maintain property damage (PD) liability continue to apply.
• Insurers must send notice to policyholders by November 15, 2007 that PIP is being added to their policies on January 1, 20080, and the premium that is due..
• In order to enable the Office of Insurance Regulation and the insurers to implement this, the bill requires insurers to use the same rates and forms that they had in effect under the old No-Fault law on September 30, 2007, unless the insurer makes a new rate and form filing as required under current law.
• Vehicle owners are not required to have PIP between October 1, 2007 and January 1, 2008. (even though many persons still have PIP coverage in their policies).
• The no-fault law tort restrictions do not apply between October 1, 2007 and January 1, 2008, with one exception: If the plaintiff and the defendant both have the old PIP coverage and are in an accident between October 1, 2007, and January 1, 2008, the no-fault tort limitations will apply.
• Legislative findings are made that it is necessary to revise policies on Jan.. 1, 2008, in order to protect the public health safety and welfare.

Medical Benefits — PIP continues to pay 80 percent of medical expenses up to $10,000, but the benefits are limited to services and care lawfully provided,supervised, ordered, or prescribed by a physician, osteopath, chiropractor, or dentist or provided by:
• Hospital or ambulatory surgical center
• Emergency transportation and treatment by an ambulance or emergency medical technician
• Chiropractic physician
• Entities wholly owned by physicians, osteopaths, chiropractors, dentists, or such practitioners and their spouse, parent, child, or sibling
• Entities wholly owned by a hospital or hospitals
• Licensed health care clinics that are accredited by a specified accrediting organization or the health care clinic:
o Has a medical director that is a Florida licensed physician, osteopath, or chiropractor;
o Has either been continuously licensed for more than 3 years or is a publicly traded corporation; and
o Provides at least four of the following medical specialties: 1) general medicine; 2) radiography; 3) orthopedic medicine; 4) physical medicine; 5) physical therapy; 6) physical rehabilitation; 7) prescribing or dispensing outpatient prescription medication; 8) laboratory services.
o Persons providing magnetic resonance imaging (MRI) services if lawfully ordered by a health care practitioner.

Medical Fee Limits for PIP – Allows PIP insurers to limit reimbursement to 80 percent of the following schedule of maximum charges:

• For emergency transport and treatment (ambulance, emergency medical technicians), 200 percent of Medicare;
• For emergency services and care provided by a hospital, 75 percent of the hospital’s usual and customary charge;
• For emergency services and care and related hospital inpatient services rendered by a physician, the usual and customary charges in the community;
• For hospital inpatient services, 200 percent of Medicare Part A;
• For hospital outpatient services, 200 percent of Medicare Part A;
• For all other medical services, 200 percent of Medicare Part B, not to be lower than the 2007 Medicare fee schedule;
• If medical care is not reimbursable under Medicare, the insurer may limit reimbursement to 80 percent of the workers’ compensation fee schedule. If the medical care is not reimbursable under either Medicare or workers’ compensation, the insurer is not required to pay.
• The insurer may not apply any utilization limits that apply under Medicare or workers’ compensation.
• The insurer must reimburse any health care provider rendering services under the scope of their license, regardless of any restriction under Medicare that restricts payments to certain types of health care providers for specified procedures.
• If an insurer limits payment as authorized, the medical provider may not bill the insured for any excess amount, except for amounts that are not covered due to the coinsurance amount or maximum policy limits.

Priority of Payment for Physicians Rendering Care in a Hospital
• If the PIP insurer receives notice of an accident, the insurer must reserve $5,000 of PIP benefits for payment to physicians or dentists rendering emergency care or inpatient care in the hospital.
• 30 days after the insurer receives notice of an accident, the unclaimed amount of the reserve may be used to pay claims from other providers.
• The required time to pay claims to other providers is tolled for the time period the insurer is required to hold such claims due to this requirement.

Demand Letter — Increases from 15 days to 30 days for an insurer to pay a claim (with interest and penalty) after a provider has sent a “demand letter” for late payment of a claim. (A provider may not file suit and potentially collect attorney fees until the end of this period.)

Mandatory Consolidation of PIP Claims – Requires that all PIP claims against an insurer related to the same health care provider for the same injured person must be brought together in a single lawsuit, unless good cause is shown why such claims should not be brought separately.

PIP Death Benefits — Clarifies current law that the death benefit is $5,000, or the remainder of unused PIP benefits, whichever is less.

Unfair Trade Practices; Attorney General Powers
• An insurer that fails to pay valid PIP claims with such frequency as to indicate a general business practice violates the unfair and deceptive practice provisions of the Insurance Code.
• The Dept. of Legal Affairs (Atty. Gen.) may investigate and initiate actions for such violations, as specified in part II of ch. 501 (Deceptive and Unfair Practices)

Clarification of Property Damage Liability Mandate – Clarifies that property damage liability is mandatory and remains effective during any period that PIP is not required.