test: Florida Senate Committee on Banking and Insurance Holds Personal Injury Protection (PIP) Workshop
Nov 16, 2011
The Florida Senate Committee on Banking and Insurance (“Committee”) met on November 16, 2011 and conducted a workshop on Personal Injury Protection (“PIP”) insurance.
Committee Chairman Garrett Richter called the meeting to order, stating that the there is much work to be done on PIP. While the number of motor vehicle drivers and accidents in Florida has decreased, the number and cost of PIP claims is on the rise, he explained.
Florida Governor Rick Scott’s Director of Legislative Affairs Angela Peterson addressed the Committee on behalf of the Governor, who has identified the following four key issues relating to PIP:
- Fraud prevention
- Litigation reform
- Provider reform and utilization
- Accountability.
Florida Chief Financial Officer (“CFO”) Jeff Atwater addressed the Committee, saying that consumers need fair PIP coverage at a fair price. For real relief, there needs to be bold change, he explained, adding that, because PIP is a losing proposition in Florida, carriers are leaving the state. CFO Atwater also expressed his sentiment that PIP can, and should be saved, because it is a valuable tool. As a benchmark for PIP reform, the Florida Legislature should use the 2003 workers’ compensation reforms, he said. He also highlighted the efforts of his Office to combat PIP fraud.
Bill Bell, General Counsel for the Florida Hospital Association (“FHA”), addressed the Committee as part of the workshop’s provider panel. He noted that the FHA supports mandatory medical coverage, inasmuch as some kind of coverage is needed to pay emergency rooms and hospitals. Many times, the only insurance coverage a person has is PIP. Mr. Bell also said that the FHA supports increasing the PIP limit.
Some Committee members felt that increasing the PIP benefit would just allow a larger pot of money for fraudsters. Mr. Bell clarified that the FHA supports reserving any additional amounts for hospitals.
Rich Thacker, an osteopathic physician, testified that the medical community supports keeping PIP and increasing its benefit. Mr. Thacker noted that fraud and abuse should be addressed, but not at the expense of legitimate claimants.
Paul Lambert, representing the Florida Chiropractic Association, highlighted the problems with Florida’s clinic licensing statute. He enumerated a number of suggested statutory changes, such as limiting the licensing exemptions to apply to only one location, requiring providers to list the locations where they practice, suspending or revoking licensees for operating fraudulent clinics, and creating PIP fraud investigation unit within the Florida Department of Health.
Chip Smith, a chiropractic physician, addressed the Committee about his experience as a provider who treats PIP patients.
Gary Brown, a clinic owner, agreed there is a need for clinic licensure reform. Florida law should be amended to prohibit providers from overseeing other providers outside their scope of practice, which he said is a growing problem in Florida. Mr. Brown also expressed his opinion that electronic claims submission should be required and that licensure should be required for all clinics.
James Pratt, Director of Staff Counsel for GEICO, addressed the Committee as part of the insurer panel. Mr. Pratt noted that Examinations Under Oath are the most effective tool in combating fraud. He also stated that litigation reform is key to PIP reform. Factors such as the one-way attorney fee and the attorney fee multiplier drive up PIP costs. Sometimes, he explained, insurers will settle claims rather than fight them, then lose and have to pay attorneys’ fees. Mr. Pratt also noted that provider reform and utilization reviews are also key factors in keeping down costs.
Maureen Hasselman, Claims Section Manager for State Farm Insurance Company, explained the role of Special Investigation Units in an insurance company. Echoing Mr. Pratt’s sentiments on attorneys’ fees, she also stated that pre-suit demands are not as effective as they were created to be, and have actually increased litigation. She also noted that the fee schedule is not working as it was created to, since it is ineffective without utilization controls.
Recognizing that more time needs to be spent on this issue, Chairman Richter announced that the Committee’s next meeting would be spent on PIP. During that time, the Committee plans to hear from trial attorneys, he said.