With Gov.’s Signature, Florida PIP Insurance Reform Becomes Law

Gov. Rick Scott signed off on a bill reforming Florida’s auto insurance system Friday, finalizing a contentious debate around the now-approved law that overhauls how the state compensates providers and policyholders for crash-related injuries.

Legislators passed the reform bill in early March by an 80-34 vote in the state House and a 22-17 vote in the state Senate. That compromise bill followed battles in both state chambers over how to improve the state’s personal injury protection (PIP) coverage system that reimburses policyholders for post-crash medical expenses regardless of who was at fault for the collision.

The law’s proponents say it will save taxpayers money because it will reduce the rate of insurance-related crime, and insurers will, in theory, pass savings from reform onto drivers who search for Florida car insurance with lower premiums.

Opponents say that the reform measure severely undercuts the value of PIP coverage by restricting the amount that can go to treating nonemergency medical conditions to a total of $2,500, barring massage therapists and acupuncturists from receiving PIP payments and covering only treatments that start within the first 14 days of a crash.

​The governor signed the bill into law at an event in Jacksonville, Fla., saying “I am glad to do my part in keeping the cost of living low in Florida.”

The governor’s office cited statistics from state regulators showing that the number of crashes in the state declined as the amount of PIP payments increased 66 percent in 2006-10.

“These claims have caused auto insurance premiums to burden Florida families,” the governor’s office stated in a release coinciding with the signing ceremony.

New Conditions for PIP Medical Treatment

The new law institutes reforms that tighten restrictions on the kind of medical treatment a person receives under PIP coverage.

Previously, PIP covered up to 80 percent of medical expenses, up to 60 percent of lost income and up to a $5,000 death benefit, up to the policy limits. Reform supporters said this setup was too wide, leading to a rising number of phony claims and, ultimately, higher insurance premiums for everyone in the state.

Medical care providers previously covered by the state’s no-fault coverage included acupuncturists, massage therapists and other nonemergency medical professionals.

The law now eliminates services like massage therapy and acupuncture from benefits eligibility, requiring specific accreditations of facilities, hospitals and physician-owned clinics where policyholders can receive PIP-covered medical treatment. The law also requires policyholders to receive their initial treatment within the first 14 days after a crash if it is to be covered.

The newly approved reform measure adds a clause requiring that medical expenses covered up to the $10,000 PIP limit be related to an “emergency medical condition,” defined within the law as an injury that could lead to death or serious impairment or dysfunction if left untreated.

Treatment of nonemergency medical conditions are only covered up to $2,500.

The law also gives judges the power to review the fee amounts charged by attorneys in PIP-related cases “to ensure that each attorney doesn’t overinflate the hours or amount of skill involved and represents reasonable legal services,” according to a statement from Gov. Scott’s office.

Also, health-care professionals found guilty of PIP-related crimes will have their license suspended for 5 years and won’t be able to be reimbursed for PIP-related services for 10 years.

Gov. Rick Scott and the bill’s supporters claim that cost saving will really come from cutting back on insurance crimes. The new law does so by requiring long-form, post-crash police reports more often and allowing insurers a larger window to investigate claims that they find to be suspicious.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for Patch.com and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

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