An insurance-backed effort to make it easier for the industry to deny personal injury protection claims stalled in both chambers Monday following a withering assault from attorneys who represent motorists, physicians, chiropractors and other providers.
By a 9-8 vote, the House Health and Human Services Committee defeated a pair of measures (HB 967 and HB 1411) requested by auto insurers and backed by state insurance regulators that backers say is needed to address fraudulent insurance claims that cost policyholders collectively $1 billion a year.
Earlier Monday the Senate Judiciary Committee at its last scheduled committee hearing adjourned without acting upon a pair of Senate measures (SB 1930 and SB 1694) dealing with the personal injury protection issue.
The majority of the bill was not addressing the matter of fraud, said Paul Jess, general counsel for the Florida Justice Association, which represents plaintiffs' attorneys. It was basically creating opportunities for the insurance companies to deny and delay claims and create hurdles for health care providers from being paid on legitimate claims and legitimate bills.
Among the most controversial provisions were caps on attorney fees of $200 an hour and making it more common for providers to be examined under oath when fraud was suspected in cases.
Mondays defeat came despite efforts by the bills sponsors to soften the original proposals, which capped attorney fees at $10,000.
Established to provide injured motorists with a relatively hassle-free mechanism to obtain up to $10,000 in medical care without having to go to court, the system last underwent a major overhaul in 2007. Changes made at that time, however, appear to have done little to stop -- and may have nurtured -- a growing, clandestine industry of false claims, with perpetrators betting insurance companies will pay most claims to avoid the expense of litigation.
Every motorist in the state of Florida pays a $50 tax to pay for this fraud,Rep. Mike Horner, R-Kissimmee, told members Monday.
The number of referrals to the state's Division of Insurance Fraud continues to rise, jumping from a three-year total of 3,942 cases between 2002 and 2005 to 5,500 referrals for the 2009-10 fiscal year alone. An Office of Insurance Regulation report released in April showed overall PIP insurance payments up 66 percent between 2006 and 2010. Meanwhile, the number of lawsuits filed against insurers increased 387 percent.
These are bills that have the support of the agency that regulates the insurance industry, said Sam Miller, executive vice president of the Florida Insurance Council. These are OIR estimates.
