A flurry oflawsuits is expected as the new aspects of Floridas personal injury protection auto insurance reform take hold.
Measures designed to eliminate the rampant fraud that has used the system as a financial syphon will be challenged, most likely over the provision that drops coverage from $10,000 to $2,500 based upon the definition of emergency medical condition.
The Florida Justice Association, which represents trial lawyers, has said it anticipates lawsuits will come after January 2013, once the provisions in the new law require people injured in auto accidents to seek their initial treatment within 14 days.
Until the Legislature amended the coverage in the 2012 session, the law had set no deadline for people to seek treatment and allowed a wider range of professionals to offer treatment.
But in addition to the new deadline comes the new definition, as well as a prohibition on massage threrapists and acupuncturists from offering treatment.Chiropractic services are limited to payment of up to $2,500 for treatment of non-emergency medical conditions.
Mostly likely, those taken to the emergency room will be eligible for the full $10,000 coverage since a physician, osteopathic physician, dentist, or a supervised physicians assistant or advanced registered nurse practitioner must determine if the insured has an emergency medical condition."
The payout scale is intended to drive away the more malevolent players that in the current system have banked upon treating often dubious claims days and weeks after the initial crash.
Florida Consumer Action Network spokesman Bill Newton has said Floridians will be in for a "rude awakening," as instead of a bill that prevented fraud, it will only "pad the pockets of big insurance companies.
Business leaders in the state that pushed for the reform hope the fraud-fighting tools in the new PIP law will allow insurers to ferret out fraudulent claims before they lead to lawsuits.
"At the same time, they are not nae that plaintiffs wont attack the new law and the emergency medical condition aspects," Jose L. Gonzalez, vice president for governmental affairs for Associated Industries of Florida, responded in an email.
We are optimistic that some of the provisions in HB 119 will reduce the volume of litigation seen by Florida courts, Gonzalez continued. "The original concept of no-fault contemplated less litigation in exchange for expedient receipt of benefits.
Sam Miller, executive vice president of the Florida Insurance Council, the state's largest insurance company trade association, expressed concern that if the courts dump the provisions in the reform effort, the future of the low-cost insurance option in the Sunshine State may be in trouble.
We absolutely will have a lot of this mediated, Miller responded in an email. If the courts throw out key parts, we are in trouble, and so is PIP because this is probably the last serious effort by the Florida Legislature to save it rather than repeal it.
Legislators have said that if the reform fails, PIP may need to be replaced with a bodily injury policy and liability auto insurance.
Bodily injury protection typically has higher coverage limits, which would be expected to include higher premiums.
And the courts could put the state and legislators in such a position if they continually have to decide if a sprained ankle or other injuries are major or minor emergency medical conditions.
The Florida Chamber of Commerce is confident that the reform effort will reduce premiums for individual motorists. But the concern remains that scammers will find new avenues.
And the Chamber is already seeing signs that plaintiff trial lawyers wont be slowed by the law and that legislators may need to tackle excessive and unreasonable one-way attorney fees in the 2013 session.
Theoretically, the bill should reduce litigation, stated David Hart, executive vice president of the Florida Chamber of Commerce. However, history indicates that some plaintiff trial lawyers will stop at nothing and that includes a fight in the courts."
Created in 1972 to ensure that anyone injured in an auto accident would be able to pay for treatment regardless of who was at fault, costs have grown $1.4 billion since 2008. State officials have blamed fraud in the form of staged accidents and receptive health-care providers for the bulk of the increase in premiums.
Bob Lotane, communications director for the National Association of Insurance and Financial Advisors in Florida, expects the rush of lawsuits will abate over time. He also doesnt envision legislators taking on further major issues involving the no-fault coverage next year, allowing this years reforms to first take hold.
My guess is that there will be little appetite for doing anything significant on this issue next session, Lotane stated.
Everyone is a little PIP'd out. so to speak. When you pass significant reform, like this, it is best to let it work a while so you can measure the impact. If you tinker with reforms soon after putting them on the books, you never really know what effect the changes are having.
Reach Jim Turner at jturner@sunshinestatenews.com or at (772) 215-9889.
