FPCA Automobile Division: Florida Senate Committee on Banking and Insurance Amends, Passes PIP Bills
Apr 12, 2011
Florida Property and Casualty Association Automobile Division Members:
During its meeting today, April 12, 2011, the Senate Committee on Banking and Insurance (“Committee”) considered SB 1930 sponsored by Senator Ellyn Bogdanoff, relating to the Motor Vehicle Personal Injury Protection Insurance (“PIP”).
Several amendments were filed to SB 1930. Following consideration of the amendments, SB 1930, as amended, was considered and passed favorably by a vote of 7 to 4.
Following the introduction of SB 1930 by Senator Bogdanoff, the Committee began consideration of the amendments and took the following actions:
- Amendment 100124, filed by Senator Bogdanoff, is a strike-all amendment. Senator Bogdanoff explained that the amendment is designed to “address fraud where it happens.” She described some of the changes in the strike-all from the original bill as follows: “claimant” is defined to include all providers; acupuncturists are included; includes a “knowing” standard for fraud as a basis to deny claims/benefits; bifurcates fraudulent claims such that only fraudulent submissions can be denied; requires that records review must be by same class or licensure level of the doctor performing services; deletes cooperation requirement prior to filing suit; clarifies fee schedule; includes countersignature requirement, but removes provision that the actual bill must be signed; with respect to examinations under oath (“EUOs”), an insurer may only request information relevant to the treatment rendered; insurers must pay reasonable compensation to medical providers for sitting for EUOs; insurers may suspend benefits for failure to appear for an independent medical examination (“IME”), and two failures to appear for an IME raises a rebuttable presumption that the failure is unreasonable; appearing for an IME is condition precedent for benefits to be payable; authorizes discount for the use of a provider network; modifies provisions regarding demand letters; and adds civil penalties for committing auto insurance fraud. ADOPTED.
The following amendments to Amendment 100124 were considered:
- Amendment 308938, filed by Senator Bogdanoff, deletes language that provides certain charges “may not exceed the reimbursement schedule . . . .” Adopted.
- Amendment 507024, filed by Senator Bogdanoff, adds definition of “Entity wholly owned,” which is designed to eliminate shell operations, but preserve legitimate operations. Adopted.
- Amendment 182886, filed by Senator Bogdanoff, allows medical providers to impose a reasonable charge for the cost of copying and postage. According to Senator Bogdanoff, this amendment was requested by the Florida Medical Association. Adopted.
- Amendment 495560, filed by Senator Mike Fasano, retains provisions regarding the Florida Crash Report long form requirements and includes provisions for civil penalties, but deletes all other provisions in Senator Bogdanoff’s Amendment 100124. FAILED.
- Amendment 583554, late-filed by Senator Alan Hays, provides that those business owners and licensed health care practitioners who are found guilty of insurance fraud shall lose any occupational license or license to practice for five years, and shall be ineligible for reimbursement for PIP benefits for 10 years. ADOPTED.
Public testimony was given on Senator Fasano’s amendment by representatives of the Florida Justice Association, who stated the organization’s position that Senator Bogdanoff’s strike-all amendment is problematic and will adversely affect practitioners.
Debate on Senator Fasano’s amendment included statements by Senator Bogdanoff that Senator Fasano’s amendment “guts the bill.” She further noted that she feels responsible for the proliferation of lawsuits from 2007 when the Florida Legislature last attempted to fix the No-Fault Law. Senator Bogdanoff urged the Committee to return the No-Fault Law back to its intended purpose and eliminate fraud. In this regard, she asked Committee members not to support Senator Fasano’s amendment.
Senator Chris Smith noted that he likes what Senator Fasano is trying to do, but has concerns with the “punishment fitting the crime” and level of culpability. In this regard, Senator Smith would like different degrees of punishment for the varying degrees of culpability. Committee Chair Senator Garrett Richter stated that PIP fraud is a serious problem and is documented by the report issued yesterday following the Florida Office of Insurance Regulation’s PIP data call. In this regard, Senator Richter said he believes Senator Fasano’s amendment is well-intended, but does not go far enough. In closing on his amendment, Senator Fasano expressed concern that Senator Bogdanoff’s strike-all amendment is too extreme and could result in the loss of medical professionals in the state and the inability of injured people to get medical attention they need. A vote was taken and Senator Fasano’s amendment was not adopted. (Amendment 495560)
The Committee then addressed Senator Bogdanoff’s strike-all amendment, as amended. Committee members asked questions and there was general agreement that there needs to be some balance, and that the law needs to address all bad actors on both sides of the problem.
Public testimony was given on the strike-all amendment. Representatives of the Coalition Against Insurance Fraud and the Property Casualty Insurance Association of America were among those speaking in support of the amendment. The Florida Justice Association, PIP attorneys and medical providers spoke in opposition to the amendment. The Committee voted and adopted Senator Bogdanoff’s strike-all amendment. (Amendment 100124)
SB 1930, as amended, was then debated by the Committee. The Members again considered the need for balance in addressing PIP fraud. Some agreed to vote in favor of the legislation to pass it out of the Committee, but noted the need to continue to modify the bill to include more balance. It was specifically noted that 90 days is too long for an insurer to pay medical bills.
Senator Bogdanoff then closed on the bill. She noted her frustration with those interested parties that have not made an attempt to address their concerns with her office. She further expressed her willingness to work on the bill to make it effective, but also defended many of the provisions as a step in the right direction to fix the fraud epidemic. A vote was taken and the bill was passed.
The Committee also considered SB 1694, sponsored by Senator Richter, relating to Motor Vehicle Personal Injury Protection Insurance.
Senator Mike Bennett filed a strike-all amendment to SB 1694, Amendment 767910. Two amendments filed by Senator Fasano were withdrawn (Amendments 922322 and 447460). Senator Richter explained Amendment 767910, noting that it narrows the bill to cap attorney fees only. The amendment was adopted and SB 1694, as amended, was passed by the Committee by a vote of 6 to 5.
Public testimony was given on the strike-all amendment, and included a representative from the Florida Justice Association speaking in opposition to the amendment and a representative from GEICO Insurance Company speaking in support of the amendment. Committee members took the opportunity to question the GEICO representative regarding its claims handling procedures, among other topics. In addition, individual attorneys testified in opposition to the amendment, noting that insurance companies can still spend unlimited amounts on attorney fees and that the attorney fee cap tier will actually provide an incentive to commit fraud.
In debate on the amendment, Senator Bogdanoff stated that she does not support the multiplier concept and further believes the $200 per hour cap will not be effective. Notwithstanding, she agreed to support the bill and to work with Senator Richter regarding her concerns.
The strike-all amendment was adopted. Senator Richter then closed on SB 1694, as amended, noting that the bill addresses PIP fraud and will be effective in reducing the incentive to commit fraud. A vote was then taken on SB 1694, as amended, and the bill passed.