Scott stays on PIP course — even as questions grow about glitch
Friday, May 11th, 2012 by John KennedyGov. Rick Scott traveled to Tampa and Orlando on Friday to tout the new rewrite of state auto insurance laws, even as critics continue to question whether a glitch in the new measure could prompt battles between health care providers and insurers over payments.
Scott was in West Palm Beach earlier this week promoting the measure (HB 119) that he said will go a long way toward reducing accident fraud and high insurance premiums, which have plagued Florida’s mandatory, no-fault personal injury protection (PIP) coverage.
“This was done for the benefit of consumers and not for the benefit of insurance companies,” Scott said at the event, held at the Palm Beach County Sheriff’s Office.
But Russel Lazega, a Dania Beach lawyer who represents hospitals seeking to recover PIP claims, said he expects the new law will only force more health care providers into court to receive payments.
The PIP bill was hastily cobbled together in the waning hours of the 2012 session and includes conflicting language that raises questions of whether insurers could be considered exempt from paying claims between July 1 and Jan. 1, 2013 to hospitals, chiropractors, dentists, doctors and others.
”I see a mountain of red tape ahead,” Lazega said.
Lazega, who said he has helped 350 hospitals and other medical facilities receive $20 million in disputed insurance payments over the past 15 years, said insurance companies can use the flaw in the new law as a “heavy-handed negotiating tool,” when hospitals submit claims.
Hospitals could choose to accept lesser payments, Lazega said, rather than take chances on the insurance company refusing to pay anything — with insurers banking on the law’s gap to help them win in court. Also, it’s possible that medical providers will end up suing each other to collect a larger portion of a $10,000 PIP claim — especially if one of the competing providers is in a profession whose reimbursement status is clouded because of the flaw in the new law.
The changes are the state’s latest attempt to overhaul the $10,000 PIP coverage required since the 1970s. The system, intended to reduce lawsuits and get payments issued quickly for treating injured motorists, has been plagued by frequent complaints about fraud, staged accidents and high insurance rates.
The Florida Agency for Health Care Administration this week sought to resolve the new law’s problems by issuing a memo saying that it considers all providers still eligible to receive insurance payments. Changes to eligibility outlined in the law would not take effect until Jan. 1, according to AHCA’s memo.
In the memo, AHCA’s general counsel, Stuart Williams, acknowledged the conflict “would place the agency in a conundrum.” But he concluded, the “agency believes that the (law) applies the same effective date of January 1, 2013 to both the new licensure requirement and the…exemption.”
But whether a state agency can correct a conflict in law with a simple memo is a deeper question, said Mark Seidenfeld, an administrative law expert at Florida State University.
“A memo, executive order or rule issued by an agency can influence a court in deciding the intent of the new law,” Seidenfeld said. “But there’s no guarantee. You can be sure, though, this is going to be challenged in court.”



