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Plenty of options but no consensus on car insurance reform

TALLAHASSEE — What happens after you get into an automobile accident, and who pays the bills, could be changing.

State lawmakers are wrestling with ways to reform the state's no-fault auto insurance law. The law requires drivers to carry $10,000 worth of coverage and forces insurance companies to pay out regardless of who caused the accident.

The system is rife with abuse, lawmakers say — an estimated $1 billion in fraud this year.

But there is no simple fix, and several competing proposals are being floated by Republicans.

One tightens procedures for licensing medical clinics and creates a task force to help stamp out abuse. Another requires auto accident victims to seek initial treatment at emergency rooms and limits the type of medical services that are covered. A third measure repeals the law and replaces it with a system where the person who caused the crash pays.

"I'm optimistic that we'll be able to address the issue before we're through here," said Sen. Joe Negron, a Stuart Republican.

He just doesn't know how yet.

Gov. Rick Scott urged action in his State of the State address Tuesday, calling on legislators to pass substantive fixes to the system, called Personal Injury Protection insurance, or PIP. In recent years, similar efforts have been watered down by politics.

Scott backs a House proposal that keeps the requirement of $10,000 in mandatory coverage but makes hospitals the first stop for treatment instead of a family doctor. The House proposal also limits which medical professionals provide follow-up care.

"You know there's other approaches to license providers and all sorts of things," Scott told the Associated Press, "(but) I think that bill is a good bill and I'm very supportive of it."

That measure, introduced by Rep. Jim Boyd, R-Bradenton, passed a subcommittee last week and has the support of the state Office of Insurance Regulation and the Property Casualty Insurers Association of America.

The bill is unpopular with Democrats, however, who say it goes too far and limits personal choice. It's also opposed by trial lawyers who don't like a provision to cap attorney fees and by physicians who believe some of the provisions are too heavy handed.

The opponents generally prefer another idea, sponsored by Negron and state Rep. Ritch Workman, R-Melbourne, that tightens regulations for medical clinics, requires more detailed accident reports and creates a statewide antifraud task force.

"Ultimately, the single biggest thing we can do to control fraud is to require a ticket to participate in PIP that is regulated heavily by the state," said lawyer Russel Lazega, who represents hospitals and other medical providers.

Neither Negron nor Workman's legislation limits attorney fees. (Negron is a lawyer; Workman is a mortgage broker.)

A cap is an "essential element" that should be contained in any PIP reform package to lower costs, said Donovan Brown of the Property Casualty Insurers.

That organization, along with business groups and lawyers, has also expressed support for PIP repeal efforts, but the idea remains unpopular among medical providers and consumer advocacy groups.

The Florida Hospital Association isn't supporting any specific bill but said eliminating the no-fault insurance system would ultimately affect quality of care. More than a third of emergency room patients have no other health coverage beyond PIP, general counsel Bill Bell said.

Rep. Mike Horner, R-Kissimmee, and Rep. Mack Bernard, D-West Palm Beach, introduced legislation to repeal PIP. They want drivers to carry bodily injury insurance that goes into effect when they hurt someone else in an accident. Forty-eight other states have a similar requirement.

Bill Newton, executive director of the Florida Consumer Action Network, said he doesn't expect the Legislature to go that far.

Among all the ideas, one proposal is already being left behind. Sen. Mike Bennett, R-Bradenton, has decided to let the legislation he filed in September die without being heard in any committees and instead will support one of the other proposals on the table, his aide said.

He hasn't decided which one.

Tia Mitchell can be reached at tmitchell@tampabay.com or (850) 224-7263.

Personal Injury Protection insurance

The Legislature passed the law in 1972 requiring all Florida drivers to carry $10,000 worth of personal injury protection coverage. This type of insurance was meant to ensure that people hurt in auto accidents could quickly get money to treat injuries regardless of who was at fault. In recent years, abuse of the system and fraudulent claims have caused PIP-related expenses and insurance premiums to skyrocket. It is estimated that PIP fraud will cost Florida drivers $1 billion this year.

The proposals

HB119 Sponsor: Rep. Jim Boyd, R-Bradenton
HB 119 would replace PIP with a new but similar no-fault insurance system called Emergency Care Coverage. It requires a trip to the emergency room for most car accident victims and limits the types of medical professionals that can perform follow-up treatment. The bill also caps attorneys fees, gives insurance companies extra time to investigate suspected fraudulent claims and clarifies the legality of examining doctors under oath as part of the claim process.

The latest: The House Insurance and Banking Subcommittee approved the bill this week, though the vote was split along party lines with Democrats dissenting. It's now headed to the Civil Justice Subcommittee.

SB 1860 Sponsor: Sen. Joe Negron, R-Stuart
SB 1860 requires long-form incident reports as a way to thwart staged accidents, requires licensing for health clinics that wish to participate in the PIP system, establishes a statewide task force to help eradicate fraud and introduces new measures to streamline the payment process and give hospitals priority standing.

The latest: Senate President Mike Haridopolos has lent his support to the bill, which was filed Monday. It has yet to be assigned to committees.

HB 523 Sponsor: Rep. Ritch Workman, R-Melbourne
HB 523 is similar to Negron's proposal, including licensing requirements for health clinics that wish to participate in the PIP system and a statewide task force to help eradicate fraud.

The latest: Filed in October and assigned to four committees.

HB 1007
HB 1007 repeals the current no-fault auto insurance system. Instead, drivers would be required to carry bodily injury insurance, which would cover the cost of paying for others' injuries when a driver is at-fault in an accident.

The latest: Filed in December and assigned to four committees.

Plenty of options but no consensus on car insurance reform 01/13/12 [Last modified: Friday, January 13, 2012 10:47pm]
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