Category Archives: Fla. Stat. 627.736 (2012)

Will Florida’s Reported Drop in PIP Fraud Continue?

Florida, one of 12 states with no-fault auto insurance, has reported its fair share of insurance fraud, mostly through scams involving Personal Injury Protection. PIP insurance provides personal injury protection up to $10,000 in immediate medical coverage without having to establish fault in the court system.

As industry insiders know, this monetary level is often seen as an easy target by fraudsters. Even though PIP premiums have represented only about 2 percent of all of Florida’s collected insurance premiums, they account for nearly half of all auto insurance fraud referrals, the Florida Office of Insurance Regulation (FOIR) has established.

But all of that may be changing, the National Insurance Crime Bureau believes, as auto insurance fraud has actually dropped in Florida since a 2012 law reformed PIP. As we posted on our FL PIP Guide this past March, tighter legislation, enhanced public awareness, and coordinated law enforcement efforts appear to be having a positive effect on PIP fraud in Florida.

These changes specifically include stronger penalties for medical providers who commit PIP fraud, a 14-day window for accident victims to seek medical treatment, and reduced benefits and treatments.

In line with projections made when HB119 was passed, FOIR expects PIP coverage rates to decrease by an average of 13.2 percent, reducing auto insurance rates 1.2 percent overall, according to figures based on a review of data from 20 insurers that provide auto insurance to more than 75 percent of the Florida market.

However, because PIP coverage savings will still be relatively small in comparison to the overall total cost of a typical auto insurance policy, and because fraud is at times difficult to detect, the next few years may be a better indication of whether these changes have produced a statistical blip in the numbers or a longer-term trend.

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Filed under Fla. Stat. 627.736 (2012), Insurance Fraud

Operation Sledgehammer Finds Three Chiropractors Guilty of PIP Fraud

A federal jury has convicted one West Palm Beach chiropractor and two Miami chiropractors for their roles in a massive staged automobile accident scheme, following a seven-week trial in U.S. District Court for the Southern District of Florida.

Using the U.S. mail in a scheme involving Personal Injury Protection (PIP) payments, defendants were found guilty of defrauding insurance companies through mail fraud and money laundering.

Kenneth Karow, 54, of West Palm Beach, Hermann J. Diehl, 44, of Miami, and Hal Mark Kreitman, 50, of Miami Beach were all convicted on multiple counts. Karow was sentenced to 11 years in prison, Diehl to nine years, and Kreitman to eight years for the fraud scheme that ran from October 2006 through December 2012.

The fraud was perpetuated in several ways across 21 chiropractic clinics, according to a release issued by the U.S. Attorneys’ Office for the Southern District of Florida. Key elements of the scheme are outlined below.

  1. Licensed chiropractors were recruited to serve as the “named owners” of chiropractic clinics, in circumvention of Florida licensing requirements, with others actually in financial control of the business.
  2. Recruiters were used to attract real or fake auto accident victims who were fraudulently treated at the chiropractic clinics for injuries.
  3. False chiropractic treatment claims where then billed to insurance carriers.
  4. No co-pays or deductibles were collected from the “patients,” and this fact was not disclosed to the insurance companies.
  5. The money received from this scheme was then used to pay recruiters and participants and to enrich members of the conspiracy.

The prosecution is the latest in a series of charges that have been part of a four year investigation into the massive conspiracy. The joint federal and state investigation, known as Operation Sledgehammer, has resulted in charges against 93 defendants for their roles in the organization. Of these 93 defendants, 57 have been charged by the U.S. Attorney’s Office, resulting in court-ordered restitution of more than $11 million to defrauded insurance companies.

Click on the link to read the full release.

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Filed under Fla. Stat. 627.736 (2012), Insurance Fraud

Defendant’s Motion to Dismiss Granted with Prejudice in PIP Benefits Case Involving Challenge to “Emergency Medical Condition” (EMC) Provision

In a second ruling within one week involving Florida’s amended PIP law, the U.S. District Court for the Southern District of Florida dismissed a case challenging reimbursement under the amended statute’s “emergency medical condition” or “EMC” provision. See our earlier post titled Court Grants Defendant’s Motion to Dismiss in Robbins v. Garrison P & C.

Sendy Enivert sued her auto insurance company, Progressive Select, alleging breach of contract for failing to pay her PIP benefits to a limit of $10,000. Enivert’s claim involved the newly added provision to Florida’s PIP law which limits PIP benefits depending on whether a claimant has suffered an emergency medical condition.

Plaintiff Enivert interpreted this language to mean that an insured is limited to $2,500 only if a medical provider determines that there is no emergency medical condition. She argued that because, in her case, no medical provider ever made such a determination, she was entitled to the full $10,000. In other words, because no medical provider determined that she did not have an emergency medical condition, she was entitled to full benefits.

Defendant Progressive read the statute to mean the opposite, i.e., that a medical provider must affirmatively determine that an emergency medical condition does exist in order for the insured to be eligible for reimbursement of the full amount.

The court agreed with Progressive, concluding that the PIP statute clearly indicates that a determination that a claimant has suffered an emergency medical condition is required in order to receive benefits in excess of the $2,500 limit. Since a medical provider did not determine that Enivert had an emergency medical condition, she was not entitled to the full $10,000 in benefits.

The court also looked to the legislative intent behind the PIP statute. It concluded that the clear legislative intent was to decrease PIP fraud by placing more stringent requirements in order to receive the maximum amount of benefits.

Based on the above, the court granted Progressive’s motion to dismiss Enivert’s case.

The case is Sendy Enivert v. Progressive Select Insurance Co., Civil Action No. 14-CV-80279-Ryskamp/Hopkins (S.D. Fla. July 23, 2014). Click on the link to read the court ruling.

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Filed under Case Law, Fla. Stat. 627.736 (2012)

Court Grants Defendant’s Motion to Dismiss in Robbins v. Garrison P & C

On July 18, the U.S. District Court for the Southern District of Florida dismissed a case in which the plaintiff challenged reimbursement under the amended statute’s “emergency medical condition” (“EMC”) provision.

Glenaan Robbins sued her auto insurer, Garrison P&C Insurance Co., alleging that Garrison violated the 2013 provision of Florida’s PIP law that limits PIP benefits depending on a determination of whether or not the claimant suffered an emergency medical condition.

Robbins sustained injuries in an April 2013 car accident. She was treated for her injuries and alleged that ultimately “no determination was made that she did not have an emergency medical condition.” When Robbins submitted her claim to her insurer Garrison, Garrison limited her reimbursement to $2,500.

FL PIP law requires that an insurance company must reimburse its injured insured up to $10,000 if certain medical providers determine that the injured person had an emergency medical condition. Reimbursement is limited to $2,500 if a provider determines that the injured person did not have an emergency medical condition.

In this case, no determination was made either way that an emergency medical condition did or did not exist. Plaintiff Robbins argued that where there has been no such determination, insurance companies must reimburse medical expenses up to $10,000. In other words, unless a determination of no emergency medical condition is made, the plaintiff is entitled to the higher amount.

Reviewing the language of the statute and legislative intent, however, the court concluded that Robbins’ argument had no merit. Rather, where there has been no determination of an emergency medical condition made, PIP medical benefits are not to exceed $2,500. Thus, contrary to Robbins’ argument, the conclusion of the court was that unless there is a determination of an emergency condition, the reimbursement is limited to $2,500.

The court therefore held that Robbins had failed to allege a statutory claim and her case was dismissed.

The case is Glenaan Robbins v. Garrison Property & Casualty Insurance Co., Civil Action No. 13-81259-Civ-Scola (S.D. Fla. July 18, 2014). Click on the link to read the court ruling.

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Filed under Case Law, Fla. Stat. 627.736 (2012)

Cost of Florida PIP Premiums Start to Drop Due to HB 119 Reforms

Almost two years after the Florida legislature passed House Bill 119, drivers may now start to notice a slight drop in this year’s automobile insurance rates resulting from reforms that helped lower Personal Injury Protection (PIP) premiums.

Although the primary goal of PIP, also known as no-fault insurance, was to reduce court cases and payment delays for injured drivers, the number of PIP claims and PIP payments escalated, even though the number of auto accidents did not increase over the past few years.

According to an article in the April 21 edition of Highlands Today, a local edition of the Tampa Tribune, PIP premiums are roughly 2 percent of Florida’s collected insurance premiums, but questionable claims make up nearly 50 percent of fraud referrals. The Division of Insurance Fraud received over 3,000 PIP fraud complaints in 2005-06, and obtained 225 convictions in 2007, the article added.

However, as we reported on this blog on March 31, a recent National Insurance Crime Bureau (NICB) report shows that tighter legislation, enhanced public awareness, and coordinated law enforcement is having a positive effect on PIP fraud in Florida.

In calculating cost reductions to the consumer, most insurers used rates from a Pinnacle study which projected legislative reforms would save Florida policyholders roughly 14-24 percent. Typically, 25 percent of a consumer’s total auto insurance premium cost comes from PIP.

A preliminary DOI analysis of the rates submitted by the top 20 automobile insurance companies writing PIP insurance, encompassing more than 75 percent of the Florida market, showed a 13.2 percent decrease. Therefore, a statewide reduction in PIP averaging 13.2 percent would translate to a 3-4 percent savings for the policyholder, the DOI figures.

DOI’s analysis was compiled to demonstrate the cumulative effect of House Bill 119 after the first required rate filing due in October 2012 and the second rate filing on Jan. 1, 2014, the Highlands Today story said.

However, rate changes are still pending for 2014, according to Amy Bogner, Deputy Director of Communications at the Florida Office of Insurance Regulation. “The anticipated cumulative effect of these two rate filings in the legislation was a 25 percent overall decrease in PIP rates,” Bogner explained.

Auto insurers who did not decrease PIP premiums by the cumulative 25 percent were required to demonstrate why the company’s savings should vary.

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Filed under Fla. Stat. 627.736 (2012), Insurance Fraud

Florida Supreme Court Refuses to Review PIP Case

The Florida Supreme Court has refused to consider a petition seeking to overturn a 2012 state law reducing PIP benefits.

In an attempt to curb fraud and lower insurance rates, HB 119—Personal Injury Protection (PIP) for Auto Insurance Fraud—requires people involved in motor vehicle crashes to seek treatment within 14 days, and allows up to $10,000 in benefits for emergency medical conditions and up to $2,500 for non-emergency conditions.

The law also prevents accident victims from using PIP coverage to pay for treatment by certain medical providers, and set benchmarks for insurers to lower rates on PIP coverage.

In 2013, Leon County Circuit Judge Terry Lewis ruled that the law illegally shut out some medical providers, namely acupuncturists and massage therapists.

As reported in an earlier blog post titled “Motion for Rehearing of Florida PIP Injunction is Denied,” the Florida First District Court of Appeal reversed the ruling in October, 2013, saying that the challengers to the law needed a “factual” plaintiff who had actually been harmed by the law rather than a hypothetical plaintiff, as named in the complaint. The Florida Supreme Court denied review of that decision in this week’s ruling.

An attorney representing medical providers who claim they were unfairly shut out by the law said he anticipates filing an amended case within 30 days using a named plaintiff alleged to have been harmed by the 2012 PIP reforms.

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Filed under Case Law, Fla. Stat. 627.736 (2012), Insurance Fraud

Roig Lawyers Partner, Jeff Tutan, Speaks at 2014 Medical Claims Defense Network on Topic of Use of Mobile X-rays

On April 16, 2014, Roig Lawyers Partner, and Board Certified Trial Attorney, Jeff Tutan presented at the Medical Claims Defense Network Conference in Orlando, Florida.  Jeff Tutan, head of the firm’s trial practice group, discussed his recent success at jury trial in a case involving a medical provider’s claim for reimbursement for “mobile x-ray” services.  During the round table presentation, Attorney Tutan discussed how he, partner Jessica Martin, and senior associate attorney Jenna Hackman, successfully defended such a case involving these increasingly prevalent medical services.

For more information, contact attorney Jeff Tutan at jtutan@roiglawyers.com.

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Filed under Fla. Stat. 627.736 (2008), Fla. Stat. 627.736 (2012), Licensing