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PIP bills moving, but House, Senate disagree on replacement coverage

TALLAHASSEE — House and Senate committees on Thursday moved bills that would eliminate Florida’s long standing personal injury protection, or PIP requirement, but the chambers don’t agree on what insurance requirements Florida drivers should carry.

The Senate bill, SB 1766, would require drivers to purchase a mandatory medical payment policy to ensure they have continued access to health care for injuries from auto accidents; the House bill, HB 1063, does not.

The bills are supported by the Florida Justice Association and opposed by insurance carriers, many of which have pushed for the elimination of PIP because of fraud and abuse, including drivers staging accidents to tap into medical benefits and lost wages.

Though they support the repeal of PIP, auto insurers oppose the bills because neither contain changes to the state’s bad faith laws which, they claim, put insurance companies at risk for not appropriately settling cases. The insurance industry would like the Legislature to provide at a minimum a “safe harbor” that would give insurers a time frame to review claims without fear of a bad-faith lawsuit.

The bills also are opposed by a group of attorneys who represent health care providers and by health care providers who fear they won’t be reimbursed for health care if PIP is eliminated. PIP provides $10,000 in medical, disability, and funeral expenses — without regard to fault — subject to a limit of $2,500 for non-emergency medical care. It pays 80 percent of medical losses. In exchange for providing PIP coverage, vehicle owners and operators are immune from tort claims unless there is death or significant and permanent injury.

The Senate bill replaces the mandated PIP coverage with a mandated “MedPay” coverage of $5,000 that covers 100 percent of covered medical losses.

Several senators who support the measure in the Senate Baking and Insurance Committee on Thursday warned that, if the MedPay requirement were eliminated, they wouldn’t be able to support the legislation.

Senate Minority Leader Oscar Braynon noted that while Obamacare has lowered the percent of people in Florida without health insurance there is a push to eliminate the coverage. Moreover, Florida didn’t expand Medicaid under Obamacare, leaving 800,000 Floridians in the “coverage gap” — too rich to qualify for Medicaid but too poor to qualify for subsidies on the exchange.

“If that comes out,” Braynon said of the MedPay requirement, “I will have a big problem.”

House bill sponsor state Rep. Erin Grall, though, said that she doesn’t support the MedPay mandate because it’s “PIP light” and said the Senate version of the bill “looks like PIP renamed.”

She said most Floridians have health insurance and could use that coverage, if necessary. Currently, health insurance is secondary to PIP coverage.

A recent study on Florida’s no-fault system by Pinnacle Actuarial Resources indicated that there would be a near $470 million cost shift to health insurers if PIP were eliminated and not replaced with a medical payment component, and a near $33 million hit to health care providers if it were eliminated with no alternative replacement.

Another difference between the bills is the amount of financial responsibility requirements for bodily injury drivers are required to have. The House bill requires $25,000 in damages due to the bodily injury or death of any one person and $50,000 for bodily injury or death to two or more persons, effective next year.

The Senate bill phases in coverage requirements. Beginning in Jan. 1, 2018 drivers would be required to carry $20,000 for bodily injury or death of one person and $40,000 for bodily injury or death of two or more people in any one crash. That increases to $25,000 and $50,000 in Jan. 1, 2020 and by Jan. 1, 2022 the requirements would be set at $30,000 and $60,000.

Floridians for Responsible Roadways, a group supported by the Florida Justice Association, supports the bill and holds out Adrienne Gorham as an example of why PIP should be eliminated. Gorham, who lives in Edgewater, told the Senate Banking and Insurance Committee that she was T-boned by a driver in a $50,000 luxury car who had only the minimum $10,000 coverage.

“There’s still a humongous balance; I have a stack of bills and more are coming in the mail,” she said adding that her credit score is now terrible and that she does not have health insurance to provide her children the necessary follow-up care.

“My family has suffered because somebody else has acted irresponsibly and I’m here today because I want something good to come out of this,” she said.

By Christine Sexton
04/13/2017 12:47 PM EDT



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