Tag Archives: insurance

Understanding Florida Letters of Protection (LOP)

Many times after people are involved in automobile accidents and they do not have health insurance, medical providers will agree to continue to treat them with the anticipation that should the patient recover any money from a lawsuit settlement or judgment, the provider will be paid from those proceeds. This type of agreement is called a Letter of Protection, sometimes called a LOP.  A letter of protection is a letter that is sent by an attorney on behalf of a client to a medical provider. The letter is an agreement between the patient/client and the medical provider. In this agreement, the medical provider will agree to provide medical treatment to the patient in lieu of receiving payment for services until proceeds from a settlement or a jury award are received. Should the patients not receive a favorable recovery, the patient may remain liable to pay for the medical services rendered. The LOP operates as a contract between the patient and the medical provider, which operates as a lien on any injury settlement.

LOP’s are typically utilized in Florida as a result of the fact that Florida PIP insurance pays 80% of the accident-related medical bills, which leaves 20% of the medical bill outstanding. Without a LOP, a medical provider may require upfront payment or refuse to provide treatment without additional assurances that it will be paid. In addition, LOP’s may be deemed necessary in cases where the medical bills exceed $10,000 and the patient lacks health insurance or other sources of available payment.

However, these LOP’s prevent a jury from accurately evaluating bodily injury claims. For example, when a person has health insurance, the amount charged by the medical providers are typically highly regulated and controlled. When a patient treats under a LOP, these regulations and controls do not exist. As a result, plaintiffs in litigation often incur larger bills in an effort to drive up the overall value of the economic damages in their case. In turn, medical providers operating under LOP’s often charge vastly different amounts than they typically would in the treatment of patients with health insurance, which the bills are being submitted through the patient’s health insurance coverage.

After recovery in personal injury suits, the plaintiff’s attorney may further negotiate the amounts payable to the medical providers. As a result, the plaintiff’s counsel utilizes these high medical charges as “evidence” of damages in their case whereby both the plaintiff’s counsel and medical providers are fully aware that the amounts billed will be drastically reduced and paid following any recovery. As a result, the court is provided with inaccurate information for which the jury to determine actual damages. Often these plaintiff attorneys and medical providers have ongoing business relationships. Each is making referrals to the other with the anticipation of payment for services ultimately occurring at the end of any claim or case. Uncovering information concerning this ongoing business relationship between the attorneys and the medical providers has proven difficult in recent years.

In Worley v. Central Florida Young Men’s Christian, Etc. (2015)163 So. 3d 1240, the Florida Fifth District Court of Appeals addresses the issue of whether during legal proceedings, the plaintiff was required to produce information pertaining to the relationship between the patients treating physicians and her attorney. The court held that a referral of a client by an attorney to a healthcare provider is protected by attorney-client privilege. In April 2017, the Florida Supreme Court reviewed this Fifth District Court of Appeals decision and found that whether the attorney-client privilege protects a party from being required to disclose that his or her attorney referred the party to a physician for treatment implicates confidential communication between the attorney and the client and is therefore protected. This issue is sure to receive additional judicial scrutiny in the future.

To understand how letters of protection are utilized it is also important to understand how the collateral source rule works in Florida. Following a jury verdict, a trial court must reduce jury awards for medical damages by the amount that is being paid for the benefit of the claimant, or which are otherwise available to the claimant from all collateral sources. Meaning that if the plaintiff’s medical expenses incurred following an injury were covered by other available insurance, the damage award should be reduced by the amount paid by the collateral source. This rule was created in an attempt to reduce insurance costs and prevent windfall judgments. Although the set-off must occur, the payments from the collateral source benefit are not admissible at trial. It is thought that allowing such evidence would confuse the jury as to liability and damages.

Typically, contractual discounts fit within the statutory definition of collateral sources.[1] Therefore, where a medical provider bills for services at one amount but negotiates with an insurer for the payment of a decreased amount, the negotiated decreased amount is the amount used for the set-off. In Gobel, the hospital charged $574,554.31. However, due to pre-existing fee schedules between the medical provider and what the health insurer paid, and the hospital accepted less, $145,970.76. This difference between what was billed and the amount accepted shows how the amount charged is not always related to the amount of medical provider expects to receive payment or will accept in full payment for the medical services

In Florida, the Collateral Source Rule forbids negligent parties from paying less in damages simply because a third party has already compensated the injured person. As such, under the collateral source rule, health insurance payments and other sources of compensation do not affect the defendant’s liability. Generally, courts do not admit evidence of any plaintiff’s health insurance to allow the plaintiff to recover the full extent of the plaintiff’s damages.

Florida Statute 768.76(2) (a) defines Collateral Sources as “payments made to the claimant.” Therefore, letters of protection, which merely deferred payment until after settlement/judgment, the amount negotiated in a letter of protection is not considered a collateral source and are therefore not subject to collateral source reductions post-judgment.

Understanding letters of protection and how they are utilized many times in litigation will help understand how the “business” of personal injury litigation occurs. This will allow for a better understanding of how medical charges can be manipulated and utilized at trial in an attempt to increase settlements and judgments by plaintiff attorneys.

[1] Joerg v. State Farm, 176 So. 3d 1247, 1249 (Fla. 2015) citing Gobel v Froham, 901 So. 2d 830, 833 (Fla. 2001)

 

Filed under Personal Injury Protection (PIP)

Possible Changes to Florida Damages Statute: Florida Statute 768.042 in Personal Injury Cases

Jurys often time struggle with calculating future medical expenses to award or not to award during jury deliberations. Florida law restricts recovery of future medical expenses to those expenses “reasonably certain” to be incurred. [1] At trial, a jury must be offered evidence which reasonably supports that future medical services are reasonably certain to occur. Awarding damages for future medical expenses cannot be grounded on the mere possibility that certain treatment might be obtained in the future. [2]

Further, a jury must be provided evidence that is reasonably certain to allow a jury to determine the amount of those expenses. In proving special [past] medical damages for personal injuries, proof should be offered (1) that the medical services were rendered, (2) what the reasonable charges are therefor, (3) that the services for which they were rendered were necessary, and (4) that they were related to the trauma suffered in the accident. Florida law restricts recovery of future medical expenses to those expenses “reasonably certain” to be incurred. [3] At trial, a jury must be offered evidence which reasonably supports that future medical services are reasonably certain to occur. Awarding damages for future medical expenses cannot be grounded on the mere possibility that certain treatment might be obtained in the future. [4]

Florida Standard Jury Instruction 501.2(b) provides the basis of how a jury is to award damages for medical expenses. Specifically, Florida Standard Jury Instruction 501.2(b) states:

b. Medical expenses:

Care and treatment of claimant:

The reasonable [value] [or] [expense] of [hospitalization and] medical [in nursing] care and treatment necessarily or reasonably obtained by (claimant) in the past [or to be so obtained in the future].

Recently, House Bill 9/Senate Bill 1668 was offered to require certain medical expenses in personal injury claims be based on certain usual & customary amounts received. Should this bill become law, a jury will be allowed to rely upon usual and customary charges as evidence to be utilized as a way to calculate past, present, or future medical expenses. Currently, Florida Statute 768.042 states:

768.042 Damages-

(1) In any action brought in the Circuit Court to recover damages for personal injury or wrongful death, the amount of general damages shall not be stated in the complaint, but the amount of special damages, if any, may be specifically pleaded and the requisite jurisdictional amount established for filing in any court of competent jurisdiction.

However, should House Bill 9/Senate Bill 1668 become law, the following will be added as subsection 2 to Florida Statute 768.042:

(2) In any claim for damages related to personal injury to the claimant, evidence regarding the past, present, or future medical expenses must be based on the usual and customary charges of the community where the medical expenses are or are reasonably probable to be, incurred. With respect to past and present medical expenses, if the claimant is entitled to be reimbursed to any public or private health insurance or governmental health coverage, the amounts paid or payable under the insurance or governmental health coverage shall be presumed to be the usual and customary medical charges, unless the claimant shows that such amounts are inadequate under the circumstances. With respect to damages for future medical expenses, evidence of the availability of private or public health insurance coverage may be considered along with other relevant evidence. Usual and customary charges may not include increased or additional charges based on the outcome of the litigation.

As outlined in the January 28, 2020 Bill Analysis and Fiscal Impact Statement concerning Senate Bill 1668, this bill would require that in any claim for damages for personal injury to a claimant, evidence of past, present, or future medical expenses would have to be based on the usual and customary charges in the community where the medical expenses were incurred.

Currently, jury’s rely upon evidence of past expenses and testimony from experts as to reasonably certain procedures which are alleged needed as evidence of what future medical expenses it should award. This proposed new methodology of calculating future medical expenses is consistent with the current Florida methodology for calculating PIP reimbursement under Florida No-Fault Law, which also requires a determination of costs based on usual and customary charges in the community. This bill would prevent utilization of evidence of cost which had been inflated in anticipation of the jury award that may be larger than the amount insurers are typically willing to pay and larger than amounts healthcare providers typically accept. As a result, this will decrease the opportunity for plaintiffs to present evidence of inflated costs through the use of a letter of protection.

[1]Loftin v. Wilson, 67 So. 2d 185,188 (Fla 1953)

[2] White v. Westlund, 624 So. 2d 185, 188 (Fla. 4th DCA 1993)

[3] Loftin v. Wilson, 67 So. 2d 185,188 (Fla 1953)

[4] White v. Westlund, 624 So. 2d 185, 188 (Fla. 4th DCA 1993). Crowe v. Overland Hauling, Inc., 245 So. 2d 654, 656 (Fla. 4th DCA 1971) (quoting Ratay v. Yu Chen Liu, 260 A. 2d 484, 486 (Pa. Superior, 1969).

Filed under Legislation, Personal Injury Protection (PIP)

Tallahassee Doctor Accused of Billing Insurers for Phony Medical Procedures

Dr. Moses D. Degraft-Johnson of the Heart and Vascular Institute of Northern Florida in Tallahassee is accused of taking $26 million from health insurance agencies for phony medical procedures. According to federal prosecutors, Dr. Degraft-Johnson allegedly went to hospitals, scheduled patients for unnecessary visits, and billed for the services that never occurred. In some cases, the doctor was traveling when he claims to have done procedures in his office.

Click here to read the article.

Filed under Fraud, Healthcare

FL Insurance Industry Pushes for Lawsuit Abuse Reform in 2020 Legislative Session

Florida’s insurance industry and consumer advocates are pushing lawmakers to consider reforms that would curb lawsuit abuses that clog the state’s legal system and hurt insurers’ bottom lines. During the last legislative session, lawmakers for passed AOB reform legislation that has led to lower rates for Citizens Property Insurance Corporation policyholders. Governor Ron DeSantis urged Florida lawmakers to target other lawsuit abuses.

Click here to read the article.

Filed under Legislation

Insurance Bills to Watch for the 2020 Legislative Session in Florida

Several key insurance-related bills were introduced in this year’s Legislative Session, including reform for auto glass (windshield), assignment of benefits (AOB) abuse, reforms to the state’s legal system, and changes to the Florida Hurricane Catastrophe Fund.

Here are a few more bills to keep an eye on:

  • CS/SB 292: Insurance Claims Data
  • SB 898/HB 529: Insurance Guaranty Associations
  • HB 329/SB 540: Insurance Guaranty Associations
  • HB 359: Insurance (General)
  • SB 378: Motor Vehicle Insurance (Personal Injury Protection)
  • HB 771: Motor Vehicle Insurance (Personal Injury Protection)
  • HB 895: Insurance
  • SB 904: Sinkhole and Catastrophic Ground Cover Collapse Insurance
  • HB 963/SB 1670: Consumer Data Privacy
  • HB 1137/SB 1492: Consumer Protection
  • SB 1204: Citizens Property Insurance Corporation
  • Senate Joint Resolution 1460: Commissioner of Insurance
  • SB 1494: Insurance Coverage for Condominium Unit Owners
  • HB359/SB 1334: Financial Services

Click here to read the article.

Filed under Legislation

Farmers Insurance Now Covering Rideshare Drivers in 14 States

Farmers Insurance now provides commercial auto insurance to its Uber drivers in the District of Columbia, Delaware, Hawaii, Indiana, Iowa, Kansas, Maryland, Missouri, Nebraska, North Dakota, South Dakota, Virginia, and West Virginia. Ridesharing drivers in Pennsylvania and Georgia were already covered.

Farmers is the second insurer to announce the expansion of its relationship with Uber. Liberty Mutual started covering Uber drivers and passengers on December 31, 2019.

Click here to read the article.

Filed under Personal Injury Protection (PIP), Technology

Roig Lawyers Complimentary Webinar – Insurance Bad Faith 101

We are pleased to announce our first CE Webinar for 2020!

Bad Faith 101 SM

Tampa attorneys Amanda Kidd and Stephanie McQueen-Zehm will present “Insurance Bad Faith 101” on Wednesday, February 12th, at 1:00 pm.  This course will provide an introduction to insurance bad faith claims and more.

This CE is approved for 1 credit for Florida adjusters.

REGISTER NOW!

Filed under Firm News

How The Rise of Autonomous Vehicles Will Impact Auto Insurance

Understanding the future of insurance in a world of autonomous vehicles is highly relevant for insurance carriers today. Auto insurance, like cyber insurance and new parametric products, will impact traditional lines of business with the rise of autonomous vehicle technology. Most carrier executives point to it as the industry’s key prospective destabilizer.

Click here to read the article. (Subscription may be required.)

Filed under Technology

Insurance and Tort Case Law Update Published in Trial Advocate

Check out the Insurance and Tort Case Law Update by Tampa Partner, Miguel Roura and John Miller (Henderson, Franklin, Starnes & Holt, P.A.) published in FDLA’s Trial Advocate.

TA 2019 Vol 38 No 3 - web

The Insurance and Tort Case Law Update was originally presented by Miguel and John at the 2019 Florida Liability Claims Conference.

Click here for FDLA’s Trial Advocate.

 

Filed under Firm News, Personal Injury Protection (PIP)

Florida Panhandle Struggles to Recover from Hurricane Michael

Thousands are still struggling to recover from Hurricane Michael in the Florida Panhandle. The Category 5 storm left 22,000 of Bay County’s residents homeless and few affordable living spaces available. With nearly $7 billion in total insurance losses, about 1 in 6 insurance claims remain unresolved. There is reportedly a mental health crisis and a shortage of healthcare professionals as well.

Click here to read the article.

Filed under Hurricanes, Property (Homeowners)