Tag Archives: PIP Claims

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)

Florida Doctor Arrested for Allegedly Defrauding Nine Auto Insurers

According to a statement from the Florida Department of Financial Services, Dr. Celestino Santi was arrested for allegedly defrauding nine auto insurance companies our of more than $500,000 in unlicensed medical billing.

Investigators reveal that Santi was allegedly acting as a “straw owner” of Accident Care Center of Boggy Creek to disguise the identity of the unlicensed, true owner of the motor vehicle accident medical treatment center.

Click here to read the article.

Filed under Fraud, Personal Injury Protection (PIP)

Roig Lawyers Complimentary Webinar – Injections Don’t Need To Be Painful

Injections SM - 5

We are pleased to announce a webinar perfect for October, “Injections Don’t Have to be Painful” presented by Orlando Managing Partner Scharome Wolfe. The webinar will take place on Tuesday, October 29th at 1:00 pm. This course explores the use of injections by pain management physicians and their teams.

This CE is approved for 1 credit for Florida adjusters.

REGISTER NOW!

Filed under Firm News

Three Miami Arrests in Physical Therapy Clinic PIP Fraud Scheme

Three individuals from the Miami physical therapy clinic Professional Medical Practice have been arrested in an alleged personal injury protection (PIP) fraud scheme. The clinic owner Alean Machado, recruiter Barbarito Leyva-Claro, and physical therapist Yoandra Rodriguez-Pena were charged with Insurance Fraud, Grand Theft, Patient Brokering and Organized Scheme to Defraud.

An undercover investigation uncovered the scheme which paid $2,500 for patients that participated in the fraudulent physical therapy sessions. Two insurance companies were billed over $39,000 in fraudulent claims from the clinic. Machado, Rodriguez-Pena and Leyva-Claro could face up to 45 years in prison if proven guilty.

Click here to read the article.

Filed under Fraud, Personal Injury Protection (PIP)

UPDATE: Ringleader Pleads Guilty To His Role In $23 Million Auto Insurance Fraud Crime Ring

Andrew Rubinstein of Miami and the self-confessed ringleader, Felix Filenger of Sunny Isles pleaded guilty to a racketeering conspiracy charge last year. Rubinstein and Filenger were paying kickbacks to tow truck drivers and body shop workers who illegally steered accident victims to chiropractic clinics they owned at a rate of $1,500 to $2,000 per “patient.” Clinic workers would then have patients attend multiple visits, document exaggerated pain levels, and bill insurance providers for treatment in the amount of $10,000, the maximum allowed under Florida law.

According to Prosecutors, the clinics were located throughout south and central Florida, including Sunrise, Hollywood, Hallandale Beach, Pompano Beach, Delray Beach, West Palm Beach, Miami, Orlando and Kissimmee.

Under the terms of his plea agreement, both sides had agreed to recommend the six-year sentence for Rubinstein. Filenger’s sentencing has been postponed. Several other people who also admitted their roles in the fraud are scheduled for sentencing later this year.

Click here to view the full article. (Previous post)

Filed under Fraud, Personal Injury Protection (PIP)

ROIG Attorneys Publish Ridesharing Article in Daily Business Review

ROIG Lawyers Attorneys Cecile S. Mendizabal and Lissette M. Alvarez published the article, “Ridesharing Legislation May Trigger New Wave of Litigation” in the Daily Business Review.

ROIG Lawyers Summer Law Clerk Yasbel Perez also contributed to the article.

Subscription required for full article.

Filed under Legislation, Personal Injury Protection (PIP)

Florida’s Third District Court of Appeal Retroactively Applies Allstate PIP Decision

According to Law360, on Wednesday, April 19th Florida’s Third District Court of Appeal retroactively applied a state Supreme Court decision involving Allstate Insurance Co.’s personal injury protection policy language regarding the use of the Medicare fee schedules, overriding a lower court’s ruling and handing Allstate the win. After denying the insurer’s request for review of a circuit court appellate division’s ruling in favor of medical provider Hallandale Open MRI LLC last September, the court reversed course, applying the Supreme Court’s January decision in Allstate v. Orthopedic Specialists.

Click here to read the full article (subscription required).

Filed under Legislation

Geico Sues Florida Health Clinic for ‘Unnecessary’ Massage Claims

As reported by Law360, Geico sued Medical Wellness Services Inc. of Miami, FL for allegedly making $1.2 million in claims for providing medically unnecessary treatments for automobile accident victims who were eligible for coverage under their no-fault insurance policies. According to Geico, some of the claims were for services that were not actually provided and contained billing codes that misrepresented and exaggerated the services.

“The defendants do not now have — and never had — any right to be compensated for the fraudulent services that were billed to Geico through Medical Wellness,” Geico said. Geico claims Medical Wellness Services Inc. submitted claims for massage therapist services which are not reimbursable because Florida law prohibits no-fault insurance reimbursement for massages or other similar services.

According to the suit, the scheme began no later than 2013 and continues to this day. In addition to the request for $1.2 million in damages, Geico is also requesting a declaration from the court saying it will not have to pay any pending fraudulent claims by the health clinic which totals more than $75,000.

Click here for the full story (subscription required).

Filed under Personal Injury Protection (PIP)

Sunny South Florida, Out-of-State College Students and the question of Vehicle Insurance Coverage

Spring Break, a time where college students from all over the Country flock down to Florida, known by many as the “Spring Break Capital of the World”, looking to have some fun in the sun.

Florida has many Universities, Colleges and other institutions of higher learning that welcome students from other States to attend.

So the question is, does an out-of-state student who attends University or College in Florida for 2 or 4 years now become a resident of Florida because they have decided to live in Florida during this time? Is that out-of-state student now required to register and license their out-of-state vehicle in Florida and obtain the minimum Florida automobile insurance coverage on that vehicle which is $10,000.00 in Personal Injury Protection and $10,000.00 in Property Damage Liability?

Well yes and no.

If the out-of-state student is planning to domicile themselves in Florida then they are required to license their vehicle in Florida and obtain the minimum insurance in order to operate that vehicle on the roads and highways of the State.

However, if the student maintains their residence in another State while they are enrolled as a full-time student in an “institution of higher learning”, then they are exempt from licensing their vehicle and obtaining the minimum insurance on that vehicle during the duration of their enrollment, as long as they have complied with the licensing and insurance requirements of the State for which they are a resident. One less thing for parents to worry about when they watch their babies leave the nest for the first time.

However, what constitutes an “institution of higher learning”.

The Merriam-Webster Dictionary® defines this term as “a college or university”. But what about a trade school, vocational school or cosmetology school? The Federal Government generally defines an ”institution of higher education” as a public or nonprofit educational institution who only admits students who have a high school diploma or have a recognized equivalent certificate such as a General Educational Diploma (GED); is accredited or has pre-accreditation status; awards a Bachelor’s Degree or a 2-years Associates Degree; or, any school that provides not less than a 1-year training program beyond High School, to prepare students for gainful employment in a recognized occupation.[1]

These are inquiries that an insurance company must properly investigate in an automobile accident claim involving a nonresident student in order to determine whether they would be exempt from maintaining the minimum Florida insurance on their vehicle while in Florida or if the insurer may be required to extend that student the minimum insurance under Florida law.

So would your insured qualify for the exemption as a nonresident student?

This article is not intended to create an attorney-client relationship by offering this information, and anyone’s review of the information shall not be deemed to create such a relationship. The content provided is intended to provide information of general interest to the public and is not intended to offer legal advice about specific situations or problems. You should consult a lawyer with regard to specific law issues that requires attention.

For additional information, please contact Stephen Mellor of Roig Lawyers at 954-354-1541 or by email at smellor@roiglawyers.com. Stephen G. Mellor is a partner in the Deerfield Beach office of Roig Lawyers who primarily focuses on out-of-state policy claims for insurance carriers. 

[1] 20 U.S. Code § 1001

Filed under Personal Injury Protection (PIP)

Will You Have Coverage When You Cross The Line?

Is an automobile insurance company required to extend Florida Personal Injury Protection (PIP) benefits to an insured who resides in another state?

Well yes and no.

An automobile insurer who sells automobile insurance policies in Florida and the nonresident insured’s state is required to extend the minimum Florida Personal Injury Protection (PIP) benefits of $10,000.00 to the insured if they are involved in a motor vehicle accident in Florida, but only if they qualify under Florida law.

To qualify, the nonresident insured’s vehicle must have been physically located in Florida for 90 nonconsecutive days out of the previous 365 days from the date of the accident. By nonconsecutive days, it means that the insured vehicle could leave Florida and re-enter and still qualify for Florida PIP benefits if the vehicle has been in Florida for longer than 90 days throughout that preceding year.

An insurer is not required to extend the $10,000.00 in Florida PIP benefits to a nonresident insured whose vehicle is not in Florida for longer than 90 nonconsecutive days out of the previous 365 days from the date of the accident.

Most if not all automobile insurance policies have an “Out-of-State Coverage” provision which will detail that insurer’s obligation to comply with a State’s minimum insurance requirements if their nonresident insured becomes subject to the insurance laws of that State. However, some insurance contracts make it the responsibility of the nonresident insured and not the insurer to purchase the required minimum Florida PIP coverage if they plan to stay in Florida for longer than 90-days.

An insurer is not required to extend additional Florida PIP benefits to a nonresident insured that enters Florida and whose insurance policy meets the States minimum PIP or No-Fault requirements.

For Example:

The New York Automobile No-Fault Law requires each insured to carry a minimum of $50,000.00 in No-Fault/ PIP benefits. Thus, if a New York resident drives their vehicle into Florida and is involved in a motor vehicle accident, then they will receive the $50,000.00 in New York PIP benefits as this is greater coverage than the minimum $10,000.00 in PIP benefits which is required under Florida law.

This article is not intended to create an attorney-client relationship by offering this information, and anyone’s review of the information shall not be deemed to create such a relationship. The content provided is intended to provide information of general interest to the public and is not intended to offer legal advice about specific situations or problems. You should consult a lawyer with regard to specific law issues that requires attention.

For additional information please contact Stephen Mellor of Roig Lawyers at 954-354-1541 or by email at smellor@roiglawyers.com.

Filed under Personal Injury Protection (PIP)