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YOUR NO-PAY STATUTE HAS FLORIDA'

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YOUR NO-PAY STATUTE HAS FLORIDA' Powered By Docstoc
					THE ERA OF THE PAPER IMEs: HAS FLORIDA’S NO-FAULT LAW
BECOME UNCONSTITUTIONAL?
                                          WOODY R. CLERMONT


        In 1971, Florida made monumental changes in the way that automobile insurance claims were

handled; the Legislature enacted the Automobile Reparations Reform Act.1 The purpose of this act was

to provide Floridians with No-Fault insurance that would provide swift payments of certain types of

claims, without regard to fault. Written into the statute for the benefit of the insurers, was a section

designed to control the cost of PIP claims, known as an independent medical examination (“IME”),

contained in section 627.736(7)(a).2 Insurers could require their insured to attend a compulsory medical

examination with a doctor of their choosing. If an insured unreasonably refused to attend, an insurer

could withdraw from providing and would no longer be liable for subsequent benefits under section

627.736(7)(b).3

        However the submission of the bills by treatment providers using a practice known as bulk

billing, deprived many insurance companies of their opportunity to obtain the proof they needed to

contest the validity of any rendered treatment and their statutory rights to rescind coverage, due to an

insured‟s unreasonable failure to cooperate with the IME requirement. In response to an increasingly

powerful insurance lobby, the PIP statute has been amended numerous times over the years, placing

greater and greater restrictions on treatment providers to curb these abusive practices.4 Some of these

reactionary changes have led to dramatic improvements,5 and others have called into question whether the

No-Fault law truly still serves its original purpose and remains constitutional.6

        At the present, only twelve states mandate no fault insurance: Delaware, Florida, Hawaii, Kansas,

Massachusetts, Michigan, Minnesota, New York, North Dakota, Oregon, Utah and Texas.7 No-Fault

insurance may be rejected by motorists in the “choice” states of Kentucky, Pennsylvania and New

Jersey.8 Could there be a reason why thirty-five other states, choose not to offer no-fault insurance at all?



                                                      1
Perhaps Florida motor vehicle owners may find that the current quid pro quo, is not what Floridians

originally “bargained” for; with the advent of legislative and judicial approval of insurers coming to rely

on “paper IMEs,” PIP could be a unconstitutional deprivation of certain rights and be a far cry from the

great expectations that proponents and reformers once held.


                                       The Origins of Florida PIP

        In 1971, Massachusetts became the first state to pass legislation that brought No-Fault automobile

insurance to its citizens. Later that year, Florida became the second state to do so.9 After this time, as

many as twenty states came to require no-fault insurance, but five subsequently went on to repeal those

requirements.10 The Florida Legislature in coming to its decision to provide no-fault insurance for Florida

citizens elected to do so to accomplish several public policy goals: (1) to assure that persons injured in

vehicular accidents would be directly compensated by their own insurer, even if the injured party was at

fault;11 (2) to lessen court congestion and delays in court calendars by limiting the number of law suits; 12
                                                                            13
(3) to end the inequities of recovery under the traditional tort system;         and (4) to lower automobile

insurance premiums.14

        In exchange, an accompanying tort exemption was enacted.15 This exemption would allow

liability insurers to strike down any claims for reimbursement of bills for medical treatment rendered

greater than 20%, and claims for non-economic damages (pain and suffering) submitted to carriers under

the bodily injury (“BI”) portion of the liability policy, that could not pass a threshold requirement. 16 In

1971, the Legislature, had similarly attempted to create no-fault insurance with respect to claims for

property damage (“PD”).17

        The Florida Supreme Court addressed the constitutionality of this statute in the case of Kluger v.

White, 281 So. 2d 1 (Fla. 1973). The provisions of section 627.783, provided that motorists could elect

basic coverage (liability only) and full coverage (liability and no-fault insurance).18 A damaged party

involved in an automobile accident could not pursue a PD claim against an at-fault tortfeasor unless the


                                                     2
amount of damages exceeded $550.00.19 Kluger‟s car would cost $774.95 to repair, but that exceeded the

fair market value (“FMV”) of the car, which was only $250.00.20 Her damages had to be limited to the

FMV by law,21 and thus were below the monetary threshold, barring her recovery.22 The Florida Supreme

Court held that depriving her of due process accordable to the $250.00 FMV amount violated her equal

protection rights under article I, section 2 of the Florida Constitution, and the amendment XIV, section 1

of the U.S. Constitution. In so doing, the Legislature deprived her of access to courts under the Florida

Constitution, article I, section 21.23 The Florida Supreme Court subsequently held that section 627.738

was unconstitutional as written, because the Legislature eliminated a constitutionally protected remedy

without providing a reasonable alternative.24

        In Lasky v. State Farm Ins. Co., 296 So. 2d 9 (Fla. 1974), appellants raised similar arguments

contending they were deprived of their rights guaranteed under the Florida and U.S. Constitutions,

because sections 627.736 and 627.737 denied the parties access to courts -- a violation against equal

protection. Nonetheless, the Florida Supreme Court upheld the constitutionality of the Florida No-Fault

PIP law.25 To do so, the Court struck the portion of the statute, which imposed a $1,000.00 threshold.26

In this way, it was able to distinguish its treatment of PIP law from Kluger.27 The Court held that “[i]n

exchange for the loss of a former right to recover-upon proving the other party to be at fault-for pain and

suffering, etc., in cases where the thresholds of the statute are not met, the injured party is assured a

speedy payment of his medical bills and compensation for lost income from his own insurer, even where

the injured party was himself clearly at fault.”28 In so doing, the Florida Supreme Court sent a clear

signal to the public: PIP is constitutional and it is here to stay.29

        The First District Court of Appeal, in Dunmore v. Interstate Fire Ins. Co., 301 So. 2d 502 (Fla.

1st Dist. Ct. App. 1974), rightfully recognized that the quid pro quo turned on the assurance of a swift and

speedy payment of medical bills and lost wages. Dunmore had submitted an application for PIP benefits,

but the insurer denied the claim.30 Dunmore filed suit and secured a default judgment, which was later set




                                                         3
aside by the trial court.31 The insurer acknowledged that it was responsible for making the payments but

argued that attorney‟s fees, as provided for by section 627.736 were not due.32 The district court held that

the insurer was responsible for the paying the attorney‟s fees and costs as “[t]o rule otherwise would

render the recently enacted „no-fault‟ insurance statute a „no-pay‟ plan-a result we are sure was not

intended by the legislature.33 For nearly three decades that would follow, it would seem that the decisions

of the Florida courts had followed in line with Dunmore‟s reasoning that a reasonable alternative to the

rights that Florida citizens lost, required that PIP did not devolve into a „no-pay‟ plan.


                                 The Initial Prohibition Against ‘No Pay’

        The Third District Court of Appeal in Government Employees Ins. Co. v. Gonzalez, 512 So. 2d

269 (Fla. 3d Dist. Ct. App. 1987), continued to reiterate the mandate that an insurer cannot avoid its

burden to pay claims timely. Gonzalez had been seriously hurt in an automobile crash, and the hospital

had a lien for its bills, but Gonzalez‟s attorney requested GEICO reserve the entirety of the $10,000.00 in

PIP benefits for the payment of Gonzalez‟s lost wages.34 GEICO could not disregard a hospital lien,35 nor

could it disregard a request to reserve benefits for lost wages.36 The district court observed that GEICO

could have made a check payable to both insured and hospital37 or filed an interpleader action within the

30 days,38 to resolve the dilemma.39 The Third District concluded that the purpose of the legislative

scheme is to “provide swift and virtually automatic payment so that the injured insured may get on with

his life without undue financial interruption” and that an insurer “cannot be permitted simply to stonewall

its insured by retaining-and drawing interest upon-payments to which it is admittedly not entitled.”40

        Eight years later, in Crooks v. State Farm Mut. Auto. Ins. Co., 659 So. 2d 1266, 1268 (Fla. 3d

Dist. Ct. App. 1995), the Third District was faced with a situation where a pedestrian (bicyclist) had been

struck by a PIP insured motor vehicle on the streets of Miami Beach. State Farm refused to honor the

claim, insisting that Crooks submit an approved “in house” PIP application form that State Farm. Crooks

filed suit after three months, and State Farm paid the claim thereafter. Citing Dunmore, the Third District


                                                       4
held that creating an exception by allowing State Farm to refuse to recognize the claim for failure to use

its approved form, contravened the intent of the statute which is to “guarantee swift payment of PIP

benefits.”41

        The Fourth District Court of Appeal, in Martinez v. Fortune Ins. Co., 684 So. 2d 201, 202 (Fla.

4th Dist. Ct. App. 1996), tackled the question of whether the portion of section 627.736(4)(b) referring to

PIP benefits being “overdue if not paid within 30 days after the insurer is furnished written notice of the

fact of a covered loss,” meant that an insurer could delay paying a wage loss claim by demanding medical

verification from the treating physician, even though written notice had been furnished. The district court

noted that section 627.736 had been amended 25 times since 1971.42 The district court in discussing the

rationale of the decisions in Dunmore and Crooks, held that this portion of the statute had remained intact,

and that “the implied adoption by the legislature of the interpretation established in Dunmore is the most

persuasive evidence of what the legislature intended.”43

        In Amador v. United Auto. Ins. Co., 748 So. 2d 307 (Fla. 3d Dist. Ct. App. 1999), United

Automobile Insurance Company (“United Auto”) sought to bypass the 30-day deadline provision by

scheduling an examination under oath (“EUO”) well after the elapse of 30 days. The insured did not

attend and filed suit.44 United Auto contended that on the authority of the Fourth District‟s decision in

Willis v. Huff, 736 So. 2d 1272 (Fla. 4th Dist. Ct. App. 1999), that an EUO is a condition precedent to

coverage and that the insured was barred from filing a lawsuit due to his failure to comply with the EUO

condition.45 United Auto also attempted to argue that its policy defined the meaning of “reasonable

proof.”46

        The district court disagreed and cited to the precedent decisions of Dunmore and Crooks.47 It

held that while an EUO is a condition precedent to coverage, that under the facts of this case, an insurer‟s

late request for an EUO could not be used to toll the deadline which had already passed, because this

would allow an insurer to use “investigative rights to extend the 30-day period without reasonable proof




                                                     5
that it is not responsible for the claim.”48 However it should be noted that a recent decision has

questioned the validity of EUOs altogether in the context of PIP claims.49

          Thus from 1974 to 2000, twenty-six years had passed since the statute had been held

constitutional. Relying on Dunmore, the courts seemed to remain committed to the prohibition against

any interpretation of section 627.736 that would turn PIP into a no-pay plan.50 That opinion would soon

change.

                                           The Dramatic Changes in PIP

          Between the 1970‟s and the early part of the 1990s, because the “reasonable proof” in section

627.736(4)(b),51 had not been well defined, the option an insurer initially had to attempt to control the

cost of PIP claims, was to resort to the use of an independent medical examination (“IME”), provided for

in section 627.736(7).52 If an insured unreasonably refused to attend, an insurer would no longer be liable

for subsequent benefits. 53 Lobbying on the part of the medical providers resulted in the 1987 amendment

to section 627.736(7)(a), which specified that insurers could only “withdraw” payment after obtaining a

medical report based on a physical examination of the insured by a physician licensed under the same

chapter (specialty) at the treating physician.54

          Other medical providers would resort to bulk billing to skirt the effects of IME provision

altogether, by treating the insured for amounts near the policy limits, and then submitting the bills all at

once before an insurer was notified of the loss.55 This deprived the insurance companies of their

opportunity to obtain the proof they needed to contest the validity of treatment 56 and their rights to deny a

claim altogether, for an insured‟s unreasonable failure to comply with the IME requirement. 57 As a result

of successful lobbying by the insurance industry, with the goal of stamping out this practice, the

Legislature amended section 627.736 in 1998, to include a section which required that bills be submitted

to an insurer within 35 days of treatment rendered or they will never be paid.58 The grace period will




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increase from 35 days to 75 days, if a notice of treatment is sent to the carrier within 21 days of the

initiation of treatment.59

        The most significant legislative reforms occurred in 2001 and 2003, as major changes were

instituted to curb other undesired practices on the part of claimants, medical providers and their

attorneys.60 For example, PIP payments that are late, are owed with interest prescribed by statute.61

Sometimes, the attorney of an insured or a provider would bring a lawsuit, seeking thousands of dollars in

attorney‟s fees, over a miscalculated payment that was short less than three dollars,62 more than likely due

to a mathematical error on the interest. Additionally, some providers inflated billing by referring patients

to unnecessary diagnostic procedures and testing.63 In some cases of PIP fraud, claimants had never seen

the doctors, having been solicited by runners, and phony patient logs were submitted to give the

appearance to the insurer that the patient had been physically present and receiving the treatment the

medical providers billed for.64 The amendments addressed these matters in part.65

        Arguably, the most startling change, was to section 627.736(4)(b): an amendment to its language

changed the interpretation of when an insurer had to have reasonable proof that it did not owe the claim. 66

The opinion of the Fifth District Court of Appeal, in Jones v. State Farm Mut. Auto. Ins. Co., 694 So. 2d

165, 166 (Fla. 5th Dist. Ct. App. 1997), became one of the first decisions which departed from the

direction in Dunmore. In Jones, State Farm questioned the necessity of a surgery the plaintiff Jones had

undergone and set him for an IME.67 While the Fifth District agreed that State Farm did not have the

reasonable proof it needed to contest the claim within the 30-day period, it concluded that failure to obtain

this proof did not forever bar the insurer from being able to contest the claim at a later time. It reversed

and remanded the matter for further proceedings as to whether Jones could be required to attend an IME

in a location not provided for, by statute.

        Nonetheless, the Fourth District Court of Appeals began to agree with the reasoning in Jones.68

The First District Court of Appeals aligned itself with the Fourth and Fifth District.69 The Second District




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and Third District Courts of Appeals however, adamantly resisted this interpretation in contrast and

conflicted with its sister district courts.70 The conflict was certified, and the Florida Supreme Court

quashed the decision of the Third District and agreed with the holding in Jones, that failure to obtain

reasonable proof in 30 days, does not bar an insurer from the right to contest the claim at a later time. 71

The effect of this change, which was subsequently legislatively incorporated into the statute, was

dramatic.72 This development begs the question: is PIP still constitutional?

                  The Differences Between Sections 627.736(4)(B) and 627.736(7)(A)

        Unlike section 627.736(7)(a), an insurer relying on section 627.736(4)(b) could use a medical

doctor licensed under Chapter 458 to conduct a “peer review” of the medical bills of a chiropractor

licensed under Chapter 460. They could likewise use a neurologist licensed under Chapter 458 to review

the medical bills of an optometrist under Chapter 463. There is no prohibition in place, to limit one type

of specialist from reviewing the treatment rendered by another type of specialist.73 No court to date, has

ruled that the use of experts outside of the treating physician‟s specialty, cannot constitute “reasonable

proof” as a matter of law. The issue seems to be one of first impression as of the writing of this article.

        Unfortunately, although such a requirement appears in section 627.736(7)(a), that a reviewing

physician be of the same licensing chapter as the physician whose bills are in question, no such

requirement appears in § 627.736(4)(b). Since the Florida Legislature could have included such language

in section 627.736(4)(b), and being as no “valid report” is required, then it stands to reason under the

statutory rule of construction expressio unius est exclusio alterius, that no chapter licensing restriction

applies to a reduction or denial based on reasonable proof that treatment rendered is not RRN.74

        Additionally where section 627.436(4)(b) is used, “[t]he statute does not limit „reasonable proof‟

to a „medical report.‟”75 Whereas cases addressed under section 627.736(7)(a), do require a medical

report, specifically a “valid report.”76 “Subsection (7)(a) only requires that a valid report be obtained




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when further benefits are withdrawn” without the injured party‟s consent.77 Furthermore, “[w]ithdraw

means „to take back or away (something bestowed or possessed).‟”78

        In 2009, there were numerous cases in the district courts of appeal, which undertook a directed

effort to address conflicting decisions regarding section 627.736 in the circuit courts.79 Some of that

confusion arose from a misinterpretation of existing law precedent involving whether an insurer must

always obtain a physical examination pursuant to section 627.736(7)(a) before failing to make payments

on claims within 30 days of receipt.80 It would seem that “the thirty-day period in section 627.736(4)

applies only to benefits [that] are reasonable and necessary as a result of the accident.”81 The Third

District had begun to finally acknowledge, what other district courts and the Florida Supreme Court had

already held.

        As discussed in a prior section, in the Jones case in 1997, the Fifth District Court of Appeal, had

already held that even though it reversed the summary judgment, that the insurer did not “lose its right to

contest the claim.”82 The Fourth District subsequently held in 1998, that the 30-day provision only served

to make the insurer responsible for interest and attorney‟s fees and costs, not to waive its ability to defend

the claim. 83

        In 2000, the Fourth District additionally held that when an insurer that fails “to obtain proof that it

is not responsible for payment, [that] does not deprive the insurer of its right to contest payment.”84 In

2001, in the case of United Auto. Ins. Co. v. Rodriguez, 808 So. 2d 82, 83 (Fla. 2001), the Florida

Supreme Court reviewed two consolidated cases from the Third District Court of Appeal.85 The Florida

Supreme Court quashed the consolidated decision, concluding that the holding that “the insurer can no

longer contest the claim” when it fails to obtain reasonable proof within 30 days “violates the plain

language of the Law.”86

        The Rodriguez case confirmed the understanding of the approach of many district courts that had

always interpreted the statute as not shifting the evidentiary burden from the claimant-plaintiff to the




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insurer-defendant, contrary to the position advocated by some PIP litigators.87 As an extension of this

understanding, the Second District had held in 2008, that an insurer is not required to “first” obtain a

physical examination complying with section 627.736(7)(a) within 30 days, to reduce or deny payments

on services that are not RRN under section 627.736(4)(b).88 The Fourth District followed suit with a

similar position in 2009.89 In 2009, the Third District began to align itself with the other courts: an

insurer may at any time challenge whether treatment is RRN, and is permitted to rely on a report obtained

pursuant to section 627.736(7)(a) even when the report is obtained more than thirty days after the claim

was submitted.90 Thus, where some bills are being rejected by an insurer, section 627.736(4)(b) applies

and does not require insurers to have a “valid report” before denying payment. Some insurers do not

formally approve or authorize the course of treatment of the treating physician; therefore, the provisions

of section 627.736(7)(a) which deals with the withdrawal of benefits, often may not apply.91

        A number of the 2009 decisions of the Third District were appealed, on the grounds of an alleged

conflict with the Second District‟s decision in State Farm Mutual Auto. Ins. Co. v. Rhodes & Anderson,

D.C., P.A., 18 So. 3d 1059 (Fla. 2d Dist. Ct. App. 2008).92 Those cases are now pending review before

the Florida Supreme Court, and are subject to a stay,93 pending the determination of the Custer Medical

Center case.94 It is the hope of the affected PIP litigators, that they can convince the Court, that it is

possible for an insurer to waive the right to contest and defend the claims, due to a failure to obtain

reasonable proof properly within the 30-day time period, as well as an IME based on a physical

examination. However, based on the aforementioned case law,95 it does not seem likely that the Florida

Supreme Court will side with such arguments.

                                       Is PIP Unconstitutional?

        So now to answer, the question posed earlier. Does the existence of PIP result in a lessening of

the congestion of the court system? No, it does not, in fact, most of the reforms of PIP including the

requirement of the 15-day pre-suit demand letter, have unsuccessfully attempted to find ways to reduce




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the volume of PIP litigation, which consistently increases yearly.96 Has PIP resulted in a reduction of

automobile insurance premiums? No, in fact, statistics show that the Florida premiums for automobile

insurance, are rising and among the highest in the country.97 Additionally, there is evidence from

Colorado‟s repeal of its No-Fault law, that eliminating PIP would result in overall lowered automobile

insurance premiums.98 Has PIP eliminated inequalities of recovery? No, because if insurers are now

permitted to use their vast resources to steer PIP claims they refuse to pay, into litigation with the ability

to unilaterally reduce payment of benefits, negotiate the claims at a reduced settlement amount or prevail

at summary judgment or trial, how does this differ from the bargaining and litigation process that occurs

when medical bills are settled or litigated within the context of BI liability claims and tort lawsuits? 99

With the ability to contest the claim at any time, medical bills need no longer be paid timely. 100 The only

disincentive against this is the possibility an insurer will have to pay interest, penalties and attorney‟s

fees, but financially solvent insurance companies in Florida (the motto of one non-standard insurer which

was “Deny, Delay, Don‟t Pay”), have the tremendous resources necessary to do so.101

        Does PIP eliminate the necessity to bring a cause of action in many cases? As previously

mentioned, PIP litigation has steadily risen year after year (though reduced in part from 2004 onwards

due to statutory addition of the pre-suit filing requirements) and the ability of insurers to contest claims

without limitation, will continue to create increased need to bring causes of action to resolve PIP disputes.

Does PIP provide for prompt reimbursement of their most essential out-of-pocket losses? No, because

PIP benefits may be contested indefinitely and paid years later, only subject to the statutory penalties. 102

For example, a Target Market Conduct Examination performed by the Office of Insurance Regulation of a

non-standard insurer in Florida reported that, during 2002, the insurer received over 6,034 new open PIP

claims “but as of December 2003, only 88 of these claims had been paid.”103

        Therefore, it can be argued that the reasons articulated by the Florida Supreme Court in Lasky, no

longer exist and that the Florida No Fault law no longer serves a valid rational governmental purpose. 104




                                                     11
Lasky presumed these conditions to be true, because it claimed to have no evidence to the contrary.105 We

now have over thirty years of evidence with which, to prove that the presumptions articulated in Lasky are

presently invalid. After all, insurers are now free to retain a “hired gun” to prepare a report at any time;

this “hired gun” need not even be licensed under the same chapter as the treating physician, this “hired

gun” can review bills and reports years after treatment has been rendered in a fashion tantamount to a

“paper IME,” in order to defeat the insured‟s claim at trial.106

        In coming to this conclusion, this author does not make discount or make light of, the evils of PIP

fraud and abuse. Florida is facing a crisis in PIP with alarming concerns about ambulance chasing,

“swoop and squat” and other staged crashes, patients being solicited and brokered by medical

professionals, attorneys, cappers and runners, bulk, phony or inflated billing, unnecessary or inappropriate

diagnostic testing, and fraudulently trumped up lawsuits.107 However, there is evidence that part of this

fraud and abuse occurs due to the lure of PIP itself.108 “Costs associated with health care provider fraud

and abuse are likely to be reduced if no-fault is repealed, because this problem is primarily associated

with PIP claims, more so than liability claims.”109

         The Florida Supreme Court has made it abundantly clear, that when a right of redress in courts

pre-exists the adoption of the Declaration of Rights of Florida's Constitution, the Legislature cannot

abolish that right without providing a reasonable alternative. If the Legislature cannot do this, then it

must show an overpowering public necessity for its abolishment and no alternative method of meeting

such public necessity. Following this rule, it is this author‟s humble opinion that the Florida Supreme

Court should declare PIP unconstitutional if it differs from the extent of PIP coverage that existed at the

time of Lasky and Dunmore. If present day PIP payments are not swiftly delivered, then the public

necessity for the coverage itself will evaporate.




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                                                        Conclusion

           Floridians are guaranteed access to the courts by our Constitution. “The courts shall be open to

every person for redress of any injury, and justice shall be administered without sale, denial or delay.” 110

The No-Fault scheme withstood constitutional scrutiny because Floridians were provided with a

reasonable alternative in the past that bettered their position -- the automatic payment of PIP benefits. PIP

was constitutional only because the loss of rights in tort had been compensated for by the “swift and

virtually automatic payment so that the injured insured may get on with his life without undue financial

interruption.”111 “[T]he provisions of Florida's No-Fault Law that denied a plaintiff the right to sue unless

certain threshold damages existed was not a violation of access to courts because the right was replaced

with the ability to recover uncontested benefits and an exemption from tort liability.”112

           If the balance of power shifts too greatly towards insurers, they can easily recreate the harmful

inequality of recovery that the Lasky court thought the legislation intended to eliminate. The courts

should not simply uphold what may be tantamount to the Legislature‟s knee-jerk reaction to every

perceived dilemma in the insurance industry.113 The court “will become a court of men instead of a court

of law, guided by an alleged crisis instead of the wording of the Constitution.”114


1
    Fla. Laws 1971, ch. 71-252, § 7.
2
    FLA. STAT. § 627.736(7)(a) (1971).
3
    FLA. STAT. § 627.736(7)(b) (1971).
4
    Warren v. State Farm Mut. Auto. Ins. Co., 899 So. 2d 1090, 1096 (Fla. 2005).
5
    Id. (“We agree with the Fifth District that the Legislature's objectives of reducing bulk billing and ensuring that

charges covered under no-fault insurance are reasonable, necessary, and related to the motor vehicle accident are

permissible legislative objectives, and that those objectives are reasonably related to the thirty-day requirement

imposed upon certain medical providers.”)
6
    United Auto. Ins. Co. v. Rodriguez, 808 So. 2d 82, 92 (Fla. 2001) (Lewis, J., dissenting) (“Taken to its logical

conclusion, the majority's rationale belittles the protections afforded to those insured under the no-fault statute, and



                                                             13
equates statutory noncompliance by an insurer with a simple breach of contract. That is, the decision removes the

statutory mandate that insurers make timely and proper payments. The majority view today as enhanced by a

concurring opinion transforms the no-fault concept of benefits into just another form of health insurance and

disability insurance without limited time parameters to secure benefits for injured Floridians.”)
7
     Florida Senate Interim Project Report No. 2008-102, The Effect of Repealing the Florida No-Fault Law, at 8

(2007) [hereinafter Senate Interim Report No. 2008-102].
8
    Id.
9
     Florida Senate Interim Project Report No. 2006-102, Florida’s Motor Vehicle No-Fault Law at 1 (2005)

[hereinafter Senate Interim Report No. 2006-102].
10
     Nevada (repealed 1980); Pennsylvania (repealed 1984; reenacted 1990); Georgia (repealed 1991); Connecticut

(repealed 1993); and Colorado (repealed 2003).
11
     Fla. Laws 1971, ch. 71-252, § 7.
12
     See National Car Rental v. Sanchez, 349 So. 2d 829 (Fla. 3d Dist. Ct. App. 1977).
13
     Union American Ins. Co. v. Lee, 625 So. 2d 112 (Fla. 4th Dist. Ct. App. 1993).
14
     See Smiley v. Nelson, 805 So. 2d 870 (Fla. 2d Dist. Ct. App. 2001).
15
     Fla. Laws 1971, ch. 71-252, § 7.
16
     Hannah v. Newkirk, 675 So. 2d 112 (Fla. 1996).
17
     Fla. Laws 1971, ch. 71-252, § 7.
18
     Kluger, 281 So. 2d at 2.
19
     Id.
20
     Id.
21
     McDonald Air Conditioning, Inc. v. John Brown, Inc., 285 So. 2d 697 (Fla. 4th Dist. Ct. App. 1973).
22
     Id.
23
     Id. at 3-4.
24
     Id. at 5.
25
     Id. at 23.
26
     Id. at 20-21.
27
     Id. at 13-14, 22.


                                                           14
28
     Id. at 14-15.
29
     Id. at 21 (“If, when the unconstitutional part of a statute is stricken, that which remains is complete in itself and

capable of being executed in accordance with the apparent legislative intent, the valid portion of the statute will be

sustained.”)
30
     Id.
31
     Id.
32
     Id.
33
     Id.
34
     Id.
35
     Fernandez v. South Carolina Ins. Co., 408 So. 2d 753 (Fla. 3d Dist. Ct. App. 1982) (holding that payment of bills

subject to a hospital lien take priority over payment of other PIP benefits).
36
     Holloway v. State Farm Mut. Auto. Ins. Co., 370 So. 2d 452 (Fla. 4th Dist. Ct. App. 1979).
37
     Fernandez, 408 So. 2d at 755.
38
     New York Life Ins. Co. v. Shuster, 373 So. 2d 916, 917 (Fla. 1979)
39
     Gonzalez, 512 So. 2d at 270-271.
40
     Id.
41
     Id. at 1268-1269.
42
     Id. at 203.
43
     Id.
44
     Id. at 308.
45
     Amador, 748 So. 2d at 308.
46
     Id.
47
     Id.
48
     Id.
49
     Custer Medical Center v. United Auto. Ins. Co., 2010 WL 4340809, at *1, Case No. SC08-2036 (Fla. Nov. 4,

2010) (“A purported verbal exam under oath without counsel in the PIP context is invalid and more restrictive than




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permitted by the statutorily mandated coverage and the terms and limitations permitted under the statutory

provisions.”). As of the time of this writing, the Custer Medical Center opinion is not final.
50
     See e.g., Peachtree Cas. Ins. Co. v. Walden, 759 So. 2d 7 (Fla. 5th Dist. Ct. App. 2000).
51
     FLA. STAT. § 627.736(4)(b) (1971).
52
     FLA. STAT. § 627.736(7) (1971).
53
     Allstate Ins. Co. v. Graham, 541 So. 2d 160 (Fla. 2d Dist. Ct. App. 1989); Tindall v. Allstate Ins. Co., 472 So. 2d

1291, 1292 (Fla. 2d Dist. Ct. App. 1985); Griffin v. Stonewall Ins. Co., 346 So. 2d 97 (Fla. 1977).
54
     FLA. STAT. § 627.736(7)(a) (1988).
55
     Warren, 805 So. 2d at 1077-1078 (“The timely statement requirement also reduces the practice of bulk billing by

some medical providers which occurs when treatments are rendered over a period of time and the insurer is

subsequently billed for multiple treatments. In turn, this lowers the insurer's cost of providing PIP coverage.”)
56
     Id. at 1077.
57
     Graham, 541 So. 2d at 162.
58
     FLA. STAT. § 627.736(5)(c) (2009).
59
     Id.
60
     Florida Department of Financial Services, Study of PIP Insurance Changes

Effect of Changes Pursuant to the Florida Motor Vehicle Insurance Affordability Reform Act of 2003, at 3 (2005).

[hereinafter Study of PIP Insurance Changes]
61
     FLA. STAT. § 627.736(4)(d) (2009).
62
     United Auto Courts Report: A Fair and Balanced Review, Car accident lawsuit in Broward court seeks $2.59 even

after all PIP benefits paid, http://www.unitedautocourtsreport.com/blog/?p=55 (last visited March 31, 2010).
63
     Study of PIP Insurance Changes, supra note 71, at 4.
64
     Mark K. Delegal & Allison P. Pittman, Florida No-Fault Insurance Reform: A Step in the Right Direction, 29

FLA. ST. U. L. REV. 1031 (2002).
65
     The amendments provided for a uniform fee schedule for diagnostic and other types of treatment, mandated a

disclosure and acknowledgment form be given by providers to claimants, imposed a requirement for a 15-day pre-

suit demand letter prior to the commencement of litigation, which afforded insurers an extra grace period with which

to resolve and pay claims with penalties and interest, cracked down on brokering and kickbacks and added a


                                                            16
“sunset” provision that would repeal the No-Fault laws, if not renewed after October 1, 2007. Study of PIP

Insurance Changes, supra note 71, at 3.
66
     Ch. 2001-271, § 6, at 2930, Laws of Fla.; FLA. STAT. § 627.736(4)(b) (2004).
67
     Id.
68
     AIU Ins. Co. v. Daidone, 760 So. 2d 1110, 1112 (Fla. 4th Dist. Ct. App. 2000) (“If the insurer has refused to pay

the bill within thirty days and does not have reasonable proof to establish that it is not responsible, then the insurer is

liable for ten percent interest when the bill is paid. Failing to obtain proof that it is not responsible for payment,

however, does not deprive the insurer of its right to contest payment.”)
69
     State Farm Mut. Auto. Ins. Co. v. Jones, 789 So. 2d 504 (Fla. 1st Dist. Ct. App. 2001).
70
     Perez v. State Farm Fire and Cas. Co., 746 So. 2d 1123, 1125-1126 (Fla. 3d Dist. Ct. App. 1999).
71
     Rodriguez, 808 So. 2d at 87.
72
     See United Auto. Ins. Co. v. Perez, 21 So. 3d 886 (Fla. 3d Dist. Ct. App. 2009) (reversing the decision of the

appellate circuit court, holding that statute provided that the insurer could contest the claim at any time regardless of

the expiration of the 30-day deadline).
73
     Allstate Ins. Co. v. Garrett, 550 So. 2d 22, 24 (Fla. 2d Dist. Ct. App. 1989).
74
     See United Auto. Ins. Co. v. Salgado, 22 So. 3d 594 (Fla. 3d Dist. Ct. App. 2009) (holding that the Florida No

Fault Law did not abrogate an insurer‟s right of recission because it was not on a specifically enumerated list of

types of insurance listed in section 627.401).
75
     Rodriguez, 808 So. 2d at 87.
76
     Santa Fe Medical Center, 21 So. 3d at 65.
77
     Id.
78
     State Farm Mutual Auto. Ins. Co. v. Rhodes & Anderson, D.C., P.A., 18 So. 3d 1059, 1064 (Fla. 2d Dist. Ct. App.

2008), citing Webster's 3d New International Dictionary 2626 (1993).
79
     See United Auto. Ins. Co. v. Santa Fe Medical Center, 21 So. 3d 60 (Fla. 3d Dist. Ct. App. 2009) (en banc); see

also Partners in Health Chiropractic v. United Auto. Ins. Co., 21 So. 3d 858 (Fla. 3d Dist. Ct. App. 2009); United

Auto. Ins. Co. v. Metro Injury & Rehab Center, 16 So. 3d 897 (Fla 3d Dist. Ct. App. 2009).
80
     See United Auto. Ins. Co. v. Viles, 726 So.2d 320 (Fla. 3d Dist. Ct. App. 1998).




                                                             17
81
     United Auto. Ins. Co. v. Bermudez, 980 So. 2d 1213, 1217 n.4 (Fla. 3d Dist. Ct. App. 2008) (quoting Daidone,

760 So. 2d at 1112).
82
     Jones, 694 So. 2d at 166.
83
     Fortune Insurance Co. v. Everglades Diagnostics, Inc., 721 So.2d 384, 385 (Fla. 4th Dist. Ct. App. 1998) (holding

that the insurer was not barred from participating in arbitration).
84
     Daidone, 760 So. 2d at 1113.
85
     United Auto. Ins. Co. v. Rodriguez & Perez v. State Farm Fire and Cas. Co, 746 So. 2d 1123 (Fla. 3d Dist. Ct.

App. 1999).
86
     Rodriguez, 808 So. 2d at 87.
87
     Derius v. Allstate Indem. Co., 723 So. 2d 271, 272 (Fla. 4th Dist. Ct. App. 1998).
88
     See State Farm Mutual Auto. Ins. Co. v. Rhodes & Anderson, D.C., P.A., 18 So. 3d 1059 (Fla. 2d Dist. Ct. App.

2008).
89
     See Central Magnetic Imaging Open MRI of Plantation, Ltd. v. State Farm Fire and Cas. Co., 22 So. 3d 782, 784

(Fla. 4th Dist. Ct. App. 2009).
90
     United Auto. Ins. Co. v. Millennium Diagnostic Imaging Center, Inc., 12 So. 3d 242, 246-247 (Fla. 3d Dist. Ct.

App. 2009).
91
     See Santa Fe Medical Center, 21 So. 3d at 66-67.
92
     Metro Injury, SC09-1946 (Fla. Jan. 5, 2010) (“The proceedings in this Court in the above case are hereby stayed

pending disposition of Custer Medical Center a/a/o Maximo Masis v. United Automobile Insurance Company, Case

No. SC08-2036, which is pending in this Court.”) However, it should be noted that the decision of Partners in

Health Chiropractic v. United Auto. Ins. Co., 21 So. 3d 858 (Fla. 3d Dist. Ct. App. 2009), has never been appealed.
93
     Santa Fe, SC09-2100 (Fla. Jan. 5, 2010).
94
     Custer Medical Center, review granted, 15 So. 3d 580 (Fla. 2009). An opinion was subsequently issued. See

Custer Medical Center v. United Auto. Ins. Co., 2010 WL 4340809, at *1, Case No. SC08-2036 (Fla. Nov. 4, 2010).

However, the outcome of the stayed cases is yet to be determined.
95
     See e.g., Central Magnetic Imaging Open MRI of Plantation, 22 So. 3d at 784.
96
     Senate Interim Report No. 2006-102, supra note 9, at 80.
97
     Senate Interim Report No. 2008-102, supra note 7.


                                                            18
98
     Senate Interim Report No. 2006-102, supra note 9, at 79-80.
99
     See Ivey v. Allstate Ins, Co., 774 So. 2d 679, 684 (Fla. 2000).
100
      Rodriguez, 808 So. 2d at 87.
101
      Wyatt Olson, The Friendly Ties of United, Broward/Palm Beach New Times, May 6, 2006, at 1, available at

http://www.browardpalmbeach.com/2006-03-09/news/the-friendly-ties-of-united/.
102
      Rodriguez, 808 So. 2d at 92 (Lewis, J., dissenting) (“The practical impact of this judicial rewrite is to sanction the

practice of withholding benefits for extended periods of time without any basis whatsoever and then permit the

contesting and litigating of minor aspects related to loss of wages and medical treatment rendered years earlier.”)
103
      Senate Interim Report No. 2006-102, supra note 9, at 41.
104
      Lasky, 296 So. 2d at 15 (“[The test] is whether the statute bears a reasonable relation to a permissible legislative

objective and is not discriminatory, arbitrary or oppressive.”)
105
      Id.
106
      See FLA. STAT. § 627.736(4)(b) (2009); FLA. STAT. § 627.736(7)(a) (2009); United Auto. Ins. Co. v.

Hollywood Injury Rehab Center, 27 So. 3d 743, 744 (Fla. 4th Dist. Ct. App. 2010).
107
      See Second Interim Report of the Fifteenth Statewide Grand Jury, Florida Supreme Court Case No. 95,746,

available at http://myfloridalegal.com/. [hereinafter Fifteenth Statewide Grand Jury Interim Report]
108
      Id. (“We find it difficult to believe any medical professional can render competent care to patients when the

exercise of independent professional judgment is clouded by the lure of exorbitant profits.”)
109
      Senate Interim Report No. 2006-102, supra note 9, at 79.
110
      FLA. CONST. art. I, § 21.
111
      Gonzalez, 512 So. 2d at 271 (citing Comeau v. Safeco Ins. Co., 356 So. 2d 790 (Fla. 1978)).
112
      Nationwide Mut. Fire Ins. Co., v. Pinnacle Medical, Inc., 753 So. 2d 55, 59 (Fla. 2000) (citing Smith v.

Department of Insurance, 507 So. 2d 1080, 1088 (Fla. 1987)).
113
      Smith, 507 So. 2d at 1099 (Adkins, J. (Ret.), concurring in part, and dissenting in part).
114
      Id.




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