Senate Bill 1640
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Florida Senate - 1998 SB 1640
By Senator Kurth
15-1115A-98 See HB
1 A bill to be entitled
2 An act relating to insurance fraud; amending s.
3 440.09, F.S.; conforming references to judges
4 of compensation claims and administrative law
5 judges; amending s. 440.105, F.S.; specifying a
6 schedule of criminal penalties for certain
7 prohibited activities; providing definitions;
8 providing a period of limitations for
9 undertaking certain proceedings; amending s.
10 624.416, F.S.; providing additional criteria
11 for the Department of Insurance to consider in
12 issuing certain certificates of authority;
13 amending s. 624.418, F.S.; providing an
14 additional criterion for suspending or revoking
15 certain certificates of authority; amending s.
16 626.989, F.S.; providing for reports of
17 insurance fraud to the Division of Insurance
18 Fraud of the Department of Insurance; amending
19 s. 626.9891, F.S.; requiring insurers to
20 provide for investigation of fraudulent claims;
21 requiring insurers to adopt an anti-fraud plan;
22 providing criteria and procedures; requiring
23 insurers to file an anti-fraud report with the
24 department; specifying contents; authorizing
25 the department to adopt rules; creating s.
26 626.9892, F.S.; establishing the Anti-Fraud
27 Reward Program in the department; providing for
28 awarding rewards under certain circumstances;
29 exempting certain department actions from
30 Florida Administrative Code requirements;
31 amending s. 627.062, F.S.; requiring the
1
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Florida Senate - 1998 SB 1640
15-1115A-98 See HB
1 department to consider certain additional
2 factors in reviewing rate filings; amending s.
3 627.072, F.S.; requiring consideration of
4 certain additional factors in making and using
5 rates; amending s. 627.411, F.S.; requiring the
6 department to consider certain additional
7 factors in determining the reasonableness of
8 benefits in relation to premium charges;
9 amending s. 641.31, F.S.; providing for
10 disapproval of rates, forms, or other filings;
11 creating s. 641.3915, F.S.; requiring certain
12 health maintenance organizations to provide for
13 investigation of fraudulent claims; requiring
14 health maintenance organizations to adopt an
15 anti-fraud plan; providing criteria and
16 procedures; requiring health maintenance
17 organizations to file an anti-fraud report with
18 the department; specifying contents;
19 authorizing the department to adopt rules;
20 amending s. 817.234, F.S.; specifying a
21 schedule of criminal penalties for committing
22 insurance fraud or insurance solicitation;
23 providing definitions; providing a period of
24 limitations for undertaking certain
25 proceedings; providing an appropriation;
26 providing an effective date.
27
28 Be It Enacted by the Legislature of the State of Florida:
29
30 Section 1. Subsection (4) of section 440.09, Florida
31 Statutes, is amended to read:
2
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Florida Senate - 1998 SB 1640
15-1115A-98 See HB
1 440.09 Coverage.--
2 (4) An employee shall not be entitled to compensation
3 or benefits under this chapter if any judge of compensation
4 claims, administrative law judge hearing officer, court, or
5 jury convened in this state determines that the employee has
6 knowingly or intentionally engaged in any of the acts
7 described in s. 440.105 for the purpose of securing workers'
8 compensation benefits.
9 Section 2. Subsections (4) and (6) of section 440.105,
10 Florida Statutes, are amended, and subsection (8) is added to
11 said section, to read:
12 440.105 Prohibited activities; penalties;
13 limitations.--
14 (4)(a) Whoever violates any provision of this
15 subsection commits insurance fraud. If the value of any
16 property involved in violation of this subsection:
17 1. Is less than $20,000, the offender commits a felony
18 of the third degree, punishable as provided in s. 775.082, s.
19 775.083, or s. 775.084.
20 2. Is $20,000 or more, but less than $100,000, the
21 offender commits a felony of the second degree, punishable as
22 provided in s. 775.082, s. 775.083, or s. 775.084.
23 3. Is $100,000 or more, the offender commits a felony
24 of the first degree, punishable as provided in s. 775.082, s.
25 775.083, or s. 775.084.
26 (b)(a) It shall be unlawful for any employer to
27 knowingly:
28 1. Present or cause to be presented any false,
29 fraudulent, or misleading oral or written statement to any
30 person as evidence of compliance with s. 440.38.
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1 2. Make a deduction from the pay of any employee
2 entitled to the benefits of this chapter for the purpose of
3 requiring the employee to pay any portion of premium paid by
4 the employer to a carrier or to contribute to a benefit fund
5 or department maintained by such employer for the purpose of
6 providing compensation or medical services and supplies as
7 required by this chapter.
8 3. Fail to secure payment of compensation if required
9 to do so by this chapter.
10 (c)(b) It shall be unlawful for any person:
11 1. To knowingly make, or cause to be made, any false,
12 fraudulent, or misleading oral or written statement for the
13 purpose of obtaining or denying any benefit or payment under
14 this chapter.
15 2. To present or cause to be presented any written or
16 oral statement as part of, or in support of, a claim for
17 payment or of other benefit pursuant to any provision of this
18 chapter, knowing that such statement contains any false,
19 incomplete, or misleading information concerning any fact or
20 thing material to such claim.
21 3. To prepare or cause to be prepared any written or
22 oral statement that is intended to be presented to any
23 employer, insurance company, or self-insured program in
24 connection with, or in support of, any claim for payment or
25 other benefit pursuant to any provision of this chapter,
26 knowing that such statement contains any false, incomplete, or
27 misleading information concerning any fact or thing material
28 to such claim.
29 4. To knowingly assist, conspire with, or urge any
30 person to engage in activity prohibited by this section.
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1 5. To knowingly make any false, fraudulent, or
2 misleading oral or written statement, or to knowingly omit or
3 conceal material information, required by s. 440.185 or s.
4 440.381, for the purpose of obtaining workers' compensation
5 coverage or for the purpose of avoiding, delaying, or
6 diminishing the amount of payment of any workers' compensation
7 premiums.
8 6. To knowingly misrepresent or conceal payroll,
9 classification of workers, or information regarding an
10 employer's loss history which would be material to the
11 computation and application of an experience rating
12 modification factor for the purpose of avoiding or diminishing
13 the amount of payment of any workers' compensation premiums.
14 7. To knowingly present or cause to be presented any
15 false, fraudulent, or misleading oral or written statement to
16 any person as evidence of compliance with s. 440.38.
17 (d)(c) It shall be unlawful for any physician licensed
18 under chapter 458, osteopathic physician licensed under
19 chapter 459, chiropractic physician licensed under chapter
20 460, podiatric physician licensed under chapter 461,
21 optometric physician licensed under chapter 463, or any other
22 practitioner licensed under the laws of this state to
23 knowingly and willfully assist, conspire with, or urge any
24 person to fraudulently violate any of the provisions of this
25 chapter.
26 (e)(d) It shall be unlawful for any person or
27 governmental entity licensed under chapter 395 to maintain or
28 operate a hospital in such a manner so that such person or
29 governmental entity knowingly and willfully allows the use of
30 the facilities of such hospital by any person, in a scheme or
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1 conspiracy to fraudulently violate any of the provisions of
2 this chapter.
3 (f)(e) It shall be unlawful for any attorney or other
4 person, in his or her individual capacity or in his or her
5 capacity as a public or private employee, or any firm,
6 corporation, partnership, or association, to knowingly assist,
7 conspire with, or urge any person to fraudulently violate any
8 of the provisions of this chapter.
9 (g)(f) It shall be unlawful for any attorney or other
10 person, in his or her individual capacity or in his or her
11 capacity as a public or private employee or for any firm,
12 corporation, partnership, or association, to unlawfully
13 solicit any business in and about city or county hospitals,
14 courts, or any public institution or public place; in and
15 about private hospitals or sanitariums; in and about any
16 private institution; or upon private property of any character
17 whatsoever for the purpose of making workers' compensation
18 claims.
19 (6) For the purpose of the section:, the term
20 (a) "Statement" includes, but is not limited to, any
21 notice, representation, statement, proof of injury, bill for
22 services, diagnosis, prescription, hospital or doctor records,
23 X ray, test result, or other evidence of loss, injury, or
24 expense.
25 (b) "Property" means property as defined in s.
26 812.012.
27 (c) "Value" means value as defined in s. 812.012.
28 (8) Notwithstanding any other provision of law, a
29 proceeding under subsection (4) may be commenced at any time
30 within 5 years after the cause of action accrues; however, in
31 such proceeding, the period of limitation is tolled whenever
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Florida Senate - 1998 SB 1640
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1 the defendant is continuously absent from this state or is
2 without a reasonably ascertainable place of residence or work
3 within this state, but not to extend such period of limitation
4 by more than 1 year. If a criminal prosecution, action, or
5 other proceeding is brought, or intervened in, to punish,
6 prevent, or restrain any violation of subsection (4), the
7 running of the period of limitation prescribed by this
8 section, which is based in whole or in part upon any matter
9 complained of in any such prosecution, action, or proceeding,
10 shall be tolled during the pendency of the prosecution,
11 action, or proceeding and for 2 years following the
12 termination of such prosecution, action, or proceeding.
13 Section 3. Subsection (4) of section 624.416, Florida
14 Statutes, is amended to read:
15 624.416 Continuance, expiration, reinstatement, and
16 amendment of certificate of authority.--
17 (4) The department may amend a certificate of
18 authority at any time to accord with changes in the insurer's
19 charter or insuring powers. Prior to amending an existing
20 certificate of authority to authorize an insurer to transact a
21 new line of business, the department shall require the
22 applicant to demonstrate compliance with the provisions of s.
23 626.9891 and to allocate sufficient resources to identify and
24 eliminate fraud. The department shall consider the extent of
25 such resources in determining whether to authorize an insurer
26 to transact a new line of business.
27 Section 4. Subsection (1) of section 624.418, Florida
28 Statutes, is amended to read:
29 624.418 Suspension, revocation of certificate of
30 authority for violations and special grounds.--
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Florida Senate - 1998 SB 1640
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1 (1) The department shall suspend or revoke an
2 insurer's certificate of authority if it finds that the
3 insurer:
4 (a) Is in unsound financial condition.
5 (b) Is using such methods and practices in the conduct
6 of its business as to render its further transaction of
7 insurance in this state hazardous or injurious to its
8 policyholders or to the public.
9 (c) Has failed to pay any final judgment rendered
10 against it in this state within 60 days after the judgment
11 became final.
12 (d) Has failed to comply with the requirements of s.
13 626.9891 or has failed to allocate sufficient resources to
14 identify and eliminate fraud.
15 (e)(d) No longer meets the requirements for the
16 authority originally granted.
17 Section 5. Subsection (6) of section 626.989, Florida
18 Statutes, is amended to read:
19 626.989 Division of Insurance Fraud; definition;
20 investigative, subpoena powers; protection from civil
21 liability; reports to division; division investigator's power
22 to execute warrants and make arrests.--
23 (6) Any person, other than an insurer, agent, or other
24 person licensed under the code, or an employee thereof, having
25 knowledge or who believes that a fraudulent insurance act or
26 any other act or practice which, upon conviction, constitutes
27 a felony or a misdemeanor under the code, under s. 440.105, or
28 under s. 817.234, is being or has been committed may send to
29 the Division of Insurance Fraud a report or information
30 pertinent to such knowledge or belief and such additional
31 information relative thereto as the department may request.
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Florida Senate - 1998 SB 1640
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1 Any professional practitioner licensed or regulated by the
2 Department of Business and Professional Regulation, except as
3 otherwise provided by law, any medical review committee as
4 defined in s. 766.101, any private medical review committee,
5 and any insurer, agent, or other person licensed under the
6 code, or an employee thereof, having knowledge or who believes
7 that a fraudulent insurance act or any other act or practice
8 which, upon conviction, constitutes a felony or a misdemeanor
9 under the code, under s. 440.105, or under s. 817.234, is
10 being or has been committed shall send to the Division of
11 Insurance Fraud a report or information pertinent to such
12 knowledge or belief and such additional information relative
13 thereto as the department may require. The Division of
14 Insurance Fraud shall review such information or reports and
15 select such information or reports as, in its judgment, may
16 require further investigation. It shall then cause an
17 independent examination of the facts surrounding such
18 information or report to be made to determine the extent, if
19 any, to which a fraudulent insurance act or any other act or
20 practice which, upon conviction, constitutes a felony or a
21 misdemeanor under the code, under s. 440.105, or under s.
22 817.234, is being committed. The Division of Insurance Fraud
23 shall report any alleged violations of law which its
24 investigations disclose to the appropriate licensing agency
25 and state attorney or other prosecuting agency having
26 jurisdiction with respect to any such violation, as provided
27 in s. 624.310. If prosecution by the state attorney or other
28 prosecuting agency having jurisdiction with respect to such
29 violation is not begun within 60 days of the division's
30 report, the state attorney or other prosecuting agency having
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Florida Senate - 1998 SB 1640
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1 jurisdiction with respect to such violation shall inform the
2 division of the reasons for the lack of prosecution.
3 Section 6. Section 626.9891, Florida Statutes, is
4 amended to read:
5 (Substantial rewording of section. See
6 s. 626.9891, F.S., for present text.)
7 626.9891 Insurer anti-fraud plans, reports, and
8 investigative units.--
9 (1) Each authorized insurer that had $10 million or
10 more in direct premiums written during the previous calendar
11 year shall:
12 (a) Establish and maintain a unit or division within
13 the company to investigate possible fraudulent claims by
14 insureds or by persons making claims for services or repairs
15 against policies held by insureds; or
16 (b) Contract with others to investigate possible
17 fraudulent claims for services or repairs against policies
18 held by insureds.
19
20 For purposes of this section, the term "unit or division"
21 includes the assignment of fraud investigation to employees
22 whose principal responsibilities are the investigation and
23 disposition of claims. If an insurer creates a distinct unit
24 or division, hires additional employees, or contracts with
25 another entity to fulfill the requirements of this section,
26 the additional cost incurred must be included as an
27 administrative expense for ratemaking purposes.
28 (2)(a) Each authorized insurer shall adopt an
29 anti-fraud plan, which shall be filed with the department
30 prior to January 1, 1999.
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1 (b) Any insurer that previously filed an anti-fraud
2 plan with the department shall amend the plan to comply with
3 the requirements of subsection (3) and shall file all plan
4 amendments with the department prior to January 1, 1999.
5 (c) Any insurer that files an application for a
6 certificate of authority with the department prior to January
7 1, 1999, shall, if the certificate is not issued as of that
8 date, comply with the requirements of this section within 90
9 days after the issuance of a certificate of authority.
10 (d) Any insurer that files an application for a
11 certificate of authority with the department on or after
12 January 1, 1999, shall comply with the requirements of this
13 section when the application is filed.
14 (3) Each insurer's anti-fraud plan shall include:
15 (a) A description of the unit or division established,
16 or a copy of the contract and related documents required under
17 subsection (1), if applicable.
18 (b) A description of the insurer's policies and
19 procedures that facilitate the detection and investigation of
20 possible fraudulent insurance acts, including specific policy
21 provisions and investigative procedures intended to combat
22 complex instances of fraud with respect to each of the
23 following coverages: health, property, casualty, and workers'
24 compensation and employer's liability.
25 (c) A description of the insurer's procedures for the
26 mandatory reporting of possible fraudulent insurance acts to
27 the department.
28 (d) A description of the insurer's procedures for
29 auditing workers' compensation insureds to verify covered
30 employees and to ensure proper classification, loss experience
31 reporting, and premium collection practices.
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1 (e) A description of the insurer's anti-fraud
2 education and training program for claims adjusters or other
3 personnel.
4 (f) A description or chart that includes the
5 organizational arrangement of the insurer's anti-fraud
6 personnel and the education, training, and claims adjusting,
7 law enforcement, or other investigative experience of such
8 personnel responsible for the investigation of possible
9 fraudulent insurance acts.
10 (4) Each insurer shall file an anti-fraud report with
11 the department prior to March 1, 2000, and annually
12 thereafter, which shall include, for the previous calendar
13 year:
14 (a) Material changes or amendments to personnel,
15 policies, or procedures in the insurer's anti-fraud plan.
16 (b) A summary of significant actions taken by the
17 insurer to combat or prosecute cases of insurance fraud and
18 cases of workers' compensation insurance premium fraud.
19 (c) A statement of the insurer's actual or estimated
20 losses in this state due to fraudulent insurance claims, by
21 line of coverage, and the increase or decrease in such losses
22 compared to previous calendar years.
23 (d) The amount of direct premiums written, by line of
24 coverage, in the previous calendar year and the number of
25 fraud referrals, by line of coverage, made by the insurer to
26 the department during the reporting period.
27 (5) The department may recommend changes or amendments
28 to an insurer's anti-fraud plan.
29 (6) The department may adopt any rules necessary to
30 implement the provisions of this section.
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Florida Senate - 1998 SB 1640
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1 Section 7. Section 626.9892, Florida Statutes, is
2 created to read:
3 626.9892 Anti-Fraud Reward Program; reporting of
4 insurance fraud.--
5 (1) The Anti-Fraud Reward Program is hereby
6 established within the department, to be funded from the
7 Insurance Commissioner's Regulatory Trust Fund.
8 (2) The department may, at its discretion, pay rewards
9 of up to $25,000 to persons responsible for providing
10 information leading to the arrest and conviction of persons
11 committing complex and organized crimes, investigated by the
12 Division of Insurance Fraud, arising from violations of the
13 insurance code, s. 440.105, or s. 817.234.
14 (3) Only a single reward amount may be awarded for
15 each case, regardless of the number of persons arrested and
16 convicted in connection with the case and regardless of how
17 many persons submit claims for the reward.
18 (4) The department shall establish procedures to
19 implement and administer the Anti-Fraud Reward Program.
20 Applications for rewards authorized by this section must be
21 made pursuant to the procedures established by the department.
22 (5) All determinations and other actions of the
23 department pursuant to this section are exempt from the
24 provisions of chapter 120.
25 Section 8. Paragraph (b) of subsection (2) of section
26 627.062, Florida Statutes, is amended to read:
27 627.062 Rate standards.--
28 (2) As to all such classes of insurance:
29 (b) Upon receiving a rate filing, the department shall
30 review the rate filing to determine if a rate is excessive,
31 inadequate, or unfairly discriminatory. In making that
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Florida Senate - 1998 SB 1640
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1 determination, the department shall, in accordance with
2 generally accepted and reasonable actuarial techniques,
3 consider the following factors:
4 1. Past and prospective loss experience within and
5 without this state.
6 2. Past and prospective expenses.
7 3. The degree of competition among insurers for the
8 risk insured.
9 4. Investment income reasonably expected by the
10 insurer, consistent with the insurer's investment practices,
11 from investable premiums anticipated in the filing, plus any
12 other expected income from currently invested assets
13 representing the amount expected on unearned premium reserves
14 and loss reserves. The department may promulgate rules
15 utilizing reasonable techniques of actuarial science and
16 economics to specify the manner in which insurers shall
17 calculate investment income attributable to such classes of
18 insurance written in this state and the manner in which such
19 investment income shall be used in the calculation of
20 insurance rates. Such manner shall contemplate allowances for
21 an underwriting profit factor and full consideration of
22 investment income which produce a reasonable rate of return;
23 however, investment income from invested surplus shall not be
24 considered. The profit and contingency factor as specified in
25 the filing shall be utilized in computing excess profits in
26 conjunction with s. 627.0625.
27 5. The reasonableness of the judgment reflected in the
28 filing.
29 6. Dividends, savings, or unabsorbed premium deposits
30 allowed or returned to Florida policyholders, members, or
31 subscribers.
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Florida Senate - 1998 SB 1640
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1 7. The adequacy of loss reserves.
2 8. The cost of reinsurance.
3 9. Trend factors, including trends in actual losses
4 per insured unit for the insurer making the filing.
5 10. Conflagration and catastrophe hazards, if
6 applicable.
7 11. A reasonable margin for underwriting profit and
8 contingencies.
9 12. The cost of medical services, if applicable.
10 13. Compliance with the requirements of s. 626.9891
11 and the allocation of sufficient resources to identify and
12 eliminate fraud.
13 14.13. Other relevant factors which impact upon the
14 frequency or severity of claims or upon expenses.
15
16 The provisions of this subsection shall not apply to workers'
17 compensation and employer's liability insurance and to motor
18 vehicle insurance.
19 Section 9. Subsection (1) of section 627.072, Florida
20 Statutes, is amended to read:
21 627.072 Making and use of rates.--
22 (1) As to workers' compensation and employer's
23 liability insurance, the following factors shall be used in
24 the determination and fixing of rates:
25 (a) The past loss experience and prospective loss
26 experience within and outside this state;
27 (b) The conflagration and catastrophe hazards;
28 (c) A reasonable margin for underwriting profit and
29 contingencies;
30
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1 (d) Dividends, savings, or unabsorbed premium deposits
2 allowed or returned by insurers to their policyholders,
3 members, or subscribers;
4 (e) Investment income on unearned premium reserves and
5 loss reserves;
6 (f) Past expenses and prospective expenses, both those
7 countrywide and those specifically applicable to this state;
8 and
9 (g) Compliance with the requirements of s. 626.9891
10 and the allocation of sufficient resources to identify and
11 eliminate fraud; and
12 (h)(g) All other relevant factors, including judgment
13 factors, within and outside this state.
14 Section 10. Paragraph (e) is added to subsection (2)
15 of section 627.411, Florida Statutes, to read:
16 627.411 Grounds for disapproval.--
17 (2) In determining whether the benefits are reasonable
18 in relation to the premium charged, the department, in
19 accordance with reasonable actuarial techniques, shall
20 consider:
21 (e) Compliance with the requirements of s. 626.9891
22 and the allocation of sufficient resources to identify and
23 eliminate fraud.
24 Section 11. Paragraph (d) is added to subsection (3)
25 of section 641.31, Florida Statutes, to read:
26 641.31 Health maintenance contracts.--
27 (3)
28 (d) The department shall withdraw or withhold approval
29 of any health maintenance organization rate, form, or other
30 filing required under this subsection if the department
31 determines that the health maintenance organization has not
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1 complied with the requirements of s. 641.3915 or has not
2 allocated sufficient resources to identify and eliminate
3 fraud.
4 Section 12. Section 641.3915, Florida Statutes, is
5 created to read:
6 641.3915 Health maintenance organization anti-fraud
7 plans, reports, and investigative units.--
8 (1) Each authorized health maintenance organization
9 that had $10 million or more in revenues during the previous
10 calendar year shall:
11 (a) Establish and maintain a unit or division within
12 the company to investigate possible fraudulent claims by
13 subscribers or by persons making claims for services against
14 policies held by subscribers; or
15 (b) Contract with others to investigate possible
16 fraudulent claims for services against policies held by
17 subscribers.
18
19 For purposes of this section, the term "unit or division"
20 includes the assignment of fraud investigation to employees
21 whose principal responsibilities are the investigation and
22 disposition of claims. If a health maintenance organization
23 creates a distinct unit or division, hires additional
24 employees, or contracts with another entity to fulfill the
25 requirements of this section, the additional cost incurred
26 shall be included as an administrative expense for ratemaking
27 purposes.
28 (2)(a) Each authorized health maintenance organization
29 must adopt an anti-fraud plan and file it with the department
30 before January 1, 1999.
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1 (b) Any health maintenance organization that has filed
2 an application for a certificate of authority with the
3 department prior to January 1, 1999, shall, if the certificate
4 is not issued as of that date, comply with the requirements of
5 this section within 90 days after the issuance of the
6 certificate of authority.
7 (c) Any health maintenance organization that files an
8 application for a certificate of authority with the department
9 on or after January 1, 1999, shall comply with the
10 requirements of this section when the application is filed.
11 (3) Each health maintenance organization's anti-fraud
12 plan shall include:
13 (a) A description of the unit or division established,
14 or a copy of the contract and related documents required under
15 subsection (1), if applicable.
16 (b) A description of the health maintenance
17 organization's policies and procedures that facilitate the
18 detection and investigation of possible fraudulent insurance
19 acts.
20 (c) A description of the health maintenance
21 organization's procedures for the mandatory reporting of
22 possible fraudulent insurance acts to the department.
23 (d) A description of the health maintenance
24 organization's anti-fraud education and training program for
25 claims adjusters or other personnel.
26 (e) A description or chart that includes the
27 organizational arrangement of the health maintenance
28 organization's anti-fraud personnel and the education,
29 training, and claims adjusting, law enforcement, or other
30 investigative experience of such personnel responsible for the
31 investigation of fraudulent insurance acts.
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1 (4) Each health maintenance organization shall file an
2 anti-fraud report with the department before March 1, 2000,
3 and annually thereafter, which shall include, for the previous
4 calendar year:
5 (a) Material changes or amendments to personnel,
6 policies, or procedures in the health maintenance
7 organization's anti-fraud plan.
8 (b) A summary of significant actions taken by the
9 health maintenance organization to combat or prosecute cases
10 of insurance fraud.
11 (c) A statement of the health maintenance
12 organization's actual or estimated losses in this state due to
13 fraudulent claims and the increase or decrease in such losses
14 compared to previous calendar years.
15 (d) The number of fraud referrals made by the health
16 maintenance organization to the department during the
17 reporting period.
18 (5) The department may recommend changes or amendments
19 to a health maintenance organization's anti-fraud plan.
20 (6) The department may adopt any rules necessary to
21 implement the provisions of this section.
22 Section 13. Subsections (1), (2), (3), (4), (8), and
23 (9) of section 817.234, Florida Statutes, are amended, and
24 subsections (11), (12), and (13) are added to said section, to
25 read:
26 817.234 False and fraudulent insurance claims.--
27 (1)(a) Any person who, with the intent to injure,
28 defraud, or deceive any insurer:
29 1. Presents or causes to be presented any written or
30 oral statement as part of, or in support of, a claim for
31 payment or other benefit pursuant to an insurance policy,
19
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1 knowing that such statement contains any false, incomplete, or
2 misleading information concerning any fact or thing material
3 to such claim;
4 2. Prepares or makes any written or oral statement
5 that is intended to be presented to any insurer in connection
6 with, or in support of, any claim for payment or other benefit
7 pursuant to an insurance policy, knowing that such statement
8 contains any false, incomplete, or misleading information
9 concerning any fact or thing material to such claim; or
10 3. Knowingly presents, causes to be presented, or
11 prepares or makes with knowledge or belief that it will be
12 presented to any insurer, purported insurer, servicing
13 corporation, insurance broker, or insurance agent, or any
14 employee or agent thereof, any false, incomplete, or
15 misleading information or written or oral statement as part
16 of, or in support of, an application for the issuance of, or
17 the rating of, any insurance policy, or who conceals
18 information concerning any fact material to such application,
19
20 commits insurance fraud a felony of the third degree,
21 punishable as provided in subsection (11) s. 775.082, s.
22 775.083, or s. 775.084.
23 (b) All claims and application forms shall contain a
24 statement that is approved by the Department of Insurance that
25 clearly states in substance the following: "Any person who
26 knowingly and with intent to injure, defraud, or deceive any
27 insurer files a statement of claim or an application
28 containing any false, incomplete, or misleading information is
29 guilty of a felony of the third degree." The changes in this
30 paragraph relating to applications shall take effect on March
31 1, 1996.
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1 (2) Any physician licensed under chapter 458,
2 osteopathic physician licensed under chapter 459, chiropractor
3 licensed under chapter 460, or other practitioner licensed
4 under the laws of this state who knowingly and willfully
5 assists, conspires with, or urges any insured party to
6 fraudulently violate any of the provisions of this section or
7 part XI of chapter 627, or any person who, due to such
8 assistance, conspiracy, or urging by said physician,
9 osteopathic physician, chiropractor, or practitioner,
10 knowingly and willfully benefits from the proceeds derived
11 from the use of such fraud, commits insurance fraud is guilty
12 of a felony of the third degree, punishable as provided in
13 subsection (11) s. 775.082, s. 775.083, or s. 775.084. In the
14 event that a physician, osteopathic physician, chiropractor,
15 or practitioner is adjudicated guilty of a violation of this
16 section, the Board of Medicine as set forth in chapter 458,
17 the Board of Osteopathic Medicine as set forth in chapter 459,
18 the Board of Chiropractic as set forth in chapter 460, or
19 other appropriate licensing authority shall hold an
20 administrative hearing to consider the imposition of
21 administrative sanctions as provided by law against said
22 physician, osteopathic physician, chiropractor, or
23 practitioner.
24 (3) Any attorney who knowingly and willfully assists,
25 conspires with, or urges any claimant to fraudulently violate
26 any of the provisions of this section or part XI of chapter
27 627, or any person who, due to such assistance, conspiracy, or
28 urging on such attorney's part, knowingly and willfully
29 benefits from the proceeds derived from the use of such fraud,
30 commits insurance fraud a felony of the third degree,
31
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1 punishable as provided in subsection (11) s. 775.082, s.
2 775.083, or s. 775.084.
3 (4) Any No person or governmental unit licensed under
4 chapter 395 to maintain or operate a hospital, and any no
5 administrator or employee of any such hospital, who shall
6 knowingly and willfully allows allow the use of the facilities
7 of said hospital by an insured party in a scheme or conspiracy
8 to fraudulently violate any of the provisions of this section
9 or part XI of chapter 627. Any hospital administrator or
10 employee who violates this subsection commits insurance fraud
11 a felony of the third degree, punishable as provided in
12 subsection (11) s. 775.082, s. 775.083, or s. 775.084. Any
13 adjudication of guilt for a violation of this subsection, or
14 the use of business practices demonstrating a pattern
15 indicating that the spirit of the law set forth in this
16 section or part XI of chapter 627 is not being followed, shall
17 be grounds for suspension or revocation of the license to
18 operate the hospital or the imposition of an administrative
19 penalty of up to $5,000 by the licensing agency, as set forth
20 in chapter 395.
21 (8) It is unlawful for any person, in his or her
22 individual capacity or in his or her capacity as a public or
23 private employee, or for any firm, corporation, partnership,
24 or association, to solicit any business in or about city
25 receiving hospitals, city and county receiving hospitals,
26 county hospitals, justice courts, or municipal courts; in any
27 public institution; in any public place; upon any public
28 street or highway; in or about private hospitals, sanitariums,
29 or any private institution; or upon private property of any
30 character whatsoever for the purpose of making motor vehicle
31 tort claims or claims for personal injury protection benefits
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1 required by s. 627.736. Any person who violates the
2 provisions of this subsection commits insurance solicitation a
3 felony of the third degree, punishable as provided in
4 subsection (11) s. 775.082, s. 775.083, or s. 775.084.
5 (9) It is unlawful for any attorney to solicit any
6 business relating to the representation of persons injured in
7 a motor vehicle accident for the purpose of filing a motor
8 vehicle tort claim or a claim for personal injury protection
9 benefits required by s. 627.736. The solicitation by
10 advertising of any business by an attorney relating to the
11 representation of a person injured in a specific motor vehicle
12 accident is prohibited by this section. Any attorney who
13 violates the provisions of this subsection commits insurance
14 solicitation a felony of the third degree, punishable as
15 provided in subsection (11) s. 775.082, s. 775.083, or s.
16 775.084. Whenever any circuit or special grievance committee
17 acting under the jurisdiction of the Supreme Court finds
18 probable cause to believe that an attorney is guilty of a
19 violation of this section, such committee shall forward to the
20 appropriate state attorney a copy of the finding of probable
21 cause and the report being filed in the matter. This section
22 shall not be interpreted to prohibit advertising by attorneys
23 which does not entail a solicitation as described in this
24 subsection and which is permitted by the rules regulating The
25 Florida Bar as promulgated by the Florida Supreme Court.
26 (11) If the value of any property involved in
27 violation of this section:
28 (a) Is less than $20,000, the offender commits a
29 felony of the third degree, punishable as provided in s.
30 775.082, s. 775.083, or s. 775.084.
31
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1 (b) Is $20,000 or more, but less than $100,000, the
2 offender commits a felony of the second degree, punishable as
3 provided in s. 775.082, s. 775.083, or s. 775.084.
4 (c) Is $100,000 or more, the offender commits a felony
5 of the first degree, punishable as provided in s. 775.082, s.
6 775.083, or s. 775.084.
7 (12) As used in this section:
8 (a) "Property" means property as defined in s.
9 812.012.
10 (b) "Value" means value as defined in s. 812.012.
11 (13) Notwithstanding any other provision of law, a
12 proceeding under this section may be commenced at any time
13 within 5 years after the cause of action accrues; however, in
14 such proceeding, the period of limitation is tolled whenever
15 the defendant is continuously absent from this state or is
16 without a reasonably ascertainable place of residence or work
17 within this state, but not to extend such period of limitation
18 by more than 1 year. If a criminal prosecution, action, or
19 other proceeding is brought, or intervened in, to punish,
20 prevent, or restrain any violation of this section, the
21 running of the period of limitation prescribed by this
22 section, which is based in whole or in part upon any matter
23 complained of in any such prosecution, action, or proceeding,
24 shall be tolled during the pendency of the prosecution,
25 action, or proceeding and for 2 years following the
26 termination of such prosecution, action, or proceeding.
27 Section 14. The sum of $250,000 is hereby appropriated
28 from the Insurance Commissioner's Regulatory Trust Fund in a
29 nonoperating category to implement the purpose and provisions
30 of funding the anti-fraud reward program established by this
31 act.
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1 Section 15. This act shall take effect upon becoming a
2 law.
3
4 *****************************************
5 LEGISLATIVE SUMMARY
6
Requires insurers and health maintenance organizations to
7 provide for investigating insurance fraud and to submit
anti-fraud plans to the division. Establishes penalty
8 levels and prescribes time limitations for prosecution of
prohibited insurance fraud and solicitations. Provides
9 for disapproval of rates, forms, and filings.
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