Senate Bill sb1092c1

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    Florida Senate - 2001                           CS for SB 1092

    By the Committee on Banking and Insurance; and Senator
    Campbell




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  1                      A bill to be entitled

  2         An act relating to insurance fraud; providing

  3         legislative findings; creating s. 456.0375,

  4         F.S., relating to clinics; defining the term

  5         "clinic"; imposing registration requirements

  6         for certain clinics; providing for medical

  7         directors; providing for enforcement; amending

  8         s. 626.989, F.S., relating to Department of

  9         Insurance investigation of insurance fraud;

10         revising immunity provisions; amending s.

11         627.732, F.S., relating to definitions;

12         defining the terms "medically necessary" and

13         "broker"; amending s. 627.736, F.S.; revising

14         provisions relating to required personal injury

15         protection benefits; deleting provisions

16         specifying what medical payments insurance

17         pays; revising provisions for charges for

18         treatments; providing for presuit notice;

19         amending s. 627.739, F.S.; revising provisions

20         relating to deductibles; amending s. 817.234,

21         F.S.; revising provisions relating to false and

22         fraudulent insurance claims; amending s.

23         817.505, F.S.; providing penalties; amending s.

24         324.021, F.S.; conforming provisions to changes

25         made by the act; providing an effective date.

26

27  Be It Enacted by the Legislature of the State of Florida:

28

29         Section 1.  Legislative findings.--The Legislature

30  finds and declares that the purposes of the Florida Motor

31  Vehicle No-Fault Law have included providing to the public

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  1  affordable personal injury protection insurance, which is

  2  intended to deliver to persons involved in motor vehicle

  3  crashes medically necessary and appropriate medical care

  4  quickly, and without undue litigation or other associated

  5  costs, but that these purposes have been impeded by, among

  6  other things, fraud, medically inappropriate over-utilization

  7  of treatment and diagnostic services, inflated charges, and

  8  other practices of a small number of health care providers,

  9  entrepreneurs, and attorneys who are adding significant costs

10  to consumers, yet providing little or no real benefits. The

11  Legislature finds that some, but not all, of these practices

12  are described in the Statewide Grand Jury Report entitled

13  "Report on Insurance Fraud Related to Personal Injury

14  Protection" in case No. 95-746 in the Supreme Court of the

15  State of Florida, and the Legislature adopts and incorporates

16  in this section by reference as findings the entirety of such

17  report. The Legislature further finds that the problems

18  addressed in this report and in this act are matters of great

19  public interest and importance to public health, safety, and

20  welfare, and that the specific provisions of this act are the

21  least-restrictive reasonable means by which to solve these

22  problems.

23         Section 2.  Effective October 1, 2001, section

24  456.0375, Florida Statutes, is created to read:

25         456.0375  Registration of certain clinics;

26  requirements; discipline; exemptions.--

27         (1)  As used in this section, the term "clinic" means a

28  single structure or facility or group of adjacent structures

29  or facilities operating under the same business name or

30  management at which health care services are provided to

31  individuals and which tenders charges for reimbursement for

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  1  such services, unless it is otherwise licensed by the state

  2  pursuant to chapter 390, chapter 394, chapter 395, chapter

  3  400, chapter 463, chapter 465, chapter 466, chapter 478,

  4  chapter 480, or chapter 484 or is exempt from federal taxation

  5  under 26 U.S.C. s. 501(c)(3).

  6         (2)(a)  A clinic in which an entity or individual other

  7  than those licensed under chapter 458, chapter 459, chapter

  8  460, or chapter 461 possesses an ownership interest must

  9  register with the department. The clinic must at all times

10  maintain a valid registration. Each clinic location must be

11  registered separately even though operated under the same

12  business name or management. For purposes of determining

13  registration requirements under this paragraph, a clinic owned

14  by a physician licensed under chapter 458, chapter 459,

15  chapter 460, or chapter 461 also includes any clinic owned

16  jointly by the physician and the physician's spouse, parent,

17  or child if the licensed physician supervises the services

18  performed in the clinic and is legally responsible for the

19  clinic's compliance with all federal and state laws.

20         (b)  The department shall adopt rules necessary to

21  administer the registration program, including rules

22  establishing the specific registration procedures, forms, and

23  fees. Registration fees must be calculated to reasonably cover

24  the cost of registration and must be in such amount that the

25  total fees collected do not exceed the cost of administering

26  and enforcing compliance with this section. The registration

27  program must require:

28         1.  The clinic to file the registration form with the

29  department within 60 days after the effective date of this

30  section or prior to the inception of operation. The

31

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  1  registration expires automatically 2 years after its date of

  2  issuance and must be renewed biennially thereafter.

  3         2.  The registration form to contain the name,

  4  residence, and business address, phone number, and license

  5  number of the medical director for the clinic.

  6         3.  The clinic to display the registration certificate

  7  in a conspicuous location within the clinic which is readily

  8  visible to all patients.

  9         (3)(a)  Each clinic owned by an individual other than a

10  fully licensed physician or owned by an entity other than a

11  professional corporation or limited liability company composed

12  only of fully licensed physicians must employ or contract with

13  a physician maintaining a full and unencumbered physician

14  license in accordance with chapter 458, chapter 459, chapter

15  460, or chapter 461 to serve as the medical director.

16         (b)  A medical director must agree in writing to accept

17  legal responsibility for supervising the delivery of

18  appropriate health care services and supplies. The medical

19  director shall:

20         1.  Have signs identifying the medical director posted

21  in a conspicuous location within the clinic which is readily

22  visible to all patients.

23         2.  Ensure that all practitioners providing health care

24  services or supplies to patients maintain a current active and

25  unencumbered Florida license.

26         3.  Review any patient-referral contracts or agreements

27  executed by the clinic.

28         4.  Ensure that all health care practitioners at the

29  clinic have active appropriate certification or licensure for

30  the level of care being provided.

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  1         5.  Serve as the clinic records owner as defined in s.

  2  456.057.

  3         6.  Comply with the medical recordkeeping,

  4  office-surgery, and adverse-incident-reporting requirements of

  5  chapter 456, the respective practice acts, and the rules

  6  adopted thereunder.

  7         7.  Conduct systematic reviews of clinic billings to

  8  ensure that the billings are not fraudulent or unlawful. Upon

  9  discovery of an unlawful charge, the medical director must

10  take immediate corrective action.

11         (c)  Any contract to serve as a medical director

12  entered into or renewed by a physician in violation of this

13  section is void as contrary to public policy. This section

14  applies to contracts entered into or renewed on or after

15  October 1, 2001.

16         (d)  The department, in consultation with the boards,

17  shall adopt rules specifying limitations on the number of

18  registered clinics and licensees for which a medical director

19  may assume responsibility for purposes of this section. In

20  determining the quality of supervision a medical director can

21  provide, the department shall consider the number of clinic

22  employees, the clinic location, and the services provided by

23  the clinic.

24         (4)(a)  All charges or reimbursement claims made by or

25  on behalf of a clinic that is required to be registered under

26  this section but that is not so registered are unlawful

27  charges and therefore are noncompensable and unenforceable.

28  Any person establishing, operating, or managing an

29  unregistered clinic otherwise required to be registered under

30  this section commits a felony of the third degree, as provided

31

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  1  in s. 775.082, s. 775.083, or s. 775.084, in accordance with

  2  s. 456.065.

  3         (b)  Any licensed health care practitioner who violates

  4  this section is subject to discipline in accordance with

  5  chapter 456 and the respective practice act.

  6         (c)  The department shall revoke the registration of

  7  any clinic registered under this section for operating in

  8  violation of the requirements of this section.

  9         Section 3.  Paragraph (c) of subsection (4) of section

10  626.989, Florida Statutes, is amended to read:

11         626.989  Investigation by department or Division of

12  Insurance Fraud; compliance; immunity; confidential

13  information; reports to division; division investigator's

14  power of arrest.--

15         (4)

16         (c)  In the absence of fraud or bad faith, a person is

17  not subject to civil liability for libel, slander, or any

18  other relevant tort by virtue of filing reports, without

19  malice, or furnishing other information, without malice,

20  required by this section or required by the department or

21  division under the authority granted in this section, and no

22  civil cause of action of any nature shall arise against such

23  person:

24         1.  For any information relating to suspected

25  fraudulent insurance acts or persons suspected of engaging in

26  such acts furnished to or received from any local, state, or

27  federal law enforcement officials, their agents, or employees;

28         2.  For any information relating to suspected

29  fraudulent insurance acts or persons suspected of engaging in

30  such acts furnished to or received from other persons subject

31  to the provisions of this chapter; or

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  1         3.  For any such information furnished in reports to

  2  the department, the division, the National Insurance Crime

  3  Bureau, or the National Association of Insurance

  4  Commissioners, or any local, state, or federal enforcement

  5  officials or their agents or employees; or

  6         4.  For other actions taken in cooperation with any of

  7  the agencies or individuals specified in this paragraph in the

  8  lawful investigation of suspected fraudulent insurance acts.

  9         Section 4.  Section 627.732, Florida Statutes, is

10  amended to read:

11         627.732  Definitions.--As used in ss. 627.730-627.7405,

12  the term:

13         (1)  "Broker" means any person not possessing a license

14  under chapter 395, chapter 400, chapter 458, chapter 459,

15  chapter 460, chapter 461, or chapter 641 who charges or

16  receives compensation for any use of medical equipment and is

17  not the 100-percent owner or the 100-percent lessee of such

18  equipment. For purposes of this section, such owner or lessee

19  may be an individual, a corporation, a partnership, or any

20  other entity and any of its 100-percent-owned affiliates and

21  subsidiaries. For purposes of this subsection, the term

22  "lessee" means a long-term lessee under a capital or operating

23  lease, but does not include a part-time lessee. The term

24  "broker" does not include a hospital or physician management

25  company whose medical equipment is ancillary to the practices

26  managed, a debt collection agency, or an entity that has

27  contracted with the insurer to obtain a discounted rate for

28  such services; nor does the term include a management company

29  that has contracted to provide general management services for

30  a licensed physician or health care facility and whose

31  compensation is not materially affected by the usage or

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  1  frequency of usage of medical equipment or an entity that is

  2  100-percent owned by one or more hospitals or physicians.

  3         (2)  "Medically necessary" refers to a medical service

  4  or supply that a prudent physician would provide for the

  5  purpose of preventing, diagnosing, or treating an illness,

  6  injury, disease, or symptom in a manner that is:

  7         (a)  In accordance with generally accepted standards of

  8  medical practice;

  9         (b)  Clinically appropriate in terms of type,

10  frequency, extent, site, and duration; and

11         (c)  Not primarily for the convenience of the patient,

12  physician, or other health care provider.

13         (3)(1)  "Motor vehicle" means any self-propelled

14  vehicle with four or more wheels which is of a type both

15  designed and required to be licensed for use on the highways

16  of this state and any trailer or semitrailer designed for use

17  with such vehicle and includes:

18         (a)  A "private passenger motor vehicle," which is any

19  motor vehicle which is a sedan, station wagon, or jeep-type

20  vehicle and, if not used primarily for occupational,

21  professional, or business purposes, a motor vehicle of the

22  pickup, panel, van, camper, or motor home type.

23         (b)  A "commercial motor vehicle," which is any motor

24  vehicle which is not a private passenger motor vehicle.

25

26  The term "motor vehicle" does not include a mobile home or any

27  motor vehicle which is used in mass transit, other than public

28  school transportation, and designed to transport more than

29  five passengers exclusive of the operator of the motor vehicle

30  and which is owned by a municipality, a transit authority, or

31  a political subdivision of the state.

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  1         (4)(2)  "Named insured" means a person, usually the

  2  owner of a vehicle, identified in a policy by name as the

  3  insured under the policy.

  4         (5)(3)  "Owner" means a person who holds the legal

  5  title to a motor vehicle; or, in the event a motor vehicle is

  6  the subject of a security agreement or lease with an option to

  7  purchase with the debtor or lessee having the right to

  8  possession, then the debtor or lessee shall be deemed the

  9  owner for the purposes of ss. 627.730-627.7405.

10         (6)(4)  "Relative residing in the same household" means

11  a relative of any degree by blood or by marriage who usually

12  makes her or his home in the same family unit, whether or not

13  temporarily living elsewhere.

14         (7)(5)  "Recovery agent" means any person or agency who

15  is licensed as a recovery agent or recovery agency and

16  authorized under s. 324.202 to seize license plates.

17         Section 5.  Subsections (1), (4), (5), (7), (8), and

18  (9) of section 627.736, Florida Statutes, are amended, and

19  subsections (11) and (12) are added to that section, to read:

20         627.736  Required personal injury protection benefits;

21  exclusions; priority; claims.--

22         (1)  REQUIRED BENEFITS.--Every insurance policy

23  complying with the security requirements of s. 627.733 shall

24  provide personal injury protection to the named insured,

25  relatives residing in the same household, persons operating

26  the insured motor vehicle, passengers in such motor vehicle,

27  and other persons struck by such motor vehicle and suffering

28  bodily injury while not an occupant of a self-propelled

29  vehicle, subject to the provisions of subsection (2) and

30  paragraph (4)(d), to a limit of $10,000 for loss sustained by

31  any such person as a result of bodily injury, sickness,

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  1  disease, or death arising out of the ownership, maintenance,

  2  or use of a motor vehicle as follows:

  3         (a)  Medical benefits.--Eighty percent of all

  4  reasonable expenses for medically necessary medical, surgical,

  5  X-ray, dental, and rehabilitative services, including

  6  prosthetic devices, and medically necessary ambulance,

  7  hospital, and nursing services. Such benefits shall also

  8  include necessary remedial treatment and services recognized

  9  and permitted under the laws of the state for an injured

10  person who relies upon spiritual means through prayer alone

11  for healing, in accordance with his or her religious beliefs;

12  however, this sentence does not affect the determination of

13  what other services or procedures are medically necessary.

14         (b)  Disability benefits.--Sixty percent of any loss of

15  gross income and loss of earning capacity per individual from

16  inability to work proximately caused by the injury sustained

17  by the injured person, plus all expenses reasonably incurred

18  in obtaining from others ordinary and necessary services in

19  lieu of those that, but for the injury, the injured person

20  would have performed without income for the benefit of his or

21  her household. All disability benefits payable under this

22  provision shall be paid not less than every 2 weeks.

23         (c)  Death benefits.--Death benefits of $5,000 per

24  individual.  The insurer may pay such benefits to the executor

25  or administrator of the deceased, to any of the deceased's

26  relatives by blood or legal adoption or connection by

27  marriage, or to any person appearing to the insurer to be

28  equitably entitled thereto.

29

30  Only insurers writing motor vehicle liability insurance in

31  this state may provide the required benefits of this section,

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  1  and no such insurer shall require the purchase of any other

  2  motor vehicle coverage other than the purchase of property

  3  damage liability coverage as required by s. 627.7275 as a

  4  condition for providing such required benefits. Insurers may

  5  not require that property damage liability insurance in an

  6  amount greater than $10,000 be purchased in conjunction with

  7  personal injury protection.  Such insurers shall make benefits

  8  and required property damage liability insurance coverage

  9  available through normal marketing channels. Any insurer

10  writing motor vehicle liability insurance in this state who

11  fails to comply with such availability requirement as a

12  general business practice shall be deemed to have violated

13  part X of chapter 626, and such violation shall constitute an

14  unfair method of competition or an unfair or deceptive act or

15  practice involving the business of insurance; and any such

16  insurer committing such violation shall be subject to the

17  penalties afforded in such part, as well as those which may be

18  afforded elsewhere in the insurance code.

19         (4)  BENEFITS; WHEN DUE.--Benefits due from an insurer

20  under ss. 627.730-627.7405 shall be primary, except that

21  benefits received under any workers' compensation law shall be

22  credited against the benefits provided by subsection (1) and

23  shall be due and payable as loss accrues, upon receipt of

24  reasonable proof of such loss and the amount of expenses and

25  loss incurred which are covered by the policy issued under ss.

26  627.730-627.7405. When the Agency for Health Care

27  Administration provides, pays, or becomes liable for medical

28  assistance under the Medicaid program related to injury,

29  sickness, disease, or death arising out of the ownership,

30  maintenance, or use of a motor vehicle, benefits under ss.

31

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  1  627.730-627.7405 shall be subject to the provisions of the

  2  Medicaid program.

  3         (a)  An insurer may require written notice to be given

  4  as soon as practicable after an accident involving a motor

  5  vehicle with respect to which the policy affords the security

  6  required by ss. 627.730-627.7405.

  7         (b)  Personal injury protection insurance benefits paid

  8  pursuant to this section shall be overdue if not paid within

  9  30 days after the insurer is furnished written notice of the

10  fact of a covered loss and of the amount of same.  If such

11  written notice is not furnished to the insurer as to the

12  entire claim, any partial amount supported by written notice

13  is overdue if not paid within 30 days after such written

14  notice is furnished to the insurer.  Any part or all of the

15  remainder of the claim that is subsequently supported by

16  written notice is overdue if not paid within 30 days after

17  such written notice is furnished to the insurer.  However,

18  notwithstanding the fact that written notice has been

19  furnished to the insurer, any payment shall not be deemed

20  overdue when the insurer has reasonable proof to establish

21  that the insurer is not responsible for the payment,

22  notwithstanding that written notice has been furnished to the

23  insurer. An insurer shall have an additional 30 days from the

24  date the claim would otherwise have become overdue under this

25  subsection to pay a claim that the insurer refers within 30

26  days from the date of the claim to the Department of Insurance

27  pursuant to s. 626.989(6). An insurer may refer a claim to the

28  Department of Insurance for investigation only when the

29  insurer has reasonable evidence to establish that the claim is

30  in violation of s. 626.989 or is a criminal act. The insurer

31  shall provide the department with any information in support

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  1  of the referral, and shall, except when the department agrees

  2  that it would compromise the investigation, notify the person

  3  submitting the claim that the claim has been referred to the

  4  Department of Insurance for investigation. Any insurer who

  5  engages in a general business practice of forwarding claims

  6  for investigation under this section commits an unfair trade

  7  practice under the Insurance Code. For the purpose of

  8  calculating the extent to which any benefits are overdue,

  9  payment shall be treated as being made on the date a draft or

10  other valid instrument which is equivalent to payment was

11  placed in the United States mail in a properly addressed,

12  postpaid envelope or, if not so posted, on the date of

13  delivery. This paragraph does not preclude or limit the

14  ability of the insurer to assert that the claim was unrelated,

15  was not medically necessary, or was unreasonable or that the

16  amount of the charge was in excess of that permitted under, or

17  in violation of, subsection (5). Such assertion by the insurer

18  may be made at any time, including after payment of the claim

19  or after the 30-day time period for payment set forth in this

20  paragraph.

21         (c)  All overdue payments shall bear simple interest at

22  the rate established by the Comptroller under s. 55.03 or the

23  rate established in the insurance contract, whichever is

24  greater, for the year in which the payment became overdue and

25  for claims referred to the Department of Insurance for

26  investigation under paragraph (b), calculated from the date

27  the insurer was furnished with written notice of the amount of

28  covered loss. Interest shall be due at the time payment of the

29  overdue claim is made of 10 percent per year.

30         (d)  The insurer of the owner of a motor vehicle shall

31  pay personal injury protection benefits for:

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  1         1.  Accidental bodily injury sustained in this state by

  2  the owner while occupying a motor vehicle, or while not an

  3  occupant of a self-propelled vehicle if the injury is caused

  4  by physical contact with a motor vehicle.

  5         2.  Accidental bodily injury sustained outside this

  6  state, but within the United States of America or its

  7  territories or possessions or Canada, by the owner while

  8  occupying the owner's motor vehicle.

  9         3.  Accidental bodily injury sustained by a relative of

10  the owner residing in the same household, under the

11  circumstances described in subparagraph 1. or subparagraph 2.,

12  provided the relative at the time of the accident is domiciled

13  in the owner's household and is not himself or herself the

14  owner of a motor vehicle with respect to which security is

15  required under ss. 627.730-627.7405.

16         4.  Accidental bodily injury sustained in this state by

17  any other person while occupying the owner's motor vehicle or,

18  if a resident of this state, while not an occupant of a

19  self-propelled vehicle, if the injury is caused by physical

20  contact with such motor vehicle, provided the injured person

21  is not himself or herself:

22         a.  The owner of a motor vehicle with respect to which

23  security is required under ss. 627.730-627.7405; or

24         b.  Entitled to personal injury benefits from the

25  insurer of the owner or owners of such a motor vehicle.

26         (e)  If two or more insurers are liable to pay personal

27  injury protection benefits for the same injury to any one

28  person, the maximum payable shall be as specified in

29  subsection (1), and any insurer paying the benefits shall be

30  entitled to recover from each of the other insurers an

31

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  1  equitable pro rata share of the benefits paid and expenses

  2  incurred in processing the claim.

  3         (f)  Medical payments insurance, if available in a

  4  policy of motor vehicle insurance, shall pay the portion of

  5  any claim for personal injury protection medical benefits

  6  which is otherwise covered but is not payable due to the

  7  coinsurance provision of paragraph (1)(a), regardless of

  8  whether the full amount of personal injury protection coverage

  9  has been exhausted.  The benefits shall not be payable for the

10  amount of any deductible which has been selected.

11         (f)(g)  It is a violation of the insurance code for an

12  insurer to fail to timely provide benefits as required by this

13  section with such frequency as to constitute a general

14  business practice.

15         (5)  CHARGES FOR TREATMENT OF INJURED PERSONS.--

16         (a)  Any physician, hospital, clinic, or other person

17  or institution lawfully rendering treatment to an injured

18  person for a bodily injury covered by personal injury

19  protection insurance may charge only a reasonable amount for

20  the products, services, and supplies accommodations rendered,

21  and the insurer providing such coverage may pay for such

22  charges directly to such person or institution lawfully

23  rendering such treatment, if the insured receiving such

24  treatment or his or her guardian has countersigned the

25  invoice, bill, or claim form approved by the Department of

26  Insurance upon which such charges are to be paid for as having

27  actually been rendered, to the best knowledge of the insured

28  or his or her guardian. In no event, however, may such a

29  charge be in excess of the amount the person or institution

30  customarily charges for like products, services, or supplies

31  accommodations in cases involving no insurance. An insurer is

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  1  not required to pay a claim made by a broker or by a person

  2  making a claim on behalf of a broker.

  3         (b)1.  Charges, provided that charges for medically

  4  necessary cephalic thermograms, and peripheral thermograms,

  5  spinal ultrasounds, extremity ultrasounds, video fluoroscopy,

  6  surface electromyography, and nerve conduction testing

  7  (including motor and sensory nerves as well as F waves, H

  8  reflexes, somatosensory evoked potentials, and dermatomal

  9  studies) shall not exceed the maximum reimbursement allowance

10  for such procedures as set forth in the applicable fee

11  schedule or other payment methodology established pursuant to

12  s. 440.13.

13         2.  Charges for medically necessary magnetic resonance

14  imaging service may not exceed 75 percent of the Ingenix

15  Customized Fee Analyzer for the Zip Code prefix 330 for

16  Florida year 2000 plus annual increases equal to the medical

17  Consumer Price Index for Florida. Procedures not reimbursed

18  under the Ingenix Customized Fee Analyzer for Zip Code prefix

19  330 shall not be reimbursed for magnetic resonance imaging

20  centers or magnetic resonance imaging leasing companies in

21  Florida to reduce costs and prevent fraud. This subparagraph

22  does not apply to charges for magnetic resonance imaging

23  services billed and collected by facilities licensed under

24  chapter 395.

25         (c)(b)  With respect to any treatment or service, other

26  than medical services billed by a hospital or other provider

27  for emergency services as defined in s. 395.002 or inpatient

28  services rendered at a hospital-owned facility, the statement

29  of charges must be furnished to the insurer by the provider

30  and may not include, and the insurer is not required to pay,

31  charges for treatment or services rendered more than 35 30

                                  16

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  1  days before the postmark date of the statement, except for

  2  past due amounts previously billed on a timely basis under

  3  this paragraph, and except that, if the provider submits to

  4  the insurer a notice of initiation of treatment within 21 days

  5  after its first examination or treatment of the claimant, the

  6  statement may include charges for treatment or services

  7  rendered up to, but not more than, 75 60 days before the

  8  postmark date of the statement. The injured party is not

  9  liable for, and the provider shall not bill the injured party

10  for, charges that are unpaid because of the provider's failure

11  to comply with this paragraph. Any agreement requiring the

12  injured person or insured to pay for such charges is

13  unenforceable. If, however, the insured fails to furnish the

14  provider with the correct name and address of the insured's

15  personal injury protection insurer, the provider has 35 days

16  from the date the provider obtains the correct information to

17  furnish the insurer with a statement of the charges. The

18  insurer is not required to pay for such charges unless the

19  provider includes with the statement documentary evidence that

20  was provided by the insured during the 35-day period

21  demonstrating that the provider reasonably relied on erroneous

22  information from the insured and either:

23         1.  A denial letter from the incorrect insurer; or

24         2.  Proof of mailing, which may include an affidavit

25  under penalty of perjury, reflecting timely mailing to the

26  incorrect address or insurer. For emergency services and care

27  as defined in s. 395.002 rendered in a hospital emergency

28  department or for transport and treatment rendered by an

29  ambulance provider licensed pursuant to part III of chapter

30  401, the provider is not required to furnish the statement of

31  charges within the time periods established by this paragraph;

                                  17

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  1  and the insurer shall not be considered to have been furnished

  2  with notice of the amount of covered loss for purposes of

  3  paragraph (4)(b) until it receives a statement complying with

  4  paragraph (e) (5)(d), or copy thereof, which specifically

  5  identifies the place of service to be a hospital emergency

  6  department or an ambulance in accordance with billing

  7  standards recognized by the Health Care Finance

  8  Administration. Each notice of insured's rights under s.

  9  627.7401 must include the following statement in type no

10  smaller than 12 points:

11         BILLING REQUIREMENTS.--Florida Statutes provide

12         that with respect to any treatment or services,

13         other than certain hospital and emergency

14         services, the statement of charges furnished to

15         the insurer by the provider may not include,

16         and the insurer and the injured party are not

17         required to pay, charges for treatment or

18         services rendered more than 35 30 days before

19         the postmark date of the statement, except for

20         past due amounts previously billed on a timely

21         basis, and except that, if the provider submits

22         to the insurer a notice of initiation of

23         treatment within 21 days after its first

24         examination or treatment of the claimant, the

25         statement may include charges for treatment or

26         services rendered up to, but not more than, 75

27         60 days before the postmark date of the

28         statement.

29         (d)(c)  Every insurer shall include a provision in its

30  policy for personal injury protection benefits for binding

31  arbitration of any claims dispute involving medical benefits

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  1  arising between the insurer and any person providing medical

  2  services or supplies if that person has agreed to accept

  3  assignment of personal injury protection benefits. The

  4  provision shall specify that the provisions of chapter 682

  5  relating to arbitration shall apply.  The prevailing party

  6  shall be entitled to attorney's fees and costs. For purposes

  7  of the award of attorney's fees and costs, the prevailing

  8  party shall be determined as follows:

  9         1.  When the amount of personal injury protection

10  benefits determined by arbitration exceeds the sum of the

11  amount offered by the insurer at arbitration plus 50 percent

12  of the difference between the amount of the claim asserted by

13  the claimant at arbitration and the amount offered by the

14  insurer at arbitration, the claimant is the prevailing party.

15         2.  When the amount of personal injury protection

16  benefits determined by arbitration is less than the sum of the

17  amount offered by the insurer at arbitration plus 50 percent

18  of the difference between the amount of the claim asserted by

19  the claimant at arbitration and the amount offered by the

20  insurer at arbitration, the insurer is the prevailing party.

21         3.  When neither subparagraph 1. nor subparagraph 2.

22  applies, there is no prevailing party. For purposes of this

23  paragraph, the amount of the offer or claim at arbitration is

24  the amount of the last written offer or claim made at least 30

25  days prior to the arbitration.

26         4.  In the demand for arbitration, the party requesting

27  arbitration must include a statement specifically identifying

28  the issues for arbitration for each examination or treatment

29  in dispute. The other party must subsequently issue a

30  statement specifying any other examinations or treatment and

31  any other issues that it intends to raise in the arbitration.

                                  19

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  1  The parties may amend their statements up to 30 days prior to

  2  arbitration, provided that arbitration shall be limited to

  3  those identified issues and neither party may add additional

  4  issues during arbitration.

  5         (e)(d)  All statements and bills for medical services

  6  rendered by any physician, hospital, clinic, or other person

  7  or institution shall be submitted to the insurer on a Health

  8  Care Finance Administration 1500 form, UB 92 forms, or any

  9  other standard form approved by the department for purposes of

10  this paragraph. All billings for such services shall, to the

11  extent applicable, follow the Physicians' Current Procedural

12  Terminology (CPT) in the year in which services are rendered.

13  No statement of medical services may include charges for

14  medical services of a person or entity that performed such

15  services without possessing the valid licenses required to

16  perform such services. For purposes of paragraph (4)(b), an

17  insurer shall not be considered to have been furnished with

18  notice of the amount of covered loss or medical bills due

19  unless the statements or bills comply with this paragraph.

20         (7)  MENTAL AND PHYSICAL EXAMINATION OF INJURED PERSON;

21  REPORTS.--

22         (a)  Whenever the mental or physical condition of an

23  injured person covered by personal injury protection is

24  material to any claim that has been or may be made for past or

25  future personal injury protection insurance benefits, such

26  person shall, upon the request of an insurer, submit to mental

27  or physical examination by a physician or physicians.  The

28  costs of any examinations requested by an insurer shall be

29  borne entirely by the insurer. Such examination shall be

30  conducted within the municipality where the insured is

31  receiving treatment, or in a location reasonably accessible to

                                  20

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  1  the insured, which, for purposes of this paragraph, means any

  2  location within the municipality in which the insured resides,

  3  or any location within 10 miles by road of the insured's

  4  residence, provided such location is within the county in

  5  which the insured resides. If the examination is to be

  6  conducted in a location reasonably accessible to the insured,

  7  and if there is no qualified physician to conduct the

  8  examination in a location reasonably accessible to the

  9  insured, then such examination shall be conducted in an area

10  of the closest proximity to the insured's residence.  Personal

11  protection insurers are authorized to include reasonable

12  provisions in personal injury protection insurance policies

13  for mental and physical examination of those claiming personal

14  injury protection insurance benefits. An insurer may not

15  withdraw payment of a treating physician without the consent

16  of the injured person covered by the personal injury

17  protection, unless the insurer first obtains a valid report by

18  a physician licensed under the same chapter as the treating

19  physician whose treatment authorization is sought to be

20  withdrawn, stating that treatment was not reasonable, related,

21  or necessary. A valid report is one that is prepared and

22  signed by the physician examining the injured person or

23  reviewing the treatment records of the injured person and is

24  factually supported by the examination and treatment records

25  if reviewed and that has not been modified by anyone other

26  than the physician. The physician preparing the report must be

27  in active practice, unless the physician is physically

28  disabled. Active practice means that during the 3 years

29  immediately preceding the date of the physical examination or

30  review of the treatment records the physician must have

31  devoted professional time to the active clinical practice of

                                  21

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  1  evaluation, diagnosis, or treatment of medical conditions or

  2  to the instruction of students in an accredited health

  3  professional school or accredited residency program or a

  4  clinical research program that is affiliated with an

  5  accredited health professional school or teaching hospital or

  6  accredited residency program.

  7         (b)  If requested by the person examined, a party

  8  causing an examination to be made shall deliver to him or her

  9  a copy of every written report concerning the examination

10  rendered by an examining physician, at least one of which

11  reports must set out the examining physician's findings and

12  conclusions in detail.  After such request and delivery, the

13  party causing the examination to be made is entitled, upon

14  request, to receive from the person examined every written

15  report available to him or her or his or her representative

16  concerning any examination, previously or thereafter made, of

17  the same mental or physical condition.  By requesting and

18  obtaining a report of the examination so ordered, or by taking

19  the deposition of the examiner, the person examined waives any

20  privilege he or she may have, in relation to the claim for

21  benefits, regarding the testimony of every other person who

22  has examined, or may thereafter examine, him or her in respect

23  to the same mental or physical condition. If a person

24  unreasonably refuses to submit to an examination, the personal

25  injury protection carrier is no longer liable for subsequent

26  personal injury protection benefits.

27         (8)  APPLICABILITY OF PROVISION REGULATING ATTORNEY'S

28  FEES.--With respect to any dispute under the provisions of ss.

29  627.730-627.7405 between the insured and the insurer, or

30  between an assignee of an insured's rights and the insurer,

31

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  1  the provisions of s. 627.428 shall apply, except as provided

  2  in subsection (11).

  3         (9)  REPORTING REQUIREMENTS.--

  4         (a)  Each insurer which has issued a policy providing

  5  personal injury protection benefits shall report the renewal,

  6  cancellation, or nonrenewal thereof to the Department of

  7  Highway Safety and Motor Vehicles within 45 days from the

  8  effective date of the renewal, cancellation, or nonrenewal.

  9  Upon the issuance of a policy providing personal injury

10  protection benefits to a named insured not previously insured

11  by the insurer thereof during that calendar year, the insurer

12  shall report the issuance of the new policy to the Department

13  of Highway Safety and Motor Vehicles within 30 days.  The

14  report shall be in such form and format and contain such

15  information as may be required by the Department of Highway

16  Safety and Motor Vehicles which shall include a format

17  compatible with the data processing capabilities of said

18  department, and the Department of Highway Safety and Motor

19  Vehicles is authorized to adopt rules necessary with respect

20  thereto. Failure by an insurer to file proper reports with the

21  Department of Highway Safety and Motor Vehicles as required by

22  this subsection or rules adopted with respect to the

23  requirements of this subsection constitutes a violation of the

24  Florida Insurance Code. Reports of cancellations and policy

25  renewals and reports of the issuance of new policies received

26  by the Department of Highway Safety and Motor Vehicles are

27  confidential and exempt from the provisions of s. 119.07(1).

28  These records are to be used for enforcement and regulatory

29  purposes only, including the generation by the department of

30  data regarding compliance by owners of motor vehicles with

31  financial responsibility coverage requirements. In addition,

                                  23

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  1  the Department of Highway Safety and Motor Vehicles shall

  2  release, upon a written request by a person involved in a

  3  motor vehicle accident, by the person's attorney, or by a

  4  representative of the person's motor vehicle insurer, the name

  5  of the insurance company and the policy number for the policy

  6  covering the vehicle named by the requesting party.  The

  7  written request must include a copy of the appropriate

  8  accident form as provided in s. 316.065, s. 316.066, or s.

  9  316.068. Electronic access to the vehicle insurer information

10  maintained in the vehicle database of the Department of

11  Highway Safety and Motor Vehicles may be provided by an

12  approved third-party provider to insurers, lawyers, and

13  financial institutions for subrogation and claims purposes

14  only. The compilation of and retention of this information is

15  strictly prohibited.

16         (b)  Every insurer with respect to each insurance

17  policy providing personal injury protection benefits shall

18  notify the named insured or in the case of a commercial fleet

19  policy, the first named insured in writing that any

20  cancellation or nonrenewal of the policy will be reported by

21  the insurer to the Department of Highway Safety and Motor

22  Vehicles.  The notice shall also inform the named insured that

23  failure to maintain personal injury protection and property

24  damage liability insurance on a motor vehicle when required by

25  law may result in the loss of registration and driving

26  privileges in this state, and the notice shall inform the

27  named insured of the amount of the reinstatement fees required

28  by s. 627.733(7).  This notice is for informational purposes

29  only, and no civil liability shall attach to an insurer due to

30  failure to provide this notice.

31         (11)  PRESUIT NOTICE.--

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  1         (a)  As a condition precedent to filing any action for

  2  an overdue claim for benefits under paragraph (4)(b) for any

  3  claim that is not more than 45 days overdue, an insured or an

  4  assignee of an insured's rights must first provide the insurer

  5  with written notice of intent to initiate litigation. Such

  6  notice may not be sent until the claim is overdue, including

  7  any additional time the insurer has to pay the claim pursuant

  8  to paragraph (4)(b).

  9         (b)  This notice must be on a form approved by the

10  department and must state with specificity:

11         1.  The name of the insured with respect to whom such

12  benefits are being sought;

13         2.  The claim number or policy number under which such

14  claim was originally submitted to the insurer; and

15         3.  To the extent applicable, the name of any medical

16  provider who rendered the treatment, services, accommodations,

17  or supplies to an insured which form the basis of such claim;

18  and an itemized statement specifying the exact amount, the

19  dates of treatment, services, or accommodations, and the types

20  of benefits claimed to be due.

21         (c)  Each notice required by this section must be

22  delivered to the insurer by U.S. certified or registered mail,

23  return receipt requested, which postal costs are to be

24  reimbursed by the insurer if so requested by the provider in

25  the notice. Such notice must be sent to the insurer at the

26  address to which the claim in issue was sent, or current

27  address, if known, and to the attention of the adjuster

28  handling the claim, if known.

29         (d)  If, within 7 business days after receipt of notice

30  by the insurer, the overdue claim specified in the notice is

31  paid by the insurer along with applicable interest, no action

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  1  for nonpayment or late payment may be brought against the

  2  insurer. For purposes of this subsection, payment is

  3  considered to have been made on the date a draft or other

  4  valid instrument that is equivalent to payment has been placed

  5  in the U.S. mail in a properly addressed, postpaid envelope,

  6  or if not so posted, on the date of delivery. The insurer is

  7  not obligated to pay any attorney's fees if the insurer pays

  8  the claim within the time prescribed by this subsection.

  9         (e)  The applicable statute of limitation for an action

10  under this section shall be tolled for a period of 15 business

11  days by the mailing of the notice required by this subsection.

12         (f)  Any insurer who engages in a general business

13  practice of taking no action to pay, deny, or reduce claims

14  until receipt of the notice required by this section commits

15  an unfair trade practice under the Insurance Code.

16         (12)  CIVIL ACTION AGAINST PERSONS CONVICTED OF

17  FRAUD.--An insurer shall have a cause of action against any

18  person who, as a result of or in connection with a claim for

19  personal injury protection benefits under s. 627.736, is found

20  guilty of or pleads guilty or nolo contendere to, regardless

21  of adjudication of guilt, a violation of s. 817.234, s.

22  817.505, or s. 456.054. An insurer prevailing in an action

23  brought under this subsection may recover compensatory,

24  consequential, and punitive damages subject to the

25  requirements and limitations of part II of chapter 768, and

26  attorney's fees and costs incurred in litigating a cause of

27  action.

28         Section 6.  Subsection (2) of section 627.739, Florida

29  Statutes, is amended, and subsection (6) is added to that

30  section, to read:

31

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  1         627.739  Personal injury protection; optional

  2  limitations; deductibles.--

  3         (2)  Insurers shall offer to each applicant and to each

  4  policyholder, upon the renewal of an existing policy,

  5  deductibles, in amounts of $250, $500, and $1,000, and $2,000,

  6  such amount to be deducted from the benefits otherwise due

  7  each person subject to the deduction. However, at the time of

  8  application or renewal, each applicant and each policyholder

  9  must offer proof of health insurance to such insurer in order

10  to obtain a deductible of more than $500. However, this

11  subsection shall not be applied to reduce the amount of any

12  benefits received in accordance with s. 627.736(1)(c).

13         (6)  An insurer is not required to pay any charge as to

14  which the provider has failed to bill a copayment or

15  deductible, except that this does not apply when a provider

16  has waived a copayment or deductible in individual infrequent

17  cases (not as a general business practice) related to a

18  specific patient's ability to pay.

19         Section 7.  Subsections (8), (9), and (11) of section

20  817.234, Florida Statutes, are amended to read:

21         817.234  False and fraudulent insurance claims.--

22         (8)  It is unlawful for any person, in his or her

23  individual capacity or in his or her capacity as a public or

24  private employee, or for any firm, corporation, partnership,

25  or association, to solicit or cause to be solicited any

26  business from a person involved in a motor vehicle crash by

27  any means of communication other than advertising directed to

28  the public in or about city receiving hospitals, city and

29  county receiving hospitals, county hospitals, justice courts,

30  or municipal courts; in any public institution; in any public

31  place; upon any public street or highway; in or about private

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  1  hospitals, sanitariums, or any private institution; or upon

  2  private property of any character whatsoever for the purpose

  3  of making motor vehicle tort claims or claims for personal

  4  injury protection benefits required by s. 627.736.  Charges

  5  for any services rendered by a health care provider or

  6  attorney who violates this subsection in regard to the person

  7  for whom such services were rendered are noncompensable and

  8  unenforceable as a matter of law. Any person who violates the

  9  provisions of this subsection commits a felony of the third

10  degree, punishable as provided in s. 775.082, s. 775.083, or

11  s. 775.084. A person who is convicted of a violation of this

12  subsection shall be sentenced to a minimum term of

13  imprisonment of 6 months.

14         (9)  It is unlawful for any attorney to solicit any

15  business relating to the representation of a person involved

16  persons injured in a motor vehicle accident for the purpose of

17  filing a motor vehicle tort claim or a claim for personal

18  injury protection benefits required by s. 627.736.  The

19  solicitation by advertising of any business by an attorney

20  relating to the representation of a person injured in a

21  specific motor vehicle accident is prohibited by this section.

22  Any attorney who violates the provisions of this subsection

23  commits a felony of the third degree, punishable as provided

24  in s. 775.082, s. 775.083, or s. 775.084.  A person who is

25  convicted of a violation of this subsection shall be sentenced

26  to a minimum term of imprisonment of 6 months. Whenever any

27  circuit or special grievance committee acting under the

28  jurisdiction of the Supreme Court finds probable cause to

29  believe that an attorney is guilty of a violation of this

30  section, such committee shall forward to the appropriate state

31  attorney a copy of the finding of probable cause and the

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  1  report being filed in the matter. This section shall not be

  2  interpreted to prohibit advertising by attorneys which does

  3  not entail a solicitation as described in this subsection and

  4  which is permitted by the rules regulating The Florida Bar as

  5  promulgated by the Florida Supreme Court.

  6         (11)  If the value of any property involved in a

  7  violation of this section:

  8         (a)  Is less than $20,000, the offender commits a

  9  felony of the third degree, punishable as provided in s.

10  775.082, s. 775.083, or s. 775.084, and a convicted offender

11  shall be sentenced to a minimum term of imprisonment of 6

12  months.

13         (b)  Is $20,000 or more, but less than $100,000, the

14  offender commits a felony of the second degree, punishable as

15  provided in s. 775.082, s. 775.083, or s. 775.084, and a

16  convicted offender shall be sentenced to a minimum term of

17  imprisonment of 1 year.

18         (c)  Is $100,000 or more, the offender commits a felony

19  of the first degree, punishable as provided in s. 775.082, s.

20  775.083, or s. 775.084, and a convicted offender shall be

21  sentenced to a minimum term of imprisonment of 2 years.

22         Section 8.  Subsection (4) of section 817.505, Florida

23  Statutes, is amended to read:

24         817.505  Patient brokering prohibited; exceptions;

25  penalties.--

26         (4)  Any person, including an officer, partner, agent,

27  attorney, or other representative of a firm, joint venture,

28  partnership, business trust, syndicate, corporation, or other

29  business entity, who violates any provision of this section

30  commits a felony of the third degree, punishable as provided

31  in s. 775.082, s. 775.083, or s. 775.084. A person who is

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  1  convicted of a violation of this section shall be sentenced to

  2  a minimum term of imprisonment of 6 months.

  3         Section 9.  Subsection (1) of section 324.021, Florida

  4  Statutes, is amended to read:

  5         324.021  Definitions; minimum insurance required.--The

  6  following words and phrases when used in this chapter shall,

  7  for the purpose of this chapter, have the meanings

  8  respectively ascribed to them in this section, except in those

  9  instances where the context clearly indicates a different

10  meaning:

11         (1)  MOTOR VEHICLE.--Every self-propelled vehicle which

12  is designed and required to be licensed for use upon a

13  highway, including trailers and semitrailers designed for use

14  with such vehicles, except traction engines, road rollers,

15  farm tractors, power shovels, and well drillers, and every

16  vehicle which is propelled by electric power obtained from

17  overhead wires but not operated upon rails, but not including

18  any bicycle or moped. However, the term "motor vehicle" shall

19  not include any motor vehicle as defined in s. 627.732(3) s.

20  627.732(1) when the owner of such vehicle has complied with

21  the requirements of ss. 627.730-627.7405, inclusive, unless

22  the provisions of s. 324.051 apply; and, in such case, the

23  applicable proof of insurance provisions of s. 320.02 apply.

24         Section 10.  Except as otherwise expressly provided in

25  this act, this act shall take effect upon becoming a law.

26

27

28

29

30

31

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  1          STATEMENT OF SUBSTANTIAL CHANGES CONTAINED IN
                       COMMITTEE SUBSTITUTE FOR
  2                             SB 1092

  3

  4  Deletes the provision that a person who commits motor vehicle
    insurance fraud shall serve a minimum mandatory prison term of
  5  1 year.

  6  Requires certain clinics to register with the Department of
    Health and employ a physician as medical director with
  7  specified exceptions. Provides for responsibilities of the
    medical director and mandate penalties for unregistered
  8  clinics as well as discipline as to licensed health care
    practitioners who violate certain provisions.
  9
    Adds five additional diagnostic tests to the one now subject
10  to the workers' compensation fee schedule and limits the
    maximum reimbursement for medically necessary magnetic
11  resonance imaging (MRIs) services to 75 percent of the
    "Ingenix Customized Fee Analyzer." Hospitals are excluded from
12  this provision.

13  Provides for the definition of "broker" and states, with
    certain exceptions, that insurance companies are not required
14  to pay claims made by brokers or by persons making claims on
    behalf of brokers. Also defines "medically necessary" as used
15  in the motor vehicle no-fault law.

16  Allows an insurer an additional 30 days from the date a claim
    would otherwise become overdue to refer such claim for
17  investigation to the Department of Insurance (Fraud Division).
    Such referrals must be made within 30 days from the date of
18  the claim. However, the insurer may only refer such claims
    when it has "reasonable evidence" to establish that the claim
19  violates s. 626.989, F.S., or is a criminal act.

20  Mandates "presuit notice" as a condition precedent to filing
    an action for overdue claims against an insurer. However, such
21  notice only applies to claims which are not greater than 45
    days overdue. Clarifies that the notice of intent to initiate
22  litigation may not be sent until a claim is overdue and
    specifies the notice is to be sent to the insurer at the
23  address to which the claim in issue was sent and to the
    insurance adjuster. This provision allows insurers 7 business
24  days after receipt of a notice of an overdue claim to pay the
    claim without being potentially subject to payment of
25  attorney's fees.

26  Creates a civil cause of action to allow insurers to sue a
    person who, in connection with a claim for PIP benefits, is
27  found guilty of or plead guilty or nolo contendere to
    specified violations, regardless of adjudication of guilt.
28
    Provides minimum mandatory sentences for persons who solicit
29  persons involved in motor vehicle accidents, insurance fraud,
    and patient brokering.
30
    Expands immunity from civil liability for individuals
31  reporting insurance fraud to the Department of Insurance.

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CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2001                           CS for SB 1092
    311-1629-01




  1  Eliminates the $2,000 deductible and requires proof of health
    insurance in order to obtain a deductible above $500. Keeps
  2  the $250, $500, and $1,000 deductible.

  3  Provides that the "spiritual healing" provision does not
    affect determinations of what other services or procedures are
  4  medically necessary.

  5  Eliminates the medical payments provision which currently
    requires that medical payment insurance fill the 20 percent
  6  PIP co-insurance.

  7  Changes the interest rate for overdue payments from a fixed
    rate to the rate established by the Comptroller under s.
  8  55.03, F.S.

  9  Helps remedy the current practice of insurers utilizing
    "paper" independent medical examinations (IMEs) by requiring
10  "valid" reports by experienced physicians or a physical
    examination by a physician who meets certain active practice
11  criteria. Also provides that such report may not be modified
    by anyone other than the physician.
12
    Allows providers up to 75 days under specified conditions to
13  submit a statement of charges to insurance companies.

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CODING: Words stricken are deletions; words underlined are additions.