Michael Moline – Page 5 – Florida Politics

Michael Moline

Michael Moline is a former assistant managing editor of The National Law Journal and managing editor of the San Francisco Daily Journal. Previously, he reported on politics and the courts in Tallahassee for United Press International. He is a graduate of Florida State University, where he served as editor of the Florida Flambeau. His family’s roots in Jackson County date back many generations.

Mary McLeod Bethune statue proposal heading to House floor

A bill OK’d Wednesday would clear the way for a likeness of Florida educator and activist Mary McLeod Bethune to replace one of a Confederate general representing Florida in the U.S. Capitol.

The House Appropriations Committee unanimously cleared the measure (HB 139), making it available for the floor. The Senate version (SB 472) also cleared the floor unanimously on Jan. 31.

None of the Confederacy nostalgists who in the past have opposed the statue switch appeared during Wednesday’s hearing.

The panel also approved an amendment authorizing the state to claim the statue of General Edmund Kirby Smith in the spot Bethune’s would occupy, and to make it available for public display.

The move to replace Smith’s statue came after renewed debate about Confederate symbols, including the battle flag ubiquitous in the South.

Legislation to remove Smith and decide who should replace him passed during the 2016 Session. The options included George Washington Jenkins Jr., founder of the Publix supermarket chain, and author and environmentalist Marjory Stoneman Douglas.

In 1904, Bethune founded the school that eventually became what is now Bethune-Cookman University in Daytona Beach.

Daytona Beach Democrat Patrick Henry, who co-sponsored the measure with Republican Tom Leek, also from that area, said the time was right.

“A lot has happened in this country, with the things that went on in Charlottesville,” Henry said. “The state realized the time has come to move forward, and for the state of Florida to show the rest of the country that we’ll take the lead and be the first state to put an African American in Statuary Hall as our representative.”

The estimated cost of making the switch is $388,000. Bethune-Cookman University has offered to pick up the bill pending a fundraising effort. Each state can select two representatives to honor in the hall.

It’s not clear where Smith will land. “That’s above my pay grade,” Henry said. He is the only graduate of Bethune-Cookman University serving in the House, he said.

Bethune also served as president of the National Association of Colored Women, was an appointee of President Herbert Hoover to the White House Conference on Child Health, and was an adviser to President Franklin Roosevelt.

Each state has two statues on display in the Capitol. Florida’s other statue, a marble rendering of scientist-inventor Dr. John Gorrie of Apalachicola, a pivotal figure in the invention of air conditioning, is unaffected.

Insurance retroactive denial ban clears another House committee, despite qualms

Legislation to bar health insurers from retroactively denying claims passed the House Appropriations Committee Wednesday, after the sponsor promised to keep massaging language allowing insurers to tip off providers that a patient might not be covered.

The committee had been poised to vote on updated language allowing insurers to inform doctors that a patient’s policy was under a grace period — generally, a period of up to 30 days when a policy is in effect pending receipt of the premium.

But bill sponsor Bill Hager saw soft support for his amendment’s language, if not necessarily for its spirit.

“I know how to count,” Hager said following the 20-6 vote to send the underlying bill (CS/HB 271) to the Health & Human Services Committee. “The count I had indicated the amendment would not pass, but I was confident I could get the underlying bill through committee.”

The Boca Raton Republican plans to work on fresh language clarifying that insurers may inform providers that a patient’s policy is under a grace period. The Office of Insurance Regulation believes insurers lack that ability under existing law. That means a doctor can secure approval to provide services, only to face a demand to pay back an insurer later.

“I don’t see any statutory prohibition on it, but I’d prefer to clean it up and get this issue dealt with,” Hager said.

The idea is to let providers know that approval for a non-emergency procedure or test might be revoked unless the patient pays his or her premium by the end of the grace period.

“If we could just address that, I don’t know that we need all the other stuff,” committee member Richard Stark, a Democrat from Weston, said following the hearing. “It’s really a better idea to allow the discussion between the insurer and the physician, and let the physician make a decision.”

It would be easy enough to postpone nonemergency care until a premium gets paid, he said.

Lobbyists for providers spoke in favor of the bill, which has already cleared the Health Innovation Subcommittee. But insurance and business lobbyists warned it would enshrine a similar provision of the Affordable Care Act into state law. The bill would apply to non-ACA-subsidized individual and group plans.

Sanford Republican Jason Brodeur voted in favor of bill despite reservations that it might make insurance for state workers more expensive.

“What we’re really concerned about is this gaming of the system,” he said. Better to let patients and doctors figure out what to do if insurers rescind approvals for nonpayment.

“I don’t want to shift the risk to folks who don’t have any control over the situation. I would rather put the risk on those who do. And, in that transaction, that’s the physician and the patient.”

Flood insurance ‘warning’ clears second committee

Policyholders would see a bold 18-point type warning when their hurricane coverage won’t pay for flood damage under legislation that cleared a Senate panel Tuesday.

The Senate Community Affairs Committee OK’d the bill (SB 1282) 6-0.

Taddeo

The idea is to spare policyholders any nasty shocks following a hurricane or other natural disaster, said the sponsor, Miami Democrat Annette Taddeo.

“What we want to make sure is that homeowners, when they’re buying hurricane insurance, know that that does not include flood insurance,” Taddeo said.

“It will save a lot of trouble for homeowners,” she said. “After Hurricane Irma, a lot of homeowners were calling our office saying, ‘My insurance is not covering this.’ ”

The bill, which has one final stop at the Rules Committee, requires policy documents to contain the following warning:

“Flood insurance: you may also need to consider the purchase of flood insurance. Your homeowner’s insurance policy does not include coverage for damage resulting from flood, even if hurricane winds and rain caused the flood to occur. Without separate flood insurance coverage, you may have uncovered losses caused by flood. Please discuss the need to purchase separate flood insurance coverage with your insurance agent.”

Taddeo said following the vote that she’d taken steps to ensure the bill wouldn’t overly burden insurers.

“It’s a big problem,” she said following the vote. “It happened again with Irma — ‘What do you mean, it doesn’t cover it?’”

She noted that the Florida Wildlife Federation has endorsed the bill in light of rising sea levels caused by global warming.

“With sea level rise, it’s going to get worse. I’m concerned that homeowners need to cover themselves,” Taddeo said.

“My area’s not even on the beach — I’m on the west side. But I’m telling you, the flooding’s going to get worse on the west side, and that’s something people don’t realize.”

Tort reformer William Large keeps plugging away for PIP bad-faith revamp

One argument in the debate over repeal of Florida’s no-fault auto insurance system isn’t finding much love in the Legislature — that the real key to lower premiums is reform of the legal rules governing coverage disputes that do land in court.

People injured by covered motorists can resort to the tort system if carriers treat them in bad faith — say, by refusing legitimate claims or dallying in replying to demands. Carriers and other advocates argue plaintiffs’ attorneys abuse the system to win recoveries above stated policy limits.

Neither HB 19 by Vero Beach Republican Erin Grall  nor SB 150 by Brandon Republican Tom Lee would do that. This story summarizes the legislation.

We sat down with William Large, president of the Justice Reform Institute, which advocates for tort reform, to discuss the situation. The remarks below have been edited for length and clarity.

FP: PIP reform — good idea? Bad idea?

Large: It’s a bad idea in its current form. You cannot reform PIP without doing something essential. And that is reforming our third-party bad-faith litigation regime. Since both the House bill and the Senate bill don’t have third-party bad faith reforms, it’s currently a bad idea. In addition, the Senate version has a medical pay provision, which is basically PIP 2.0. So when you combine those two factors, you have really bad idea.

FP: Define PIP 2.0.

Large: PIP was developed back in the 1970s here in Florida. It was a no-fault system, whereby, if there were an accident, there would be coverage provided to those individuals. The founder of the PIP system later realized there was a mistake, because you saw litigation over low-dollar amounts while an attorney was making a fee fighting over these low-dollar amounts. It was akin to the problems you see with workers’ compensation litigation.

If we were to remove PIP completely and replace it with a mandatory medical payment system, it’s going to be very similar to the old PIP regime. You’ll see litigation over low-dollar amounts, and you’ll see high attorney fee awards fighting over those low-dollar amounts.

In Florida, there’s been a plethora of third-party bad-faith cases. There are two types of attorneys in these cases. There are the attorneys who handle PIP cases, and they fight over the PIP policy, usually in county court. They’re making an hourly rate. And there are many practitioners who practice in circuit court who look down on county court practitioners. Even though the PIP practitioners do very well litigating those cases.

FP: They’re in county court because of the dollar amounts?

Large: Yes, the jurisdictional limits. There’s a rift in the Florida Justice Association — the trial lawyers — between the traditional PIP attorneys and those attorneys who want to go to mandatory bodily injury coverage. They really want to bring third-party bad-faith cases. And that’s exactly what they’ll do if this law passes without third-party bad-faith reform. What they have done is thrown the PIP county court practitioners under the bus.

FP: Are you concerned about the medical coverage mandate?

Large: Yes, because med pay brings both bad things together. It’s basically PIP all over again, without the 30-some-odd years’ case law. It’s going to be fighting over low-dollar amounts on an hourly rate. You’ll have PIP 2.0, no bad-faith reform, and you’ll see a plethora of lawsuits. Any reform can’t have med pay in it, and you need to have third-party bad-faith reform to be successful.

FP: The one-way fee provision (under which insurers are obliged to pay policyholders’ costs of litigating coverage disputes) applies in this instance?

Large: Right.

FP: So what does third-party bad-faith reform look like?

Large: One is an objective measure of time, such as 45 days, before a insurer can be held in bad faith. Two, a mandate that the third-party plaintiffs and their attorneys act in good faith in handling the claim. And No. 3 is interpleader reform (clarifying apportionment of payments between, say, four people, with diverging injuries and medical costs, hurt by a covered driver). Any PIP repeal bill has to have those three elements, and can’t include a med pay provision.

FP: What are you hearing about the likelihood that the reforms you’re talking about are going to happen?

Large: It’s a difficult road ahead of us. We’ve made our position known at every committee stop and we’ve asked the sponsors to include that. As of this date, that hasn’t happened.

FP: What’s the reluctance?

Large: Seemingly that the trial bar does not want third-party bad-faith reform, and they have advocated against it. It’s a powerful stakeholder group.

FP: What’s next?

Large: What’s next is continuing to advocate. I think it’s also important to point out that the Property Casualty Insurers Association of America came out with a study that shows if you go to a mandatory bodily injury system, it’s going to be a cost driver for a lot of individuals. (Details of that study here.)

FP: Do you consider that report credible?

Large: I consider it very credible. It’s well documented, the analysis is solid, and a lot of time was spent analyzing the issues concerned with both PIP and third-party bad-faith language. There would be a 5.3 percent or $67 dollar increase for the average driver who purchases many but not all of the available auto insurance coverage, a 7.2 percent or $105 dollar increase to drivers who purchase all coverages, and a 50.1 percent or $230 increase to drivers who purchase minimum mandatory limits post HB 19. For a working family of four trying to get by, this is going to be a cost driver.

FP: Did the report have much effect on what the Legislature seems likely to do?

Large: The report just came out. I hope it does cause the policymakers in the Legislative branch to see that this will be a cost driver for insurance premiums for all Floridians — and in particular for Floridians who buy the minimum coverage requirements.

I’ve spoken to Rep. Grall and Sen. Lee about this subject. Their thinking is that these are two separate and distinct concepts that are unrelated. They think third-party bad-faith reform is a separate subject that they want to leave for another day.

FP: That would be a mistake?

Large: Yes. They are completely interrelated. If you’re going to get rid of PIP, you need third-party bad-faith reform and you can’t include a medical payments provision.

Senators lash out at insurance industry during hearing on AOB reform

The Senate Judiciary Committee on Tuesday stripped assignment of benefits legislation of an attorney-fee provision despised by the insurance industry. But that didn’t satisfy industry objections to the overall bill.

And that really annoyed a couple of key senators.

An amendment to CS/SB 1168 by Judiciary Committee chairman Greg Steube, a Sarasota Republican, eliminated language barring carriers from factoring any attorney fee awards they pay into their premium structures.

“That seemed to be the most controversial, most antagonist piece of the bill,” Steube said. “Working with the stakeholders and working with both sides, it seemed that there was some agreement to take that part out.”

Nevertheless, a stream of insurance and big-business lobbyists said the amended bill wouldn’t solve the main problem, which they saw as abuse by contractors using assignment of benefits, or AOB, agreements to extract legal fees from carriers.

Florida’s one-way attorney fee statute requires carriers to cover policyholders’ litigation costs, as a way of easing the burden on consumers.

Steube said none of the critics could explain why his language wouldn’t help solve the problem, and pointed to a provision allowing carriers to collect attorney fees from plaintiffs if the latter refuse a good faith offer of settlement and then lose in court.

“Also, I’ve asked everyone who has come to meet with me, on the insurance side of the argument, if you have a recommendation as to how we can fix the one-way attorney fee without doing away with it … I’m happy and more than willing to look at that. No one from that side of the argument has come to me with any recommendation,” Steube said.

The committee voted, 7-3, to send the bill on to the Rules Committee.

Later, Steube let off some steam with reporters.

“We’ve gotten the ball to where they want the ball to be with the exception of the one-way attorney fees,” he said. “I don’t think there’s an appetite in this Senate to do away with the one-way attorney fees.”

Miami Republican Anitere Flores, who sits on the Judiciary Committee and chairs the Banking & Insurance Committee, shared that sentiment. She cited industry reluctance to commit to lower rates, plus what she viewed as an overall intransigent attitude.

“It’s SB 62 or the highway,” Flores said of legislation, by Sen. Dorothy Hukill, which essentially would eliminate attorney fees awards to contractors with AOBs. It has gone nowhere in the legislative process. “They don’t even like the House bill.”

Legislation (HB 7015) that has cleared the House also would eliminate one-way fees.

Industry spokesmen insisted it would be difficult to predict premium levels resulting from any legislation.

Fort Myers Republican Lizbeth Benacquisto put the question to Personal Insurance Federation of Florida lobbyist Michael Carlson: Would he stipulate that rates would go down if the Legislature does what the industry wants?

“If we’re going to do the hard work, we should make sure that the folks back home see the benefit,” she said.

There are too many variables to make an accurate prediction, Carlson insisted.

“Except, with all due respect, whenever there are pieces of legislation that the industry does not like, rates will go up by certain percentages,” Benacquisto replies. “But when it is, in our estimation, to benefit the folks we serve, that math is not possible.”

Insurance industry’s Michael Carlson: We hope PIP-repeal study ‘will kill the bill’

A Property Casualty Insurers Association of America study made a splash last week in Tallahassee by suggesting repeal of Florida’s no-fault auto insurance system would produce significant increases in motorists’ premiums.

The findings contrast those of a similar study last year by Pinnacle Actuarial Resources, which estimated repeal would save policyholders 8.1 percent in liability coverage rates, but only 5.6 percent overall, as exposure shifts to lines including medical insurance.

Legislation (HB 19) by Vero Beach Republican Erin Grall would repeal Florida’s personal injury protection, or PIP, insurance mandate but require motorists to carry $25,000 per person and $50,000 per accident in bodily injury (BI) liability coverage, plus $10,000 for property damage liability, beginning next year.

The Senate version (SB 150) by Brandon Republican Tom Lee would require $20,000 per person and $40,000 per occurrence in bodily injury coverage and mandatory medical payments coverage of $5,000. Those coverage levels ratchet up to $30,000 per person and $60,000 per incident after three years.

We discussed the legislation with Michael Carlson, president of the Personal Insurance Federation of Florida, which represents major carriers including Allstate, Farmers, State Farm and Progessive. The remarks below have been edited for length and clarity.

FP: Let’s talk about those findings.

Carlson: I haven’t gone through the details. I do know that the numbers in the report indicate that, for street-legal drivers, those who buy the bare minimum, which is a pretty good number of people in Florida, there would be a substantial increase in their premiums. That’s always been a concern of ours. You can argue about the numbers; the point is that you’re going to impose a cost on thousands or hundreds of thousands of Floridians.

FP: The most economically challenged Floridians.

Carlson: I think that’s a fair statement. We’ve all along been telling (House and Senate) members to be very, very careful about the rate impacts that the bill could create. We think the House has done a better job of that. The House bill has a little less coverage and no ornamentation — there’s no medical pay or other additional mandatory coverage. One thing Pinnacle shows is increases in 60 of 67 counties under a 25/50 bodily injury mandate, which is the House bill, plus a $5,000 med pay.

FP: Did those results strike you as out of line?

Carlson: No. It struck me as — and I haven’t read the whole report — they appear to have dug down into the actual company data. They really drilled down into where you might have significant impact. They also looked at the bad-faith cost.

FP: Define bad-faith in this context.

Carlson: It’s when the insurance company puts its own interests ahead of its insured in the handling of a claim. That can take many forms. Classically, it’s when you have an insured who you know is liable for an injury or death arising out of an accident and you deny the claim — unless you have good-faith reason to understand that, “Hey, my guy is not liable; we didn’t cause this.” Commonly, though, the bad-faith law is used to position an insurer for liability above the contract amount.

(Bad-faith suits typically involve claims by third parties in accidents caused by low-insurance drivers, to attempt to secure payouts above the coverage limits, Carlson said. Plaintiffs’ attorneys may assert failure by an insurer to pay within a reasonable time, for example.)

The Insurance Research Council did a study of the costs of claims settlements designed to avoid bad-faith suits. They came up with a number of about $80 per insured vehicle per year. That’s like $800 million in additional insurance costs. If you are found to be in bad faith by a court, and you are imposed a penalty, you may not pass that on as a cost of doing business. That’s designed to penalize the companies, hurt them financially.

We’ve said as to PIP repeal, “Look, Legislature, if you are considering a major policy change, include some reasonable bad-faith reform so that you can defray the cost.” We would have to pass that lower cost on in the form of a rate. If you’re having an increase in cost over here because you’re adding more generous BI, let’s say, but you’re also helping to lower costs (through bad-faith reform), you should have rates that maybe will not be as high as they otherwise might be. The Legislature has not grabbed onto that notion.

FP: Is there a bill up to do that this year?

Carlson: There is not. It would naturally fit in either of the PIP bills. Rep. Grall, her focus is, let’s get PIP repeal done, let’s evaluate the market’s reaction, let’s see what happens, and then let’s come back and talk about bad faith. If bad faith proves to be a real problem, in her view, we’ll do it another way. It’s a polite way of putting that issue to the side, because it’s controversial. The Senate has not entertained the idea.

FP: What would you want any language to say?

Carlson: The most recent proposals have generally centered around a safe-harbor provision. That’s a period of time following a bad-faith claim to pay the limits, give them the check, in which case there would be no liability for bad faith. It should be noted that, under current law, in first-party bad faith — which is when I sue my own insurance company because they’ve mistreated me in my claim — there’s a 60-day safe harbor. In the third-party area, there is no such safe harbor.

There may be other ideas that are good ones, things we haven’t even thought about. So we’re open to dialog on that. I just don’t see much of an appetite, given the trial bar’s lobbying on this.

FP: What about no pay, no play?

Carlson: The idea being, if you have not bought the insurance, then you cannot sue for non-economic damages like pain and suffering.

FP: Any appetite for that?

Carlson: I know that that’s been talked about. But I’ve heard no member discuss it. I’ve not even seen an amendment prepared to be offered by a member on that issue. It would be a good way to incentivize the purchase of insurance, because you wouldn’t get those non-economic damages, which can be substantial.

FP: What does this report do politically in terms of the PIP bill?

Carlson: We hope the report, taken seriously, will kill the bill. We are opposed to the Senate bill. We think it’s the wrong direction. It’s a rate increase for many, many Floridians. We think that the medical payments coverage mandate is almost a tax for those Floridians who have medical coverage elsewhere. The lack of consideration of some meaningful bad-faith reform — however reasonable and common-sense we can get it to be — means that you’re not even going to try to reduce those cost impacts of higher BI limits and medical payments coverage.

FP: Bad faith is the tree we should be barking up?

Carlson: If you’re going change the entire auto reparations system to a tort system, bad faith absolutely should be included. It’s naturally connected to the problem.

FP: In an ideal world, what would the Legislature do about PIP?

Carlson: Fix the current law so that it is very clear what the fee schedule for medical reimbursements are. If the medical providers and insurers were both sat down by the law and told, “Here’s exactly how you do the math, here’s what a reasonable payment is,” you would not have litigation. The PIP system would work much, much better.

Insurance lobby pulls knives out for ‘retroactive denial of claims’ bill

An attempt in the Florida House to scale back legislation targeting retroactive denials of medical insurance claims hasn’t exactly mollified the insurance lobby.

A string of lobbyists representing health carriers testified during a recent committee hearing against HB 217 by Boca Raton Republican Bill Hager, notwithstanding an amendment restricting its provisions to policy grace periods — generally, the 30 days when a policy is in effect but the policyholder might not yet have paid the premium.

SB 162 would forbid the practice at any time.

Insurers would have to verity a patient’s eligibility at the time of treatment. The idea is to prevent carriers from giving the OK to treatment and then demanding repayment from the policyholder or treatment provider.

Asked during the hearing before the Health Innovation Subcommittee why he proposed the amendment, Hager was straightforward: “Because I want the bill to pass.”

Efforts to ban the practice go back years and, in the past, the insurance industry has worked with legislative sponsors. Paul Sanford, representing Florida Blue and the Florida Insurance Council, told the panel that his organization has not done so this year.

The committee approved the amendment and passed the bill, which still faces tests before the Appropriations and Health & Human Services committees.

The Affordable Care Act — or “Obamacare” — featured prominently in the discussion. Critics warned that Hager’s bill would enshrine in Florida law language similar to ACA regulations against retroactive denials.

“If this bill becomes law, you will have codified one of the ACA’s most controversial provisions — the idea of free health insurance,” said Wences Troncoso, general counsel of the Florida Association of Health Plans. In effect, he said, consumers could acquire 30 days of free health care per year.

“This is an expansion of Obamacare here in the state of Florida,” said Brewster Bevis of Associated Industries of Florida, which has made killing the legislation a top priority.

Miami Democrat Nicholas Duran found it a bit much.

“It makes me scratch my head how quickly we use the words ‘Obamacare’ and ‘ACA’ and boom — this thing’s already poisoned,” Duran said.

The bill eventually received two ‘no’ votes, from Jacksonville Republicans Jason Fischer and Clay Yarborough.

Fischer, for example, argued the measure would let people “legally defraud a system and allow someone to get their claims paid but not actually pay their bill.”

Mark Dobbertien of the Florida Medical Association said the amended bill still would represent “a small step forward,” but “would significantly limit the scope of the bill to a small subset of claims. In a large majority of instances, the insurers would still be able to retroactively deny that claim.”

“If an insurance company makes a promise, it should keep the promise,” Hager said.

New report: PIP repeal could cost motorists

Repeal of Florida’s no-fault auto insurance system would drive the cost of coverage up by 5.3 percent, or $67 per year, according to an analysis conducted for the Property Casualty Insurers Association of America.

The findings assume that more drivers will buy underinsured and uninsured motorist coverage to protect themselves against motorists who skip purchasing insurance for themselves, according to the report (available here).

Indeed, motorists who buy full coverage would see increases of 7.3 percent, or $150 per year. Those who buy only mandatory coverage would see increases of more than 72 percent, or $340, on average.

A bill (HB 19) by Vero Beach Republican Erin Grall, which cleared the House on a vote of 88-19 on Jan. 12, would repeal Florida’s personal injury protection, or PIP, insurance mandate. The Senate version (SB 150) by Brandon Republican Tom Lee, is pending on the floor.

The findings contrast those of a similar study last year for the Office of Insurance Regulation by Pinnacle Actuarial Resources, which estimated repeal would save policyholders 8.1 percent in liability coverage rates, but only 5.6 percent overall, as exposure shifts to lines including medical insurance.

The new analysis, conducted for PCI by the consulting firm Milliman Inc., focused on the House language, which would repeal the PIP mandate but require motorists to carry $25,000 per person and $50,000 per accident in bodily injury liability coverage, plus $10,000 for property damage liability, beginning next year.

The Senate language would $20,000 per person and $40,000 per occurrence in bodily injury coverage and mandatory medical payments coverage of $5,000. Those coverage levels ratchet up to $30,000 per person and $60,000 per incident after three years.

Requiring medical coverage at that level would add another 9.2 percent, or $116, for the average drive, Milliman’s study concluded.

Driving the increases are the addition of PIP losses previously covered by co-insurance; the addition of non-economic damages shifted from PIP to bodily injury and uninsured motorist lines; and the increase in coverage benefits related to the higher mandatory bodily injury coverage.

The report notes that these higher could be lessened by between 14 percent and 16 percent if the Legislature also passes a “no pay, no play” law, barring claims against insured drivers by uninsured drivers; and set time limits and communications requirements for filing insurance claims, to weed out bad-faith demands.

Update: Paul Jess, executive director of the Florida Justice Association, representing trial attorneys, issued a statement denouncing the analysis as “so fundamentally flawed on several levels that it has no credibility.” He cited a disclaimer contained in the document:

“[D]ue to the uncertainty involved in projecting future events, it is likely that the actual results will vary from our projections, perhaps materially. There may be greater uncertainty involved in our analysis as we have relied on a survey of PCI members for several key assumptions. To the extent the participating members do not represent an unbiased sample of the entire market of personal auto insurers in Florida, our results may be biased as well.”

The findings are out of line with savings realized in Colorado, Connecticut, and Georgia following PIP repeal, Jess said.

“The report fails to account for fraud savings that would be realized by replacing the PIP system with a responsibility-based approach. The ‘findings’ don’t even track Florida’s Office of Insurance Regulation’s own data from just over a year ago,” he said.

“The insurance corporations that paid for this report apparently are afraid of Florida embracing a new approach that promotes the principles of individual responsibility and accountability.”

Citizens paid premiums to entice adjusters after Hurricane Irma

Pay rates for insurance adjusters jumped by up to 30 percent as Citizens Property Insurance Corp. scrambled to respond to claims following Hurricane Irma, the carrier’s Consumer Service Committee learned Thursday.

The hikes were prompted by competition for trained adjusters with Texas, still recovering from Hurricane Harvey when Irma hit Florida on Sept. 10. Texas had boosted payments to adjusters, including bonuses, chief claims officer Jay Adams said.

“We were trying to equal the market rate they were paying in Texas, so that we could get adjusters … to come to Florida to work for Citizens,” he said.

Rates have since returned to their pre-Irma baseline.

Citizens engaged an outside contractor, Worley Claims Services LLC, to oversee a crash training program that armed newbie damage estimators with smart devices containing software designed to assist in assessing damage.

The committee met on the final day of the 2017 hurricane season, which saw nearly $6 billion in damage in Florida. Citizens, Florida’s property insurer of last resort, estimated that it has closed nearly two-thirds of the 62,000 claims filed against its policies.

Before Irma hit, Citizens had estimated it would need 2,500 adjusters. It had 800 contractors on hand following the storm. Scrambling allowed the carrier to assemble a strike force of 1,500.

“We leveraged every piece of technology we could to help respond to this event,” Adams said. That included the use of drones to survey damage in the Keys and Miami, which returned assessments within 72 hours.

The company also paid adjusters to work extended hours and weekends.

“We wanted people that were here, already on the ground,” Adams said.

The company looked for emergency licensed adjusters approved by the state.

“We also targeted folks that were displaced by the storm because of the storm from their jobs, such as realtors, home inspectors, and we even had some agents who engaged in this program to help support us,” Adams said.

Citizens expects to receive an additional 10,000 Irma claims by the time the dust clears, with all claims totaling $1.2 billion. Industry-wide, Irma has produced 830,788 claims and more than $5.8 billion in property damage.

“With $6.4 billion in surplus and substantial reinsurance coverage, Citizens remains fiscally sound after responding quickly and effectively to Hurricane Irma,” Chris Gardner, chairman of Citizens’ Board of Governors, said in a written statement.

House pressing on with workers’ comp reform

A ‘clean’ workers’ compensation bill is headed to the House floor after the Commerce Committee rejected a series of amendments pitched as worker-friendly Tuesday.

The bill (PCB COM 18-01) cleared the panel on a vote of 18-8.

It closely follows legislation the full House approved during the spring Legislative Session, in that it encourages injured workers and carriers — and their attorneys — to attempt to resolve disputes amicably.

But workers’ comp insurance premiums have fallen sharply since the spring’s panic over last year’s 14.5 percent increase in rates. The Office of Insurance Regulation approved a decrease of 9.5 percent just last week.

“Last session, the logic was, ‘We’re in crisis.’ The logic this session is, ‘Let’s be proactive.’ I understand that those are two good reasons, but they are separate and distinct,” Tampa Democrat Sean Shaw said.

Bill sponsor Danny Burgess, a Zephyrhills Republican, warned that the decrease doesn’t mean Florida, and companies that rely on consistent workers’ comp rates, are out of danger.

It reflects two years of declining insurer costs; it does not yet reflect Florida Supreme Court rulings last year scrapping the statutory limit on attorney fees and some total disability payments, he said.

“We won’t know what that looks like until 2019. But we do know that fees and hourly (attorney) rates have gone up about 191 percent,” Burgess said.

The committee rejected a series of amendments on voice votes, including ranking Democrat Evan Jenne’s bid to eliminate the bill’s $150 per hour limit on attorney fees, subject to a judge’s approval.

Jenne warned the high court might eventually rule the limit unconstitutional, as it did the statutory fee limits.

The amendment would cause rates to spike, as they did before the Legislature imposed drastic reforms on the system in 2003, Burgess said. The court rulings represented rejections of key elements of those reforms as unfair to workers.

“We need certainty and stability in our economy and in our market, and we don’t have that right now,” he said.

As was the case earlier this year, the bill pits labor unions, trial attorneys, and medical providers against the carriers, and their business allies.

The committee action leaves the House essentially where the chamber left off last year, before tentatively offering the Senate to raise the maximum attorney fee to $180 per hour.

“We have a solid product. It passed. It struck a balance. We’ve created some meaningful reform. I don’t know that we’ll ever strike a balance that everybody agrees with. But it’s our job to determine what that balance should be,” Burgess said.

National Federation of Independent Business Florida director Bill Herrle issued a written statement indicating no appetite for further concessions.

If the proposed committee bill “represents a final bill, then it deserves our fair consideration,” Herrle said. “If it represents just an opening bargaining position, then we’ll probably end up with a bill we cannot support.”

Trial lawyer Mark Touby, president of Florida Workers’ Advocates, saw a glass half full.

“Lawmakers have an opportunity to provide a constitutional approach to workers’ compensation reform that would bring rate stability to the market, increase transparency in ratemaking, spur free-market competition among insurers, and enhance benefits for injured workers. Unfortunately, the legislation passed by the House Commerce Committee would turn the workers’ compensation grand bargain to protect injured workers into a grand illusion,” he said in a written statement following the vote.

“As lawmakers consider this important issue, we will continue to work to ensure that increased competition, more transparency, and other essential components of meaningful workers’ compensation reform are included in any legislation that ultimately passes,” Touby said.

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