Legislative News


* Texans are better-protected against dishonest contractors and fake caller IDs, and state fraud investigators will make more money. Gov. Greg Abbott signed 3 new laws: Repair contracts over $1,000 must have warnings telling consumers they must personally pay deductibles, and nor can contractors waive or modify deductible payments. Insurers also can withhold some payments to insureds without proof the deductible was paid. … Scammers who hide their IDs when placing solicitation calls could face criminal charges and fines. The new law tackles widespread telephone spoofing, much of which is used in health scams. … Finally, Texas seeks to reverse the high staff turnover in the state DOI by increasing salaries for fraud investigators.

* Louisiana insurers may not recommend a specific auto-repair shop unless they clearly tell consumers they aren’t required to use that facility. That’s the upshot of a new law in the Bayou State. Unlike bills in other states, Louisiana doesn’t forbid insurers to inform consumers about reputable repair facilities and warn against body shops suspected of committing fraud. Nor can Louisiana insurers require specific repair shops, or try to coerce or intimidate claimants into using select vendors. Insurers could face fines of up to $5,000 per violation, and possible license suspension or revocation.

* A controversial vehicle repair bill has passed the state Senate and House in Rhode Island. Insurers would have to physically inspect any vehicle with a damage claim of $2,500 or more. Inspections must be done within 3 business days for new claims, and within 4 business days for re-inspections. Inspections must be in-person — photos can’t substitute for a physical look-see. Failure to inspect could trigger a violation of the state’s unfair claims practices act. The bill now goes to the governor, who is expected to sign the bill.

* Vermont residents may now be less-fearful of being hit with surprise medical bills from unknown out-of-network providers. The governor signed into law a new Patient Bill of Rights. Every patient has the right to receive: an itemized, detailed and understandable explanation of charges, regardless of the source of payment … and info about healthcare prices, financial assistance, plus the provider’s billing and collections practices. The law also creates a Board charged with examining healthcare price transparency initiatives in other states. The goal is to identify options for making healthcare pricing info more readily available to Vermont consumers.


* Stormchasing contractors are squarely in the crosshairs of the New York Senate, which passed a Coalition-backed reform bill on Wednesday. The measure cracks down on contractors who bilk storm-damaged homeowners typically by stealing their downpayment and disappearing after doing shoddy or no repairs. It targets contractors who defraud with schemes involving roofing, siding, downspout and other needed repairs. The bill requires: written contracts … disclosure of the contractor’s insurance info to consumers … 3-day right of contract rescission … forbidding offering to cover or rebate deductibles as an inducement for consumers to sign contracts. An identical bill awaits Assembly action. New Yorkers are urged to contact their Assembly members and urge them to support AB 7531.

* Make staging crashes a specific crime in New York, the Coalition urges Gov. Andrew Cuomo in a letter this week. “In recent years we have seen an unfortunate surge in these types of fraud scams which cause injury, death and increased insurance costs for all New Yorkers,” the Coalition’s Matthew Smith writes in a letter to Cuomo. AB 3895 is known as “Alice’s Law.” It would make staging a car crash a specific crime in the Empire State. The bill has cleared the Senate and Assembly. It’s named after Alice Ross. She was a grandmother in Queens who was killed in a botched staged accident intending to ram her vehicle for false no-fault injury claims in 2003. “The bill now only awaits your signature before becoming law,” Smith writes Cuomo. “Please Governor, sign this bill so other New York citizens are not injured or killed as a victim of these insidious acts, and those who commit these crimes are prosecuted to the full extent of the law.”

* Patient brokering sits in the crosshairs of Pennsylvania lawmakers. A Senate bill makes brokering patients with bribes, kickbacks and other incentives illegal. The measure references healthcare providers, health facilities, drug and alcohol treatment facilities, sober homes and assisted living homes. Penalties are stiff. Violators would face anywhere from a 3rd- to 1st-degree felony. The proposal tracks a bill filed earlier in the state House.

* Add Louisiana to the states cracking down on public adjusters. Unlicensed public adjusting is a specific crime under a bill signed by Gov. John Bel Edwards. Violators face up to 2 years of “hard labor” in prison, and fines of up to $5,000 per infraction. Unlicensed adjusters also must repay victim insurers or others for insurance money paid out for fraudulent claims. Victims also can recover costs of evaluating and defending the fraudulent claim. This includes investigative, attorney and court fees.


* A fraud bureau is part of much-needed PIP reforms that await only the governor’s signature in Michigan. Lawmakers and the state’s new governor have agreed on a sweeping 120-page package. The reforms seek to reduce spiraling auto premiums, fraud and medical costs. Michigan’s expensive no-fault auto system offers injured motorists unlimited lifetime medical benefits — America’s most-generous. The state also has the highest auto premiums, due largely to spiraling medical costs, not to mention persistent auto scams. The new reforms respond by imposing rate reductions. … Drivers also can choose from tiered coverage limits, or opt out of PIP entirely if they have qualifying health coverage. … The fraud bureau covers all lines, and gives the unit a permanent home in the insurance department. Outreach with other local, state and federal agencies to investigate and prosecute fraud is required. And the fraud bureau will issue an annual report to the legislature. The reforms had overwhelming support in both chambers. Gov. Gretchen Whitmer promises to sign the bill promptly. It will take effect immediately.

* The Texas legislature closed with 3 important anti-fraud bills clearing the state house, and 1 new law signed by the governor. HB 2004 provides that actions involving Medicaid fraud may be dismissed only when consented to in writing by both the court and the state AG, and with an explanation for the dismissal. It was signed by Gov. Greg Abbott. Sitting on his desk are bills making it a crime to use caller ID to misrepresent the caller’s true ID or phone number in a scam. … give state fraud investigators much-need pay increases … and strengthen penalties and scope of prosecutions of healthcare fraudsters. Proposals to regulate roofers plus towing and storage firms failed.

* Consumers in Washington state now are protected from surprise billings and potentially fraudulent out-of-network billing practices by medical providers. The new law requires: Providers must disclose billing practices to patients before procedures. Patients also must be offered alternatives for treatment with in-network providers for lower accepted billing rates. Unless medical providers follow the new provisions and secure patient approval, they’ll be limited to seeking reimbursement at the same levels as in-network providers.


* Fraudulent towing operators in Indiana may be hitching up and heading out of state now that a new law cracking down on consumer-gouging practices was signed by the governor. Towing operators may no longer troll for accidents to make unsolicited and often fraudulent tows unless the owner or law enforcement requests their services. Among the other new protections: requiring disclosure of fees … allowing consumers reasonable access to their vehicles during normal business hours … and requiring an itemized invoice. Vehicle storage facilities also must make all reasonable attempts to locate the owner within 3 business days of towing the vehicle. They must search the National Motor Vehicle Title Information System database or similar source. The state AG will investigate suspected violations. Fraudsters may face fines and criminal prosecution. The bill was sponsored by Rep. Matt Lehman, a key supporter of NCOIL’s recently adopted Model Towing Act.

* The Coalition and IASIU joined forces to help secure passage of assignment-of-benefit reforms in Florida recently. It’s the latest success of a one-of-a-kind joint grassroots effort to speak directly to elected officials, urging them to support — or oppose — pending fraud legislation. Coalition and IASIU members wrote digital letters to their Florida state Senators using the Engage system in late April. A record number of Coalition and IASIU members urged their state Senators to support reforms, just before the decisive vote that passed the bill. Fraud fighters also spoke out through Engage to support anti-fraud bills in New York, Ohio and Pennsylvania, to name a few. The Coalition and IASIU have just created a fresh new Engage landing page. Coalition and IASIU members can visit and stay updated at any time. You can learn if bills are pending, find out who your legislators are, and see how to contact them. We encourage all Coalition and IASIU members to write their legislators via Engage when fraud bills are pending in your state. It’s a proven, effective way to make your voices known to our legislators.

* Minnesota is considering severely limiting insurer ability to steer claimants to specific body shops for repairs. Consumers deserve protection, but this bill potentially overreaches. Adjusters or other insurer personnel would be strictly prohibited from even suggesting or trying to influence where a consumer’s vehicle is repaired. The bill also prohibits repairs based solely on using the least-expensive method of repair. It would ban insurers even from warning consumers about repair shops known to defraud insurers and consumers, or do shoddy work and overbill. The limits would be included in the state’s Unfair Claims Practices Act. The measure faces an uphill battle, Coalition sources say.

* Reforms of Florida’s long-abused assignment of benefits system are now law. Gov. Ron DeSantis signed a Coalition-backed bill that will revamp the practice. Homeowner premiums have risen sharply with contractors convincing homeowners to sign over legal control of claims to them. Many contractors pursued inflated and often fraudulent repair payouts. Excessive lawsuits against insurers to pursue payouts further drove up AOB losses. The new law effectively limits attorney fees in AOB lawsuits. Insurers also can offer homeowner policies that restrict or don’t permit assignments of benefits. The Coalition and IASIU teamed on a grassroots online letter-writing campaign to legislators, urging the AOB overhaul. The Coalition plans to work with others next year to renew efforts to extend needed AOB reforms to auto glass claims as well.


* A bill on Capitol Hill seeks to thwart billions of annoying robocalls peddling fake health insurance, bogus deals for medical equipment and myriad other phony offers trying to separate consumers from their hard-earned money. A Senate bill: Requires telecom companies to adopt technology that authenticates incoming calls so consumers know who they’re coming from. … Directs the FCC to develop rules that better protect consumers from unwanted calls and texts. The FCC would have 1 year to develop the protections. Introduced by Sen. John Thune (R-S.D.), the bill heads to the Senate floor after clearing the Commerce Committee. Ramped-up federal enforcement is essential. States have a hard time cracking down on their own. Scammers typically place calls across state lines and even internationally. Nevada also became the 41st state urging the FCC to make robocall reforms with or without Capitol Hill action.

* Adjusters and agents licensed in Oklahoma must report criminal convictions and administrative violations they received in other states to the Sooner insurance department within 30 days. The new law applies to all lines of insurance. The insurance department can investigate further — and revoke a violator’s license if warranted. Gov. Kevin Stitt signed the measure.

* Iowa is moving to stop fraud and abuses involving assignments of insurance benefits for home repairs. Gov. Kim Reynolds signed a bill prohibiting assigned benefits. Contractors also can only be named co-payee on insurance repair checks. … Repairs, materials and itemized costs must be specified in the assignment for payment. … Contractors cannot promise insurance payouts. … Assigned payments must provide prominent consumer protection warnings, such as the right to cancel within 5 business days of signing the document. … Insurers are allowed to communicate with their policyholders. Florida also recently adopted sweeping reforms as the nation’s epicenter of assignment-of-benefit abuses.

* America’s military health insurer can civilly fine medical providers and suppliers that defraud or abuse TRICARE, a proposed federal rule would require. A fraud unit also would be created within the Department of Defense. The healthcare program faces spiraling fraud losses. The proposal would save taxpayers $74 million between 2020-2024. TRICARE is a frequent scam target. Just look at soaring costs for often-useless compound meds: TRICARE paid about $5 million for compounds in 2004, then $514 million in 2014 — an overnight 10,000-percent increase. Compound-med losses then more than doubled to $1.3 billion in 2015.