Legislative News

02/03/2012

floridapiplegisl * A Florida Senate committee has passed a PIP reform bill this week. SB 1860 would require strict licensing of clinics that treat crash passengers, require crash reports to list the names and addresses of passengers, and allow the state to yank the licenses of deceitful medical providers. The House reform bill (HB 119) takes a markedly different approach. It would replace PIP with an insurance system that requires crash passengers to be checked by emergency rooms before going to clinics for treatment. Notably, the House bill has a provision clearly allowing insurers to conduct examinations under oath. The Senate bill lacks this provision. The exams are essential anti-fraud tools allowed by every other state. The legislature is scheduled to adjourn in early March. The lawmakers thus have only a month to resolve large, philosophically different approaches to dealing with the state's spiraling no-fault fraud epidemic.

* The sun may not set on the fraud unit of the Louisiana State Police after all. By law the unit expires July 31. But a bill extending a lifeline for another two years is likely to be introduced this session. That was the consensus of the unit’s fraud advisory board, which met in Baton Rouge this week. The Coalition is a board member. The State Police and other parties have met with key legislators in prep for the 2012 session, which begins in March. Advisory board members are concerned, however, that the state may try to sweep up anti-fraud budget money for general use even though insurers have paid specifically to fund state anti-fraud efforts.

* The New York Senate passed a bill making it a specific crime to make or market fake auto-insurance cards. SB 578 also passed the Senate last year but died in the Assembly. The same bill is back in action and returns to the Assembly for yet another look. Other auto-fraud bills have cleared the Senate in recent years, only to wither on the Assembly vine. This includes much-needed measures cracking down on staged-crash rings.

* Delaware’s fraud unit will receive more funds to go after fraudsters. The governor signed SB 80 into law, raising the annual anti-fraud assessment from $550 per insurer to $750. This is the first increase since 1995.

01/27/2012

sadspouse * New Jersey has several fraud bills in the hopper, in addition to the comprehensive auto fraud bill (AB 944) that Fraud News Weekly discussed last week. AB 1125 would protect an innocent spouse when the other spouse commits fraud. The insurer would pay the innocent spouse for losses incurred by the guilty spouse’s scam. AB 243/SB 545 make it a crime for a health provider to waive or rebate an insured’s deductible or copay.

* The New Hampshire legislature is debating a bill to define the venue in which a fraud case could start. SB 379 clearly says that a fraud case can begin in a) the county where the fraud occurred; or b) the county in which the insurer has its offices and received the suspected fraudulent information; or c) where the policy provides coverage.

* Kansas is looking at clarifying its law requiring insurers to have anti-fraud plans. HB 2485 would require insurers to submit their plans to the insurance department. Current law merely requires a plan. Insurers also would have to include a fraud warning with all claims and application forms. It would clearly state that submitting false or fraudulent information is a crime. The language is based on the Coalition’s model warning.

* New Hampshire has adopted a rule expanding the standards for SIUs and anti-fraud plans. Current law requires insurers to have either an SIU or fraud plan. But the new rule goes into more detail about how an SIU or the insurer’s vendor SIU must operate. Plans must be submitted to the insurance department within 90 days of receiving a certificate of authority, and every five years afterward. Revisions must be submitted within 30 days of the revision. Insurers also must state whether they’ve implemented public-outreach efforts about fraud, though plans aren’t required. All plans are considered confidential.

01/20/2012

njplates * New Jersey lawmakers are targeting widespread auto fraud. AB 944 first goes after drivers who illegally lower their auto premiums by lying about where they garage their vehicles. The bill would make it a specific crime to fraudulently register a vehicle and obtain out-of-state insurance. The bill also would restrict access to auto crash reports; this would help stop fraud rings from using the info to solicit passengers for bogus treatment claims. An immunity provision also would allow insurers and NICB wider exchange of case info. The Coalition has worked with NICB and the Insurance Council of New Jersey on these issues for several years. The Coalition testified last year in support of a 2011 bill that sought the same reforms. The bill missed out last year, but AB 944 resurrects it.

* No-fault auto-fraud reforms should include tighter licensing requirements for clinics that purport to treat crash victims, the Coalition’s Howard Goldblatt said in a to the chair of the Florida House insurance letter committee. The committee approved a bill last week that would replace PIP with emergency-care coverage that uses emergency rooms as the entry point for filtering honest insurance claims from dishonest ones. This approach aims to shut down unlicensed and crooked PIP clinics that operate throughout the state. But loopholes in the state’s licensing system tend to exempt the clinics from licensing standards. Many sham clinics thus might remain intact despite this PIP model’s intentions. "These clinics are too successful to expect that they would quietly disappear from the Florida scene," Goldblatt said in the letter. PIP reform is a major issue that the Florida legislature is debating this session.

* The Virginia legislature is considering clarifying that state fraud investigators can access records stored on servers outside of the state. The state’s current law assumes insurers house their claims and policy files within Virginia. But with the rise of electronic files, the documents may exist on a server (or cloud) housed outside Virginia. A problem of legal access arises when Virginia law enforcement seeks case info on those servers. HB 1145 allows access to the info no matter where or how it’s housed. The issue arose during discussions of the state police’s insurance fraud advisory board, to which the Coalition belongs.

* The Delaware legislature has passed a bill raising by 36 percent the annual assessment on insurers to fund the state’s fraud unit. SB 80 hikes the assessment from $550 to $750. This is the first increase since 1995. The bill ran out of time late last session, but was pushed to the front of the agenda this year.

01/13/2012
FloridaER * Motorists who claim they’re injured in a crash could receive no-fault benefits only if they go to a legitimate emergency room that would initially assess the purported injuries, says a prominent bill aiming to reform Florida’s troubled no-fault auto system. This measure would work to eliminate the shady clinics that now are a key element in the fraudulent claims flooding the insurance system. The House insurance committee has approved HB 119. It’s part of a larger proposal that would radically change the state’s no-fault system by replacing PIP with so-called “emergency care coverage.”

Among the other no-fault reforms in Florida:

SB 1860 keeps the current PIP system and toughens the licensing requirements for clinics that treat purportedly injured motorists. It also sets up an agency to support the investigation and prosecution of auto fraud. The agency could accept donations to fund the effort. In a companion bill (SB 1862), the donations would remain confidential and not covered by the state’s open-records law.

HB 523 also would toughen clinic licensing and create the support agency. But one step further, the state could yank licenses of clinics that fraudulently treat auto passengers.

* New York's AG has released a report urging a statewide, real-time database to target the state’s prescription drug crisis. In tandem, A8320/S5720 would expand New York’s prescription-monitoring program with the real-time database. This would "streamline communication between health care providers and pharmacists to better serve patients, stop prescription drug trafficking, and provide treatment to those who are addicted," AG Eric Schneiderman says in his report. That document dovetails with the Coalition's landmark report Prescription for Peril, which highlights the role of insurance fraud in America’s drug-diversion epidemic.

01/06/2012
floridapiplegisl * Florida’s legislature opens next week for potentially momentous showdowns over fixing the state’s beleaguered and money-leaking no-fault auto system. Rampant fraud will be a front-and-center issue, with reforms proposed in several of the bills slated for debate. HB 119 is especially important to fraud fighters — it includes a menu of stiff anti-fraud reforms the Coalition helped draft last year as part of the Sunshine Alliance. HB 485 and SB 134 would clamp down on legal and medical referral services that steer crash passengers to crooked medical clinics and attorneys. Referral services, for instance, would have to recommend clinics and attorneys not affiliated with the services. And HB 1007 would repeal PIP but retain Florida’s auto-fraud laws. The Florida bar also is drafting a reg dealing with attorney referral services. It should be ready this spring.

* Washington State is debating creating a state false claims act that targets cons against the state’s Medicaid system. SB 5978 would allow whistleblowers to sue entities such as hospitals or clinics for alleged fraud. The state could take over cases, and whistleblowers would be entitled to part of any award. Whistleblowers can continue the case on their own if the state opts out of the suit.