Florida PIP reform law withstands legal challenges on payments

July 28th, 2014

Can’t get what you want from Florida’s Personal Injury Protection (PIP) reform law? You could try suing your insurance company, but don’t expect good results.

Two individuals claimed in U.S. District Court for the Southern District of Florida that their auto insurers denied them proper PIP benefits. They both lost.

LAWSUIT #1

Glenaan Robbins went after her insurance company, claiming in a lawsuit that it violated a provision that that limits PIP benefits based on whether an emergency medical condition exists. The reform law tries to cut down on inflated claims by limiting the reimbursement to $2,500 if there was no emergency. The insurer must pay up to $10,000 if a qualified medical provider says there was an emergency.

Robbins was injured April 2013 and claimed in her lawsuit that “no determination was made that she did not have an emergency medical condition.” That’s a double negative for those of you that pay attention to grammar rules. The insurer disagreed and paid $2,500.

The court was not sympathetic to her argument. It ruled that there must be an emergency condition before an insured person can qualify for the higher PIP amount. Case dismissed.

LAWSUIT #2

Sendy Enivert also said her insurer erred by not paying $10,000 in PIP benefits. She argued that the $2,500 limit applies when a medical provider says there is no emergency. Because no medical provider said that the conditions were not met (There’s that double negative again.) she was entitled to the higher limit of $10,000.

Again, the court disagreed. “A medical provider did not determine that Enivert had an EMC [emergency medical condition], and she concedes that she did not have one. Therefore, Enivert is not entitled to the full $10,000 in benefits and her claim fails,” the court said in its opinion.

The court went a step further and recited statistics about the widespread problem of PIP fraud, especially in South Florida.

“The Court finds it clear that the legislative intent behind the PIP Statute is to decrease PIP fraud in Florida by placing more stringent requirements on the insured in order to receive the full amount of benefits and to efficiently allocate maximum benefits to the insured who have severe medical conditions. Therefore, the PIP Statute’s clear language and legislative intent are consistent,” the court wrote. Case dismissed.

Vehicle hit when you’re not in it? No problem, file a PIP claim

July 20th, 2014

Something strange happened to Frank Assouman one day. His parked truck was hit while he wasn’t in it, yet he filed Personal Injury Protection (PIP) claims totaling more than $25,000.

The Florida Division of Insurance thought it was odd, too, and arrested him. The state agency charged the 51-year-old West Palm Beach man with PIP fraud.

Assouman said he was eating lunch in his truck in Boca Raton when a vehicle struck his vehicle. The crash report and a witness statement disputed that.

He said that later  felt pain while on a trip to Haiti, according to an article in the Palm Beach Post. Assouman went to Delray Diagnostics for an MRI and Modern Medicine, Inc. for other treatment.

Those visits generated PIP claims of $21,815 to the other driver’s insurance company and $3,035 to his insurer. Both companies refused to pay, according to the Post article.

 

What do Florida PIP claimants like to do? Sue, sue, sue.

July 14th, 2014

If you are wondering where your Personal Injury Protection (PIP) premiums go, look no further than the courthouse. More than half of Florida individuals and clinics hire lawyers to pursue insurance claims.

Those attorneys charge $300 to $500 an hour to fill out paperwork and shuttle it to the clerk of court. The lawyers then ask county court judges to approve their legal bills and order insurance companies to pay them. Sometimes, the lawyers who say they are working for the little guy collect tens of thousands of dollars when the client is seeking is a few dollars.

The percentage of PIP claimants nationwide represented by attorneys rose to 36 percent in 2012 from 31 percent in 2007, according to a study by the Insurance Research Council. It comes as no surprise to us or another auto insurer that Florida leads the nation, where more than half of claimants hired attorneys in 2012.

“The attorney involvement trends shown in this study undercut two of the envisioned benefits of no-fault auto injury systems: a less adversarial settlement process and more timely payments,”  Elizabeth Sprinkel, senior vice president of the council said in a press release. “The role of attorneys is implicated in many of the factors driving up the cost of auto insurance.”

The study found that in cases where attorneys represented claimants that individuals were much more likely than those without a lawyer to receive treatment in a pain clinic and were more likely to be involved in apparent claim abuse.

PIP fraud investigations have found that people involved in staged accidents and other illegal efforts to cheat the PIP system signed over their benefits to the clinic that was supposedly diagnosing and treating them. The clinics hired attorneys to sue auto insurance companies when the claims were investigated and sometimes denied.

The study was part of the council’s continuing research into auto injury claims. More than 35,000 auto injury claims were examined and 12 insurers that represent 52 percent of personal driver market participated.

 

 

Protect yourself from PIP criminals by learning tricks of the trade

July 8th, 2014

Do you know the difference between a Curbed Drive Down and a Swoop and Squat? Have you heard of either one? If not, you could become a victim of Personal Injury Protection (PIP) fraud.

Staged-accident perpetrators often involve innocent people in their schemes. They move their vehicles in sudden ways that make a collision unavoidable. Their goal: Collect PIP benefits by claiming non-existent injuries.

You can avoid being caught in their plans by recognizing the kinds of traffic games they play. The National Insurance Crime Bureau has made several short videos of about 30 seconds each that show the driver moves that the PIP fraudsters like best. We’re posting them here as a public service.

The first is the Curbed Drive Down. Here are the rest:

FOUR VEHICLES FRAUD

SWOOP AND SQUAT

LEFT LANE FRAUD

Married couple finds that PIP crime doesn’t have happy ending

July 2nd, 2014

Jose Alberto Velez and April Rosita Wynn

The massive investigation called Operation Sledgehammer has won another two convictions on charges of Personal Injury Protection (PIP) fraud.

In the latest case, investigators in Duval County discovered that Alberto Velez, 30, and April Rosita Wynn, 23, enlisted family members and friends to participate in staged car accidents. The individuals claimed injuries and filed PIP claims through rehab clinics. The clinics billed auto insurance companies for treatment for non-existent injuries.

Velez and Wynn face up to 20 years in prison and have other charges pending, according to a press release from the state attorney’s office for the Fourth Judicial District in northeast Florida. They will be sentenced at the end of July.

The two, who are now married, were charged with knowingly participating in an intentional motor vehicle crash on May 12, 2012. Typically, this PIP fraud involves colliding two vehicles at low speed and having recruited participants enter them after the fact. When police arrive, the individuals complain of injuries.

Velez and Wynn were also convicted on four counts of false insurance claims. Typically, the stated-accident participants are directed to clinics where they sign over their PIP benefits. The clinic submits falsified medical and treatment reports and pockets the PIP payments.

 

 

Beware the kind driver: You could get caught in a PIP scam

June 30th, 2014

 

The scenario is simple: The other driver has the right of way but waves you on. You pull out and the other vehicle hits you. The driver and passengers immediately complain of injuries. Congratulations, you’ve been caught in a Personal Injury Protection (PIP) scam.

News4Jax has been covering the underhanded methods by which people stage auto accidents and collect PIP benefits. The Jacksonville news station is to be commended for its diligent work in exposing how criminals operate. Jodi Mohrmann, managing editor of special projects, has devoted a series to PIP abuses. The latest report shows how innocent drivers  were made liable for accidents they didn’t cause, and how auto insurance companies were ripped off for hundreds of thousands of dollars.

In one instance, a woman turned at a stop sign and another car hit her. The passengers of that vehicle said they had injured knees, necks and other body parts.

“All of a sudden they’re in this car accident and they have no idea how they got there because they were being waved on,” U.S. Postal Inspector Stephanie Barrett told News4Jax. Insurance losses totaled $180,000. Watch the video to learn more.

Operation Sledgehammer nails 3 more PIP fraud arrests

June 21st, 2014

From left, Leslie Martinez, Claudio Boyett and Claudia Hoy.

Operation Sledgehammer has been one of the most effective efforts in Florida history to root out Personal Injury Protection (PIP) fraud. Roughly 100 people in South Florida have been put in handcuffs since the four-year investigation began.

Add three more to the list. Claudio Boyett, 44, Leslie Martinez, 45, and Claudia Hoy, 31, all of Fort Lauderdale, face charges that they staged an accident and defrauded United Auto Insurance Co.

Based on police reports, the fraud scheme was a classic: Bump two vehicles and claim injures. In this instance, a U-Haul truck driven by Boyett struck a Dodge Caravan carrying seven people, including driver Martinez,  in a Fort Lauderdale church parking lot in August 2012.

The three people arrested had gone to a clinic for medical treatment for their faked injuries. The bills totaled $80,000.

Investigators learned that the van owner was offered $1,500 to borrow her vehicle, according to a Sun-Sentinel report. Another witness admitted the accident was staged.

This is just the latest chapter in Operation Sledgehammer, a four-year cooperative effort among federal, state and insurance industry investigators. As of late April, the U.S. Attorney’s Office had charged 57 people and obtained convictions or guilty pleas from 51 of them. Federal prosecutors had won court-ordered restitution of more than $11 million to defrauded insurance companies.

The Palm Beach County State Attorney’s Office had charged another 36 defendants.

Clinic sues for $14 in PIP benefits and loses not just trial, but the appeal

June 13th, 2014

Would you sue for $14? Wellness Associates of Florida did when an auto insurer reduced its Personal Injury Protection (PIP) claim.

Some medical clinics like to scream “Foul!” in court when they don’t receive everything they asked. PIP attorneys are all happy to accommodate them because they can bill upwards of $300 per hour — sometimes $500 an hour — to fill out the paperwork. Lawyers and their clients are happy when they win because the insurance company pays their damages and fees.

Wellness Associates went home unhappy after it lost its appeal to the Fourth District Court of Appeals. Northwood Sports Medicine was also disappointed when the court put the clinics’ two cases into one opinion.

Wellness had initially sued the insurer for damages and amended that to bad faith when the last $14 in PIP benefits were paid. The insurer moved for summary judgment, saying it had paid every dollar it owed, and won.

The clinic appealed, where its case was consolidated with that of Northwood. It had sued another insurer for damages and then bad faith, and also lost.

In its opinion on the Wellness case, the appellate court said that an insurer doesn’t have to pay anything more on a valid PIP when the full amount was paid if the insurer met certain legal requirements.  Also, an insurer doesn’t have to set aside the disputed dollar amount when it it denies or reduces a claim.

“Where the reasonableness of the provider’s claim is in dispute, post-suit exhaustion of benefits extinguishes the provider’s right to further payments, as long as exhaustion is prior to the establishment of the amount to which the medical provider is entitled to under PIP,” the court wrote in its opinion.

In other words, if the PIP benefits have been used up before the disputed amount is settled, the claim is considered settled. The court also said it didn’t matter whether the benefits were used up before or after the lawsuit was filed.

Maybe that will make some clinics think twice before picking up the phone and asking its lawsuit-happy attorney to run to the courthouse.

Mid-level PIP fraudsters sentenced in staged accident scheme

June 5th, 2014

From left, Noylan Barreto, Freddie Freytes and George Ortiz. Photo from News 4 Jax.

They weren’t the guys who came up with the Personal Injury Protection (PIP) fraud scheme; they were the ones who helped make it happen.

Three men were sentenced to prison in late May for organizing staged auto accidents in Jacksonville and directing vehicle passengers to rehabilitation clinics that then defrauded auto insurance companies with falsified PIP claims. For their crimes, they received prison time:

  • Noylan Barreto, 21, three years and 10 years of probation on two counts of committing a staged motor vehicle accident and one count of false insurance claims.
  • Freddie Alberto Freytes, 43, six years on two counts of committing a staged motor vehicle accident and three counts of false insurance claims.
  • George Orlando Ortiz Jr., 33, nine-and-one-half years after pleading guilty to four counts of committing a staged motor vehicle accident, false insurance claims and schemes to defraud

The three men recruited people to sit in vehicles involved in the faked accidents. When the police arrived at the scene, the individuals would complain of injuries.

Acting in secret, the three men sent the recruits to clinics that provided no real services. PIP invoices were concocted and collected, totaling more than $150,000 for the accidents the three men set up.

Investigators arrested 17 other people who participated in the PIP fraud scheme. Among them was the fraud mastermind, David Rodriguez Lopez; he was sentenced to 15 years in prison.

 

 

 

Operation No-Med Services produces another PIP fraud arrest

May 31st, 2014

Operation No-Med Services has put the cuffs another person charged with committing Personal Injury Protection (PIP) fraud. Authorities hauled in 16 people a year ago, when the investigation was in full swing.

Aurora Hernandez
(from Local 10)

Aurora Hernandez was accused in late May of this year of organizing a staged accident and billing for faked injuries, according to a statement from Florida CFO Jeff Atwater.  She operated Magic Hands Medical Services, one of four clinics that participated in a scheme to defraud auto insurance companies.

Investigators found that individuals were recruited to participate in coreographed auto accidents in Miami-County between August 2010 and September 2012. The drivers and passengers falsely told police that they were injured. They were referred to clinics for treatment never provided. The clinics submitted to insurers falsified PIP bills totaling more than $408,000.

Investigators think that Magic Hands and the other clinics — Clarke Medical Services, Emoge Medical Services and New Life Rehab Services –  were involved in other staged accidents.

Last year, authorities arrested a medical doctor, two clinic owners, five medical licensees, six staged accident organizers and six others. Two massage therapists caught in Operation No-Med Services had been arrested in 2012 on charges of PIP fraud in related cases. Hernandez faces up to 235 years in prison for her involvement in PIP fraud.

“I am proud of our investigators for their commitment to keeping fraudsters off the streets and out of the pockets of hard-working Floridians,” said Atwater. “Every act of fraud drives up the cost of insurance and we refuse to allow those selfish acts to continue.”
 The investigation continues. The Florida Department of Financial Services Division of Insurance Fraud is pursuing Ricardo Jimenez, who owns two clinics that closed.