Gov. Scott says fix not kill PIP, but repeal effort gathers steam on auto insurance [The Palm Beach Post, Fla.]

April 09--WEST PALM BEACH -- Gov. Rick Scott said Monday he would prefer to mend instead of end the state's no-fault auto insurance system, but the state Senate is scheduled to resume a workshop today to scrap what some lawmakers see as a 1970s-era dinosaur that effectively forces Florida drivers to pay twice for medical insurance -- at more than $2 billion a year.

Scott told The Palm Beach Post's Editorial Board he would not prejudge any bills lawmakers may send him, but he'd like to give the Personal Injury Protection system a chance to work better. A court injunction has tied up the state's latest attempted overhaul, which was supported by groups including hospitals that are paid at 200 percent of the Medicare rate under the plan.

"I'd look at it at the time," Scott said of any bill sent his way. "Right now, I'd rather fix PIP."

Though it's not clear there's enough time left in the spring session to make the change, the chairman of the Senate Banking and Insurance Committee said after the opening phase of a repeal workshop last week he believes that momentum is building.

A big reason he cites: The full implementation of the Affordable Care Act on Jan. 1, 2014, means almost all Florida drivers will be forced to pay for medical coverage they already have from other sources, in a system Scott and others say is plagued by up to $1 billion a year in fraud.

"I think the consensus is this is something whose time has come,"said committee Chairman David Simmons, R-Altamonte Springs. "I still believe it's something that can be addressed this year."

A Senate plan under development would repeal PIP and require Florida drivers to carry mandatory bodily injury liability coverage, which 90 percent of Florida drivers already have, officials say.

House leaders have taken a cautious approach, with a spokesman saying last week that Speaker Will Weatherford sees it as something that might require more time.

A spokeswoman for Florida Chief Financial Officer Jeff Atwater said Monday: "Last year, CFO Atwater supported reforms to PIP for the sole purpose of providing rate relief to Florida's drivers. And that is still where he stands today. Whether that relief comes through successful appeals or through new policy, he supports getting this cost burden off the backs of hardworking Floridians."

The Senate workshop puts repeal on the agenda and forces industry groups to consider a world without the PIP system in place since the early 1970s.

One group representing car insurers, the Property Casualty Insurers Association of America, has urged giving reforms time to work but also recognized a court injunction has tied up the state's latest attempt to rework PIP.

"PCI believes that the recent issuance of a temporary injunction against these PIP reforms has knee-capped the law's full potential," said Donovan Brown, the group's state government relations counsel. "We support dialogue on how to properly address Florida's auto insurance issues. We are hopeful for viable solutions that will protect Florida's consumers and relieve Florida drivers and policyholders from the rampant fraud and abuse that has led to Florida being the No. 1 ranking state in the nation for questionable auto claims."

Florida requires a driver to buy $10,000 of PIP insurance to cover his injuries regardless of whether he is at fault. Simmons said the Affordable Care Act makes PIP "largely redundant."

Colorado drivers saved 35 percent on their overall auto insurance premiums after becoming the most recent state to drop a no-fault system, even with a small bump in bodily injury rates.

At Scott's urging, legislators last year voted to reduce non-emergency benefits to $2,500 and cut out massage and acupuncture. A judge in Tallahassee issued an injunction sought by groups who said it unfairly shut out certain medical providers. The state is appealing.

On another insurance topic, Scott criticized state-run Citizens Property Insurance Corp. and said more reforms are needed.

"They've given outlandish raises; they have issues on their expense reports, reimbursement for alcohol; they got rid of their office of corporate integrity; they should have an inspector general that I've asked for," Scott said.

Scott said he has heard from customers in South Florida about company-paid inspections that have denied storm-resistant credits and raised premiums for three out of four Citizens customers visited -- and doubled what some pay. Many customers have protested what they believe they were wrongly denied credits.

"With regard to the inspections, what I've asked is for them to review to make sure all those inspections are proper," Scott said. "When you travel around the state, people talk about how much their insurance rates have gone up. Look, whatever they're doing at Citizens, do it properly."

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