New law reforms excessive damages, Chamber says

SEBRING — In July, the Highlands News-Sun reported the Florida Legislature's new law to protect property insurance companies from excessive claims and sky-high attorney fees.

Once Senate Bill 2D was signed by Gov. Ron DeSantis, the new law provided $2 billion in reinsurance and other help to property insurance carriers hurt by fraudulent and frivolous claims from roofing companies and other contractors.

DeSantis just signed another law to protect health insurers and businesses owners from excessive damage claims. The new law is also designed to reduce frivolous lawsuits by limiting injury cases, insurance litigation and attorney fees.

Billboard lawyers to blame?

House Bill 837, signed into law March 27, targets what Florida Chamber President and CEO Mark Wilson calls "billboard lawyers" – the personal injury firms that advertise throughout Florida's highways and byways.

"They are the ones gaming the system, suing people for $100,000 and they earn up to 40% in legal fees," Wilson said as the Legislature debated the bill. "That's why the price of everything goes up – gasoline, food, auto insurance, homeowner insurance, construction, everything is more expensive because of the 'lawsuit tsunami.'"

According to Wilson and other proponents, the new law:

reduces the statute of limitations for general negligence cases from four years to two yearsdenies damages to the injured party when he or she is at least 50 percent at fault in a negligence action.provides uniform standards to assist juries in calculating the accurate value of medical damages in wrongful death or personal injury actions.

Frivolous medical claims?

The law focuses on reducing frivolous medical malpractice damages that pay more than the true cost of the patient's care. Before the law was passed, doctors and the patient would present a bill to the jury that was much higher than the true cost of treatment, said Frank Walker, vice president of governmental affairs for the Florida Chamber of Commerce.

In other words, instead of handing a jury a blanket request for $150,000 in medical damages, the new law allows plaintiffs to collect only what they personally paid for medical care after an accident. Plaintiffs will be required to provide receipts that show anything one's health insurance companies, Medicare, and other providers paid out. That will be subtracted from what the jury can award the plaintiff.

"You get a bill in the mail for $57,000, you say, 'Wait a minute, I've got insurance', you call insurance, you don't pay that, it's $18,000. You use the lower amount to calculate the damages."

Can't collect if at fault

A Highlands County resident who sues another driver for injuries sustained in a crash cannot collect any damages if the resident is more than 50% at fault in that crash.

The new law uses Medicaid rates to determine what a severely injured plaintiff can collect.

For instance, medical care will be capped at 140% of the Medicaid rate, greatly reducing the damages a jury can award.

Sebring lawyer Michael Durham says the bill is good for insurance companies, but increases the cost to hospitals and society.

"With the 140% Medicaid reimbursement formula, insurance companies know the most they are ever going to have to cover is within that range, who will pick up the rest of the healthcare costs," Durham said. "Someone is."

The law doesn't seem to include pain and suffering.

The bill also limits the fees lawyers can collect, including something called fee multipliers.

Lawyers get less

"Fee multipliers were set up to ensure people could find attorneys for complex and difficult cases," Walker said. "Hourly fees could be multiplied 500 percent to give lawyers an incentive to take the case."

Tort lawyers, aka personal injury lawyers, opposed the bill because it reduces incentives for insurance companies to pay claims. They say the law allows insurance companies to deny claims and then payout lowball claims.