Fifth District Assesses Methodology Used to Calculate PIP Benefits to Florida Insured

Personal Injury Protection benefits are available to those who’ve suffered physical injuries in a Florida auto accident. Before PIP is distributed, Florida statutes require the deductible to be subtracted from the total medical care bill before the statutory reimbursement limitations are provided. In a recent district court of appeal decision, an auto insurer attempted to persuade the courts otherwise. In its appeal from the trial court’s calculation, the auto insurer argued the statutory limitations are applied before the deductible is subtracted from that amount.

In the underlying lawsuit, the injured party accumulated several bills for health care from one particular hospital after an auto accident. The total exceeded the $1,000 deductible in his insurance policy. Following the normal course of action, the injured man assigned his PIP benefits to the hospital.  The original hospital charge was $2,781. To calculate PIP, the hospital subtracted the deductible and multiplied the difference by 75%, as required by subsection 1.b, which was then multiplied by 80%, leaving a total of $1,068 due. The auto insurer provided payment but applied the 75% before subtracting the deductible. That amount was then multiplied by 80%, which led to an amount of $868.60 due. This was the amount provided to the hospital.

The hospital sued for the difference, arguing this was part of the PIP benefit the insurer owed it. The auto insurer denied liability for the amount and provided affirmative defenses. Both the provider and the insurer filed for summary judgment. The trial court entered summary judgment in favor of the hospital, adopting the calculation method applied by the hospital. The insurer disagreed, initiating the certiorari process.

The Fifth District Court of Appeal first noted they were limited to the question of whether or not the trial court applied the correct law to calculate the PIP benefit. Relief is only available if there was a violation of an established principle of law that led to a miscarriage of justice. The appellate court also noted they are required to liberally construe the statutory language in favor of Florida motorists receiving PIP coverage. The court of appeal strongly felt the plain language of section 627.739 requires 100 percent of the expenses and losses first. The injured person is then entitled to receive up to $10,000 in total benefits.

The insurer’s argument hinged on the expenses and losses language in the statute. The auto insurer asserted the reimbursement limitations within subsection (5)(a)1.b. should be applied first to reduce the expenses and losses before subtracting the deductible. The court of appeal disagreed, finding that methodology falls short of the statutory requirement of 100% of the expenses and losses. To ensure this is what the state legislators intended, the court reviewed the legislative history. The court acknowledged the prior version reflected the insurer’s methodology for calculating PIP benefits. However, the court concluded the legislators’ efforts to amend the statute in 2003 to the current version were not done emptily. The insurer’s attempt to change the calculation was ultimately unsuccessful. The appellate court denied the Writ of Certiorari, upholding the lower court’s application of section 627.739(2) of the Florida statutes.

After an accident, all parties responsible for payment look to minimize the amount of money paid. Personal Injury Protection was enacted to ensure financial stability for all parties involved in an accident. The Florida car accident attorneys at Donaldson & Weston can help you pursue the full benefits of your auto insurance policy alongside any damages you deserve. Call today for a free, confidential consultation at 772-266-5555 or 561-299-3999.

More Blog Posts:

Florida District Appellate Court Reviews Future Medical Expenses in Multi-Car Accident Case, Florida Injury Lawyer Blog, November 28, 2016

Federal Circuit Court of Appeal Declines to Find Equitable Tolling in Slip and Fall Case, Florida Injury Lawyer Blog, October 21, 2016

Florida Court of Appeal Allows Injured Motorist to Pursue Additional PIP Payments to Medical Providers, Florida Injury Lawyer Blog, May 18, 2017