The personal injury attorneys of Florida are nervous — the State legislature is changing the way that Personal Injury Protection (PIP) works across the state, and while some of the changes are good, a few of them may well devastate our health care system.
Right now across Florida (and most of the US, for that matter), insurance companies often underpay or illegally decline to pay personal injury claims. The law gives hospitals and other medical facilities the ability to recoup their losses by essentially proving in court that the insurance companies were being malfeasant. At the law stands now, when an insurer is found to be underpaying or illegally non-paying, they are responsible for both the payment they skipped out on and the court costs of the trial that found them guilty. Thus, the only party damaged when an insurance company acts illegally is the insurance company (as it should be) and the system more or less works.
The Florida legislature wants to cap the legal fees that a lawyer is allowed to charge for representing a hospital in one of those cases. At first, this may seem like a decent idea to an innocent bystander (such as a Florida legislator), but in actuality it will tear the system apart.
Right now legal fees are set by supply and demand. If fees on one class of case are artificially capped, then all of the lawyers who can afford to will simply move on to higher-paying cases, and the hospitals will be left with the lawyers that are too incompetent to get a higher-paying job — which may often mean no lawyer at all.
Personal injury lawyers from Orlando to Key West are appealing to the legislature to spurn this spurious bill. Collectively, the PIP claims in question make up some 20%-35% of some hospitals' incomes; if those claims cannot be collected because no lawyer can profit from representing the hospitals, they will go broke. The only winners will be the insurance companies, who will profit from their crimes. Everyone else loses.