PIP vs. health insurance after a Florida crash: who pays first, and who gets paid back

A week after a crash on US-19, the bills start arriving. HCA Florida Bayonet Point sends one. The ambulance company sends one. The orthopedic office in Trinity wants to know who to bill. Your health insurer sends a letter asking whether you were in an accident. And an adjuster from the other driver's company says not to worry, they will handle it.

They will not. Here is who actually pays, in what order, and who expects to be repaid when your case resolves.

First: PIP, whether you were at fault or not

Florida is a no-fault state. Your own auto policy's Personal Injury Protection coverage pays first for crash injuries, and Fla. Stat. § 627.736(4) says so directly: PIP benefits are primary. The only credit the statute allows is for workers' compensation benefits, if you were on the job.

What PIP pays, under § 627.736(1):

• 80 percent of reasonable and medically necessary medical expenses;
• 60 percent of lost gross income and loss of earning capacity;
• up to a combined limit of $10,000, plus a $5,000 death benefit.

Two conditions apply. You must receive initial care within 14 days of the crash or PIP pays nothing for medical expenses. And the full $10,000 is available only if a physician, dentist, physician assistant or advanced practice registered nurse determines you had an emergency medical condition. If a provider determines you did not, medical benefits are capped at $2,500. Our PIP 14-day rule post covers both rules in detail.

PIP has no lien. Section 627.736(3) says no insurer may claim a lien on your recovery from the at-fault driver for PIP benefits paid. In exchange, you cannot recover from the other driver the damages PIP paid or should have paid.

Second: MedPay, if you bought it

Medical payments coverage is an optional add-on to a Florida auto policy. It typically pays the 20 percent of medical bills PIP does not cover, and in some policies it continues after PIP is exhausted up to its own limit. It is inexpensive and most Pasco drivers do not have it. Check your declarations page.

Third: health insurance

Once PIP is exhausted, or capped at $2,500, your health insurance pays under its normal terms: deductibles, copays, networks. Most Pasco County hospitals and larger practices will bill PIP first and then your health plan, but only if you give them both policies at the first visit. Many health insurers ask for a PIP exhaustion letter from your auto carrier before they pay, so keep that letter when it arrives.

Using your health insurance also changes what a jury can see. Since HB 837, Fla. Stat. § 768.0427(2) limits evidence of paid medical bills to the amount actually paid. A health plan's contract rate is often a fraction of the hospital's charge, so a bill of several thousand dollars may come into evidence as a few hundred. For unpaid bills, the evidence is the amount the plan would have paid plus your share. Our post on what sets the value of a case explains why this rule now dominates how Florida claims are valued.

If you are getting bills from three directions and do not know who to send them to, call (240) 421-5511. Sorting the billing out is part of what we do in the first week, at no charge.

Who gets paid back: the collateral source rule

Here is where Florida law gets specific. Fla. Stat. § 768.76 says that when you win damages, the court reduces the award by the benefits you received from collateral sources, which the statute defines to include health, sickness and disability insurance, auto insurance that provides health coverage, and employer wage-continuation plans.

The exception swallows much of the rule: there is no reduction for a collateral source that holds a subrogation or reimbursement right. Nearly every health plan does. So instead of a reduction, the plan is repaid from your recovery. Under § 768.76(4), that repayment is limited to the amount the plan actually paid, minus its pro rata share of your attorney's fees and costs.

The statute also builds in a deadline. Under § 768.76(6) and (7), you send each collateral source provider notice of your claim by certified mail, and the provider has 30 days to assert its payments and its reimbursement right. A provider that misses the window waives the claim.

Self-funded employer health plans governed by federal ERISA law are different. Federal law controls, and many of those plans claim full reimbursement without reduction for fees. Knowing which kind of plan you have changes the negotiation.

Medicare and Medicaid are not collateral sources

Section 768.76(2)(b) carves Medicare, Medicaid and other federal programs with a right of reimbursement out of the collateral source definition. They are handled under their own laws.

Medicare. The Medicare Secondary Payer Act, 42 U.S.C. § 1395y(b)(2), makes Medicare a secondary payer when a liability insurer is responsible. Medicare pays conditionally and must be reimbursed from the settlement. For the many Pasco crash victims in Hudson, Holiday and Bayonet Point who are on Medicare, this process has to begin early, because Medicare's conditional payment figure determines what is left for you. Our post on injury claims for older drivers and passengers covers it.

Medicaid. Florida Medicaid's recovery rights are set out in Fla. Stat. § 409.910. The Agency for Health Care Administration asserts a lien on the recovery, with a formula and a process for challenging the amount.

In both cases, § 768.0427(2) sets the evidence for unpaid bills at 120 percent of the Medicare rate, or 170 percent of the Medicaid rate when no Medicare rate exists.

Letters of protection: the fourth path

If you have no health insurance, or your providers will not bill it for crash care, a letter of protection lets you treat now and pay from the settlement. Some of the physical therapy, imaging and pain management practices in west Pasco work this way.

HB 837 added disclosure rules. To recover medical expenses under a letter of protection, Fla. Stat. § 768.0427(3) requires you to produce the letter, itemized bills with CPT, HCPCS and ICD codes, whether the provider sold your account to a factoring company and for how much, whether you had health coverage when you were treated, and who referred you to the provider. If a lawyer referred you, that is admissible. If the account was sold, the evidence of the bill's value is what the buyer paid for it.

None of this makes letters of protection wrong. It makes them a decision with consequences, which is why we discuss it with every client before the first appointment is scheduled.

What to do this week

1. Give every provider both your auto policy and your health insurance.
2. Open your PIP claim with your own insurer. Give the date, place and the fact of injury, and decline a recorded statement for now.
3. Keep every bill and every explanation of benefits in one folder.
4. Tell your lawyer if you are on Medicare, Medicaid, Tricare or an employer plan. Each has a different process.
5. Do not sign a release from the other driver's insurer. The lien holders are paid from that money, and the check they offer in week two rarely accounts for them.

Questions about a bill, a lien letter or a letter of protection? Call (240) 421-5511. The consultation is free.

Talk to a Port Richey car accident lawyer today

Conde-Huggins Accident Injury Lawyers is at 6609 Ridge Road in Port Richey, between US-19 and Little Road. We handle car accident and personal injury claims across Pasco County, and we handle the billing, the PIP claim and every lien so that you can focus on treatment. Our attorney, Clementine Conde, has practiced in Florida courts since 1992. Call (240) 421-5511 any time. Free consultation, no attorney's fee unless we win.