Today is the Beginning of Something Good, We Hope

Our expectations are high for good results to come from this 2015 Special Session.  It will start off with a bang as the House holds a workshop today on the Senate health-care plan, according to a day-by-day calendar released last week. Tomorrow, the House will take a look at a tax cut package (including a reduction of cable television and cell phone taxes).  Also during this first week there will be budget conferences between the House and Senate, which will most likely continue into the second week. Also, the House calendar includes meetings involving members of the Health Innovation Subcommittee and the Health & Human Service Committee and then the House will be on the floor from June 11 – June 19, at least five times. The news of Florida receiving about $1 billion next year for the Low Income Pool (LIP) program might help end the budget impasse. The Federal Centers for Medicare & Medicaid Services sent the letter on May 21 indicating Florida could expect to receive about $1 billion during the upcoming fiscal year for the program. While that will be less than the program’s $2.16 billion total this year, the letter clears up some of the uncertainty that stood in the way of a budget agreement by the two chambers. House Speaker Crisafulli was quick to respond to the letter.  “I appreciate CMS (Centers for Medicare & Medicaid Services) providing this information in a timely manner for special session and for separating LIP funding from Medicaid expansion. While we are still evaluating the effect of the new LIP funding level, this progress will greatly help the House and Senate finalize allocations and pass a balanced budget that meets the needs of Floridians during the upcoming special session in June.”  We will be positive and look for that something good, a budget for our State.

What Else Is On the Special Session Agenda?

The budget is certainly the “star” of the special session, but lawmakers intend to also address some controversial health-care issues, including a proposal to revamp insurance coverage for state workers and a push to overhaul some longstanding health-industry regulations.  Six bills were filed last Wednesday (5/27/15) by the House that will address some high profile issues such as allowing advanced-registered nurse practitioners/physician assistants to prescribe controlled substances, and getting rid of a regulatory process for new or expanding hospitals. These issues aren’t new and we know that they will draw heavy lobbying, mirroring what occurred during the regular session. The bills include HB 27A by Rep. Cary Pigman (R-Avon Park) which expands the drug-prescribing powers of advanced-registered nurse practitioners/physician assistants. We expect the Florida Medical Association and other physician groups to continue to fight the proposal, taking the position that nurse practitioners and physician assistants don’t have the level of training as doctors. HB 31A by Rep. Jason Brodeur (R-Sanford) will also be of great interest to the hospital industry since it will eliminate the “Certificate of Need” process for hospitals. The CON regulatory process requires hospitals to get state approval for new or expanded facilities and often serves as a legal battleground in disputes about projects in the industry. Also, Rep. Heather Fitzenhagen (R-Fort Myers), filed HB 23A which will allow ambulatory surgical centers to keep patients overnight and make it a possibility for  recovery care centers to keep post-surgical patients for up to 72 hours. Obviously, the hospital industry lobby will object to the proposal as it did during the regular session, due to the possibility of that change diverting profits from hospitals. Rep. Jason Brodeur (R-Sanford) also filed HB 21A that addresses state employee insurance for 2018, when state employees would be given the choice among four insurance plans. Also, the bill would seek to offer financial incentives that could ultimately lead to employees shifting away from the richest plans. When asked last week if the Senate would go along with any of the House health care bills, Senate President Andy Gardiner stated, “They’ll be fully debated. We’re going to send them to committee, and the Senate will have every opportunity to review them.”  He followed that the Senate is focused on the budget. We’ll wait and see and let you know.  Click HERE to review a quick summary list of the 2015 Special Session bills filed in the House.

Today Marks Florida’s First Day in the 2015 “Tropical Wind Pinball Machine”

Insurance Villages-Helpful Information to Better Serve Your Policyholders

It’s hard to believe but today (Monday, June 1) is the first official day of the 2015 North Atlantic Hurricane Season. Each year on June 1 we are reminded that our beautiful state is a large peninsula running hundreds of miles south, southwest almost touching the Florida Straits just north of Cuba and a large portion of our state located further south than much of the Bahamas. With the warm Atlantic Ocean and the Gulf Stream bordering our entire east coast and the even warmer Gulf of Mexico bordering the other, it’s very easy to understand why so many of our residents and partnering insurers live with heightened concern for six months of the year.  When multiple low pressure systems in the tropical Atlantic begin morphing into tropical waves, tropical storms and then hurricanes we often do feel as if our peninsula has been thrown into a pinball machine. One of the very best things we can do to mitigate costs, however, is to effectively plan for recovery and for those of us in the industry to effectively serve our policyholders.

An insurance company’s mobile operation and participation in the DFS post disaster insurance village program is an excellent opportunity to showcase the company and its proficiency in claims handling.  DFS will establish insurance villages in impacted areas if necessary and have identified multiple potential insurance village locations throughout the state.  Please click HERE to view a spreadsheet that reflects the potential locations that have been identified by DFS. LMA will also have a presence at the villages should the need arise to help you with media or other trouble shooting.

4th DCA Deals Battle Against AOB

Abuses Critical Blow

On Wednesday, May 20, Florida’s 4th District Court of Appeals issued adverse decisions in three intensely watched AOB (Assignment of Benefits) appellate cases pending before the Court. Citing in part public policy decisions that need to be made about the extent to which AOBs can and should be used, the court decisions only echoed the need for legislative intervention. In fact, the DCA invited the Legislature’s involvement when the judges said in one of the three cases that if research shows that these assignments are inviting fraud and abuse, then the legislature is in the best position to investigate and undertake comprehensive reform. In issuing decisions in the three cases, the Court determined the anti-assignment and loss payment provisions of a property policy do not invalidate a contractor’s assignment.  The Court also determined a third party assignee can recover benefits on a covered loss as long as the insured complies with all policy conditions. As part of the analysis of the facts in these cases the Court observed that prior case law authorized an insured to assign a claim, regardless of whether the policy contains  language prohibiting assignments.  The Court also analyzed loss payment provisions within the contracts to ascertain whether policy provisions prohibit assignments.  The Court determined that loss payment provisions did not preclude assignments of  post-loss claims, even when payment on a claim was not due when the assignment was made. In remanding the most detailed of the three cases back to the trial court for a hearing, the 4th DCA Judges directed the trial court todecide whether the assignment in question violates the public adjuster law, whether it is a partial assignment unenforceable without the insurer’s consent, and whether the assignment violates the insurable interest law. This, however, is doubtful because another of Florida’s DCA courts ruled earlier this year that an assignment did not violate the insurable interest law. Although perhaps a long shot, it’s possible some of the issues raised in these three 4th DCA cases could land before the State Supreme Court and we’ll be closely watching for such a development. However, in the meantime it’s more important than ever for insurance industry stakeholders to share information with our legislators and help convince them that meaningful AOB reform is critical to the overall health and stability of Florida’s property insurance market. Click HERE if you would like to read the Court’s decisions in the above referenced cases.

Governor Scott’s Commission on Healthcare & Hospital Funding Holds Two

Meetings and Schedules Another

The Governor’s new healthcare and hospital funding commission held its first meeting in Tallahassee on Wednesday, May 20, to begin its work of reaching an agreement on the health-care disputes that caused this year’s regular session budget stalemate. But the head of the panel, Carlos Beruff, president of Medallion Homes and Chairman of the commission, said it would be difficult to gather the information the commission needs in order for the commission’s job to be done in time for special session.  “I don’t think you’ll have all the data by the end of the special session — no, I don’t,” Beruff said. “But there’ll be more data.” The commission received a cold shoulder from many of the state’s hospitals, when asked to fill out surveys containing data for the commission to consider. Many of the surveys returned only contained five or less lines of information from the 100 lines of data requested, with hospital officials referring the Governor’s commission back to the Florida Agency for Health Care Administration (AHCA) for information that is already filed with the agency. AHCA Secretary Liz Dudek, who serves as co-executive director of the commission, told reporters she was disappointed with the results of the survey request stating that, “these are typically collegial folks that we deal with on a regular basis.”  In addition to the slate of issues the commission is reviewing, the possibility of repealing the state’s Certificate-of-Need (CON) program is now on the list.  And at the meeting, some members of the commission panel expressed concern over whether the program was really helping contain the costs of health care. “We understand that creation of a hospital is very capital-intensive,” said Jason Rosenburg, a physician on the panel. “And if you have no CON — one of the arguments against not having CON, as I understand it, is that everyone would start building hospitals. But I don’t know that everyone would, so I’d like to see what happened to Texas when they got rid of their CON.”

At the second commission meeting in Orlando on Tuesday, May 26, the Commission continued to focus on hospitals.  It was mentioned at the first meeting of the Commission that this meeting would include discussion on the role that insurance companies/managed care plans play, but discussion didn’t foray into the topic. Though Medicare, veterans’ health, and state group health insurance are taxpayer-funded programs that provide health care benefits, Department of Health Secretary and state Surgeon General John Armstrong said the focus would be on Medicaid, Low Income Pool and graduate medical education.  He further stated that the focus of the commission is limited to those areas because those are the ones the state can control. At the end of the Orlando meeting, Secretary Armstrong suggested that the commission provide their findings at the end of each meeting and that he wants to compile a list of findings and have it available for the third meeting. He also wants the members to approve those findings. The next meeting of the commission is set for Thursday, June 4.  We have been there for these meetings and will continue to let you know of any progress that is made.

Compliance Focus Summer Series Returns

As we have done over summers past, we are once again kicking off our summer article series focusing on important compliance issues to assist insurers, managing general agents, personal and commercial lines agencies and claims adjusting firms with remaining in compliance with the Florida Insurance Code. Our first Compliance Focus article for summer 2015 is written by LMA Newsletter guest author, Bill Knepper. An introduction and Bill’s article follows below.

Insurance Expert: Using a Checklist can Protect Agents Against Liability

I’m sure that some of our readers already know Bill Knepper but for those that don’t, Bill has been an insurance company underwriter, an agent/broker and a risk management consultant during his long and successful insurance career.  He has been an independent insurance agency president and the CEO of a large insurance intermediary and he has even managed to squeeze in a stint with the Florida Office of Insurance Regulation.  Bill currently heads up a Litigation Support and Expert Witness Services firm in Tallahassee and graciously provided us with the following guest article.

And now, in Bill Knepper’s own words:

I’m currently providing expert witness testimony for two different cases involving two different insurance agents that allegedly didn’t do a good job for their clients.  The background for the two cases is different and I’m actually providing testimony for the agent on one case and against the agent on the other case.  Some of the facts however are very similar … and there is a punch line to this story that can benefit everyone.

Here’s the similar part of both cases: The insured purchased some of their insurance coverages from their agent.  There was a good relationship between the agent and insured; they met at least once a year face-to-face and talked and e-mailed frequently during the course of the year.  Then a significant claim occurred, in one case it was not covered by insurance, in the other case it was covered but the limits were inadequate.  Each insured ultimately filed suit and basically said, “You didn’t tell me about this coverage and/or you didn’t explain to me how this works.”

Obviously in both cases something in the communication process didn’t work right.  What could have fixed this is actually very simple: using a checklist.  I’m talking about the simple kind of insurance checklist that has three columns, the first one lists a coverage or exposure or risk management situation, the second might say something “Recommended/Purchased” and the third column might say “Recommended/Not Purchased”.  These types of checklists are available on line – just Google “insurance checklist template.”  If you are an agent, I’ll bet your Agency Management System already includes checklists for every type of coverage and situation.

Think about our legislative process here in Florida and some of the difficult to explain insurance changes that we have all seen over the years; could a checklist have made it easier to explain/understand insurance options for auto insurance such as UM/UIM?  Sinkhole?  Wind?  Flood?  In many cases, a checklist might have been the best and the ONLY way to do it!

The type of checklist is actually not as important as just using a checklist.  The insurance agent will know about exposures and the insured will have a chance to insure that exposure right then and there.  After completing the checklist both parties sign, date and keep a copy and in the event of a claim there is no question about “you didn’t tell me” or “you didn’t explain to me how this works.”

Punch line:  Checklists help the agent by providing a comprehensive outline for their review; checklists help the insured by pointing out situations or exposures that they may not even know exist.  And when the checklist results in a more professional analysis of exposures even the insurance company will benefit.  Everybody wins!

Dog Bites Increase Claims Payments

It’s hard to believe, but true, that claims on national homeowners policies have increased by one-third due to dog bites. That comes to approximately $530 million per year added to insurance costs. According to the Insurance Information Institute and State Farm Insurance Company, the cost of the average dog bite claim increased by 15 percent (severity), while the number of claims decreased by 4.7 percent in 2014,  compared to 2013 (frequency).  The study further tells us that the trend in higher costs per claim is also due to dogs knocking down children, senior citizens and cyclist, which in turn creates injuries due to the fall. We hate to think of our own sweet pups as the attackers in situations such as these, however, experts tell us that even the most docile dog may bite if frightened or defending its home, puppies or even food. And we all hear the stories of postal workers being bitten, which attributes to workers’ compensation costs, according to the USPS, of about $3.7 billion each year. We are fortunate, however, that Florida isn’t among the top ten states of high number and cost of dog bite claims.  California holds that designation.

Division of Workers’ Compensation Offering Workplace Safety Seminars

The Division offers the free seminars and webinars regarding workers’ compensation and workplace safety to educate employers, business owners, licensed contractors and other interested stakeholders who are responsible for assuring that workers’ compensation insurance and safety in the workplace is a priority.  The Division has partnered with the U.S. Department of Labor Office of Safety and Health Administration (OSHA), and the University of South Florida “Safety Florida Consultation Program”, in making these presentations.

Two types of training opportunities are available:

  • Classroom sessions are held in several locations around the state.
  • Webinars are held once a month.

Both seminars and webinars provide the same material and information for participants.  To participate please complete the appropriate registration form and return it to .  Questions should be directed to or by telephone at (813) 221-6518.

2015 May – Dec Seminar Flyer

2015 May – Dec Seminar Registration Form

2015 May – Dec Web Based Registration

An Opportunity to Shine Begins Today

When it comes to the really important things in life we are rarely blessed with the opportunity for “do-overs.”  However, starting today with the beginning of  Special Session, Florida’s elected policymakers have a truly golden opportunity to do-over the process of developing and passing the mammoth budget needed to operate the state next year in a quick, efficient and collegial manner. All are expected characteristics of our elected policymakers but they became increasingly absent from public view during the budget stalemate that abruptly ended 2015’s Regular Legislative Session.  Granted, during Regular Session our legislative leaders and members had to navigate a number of major factors negatively influencing budget negotiations. The threat of no LIP funding alone was a sand bar that could have beached a number of past legislatures in attempting to pass a state budget. Regardless of party affiliation or position on any specific budget issue, we all should want the Legislature to shine during this special session and support their efforts to arrive at a budget that serves the best interests of all Floridians. I am highly confident that this is exactly what we’ll see from this Legislature. As we were during Regular Session, LMA will be there covering the Special Session like a blanket  and bringing you up-to-date information as critical decisions are made. Until next time,

Lisa and the LMA Team