Letters of protection ruled lawful
A recent Florida court decision in a State Farm Insurance case may prove to be very important within the automobile insurance landscape, as a judge has ruled that a medical provider’s use of Letters of Protection should not prevent an insurance company’s payment of a patient’s Personal Injury Protection (PIP) claim. In effect, the court posited that Florida law does not allow providers immediate payment from an insured patient after injury especially without all the necessary information from the insurance company and that the use of Letters of Protection is completely lawful. Letters of Protection allow patients to defer copays and deductibles until their bodily injury settlement is concluded.
The payment dispute between State Farm and Complete Care Centers spans several years and involves multiple patients at multiple clinics. A settlement agreement was reached in March 2025, but State Farm ceased PIP payments, alleging fraud by Complete Care in delaying collection of deductibles and co-payments from its patients. This past October, Complete Care attained a temporary injunction to have State Farm pay it six months of back due PIP claims, which State Farm subsequently appealed.
In this most recent development, Hillsborough Circuit Judge Paul Huey granted a partial summary judgement for Complete Care, deciding that providers cannot know what to charge patients until charges are first submitted to insurance companies for payment; further, that medical care usually requires immediate attention that cannot wait until a claim has been processed. In his ruling, Huey said that State Farm “instigated this dispute by unilaterally deciding that it had a valid factual basis to cease processing and paying all collectively prejudged claims.” He declined State Farm’s request to delay the hearing due to its appeal of the injunction or its stated need for discovery.
“When you go to a doctor and you have paid your premium for insurance, you expect the insurance to pay your benefits,” Goldman told the Daily Business Review (DBR). “When insurance companies decide on a wholesale basis, we’re not going to pay any of them … This judge has said that’s not appropriate, and that there needs to be a good faith basis and good faith reason that tracks common sense and what the law says, otherwise, they should pay.”
While the case is still set to go to trial to resolve the remaining issues regarding the March settlement, Goldman told DBR he hopes this ruling may deter other insurers from taking a similar position and Judge Huey echoed that sentiment in his ruling.
LMA Newsletter of 2-9-26
