Policy Documents

The Era of the Paper IMEs: Has Florida's No-Fault Law Become Unconstitutional?

Woody R. Clermont –
January 1, 2011

In 1971, Florida made monumental changes in the way that automobile insurance claims were handled; the Legislature enacted the Automobile Reparations Reform Act. The purpose of this act was to provide Floridians with No-Fault insurance that  would provide swift payments of certain types of claims, without regard to fault.  Written into the  statute for the benefit of the insurers, was a section designed to control the cost of PIP claims, known as an independent medical examination (“IME”), contained in section 627.736(7)(a).

Insurers could require their insured to attend a compulsory medical examination with a doctor of their choosing.  If an insured unreasonably refused to attend, an insurer could withdraw from providing and would no longer be liable for subsequent benefits under section 627.736(7)(b).
However the submission of the bills by treatment providers using a practice known as bulk billing, deprived many insurance companies of their opportunity to obtain the proof they needed to contest the validity of any rendered treatment and their statutory rights to rescind coverage, due to an insured’s unreasonable failure to cooperate with the IME requirement.  In response to an increasingly powerful insurance lobby, the PIP statute has been  amended numerous times over the years, placing greater and greater restrictions on treatment providers to curb these abusive practices.

Some of these reactionary changes have led to dramatic improvements, and others have called into question whether the No-Fault law truly still serves its original purpose and remains constitutional.At the present, only twelve states mandate no fault insurance: Delaware, Florida, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New York, North Dakota, Oregon, Utah and Texas.

No-Fault insurance may be rejected by motorists in the “choice” states of Kentucky, Pennsylvania and New Jersey. Could there be a reason why thirty-five other states, choose not to offer no-fault insurance at all? Perhaps Florida motor vehicle owners may find that  the current quid pro quo, is not what Floridians originally “bargained” for; with the advent of legislative and judicial approval of insurers coming to rely on “paper IMEs,” PIP could be a unconstitutional deprivation of certain rights and be a far cry from the great expectations that proponents and reformers once held.