Keeping Auto Insurance Market Competitive Through PIP Reform

December 1, 2011 – In The News
New Jersey Business

Dennis Brotman commented on the proposed changes to Personal Injury Protection (PIP) coverage by the New Jersey Department of Banking and Insurance (DOBI). The proposed changes, which provides medical benefits coverage to those injured in auto accidents regardless of fault, were made to get rid of a system of abuse.

The changes will also impact PIP arbitration in the area of medical necessity. The new rules change it so that healthcare providers will be given just five days to appeal the insurance carrier’s denial decision. If they miss the deadline, they may again file a precertification for the same procedure.

Brotman, who represented the New Jersey Association for Justice at the Assembly committee hearing, said the proposed five-day appeal time “prejudices the rights of the injured person” since the timeframe is so narrow. He believes this aspect of the change may also undermine the two-year statute of limitation the injured person has to personally petition the denial.

Discussing the rise in the number of arbitrations, he said that insurers lose 90 percent of the time. “Wouldn’t they be saving money by returning to a rate of 20,000 denials instead 61,000?” he asked. “If protocols were established that were more reasonable and less likely to lead to reversals of [insurers’] decisions, insurers would save an awful lot of money…probably more than what the reforms are suggesting.”