In the plethora of paperwork that medical providers have PIP patients fill out at the initial visit, none is more important and often misunderstood as the assignment of benefits, or AOB. The AOB functions as the authority for medical provider to get paid PIP benefits but also to file a PIP suit against the insurance company. A poorly drafted AOB that arguably does not confer standing is the surest way to get a PIP lawsuit dismiss without ever arguing the merit of a case.
Why Discuss the AOB at this Time?
In the past two months I have been hit with Motions to Dismiss and Motions for Summary Judgment premised on the insufficiency of the AOB, which insurance companies argue does not confer standing to sue but is merely a direction to pay. I ponder; I research; I conclude as follows: yes you are correct and I agree. The result, PIP lawsuit is voluntarily dismissed and the process starts over. That is why the AOB matters; it can get your case kicked out of court.
In its simplest form, the AOB is a legal agreement between the insured (PIP patient) and the medical provider wherein the patient transfer their right to receive PIP payment to the medical provider as well as their ability to file a lawsuit. Essentially, the AOB says to the insurance company, “pay them not me and if you don’t they can sue you because I have the right to sue you.” The AOB allows for the orderly transition of PIP benefits directly to the medical provider, because after all, the provider is the real party in interest.
The requirements are not set out in statute but grounded in common law of the State of Florida. Without getting into a law review discussion, the AOB at a minimum must convey an intent on part of the patient to transfer their rights under the insurance policy providing PIP coverage over to the medical provider; followed by the insured’s signature. There is no particular language that must be used. There are no requirements such as the AOB must contain the date of accident, claim number, policy number, or even be signed by the medical provider. At its core, the AOB must evidence an intent that says “I wanted you, my insurance company, to pay this medical provider and they also have all the same rights under the policy that I have.”
The challenge I am seeing is that some AOBs only function as a direction to pay: “insurance company, you pay them.” If a PIP suit is filed, on behalf of the medical provider, against the patient’s insurance company, it is premised on the basis that the provider has standing to sue the insurance company through the AOB’s function as an assignment of rights. The argument made by defense lawyers is that a direction to pay is not an assignment of rights and therefore the provider has no basis to sue, only to get paid. There is a copious amount of case law from county judges all across Florida holding that an AOB which is only a direction to pay does not confer standing, and it results in a dismissal of the case which cannot be cured by simply attaching a new assignment. For medical providers, this means you cannot sue the PIP insurer because you have no standing and therefore no cause of action for unpaid bills.
While there are contrary opinions that argue equitable assignment and the lack of appellate case law making the distinction between assignments of rights vs. direction to pay, it is easier to simply re-write the assignment language; and that’s what we have done for many of our clients. Part of being a PIP lawyer is not just filing demands and lawsuits (pushing paperwork), but it’s the often neglected counselor aspect. I believe I have a duty to advise my medical providers that their assignment is potentially defective and could impair their ability to file PIP suits in the future. The next step is helping our providers re-write their assignments with key language.
The ideal AOB is a direction to pay and an assignment of causes of action under the insurance policy. By incorporating language such as “transfer of all rights”, “transfer of any causes of action I may have”, “right to bring any legal action”, and other similar phrases, it is then apparent that the intent aspect of conveying the right to sue (standing) is evident on the face of the AOB. Many of our providers appreciate the consultative aspect of our relationship because it builds trust and confidence.
While it is rare I find myself agreeing with a defense motion that is dispositive of a case, I use it as a learning opportunity to educate our medical provider about the importance of an effective AOB. The AOB is needed for filing PIP suits because it gives standing; without it your case is dead in the water.
Contact Dolman Law Group Accident Injury Lawyers, PA
Dolman Law Group Accident Injury Lawyers, PA is proud to represent medical providers and independent Radiology Facilities primarily in the Tampa Bay area, including but not limited to the counties of Pinellas, Hillsborough, Pasco, Manatee, Sarasota, Hernando, Citrus, Polk, and Charlotte. We will gladly represent any provider across the entire state of Florida.
Dolman Law Group Accident Injury Lawyers, PA
800 North Belcher Road
Clearwater, FL 33765