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Friday, February 23, 2024 | Back issues
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Doctor Challenges Allstate’s Lowballing

CHICAGO (CN) - Allstate Insurance reduced its insurance reimbursements under Florida personal injury policies without informing health care providers of the change, a class action claims in Federal Court.

Randy Rosenberg, a chiropractor with his own practice, sued Allstate Fire and Casualty Insurance Company for the class of medical services providers.

"This putative class action lawsuit involves a straightforward question of law that is applicable to each member of the class that is related to the 2008 changes to the Florida 'no-fault' insurance coverage regime," the complaint begins.

The Florida law originally required insurers to pay 80 percent of reasonable charges filed under a personal injury policy.

But in 2008, the Legislature added an option for an insurer to pay 200 percent of Medicare costs for the same services, usually a lower figure.

Rosenberg says: "Allstate immediately shifted to the new methodology but did not change its policy language or otherwise give notice of Allstate's use of the new methodology, and Florida law is clear that Allstate breached the contract of insurance by failing to amend its contract language or otherwise give notice of the use of the new methodology. This lawsuit seeks to enforce the agreement and seeks a declaration declaring Allstate's use of the alternate methodology unlawful, and thereby requiring Allstate to pay claims under the 80 percent of reasonable charges methodology."

The complaint claims that the law's amendment "does not permit defendants to limit reimbursements based on the Medicare fee without providing notice in its policy of an election to use the Medicare Fee Schedules as the sole basis for calculating reimbursements."

Rosenburg also says that before 2008, "there was no individualized assessment of reasonableness in this claims payment process," but Allstate simply accepted the billed charges, with few exceptions.

He seeks class certification, an injunction and damages for breach of contract and breach of implied covenant.

He is represented by Jeffrey Leon with the Complex Litigation Group in Highland Park.

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