Tuesday, August 11, 2009


The American Insurance Association (AIA) applauded Monday's decision by the Appellate Division of the New Jersey Superior Court to uphold the new Personal Injury Protection (PIP) Automobile Medical Fee Schedule rules that were to go into effect on Oct. 1, 2009.

The medical fee schedule is used to reimburse medical providers for the treatment of automobile accident injuries.

“The Court, as it has done in the past, has largely affirmed the Department of Banking and Insurance’s efforts to reduce costs for New Jersey auto insurance consumers,” said David Snyder, AIA Vice President and Associate General Counsel of Public Policy. “We have supported these efforts against the incessant attacks of interest groups. Containing costs, as the legislature has directed, is fundamental to maintaining New Jersey's much improved auto insurance system."

The case arose when certain medical providers filed a lawsuit challenging the Department's fee schedule regulations. The Court granted a stay of the implementation of the rules pending its review. AIA intervened as a party in the matter supporting the Department by arguing that the new PIP medical fee schedule is an essential cost-control measure that is both authorized and consistent with the statutory mandate to control PIP medical costs.

“The PIP medical fee schedule has been delayed far too long and the Department’s efforts to implement these new regulations will vastly improve the efficiency of the overall claims handling process,” concluded Snyder.

AIA member companies write nearly 25 percent of the entire property/casualty market in New Jersey.

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