New York state complies with a no-fault law for drivers involved in crashes. Attorneys as well as auto insurers are likely aware that some individuals attempt to submit fraudulent or exaggerated claims, taking advantage of the system.
Originally intended to benefit drivers involved in accidents by speeding up the compensation process, helping drivers get back on their feet after a minor accident. However, because of the exploitation of the service, New York's Department of Financial Services is limiting the rules.
Recent news shows that out-of-state healthcare providers charging more than the average fee for services that insurers were expected to reimburse. Inflated healthcare rates for individuals seeking compensation for their injuries after an accident prompted the state's Department of Financial Services to enact the finalized regulation. This parameter will restrict the amount that the insured can reimburse when seeking no-fault healthcare out of New York.
Typically, this will only be in use in the case of emergency care. In non-emergent situations there would be little need for a New York resident to get medical assistance outside of the state. However, if a New York resident is injured outside of the state, the finalized regulation restriction will go into effect. When this occurs, DFS states that the insurance company must reimburse:
- "The amount of the fee set forth in the region of this State that has the highest applicable amount in the fee schedule for that service
- The amount charged by the provider
- The prevailing fee in the geographic location of the provider"
Finalized regulation in New York will likely help auto insurers and defense attorneys avoid abuse of the no-fault law.