Claims Handling, Benefit Coordination, and Reimbursement Procedures
Claim handling
PIP claims begin with prompt notice and proof of loss. The claimant supplies medical records, bills, wage proof, and other requested information. The insurer must investigate promptly, pay undisputed benefits, and explain any reduction or denial. Providers may take an assignment of benefits, so the insurer may pay the provider directly.
Coordination and reimbursement
PIP can be coordinated with health coverage where the policy lawfully provides. The order of payment depends on the policy election and applicable law; the same charge should not be paid twice. Workers' compensation, Medicare, Medicaid, and health plans may have reimbursement or collateral-source rights. The insurer should document primary and secondary determinations.
Reimbursement procedures include itemized bills, explanation of benefits, peer review, and interest or penalty rules for overdue PIP. A claimant who receives a liability settlement may have to reimburse PIP for benefits related to the same loss, depending on the policy and law.
Worked example
An insured with a coordinated policy is treated for an auto injury. The health plan pays $3,000 of a $5,000 bill. PIP reviews the remaining $2,000, applies the deductible and co-payment, and pays the eligible balance. If the provider billed both plans for the full $5,000, the insurer must coordinate to prevent double payment.
Traps
Do not send auto medical bills to the liability carrier first. Do not assume health and PIP both pay the same charge. Do not ignore an assignment. Do not pay a disputed bill without documenting the review.