Slamming brakes on auto insurance scams

BY FRANK LOMBARDI

DAILY NEWS CITY HALL BUREAU



Blaming fraud by "medical mills" for the city's sky-high car insurance rates, some Council members are introducing a bill today to help the city fight back.

The measure would require health care providers who receive more than half of their income from no-fault auto insurance claims to obtain special licenses from the city Health Department.



The licenses would be accompanied by rigorous reporting requirements and with stiff fines and a possible one-year jail sentence for violations.



"I'm trying to drive the bad guys out of business so the good providers can continue to operate," said Councilman David Yassky (D-Brooklyn), the bill's chief sponsor.



Yassky credited a study by Brooklyn Borough President Marty Markowitz for spotlighting the role medical mills play in driving up auto insurance rates.



Joining Yassky at a City Hall press conference, Markowitz said the bill is "a major step forward in saying we're not going to take it anymore."



Auto insurance rates may be higher in Brooklyn than anywhere in the world, Markowitz said, adding that a 35-year-old Brooklyn man with a good driving record has to pay $4,500 a year for basic coverage.



According to Yassky, the same coverage costs an average of $800 elsewhere in the country and $1,161 throughout New York State.



It's not that Brooklyn drivers are more accident-prone, Yassky said, it's because of "medical mills that exist solely to milk the no-fault insurance system."



As explained by Yassky, the mills seek out accident victims and encourage them to have unnecessary and costly examinations and treatments and then submit the inflated bills to insurance companies.



"And you know who gets [left] holding these bills - average Brooklynites and New Yorkers who have outrageous insurance premiums," added Markowitz.



Assemblyman James Brennan (D-Brooklyn), who helped spotlight the role medical mills play in high auto insurance rates, said of Yassky's bill, "This legislation brings the city government into the fight against auto insurance fraud."



Also on hand to lend their support to the measure were Brooklyn Councilmen Charles Barron and Michael Nelson. Barron called the fraud-fueled high auto insurance rates "a crime against working-class families."