New Jersey Supreme Court Upholds Fee Schedule for PIP Claims

By Kenneth J. St. Onge | November 24, 2009

The New Jersey Supreme Court has ruled the state’s insurance regulator can implement a medical fee schedule for treatments covered by Personal Injury Protection (PIP).

The decision upholds an August decision by a state appeals court.

“We are gratified by the Supreme Court decision… The PIP fee schedule is the product of many years of diligent work by the Department which included a lengthy process that incorporated significant input from many interested parties from within the provider community,” said New Jersey Department of Banking and Insurance Commissioner Neil N. Jasey.

“PIP costs have been rising dramatically recently resulting in upward pressure on rates,” he said. “The Department views the implementation of the PIP fee schedule as a means to help contain health care costs associated with automobile accidents, exerting downward pressure on insurance rates and greatly benefiting New Jersey’s auto insurance consumers.”

The legal battle came after a trade group for doctors sued the state, saying the fee schedule — which was established in 2007 — set fees which were too low. The fee schedule is tied to efforts to reform the state’s personal auto insurance market.

The fee schedule was supported by the property/casualty insurance industry.