If you’ve been in an accident and need medical treatment, but don’t have health insurance, coverage, or the funds to pay for your care, you may find yourself in a difficult situation. In Florida, a Letter of Protection (LOP) is a practical solution that may help you get the medical care you need while protecting you from incurring a financial burden. This form of compensation deferment is often used in personal injury cases, and is legally binding if it is written in accordance with the rules set out by the Florida Bar Association. If you’re wondering if this is the correct route for you, read on to find out 7 things to keep in mind when considering a Letter of Protection in Florida.

What Is A Letter of Protection (LOP) in Florida?

A Letter of Protection (LOP) is a legally binding agreement between a patient and their medical provider in the state of Florida. The LOP safeguards the patient from having to pay out-of-pocket for necessary medical treatment related to the case until a settlement has been reached. In exchange, the medical provider agrees to be compensated by the proceeds of the personal injury settlement. An attorney typically drafts this letter on behalf of their client during a personal injury case as assurance of compensation for services rendered by medical providers.

7 Things to Keep in Mind When Drafting & Negotiating a Letter of Protection (LOP)

If you’re thinking about having a Letter of Protection drafted, negotiated, or are being asked to sign one, it is important to keep the following in mind:

1. What Legal Elements Must Be Included & Be Enforceable. A Letter of Protection must meet certain legal requirements in order to be enforceable. It should include: the name and contact information of both parties, an agreed-upon amount of compensation and/or percentage of the settlement proceeds to be paid out, a fair payment schedule, which medical procedures will be covered by the LOP and any limitations associated with those services, as well as, any other pertinent information regarding the agreement.

2. The Letter of Protection Must Be Reasonable & Agreed Upon by All Parties Involved. The amount of compensation must be fair to both the medical provider and the patient, and should be determined according to the scope of treatments. The Letter of Protection must also be approved by the court before it can take effect.

3. All Amendments Must Be Agreed Upon By Both Parties. Any changes or amendments to the Letter of Protection must be agreed upon by both parties. This includes any changes in terms of payment, timeline, or services rendered. Any modifications to the Letter of Protection must be made in writing and signed by both parties involved.

4. The Letter of Protection is Legally Binding. Once agreed upon and signed by both parties, the Letter of Protection is legally binding and will remain in effect until the medical provider is compensated. This means that if the case does not result in a settlement, or is dismissed by the court, the patient may still be held responsible for any outstanding payments owed to the medical provider.

5. Other Costs A Settlement May Need to Cover. When filing a successful lawsuit, it's important to remember that any funds you may receive should account for attorney fees, as well as unpaid medical bills. This means that typically, after all the legal costs and outstanding medical expenses have been paid, only then will the remaining balance be distributed to the plaintiff. Therefore, it's essential to understand which costs require payment before any money can be shared with you.

6. Get An Itemized Bill From Your Medical Provider. Obtaining an itemized bill from your medical provider can help ensure that all costs associated with the treatment being addressed within the letter of protection (LOP) agreement are accurately accounted for. Having an itemized bill included in the LOP is critical to providing a detailed breakdown of any treatments, procedures, medications and services. This helps to ensure that there won’t be any unexpected fees or costs incurred after the settlement has been distributed. Additionally, an itemized bill can provide information about what services have been rendered so far, as well as those which may be necessary in the future.

7. Florida has a Collateral Source Rule. Florida has adopted the Collateral Source Rule, which states that a trial court must reduce the medical damages awarded by the amount being paid out from collateral sources (known as a set-off). An example of this is that if the plaintiff’s medical expenses incurred are covered by a collateral source (their own health insurance), the damage awarded should be reduced by the amount that was paid out. However, under the collateral source rule, these forms of compensation do not affect the defendant’s liability or diminish what would otherwise legally be owed to the individual for damages associated with their injury. A Letter of Protection is not considered a collateral source, and is not subject to reductions post-judgment.

The Benefits of a Letter of Protection & How It Can Help Protect Your Rights

A Letter of Protection has many benefits that can help protect the rights of both the medical provider and individuals involved in a lawsuit settlement.

  • Protects from Unpaid Medical Costs. In situations where a health insurance company refuses to pay for medical costs incurred by an individual due to a personal injury lawsuit, an LOP can provide them with protection against such fees. This helps keep the process moving forward despite any issues that may arise with an insurance company.
  • Mitigates Risk Associated with Settlement Disbursements. The use of an LOP also helps to mitigate any potential risk associated with settlement disbursement distributions. With this agreement in place, funds are only released after the medical provider confirms receipt of payment in writing. This helps ensure that all parties receive what they have been promised and protects against any fraudulent activity.
  • Makes Payment Process Predictable and Reliable. Finally, having an LOP agreement in place makes the payment process predictable and reliable for both the medical provider and law firm handling the settlement case. All details regarding payments as well as timelines indicated in the agreement must be adhered to by both parties for maximum legal protection.

Potential Pitfalls to be Aware Of When Signing a Letter Of Protection

When signing a Letter of Protection (LOP), there are certain potential pitfalls that both parties should be aware of.

  • No Consideration For Extremes. In many cases, an LOP may not take into consideration any unforeseen or extreme conditions that could arise during the course of the lawsuit, which may change the scope of the settlement amount. This can lead to discrepancies between what was expected and what is actually received by both parties involved.
  • Lack of Security for the Medical Provider. Under some circumstances, a Letter of Protection can leave the medical provider with a lack of security when it comes to receiving payments for their services rendered. Examples of this include if a settlement fails, or it does not cover the full amount of the individual’s expenses, then the medical provider may not receive full compensation from their efforts in providing care and treatment.
  • Incorrectly Estimating Settlement Amount. Another pitfall to avoid when signing an LOP is incorrectly estimating what the final settlement amount will be. If either party underestimates or overestimates this number, it can result in a payment discrepancy for either party or lead to an overall delay in reaching a resolution on the case.

Why You Should Obtain an Attorney For Legal Advice Before Signing a Letter Of Protection

Before signing a Letter of Protection, you should always obtain legal advice and guidance regarding your rights, potential risks associated with the agreement, and any other legal considerations that may arise as part of the agreement. The attorneys at Frank Eidson are experienced in personal injury law and understand the complexities involved when entering into such agreements. They will be able to provide insight into how best to approach these types of agreements for maximum benefit for yourself or a loved one. If you are considering a Letter Of Protection or have any questions related to it, contact Frank Eidson at 407-245-2887, so that we can help ensure your rights are protected every step of the way.


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