Get into an accident, pay a "Crash Tax"

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I live in TN that has banned this crash tax lunacy. I thought tax payer dollars provides for these services. http://articles.moneycentral.msn.com/Ins...aid.aspx?page=2 'Crash taxes' add hefty fees for aid It's bad enough to be in a car accident, but getting billed for the police and/or fire department response can make matters worse. And your insurance may not cover that. advertisement Article Tools E-mail to a friendTools IndexPrint-friendly versionSite MapArticle IndexDiscuss in a Message BoardDigg This By Peter Lewis Imagine you're cruising down the road when you hit a patch of black ice and slide into a guardrail. A passing motorist calls 911. Soon firetrucks and police arrive. Weeks later, a $1,400 bill does, too -- for the cost of the police and firefighters who answered the call. What's worse, it's not covered by insurance, and it might scar your credit if you ignore it. Sound implausible? It's happening in a number of towns, cities and counties in at least 24 states. And given today's cratering economy (and property-tax revenue), more strapped local governments may be tempted to authorize so-called accident response fees. Private vendors that promote such programs show up at city council meetings and police and fire chief conventions with model ordinances and fee schedules in hand. The vendors typically take a 10% cut of what's recovered. Though five states (Georgia, Indiana, Missouri, Pennsylvania and Tennessee) have banned "crash taxes" outright, insurers, lawmakers and vendors are squaring off elsewhere, even setting up warring Web sites such as Municipal Fee Facts and AccidentResponseFees.com. Who's caught in the middle? Drivers like you. That'll be $2,200 Two years ago, Luke Gutilla lost control of his motorcycle along a road in Richland Township in Cambria County, Pa. He suffered a leg injury and was taken by ambulance to get treatment, which his insurance covered. Several months later, Gutilla received a bill for nearly $2,200 for the services of seven firefighters, an assistant chief, two fire vehicles, three police cruises and three officers. The bill also itemized things like "brooms and mops and things that were just kind of strange," he recounted recently. Gutilla, 26, a cable-company technician in Johnstown, Pa., said he started receiving a string of demand letters from a third-party vendor. "I threw away the papers they sent me and just ignored them," he recalled. He never paid the bill -- sent "inadvertently," according to the vendor -- and nothing showed up on his credit report. Talk back: Should individuals be charged for emergency fire and police services? Insurance trade groups estimate the typical bill for nonmedical accident response fees at between $100 and $300, although some run considerably higher. Ordinances establishing crash response fees typically distinguish between resident and nonresident, who's at fault and who has insurance. They usually go after the out-of-towners, especially if there's an interstate highway nearby that spurs the bulk of accident responses. Get a quote on car insurance Compare what Esurance, Geico, Nationwide, Progressive and State Farm have to offer. A sampling of fees from across Florida: $28 an hour for a police officer. $200 an hour for a fire chief. $435 for a fire/rescue response to no-injury accident. $1,000 for complex accident extrication. Why doesn't insurance cover this? Medical services, including ambulance transportation, have always been covered under medical payments, personal-injury protection and no-fault provisions, according to Jessica Hanson, a spokeswoman with Property Casualty Insurance Association of America. But Joe Thesing, an industry lobbyist with the National Association of Mutual Insurance Companies, said the typical policy does not cover accident response fees because "it is our belief that local taxes pay for those." It's up to each company to determine, based on policy language, whether to pay the fees. "But most instances that we learn of do not provide coverage," Hanson said. The insurance industry contends that if accident response fees catch on, it will drive up everybody's rates. Without a consistent fee structure, it's impossible to estimate how much higher policies might run, according to Mary Bonelli, an Ohio Insurance Institute spokeswoman who has been tracking the issue for five years. "You wouldn't get something for nothing," she said. Or, she said, a carrier might place a cap on such coverage, similar to the $500 allowed under homeowners policies for fire department runs. To get a broader sense of the kinds of accident response bills its customers have received, State Farm provided MSN Money with some edited summaries of incidents that took place in Ohio since 2004. The company said it never paid any of them, except for legitimate medical charges: "$350 Billed -- This accident happened in front of a fire station. Our insured driver was at fault. He reports no fire vehicles left the station. He recalls five firefighters walked from the station to the accident scene. The fire department run sheet indicates they were on scene for 20 minutes, which calculates to $1,050 per hour." "$593 Billed -- Our insured rolled into the rear of another car. There was no damage to either car. The fire department was at the scene for less than 15 minutes." "$350 Billed -- This accident was at an intersection controlled by a traffic signal. Both drivers claimed to have a green light. There were no witnesses. The police investigation could not determine fault. The municipality decided to bill the insured driver $350 for scene response." "$600 Billed -- The fire department billed $300 per person to take the vital signs of the driver and passenger. Neither was transported. They were not injured and didn't have any medical treatment after the accident. The fire department reduced the bill to $100 per person. The bills were paid under the medical payments coverage." The case for fees Fire Chief Chad Croft in Live Oak, Fla., says his small department would continue to exist without the $2,000 to $3,000 a month it gets from accident response fees but that its service would be diminished. The additional revenue has made it possible to afford a new $600,000 ladder truck and saved local residents from tax increases. The new truck has also improved the community's overall insurance rating, reducing commercial and residential premiums, Croft said. He said his department has done business with Cost Recovery, an Ohio company that collects fees on behalf of municipalities, for about two years. Croft said the money "has helped us keep the standard of care that we need." He said the additional money amounts to "10% to 15% of our budget on the operations side." A lot of tourists pass through the area en route to Disney World or Florida's beaches, and the chief estimates that 75% of the calls his 25-man department (including 10 volunteers) responds to each year are vehicle accidents on interstates. No charges are assessed unless blame can be attributed to a particular driver, and the department seeks to collect only from at-fault motorists who don't live in the county, he said. Among motorists fitting those criteria, the department collects 30% to 40% of the time, he said. The outlook Cost Recovery President Regina Moore said she collects on behalf of "hundreds" of local governments across the country and said her business is "growing exponentially." Her largest customer is Toledo, Ohio, with a population of more than 300,000. Recently, her company has been picking up smaller cities in rural parts of Florida, and it just entered Kansas, she said. Get a quote on car insurance Compare what Esurance, Geico, Nationwide, Progressive and State Farm have to offer. Even the insurance industry sees more growth ahead. "There's going to be more and more pressure on cities as their budgets are tightened or cut and on fire and police departments who obviously never have enough money to run their departments," predicted Mark Lane, a lawyer and lobbyist for State Farm who opposes accident response fees. "If they can do it and earn a little extra, more are more likely to try it." But political pressure can be just as powerful. Dozens of cities have begun the process, only to back away or later repeal. Do you really have to pay? How many customers or carriers actually honor these bills is unclear. Moore asserted that more than half the insurance companies she bills -- 56% -- pay up. By contrast, a survey conducted by the Ohio Insurance Institute indicated that more than 82% of carriers reject bills for uncovered accident response services. Bob Brown said most folks have paid when, as fire chief in the Denver suburb of Castle Rock, he established such a program. "We might have gotten $25,000 a year" for services such as mopping up hazardous materials and putting out vehicle fires on a nearby interstate, he said. Talk back: Should individuals be charged for emergency fire and police services? Castle Rock handled the billing internally and charged only those who weren't local, he said. And even then, it didn't bother billing if it was "only a fender bender and we didn't do anything," he added. The majority of ordinances aim to collect only from insurance companies, but that doesn't mean you won't receive a bill. In fact, Moore's position is that while payment from carriers is "voluntary," individuals are ultimately responsible because they benefited directly. Even so, she said "less than 5%" of bills get referred to collection agencies when individuals refuse to pay. MSN Money driving-skills quiz Remember what you learned in driver's education? See how well you score on 20 questions taken from real licensing tests across the country. Click here to take the quiz. If you get billed for accident response, you should: Contact your insurer and forward the bill. Get a copy of a police report detailing what medical assistance, if any, was required. Check into any criminal liability. In at least one municipality -- Lauderdale Lakes, Fla. -- nonpayment is a misdemeanor. Consider contacting the consumer-protection division of your state attorney general's office if you and your insurance carrier determine the bill is not warranted. Consider disputing the charge with credit reporting agencies if the bill is sent to a collection agency.
 

JHZR2

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Interesting. The question becomes at what point does the taxpayer pay for this stuff for his own protection, vs. allowing others to use it for free? And I guess there is another one too... say somebody calls 911 without good reason, and it brings about the fire, police, etc... if it was a prank, silly mistake, or someone just acting stupid (e.g. the woman calling 911 because she couldnt get ketchup on her whopper). Isnt a cost incurred? Was it justified in the least? Another example - a well-traveled highway goes through your town. Two people crash on the road, neither of whom is a resident of your town. They are using the services that you paid for, for your use and protection... without footing any sort of bill for any of it. Last I checked, most people are entitled to wear&tear, fuel, depreciation costs. Just because the police/fire departments are local government, do they not also have such costs? I can see reason for both. To reduce taxpayer burden, let those who use the system pay more for the system. Lots of folks like that concept for other applications, why not here? Alternately, since there is no 100% chance of payback, why not let the services be free to residents, and let non-residents pay? Since most accidents occur within 25 miles from home, perhaps there can be a reciprocation for within 25 miles? I live in a town that has a paid for, full time fire department. It keeps homeowner's insurance low, and response times fast. If somebody lights up in the town next to mine, and our FD gets to the scene first, Im subsidizing the fast protection of the property in another town. Its all well and good, but Im paying for a service that they are getting for free from my town. Not saying it shouldnt happen, but there may be some justification for a pay if you use it scenario. May be 100% wrong... just my 2c.
 
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We have a tradition in this country to penalize the most vulnerable. So imposing fees on car crash victims is not at all surprising (things like this are done in the health care industry all the time the highest fees are charged to the most financially vulnerable people).
 
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 Originally Posted By: JHZR2
I live in a town that has a paid for, full time fire department. It keeps homeowner's insurance low, and response times fast. If somebody lights up in the town next to mine, and our FD gets to the scene first, Im subsidizing the fast protection of the property in another town. Its all well and good, but Im paying for a service that they are getting for free from my town. Not saying it shouldnt happen, but there may be some justification for a pay if you use it scenario. May be 100% wrong... just my 2c.
Since your fire dept is full time, isn't the cost pretty much fixed no matter if they play poker all night or go to the fire in the next town? I think most emergency services are this way, no one is getting called from home to go to your accident specifically. It would be pretty dumb for places that rely on tourists to try this too. Millions of dollars could stay in Ontario or go skiing with a couple news stories of families getting ripped off in an accident on the way to Florida... Ian
 
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This reminds me of the 1700's when you bought fire insurance and the fire company would come racing over for the "reward". Or two private, for profit companies, would fight each other over who got there first and let your house crumble to the ground.
 

Cutehumor

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It just seems to me that this is illegal. especially those state farm examples of local cities trying to get payment for these services. To me, that's trying to defraud an insurance company which is a federal crime committed by states and local city governments. Kinda how doctors are defrauding Medicare out of millions of dollars. I just hope my car insurance rates don't go up due to this lunany. Everyone is trying to raise rates, taxes, bills to maintain their yearly salary increases/bonuses. has anyone ever heard of sacrificing or cutting back around here??
 
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If you haven't noticed this U.S.A over the years has turned into a third world country .Dictatorship and all.
 
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If little dirt bag communities are going to do that, everyone who lives there should have a statement to that effect on their drivers license so they can be appropriately charged if they need government services when they are in a civilized community.
 
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Another way to look at this, if I'm in an accident in a "pay as you crash" town and my car is drivable and I appear to be OK, can I refuse service from the PD/FD and then not pay the bill claiming that I didn't order the services and refused delivery?
 
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It would be reasonable to have insurance for these costs. The insurance co can also more vigorously defend against fraud by local towns. A related topic is rescue from extreme circumstances. Who should pay for a rescue if some guy wants to climb a mountain for fun and gets injured while perched on a wall somewhere? Normal people don't do that thing every day, so normal taxes should not pay for it.
 
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 Originally Posted By: oilyriser
It would be reasonable to have insurance for these costs. The insurance co can also more vigorously defend against fraud by local towns. A related topic is rescue from extreme circumstances. Who should pay for a rescue if some guy wants to climb a mountain for fun and gets injured while perched on a wall somewhere? Normal people don't do that thing every day, so normal taxes should not pay for it.
I can 100% agree on that unless the rescue people are paid[Government workers] from the sloptrough of the taxpayer.
 
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 Originally Posted By: opus1
Another way to look at this, if I'm in an accident in a "pay as you crash" town and my car is drivable and I appear to be OK, can I refuse service from the PD/FD and then not pay the bill claiming that I didn't order the services and refused delivery?
Can you refuse service from the Mafia?
 
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I guess the town has to go after the federal/state gas tax dollars, for highway stuff, since many of the roads are federal or state property.
 

Cutehumor

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 Originally Posted By: opus1
Another way to look at this, if I'm in an accident in a "pay as you crash" town and my car is drivable and I appear to be OK, can I refuse service from the PD/FD and then not pay the bill claiming that I didn't order the services and refused delivery?
I'm thinking these podunk towns will impound your car if it's driveable after an accident and make you pay for their $1500 fire dept trucks, three cop cars show up "services" before you can leave. Right XS650, legalized mafia
 
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And why not have people who CAUSE an accident (it's their fault) pay a pollution tax for all of the traffic that is backed up for hours polluting the air? Around here, the big back up accidents are usually the result of an 18 wheeler highballing on bad road surfaces and wiping out. Traffic can be delayed for hours. To me, they should pay a LARGE polltuion fine that could go to opening additional recycling or helping stationary power sources add more control to compensate.
 
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 Originally Posted By: XS650
 Originally Posted By: opus1
Another way to look at this, if I'm in an accident in a "pay as you crash" town and my car is drivable and I appear to be OK, can I refuse service from the PD/FD and then not pay the bill claiming that I didn't order the services and refused delivery?
Can you refuse service from the Mafia?
Well, I had to ask.....
 
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Having emergency service paid for by the insurance is not good, having it paid for by the one who called and not insurance is even worse. One of my dad's classmate had a nose bleed in class, and the school does not want to be liable so they called 911. Ambulance shows up, he was put on a bed and bring to the hospital, and diagnoses showed nothing other than a nose bleed. He was charged $600 for the trip and refuse to pay (he didn't called the ambulance, have no insurance, etc). He had bad credit already so what the heck. My dad got into an accident when fixing the garage door and the spring connected metal pipe hit his forehead, cracked his skin and he bleed without stopping. He had insurance at the time, but a $1000 deductible (in patient only), and refuse to call 911. He drove himself to the hospital in city traffic as well as highway (the cheapest emergency room in town). The doctors and nurses almost smacked him for endangering other people's life on the road, as he could pass out any time due to blood loss. Of course, he knows that it wasn't that severe so he drive, or else he would have called a friend or 911 to bring him to the hospital within walking distance (a Kaiser). My dad isn't poor by any mean, just frugal. If he is in this kind of way to avoid expensive emergency service, what about people that aren't as well off? What about people who got hit and run and cannot afford to pay for it? What about all those emergency services that are essential but cannot be collected (police, fire, etc) so easily? What about people refusing to use 911 and make the incident worse? Trying to put out their own fire, blocking the road so that the fire fighters the neighbors called cannot reach the location, lying about the medical situation and refuse to get in an ambulance and die later, etc? Even those who promote "Use Tax" or "Flat Tax" do not go as far as touching emergency services. We have emergency services for a reason, we have insurance for a reason, and we have municipal tax for a reason: to keep the damage to a minimum when it happens, not to save a few bucks.
 
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 Quote:
He said his department has done business with Cost Recovery, an Ohio company that collects fees on behalf of municipalities, for about two years. Croft said the money "has helped us keep the standard of care that we need." He said the additional money amounts to "10% to 15% of our budget on the operations side." A lot of tourists pass through the area en route to Disney World or Florida's beaches, and the chief estimates that 75% of the calls his 25-man department (including 10 volunteers) responds to each year are vehicle accidents on interstates.
..and those tourist are allegedly VITAL to the Florida economy ..and provide many jobs and whatnot ...etc..etc..etc and the freaking state SUCKS massive revenues when a hurricane strikes to rebuild the infrastructure .. ..blah..blah..blah. More funny money fairytale charges developed from vapor need when the stones get squeezed from their comfy spot.
 
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