10 Fla. L. Weekly Supp. 905a
Insurance — Discovery — Documents — In action arising out of insurer’s reductions and non-payment of medical provider’s charges determined not to be reasonable through the use of computer database system, sole issue is reasonableness of medical provider’s charges and amounts paid by insurer, and information regarding insurer’s general claims handling practice is irrelevant — Protective order granted — Claims that information is protected by work product doctrine or attorney-client privilege denied in absence of demonstration of applicability of privileges to specific documents
DR. RONALD HOFFMAN, D.C., on behalf of LUKE NEWMAN, Plaintiff, v. PROGRESSIVE EXPRESS INSURANCE COMPANY, Defendant. County Court, 2nd Judicial Circuit in and for Leon County. Case No. 2002 SC 006793. September 18, 2003. Judith W. Hawkins, Judge. Counsel: Jason C. Taylor, McFarlain & Cassedy, P.A., Tallahassee. P. David Brannon. Christopher Johnston. Jeremy E. Cohen.
ORDER GRANTING DEFENDANT’S MOTION FOR PROTECTIVE ORDER
THIS CAUSE having come to be heard on Progressive’s Motion for Protective Order on May 8, 2003, and the Court, having been duly advised in the premises, hereby makes the following findings of fact and conclusions of law:
The facts of this case are relatively simple and agreed to for the purpose of the above motions. Luke Newman was injured in an automobile accident on April 25, 2002, and sought medical treatment from chiropractic physician Ronald Hoffman, D.C. Newman executed an assignment of benefits under his insurance policy in favor of Dr. Hoffman, which Progressive stipulated was a valid assignment for the purposes of the above motions. Newman treated with Dr. Hoffman for several months, and Dr. Hoffinan submitted charges for this treatment to Progressive.
On several occasions, Progressive paid a reduced amount of the charges submitted by Dr. Hoffman, based on information Progressive obtained from a computer software/database system it utilized for analysis of medical charges. Progressive maintains the information provided by the computer/database system reflected that the amounts Dr. Hoffman charged for certain procedures exceeded the usual and customary amount charged by providers in the same geographic region. Progressive, therefore, determined the amounts charged were not reasonable pursuant to section 627.736(5)(a), Fla. Stat. (2002). As a result, Progressive paid what it determined was the reasonable charge for such services, based on the information provided by the computer software/database program. Based upon Progressive’s actions, Dr. Hoffman filed the instant lawsuit regarding both reductions and denials.
In addition to the written discovery in this case, Plaintiff also sought to depose Progressive’s medical claims adjuster (or front line adjuster) regarding the issues in this action. Plaintiff filed and served on Progressive a Notice of Taking Deposition Duces Tecum for an agreed upon date and requested Progressive’s “complete file of its insured, Luke Newman, including but not limited to, any and all medical records, accounting statements and bills, correspondence, explanation of benefit forms, and all other records and documents pertaining to Mr. Newman.” In response, Progressive filed an Objection and Motion for Protective Order, asserting the deposition notice was overbroad in the amount and type of materials requested, including those materials that it contended were “claims handling materials” and not subject to discovery in this action.
A hearing was held on the above discovery issue as framed by the motion listed above on May 8, 2003. During the deposition, Plaintiff asserted he was entitled to discovery regarding Progressive’s claims handling procedures. In opposition to Plaintiff’s position, Progressive objected to such discovery on the record during the deposition and denied that Plaintiff was entitled to general claims handling discovery, on the basis that such materials were either work product or irrelevant to the sole issues of the breach of contract and the reasonableness of Dr. Hoffman’s charges. At hearing, Progressive relied on the analogous case of Gallmon v. State Farm Florida Ins. Co. v. Gallmon, 835 So. 2d 389 (Fla. 2d DCA 2003), and earlier cases supporting the same position. Progressive also relied on the case of State Farm Mut. Auto. Ins. Co. v. Sestile, 821 So. 2d 1244, 1246 (Fla. 2d DCA 2002), to support its position that the documents and information sought by Plaintiff were not discoverable, as the sole issue in the case is whether there has been a breach of contract, based on the reasonableness of Plaintiff’s charges and the amounts Progressive paid Plaintiff for same.
This Court finds persuasive the argument that the sole issue to be determined in this case is the reasonableness of the charges Plaintiff submitted and the subsequent amounts Progressive paid. The positions of the parties and the information obtained during discovery, including the deposition of the adjuster, make clear the adjuster relied solely on the computer database for the alleged reasonable rate to which the charges in dispute were reduced. As stated in Sestile, supra, “If an insurer refuses to pay medical expenses that an insured believes are reasonable, the insured may sue, but he or she bears the burden of establishing that the charges are, in fact, reasonable. . . . In some cases, a computer database may accurately assess the reasonableness of a medical provider’s bill; in other cases, it may be far from the mark. But this is the insured’s burden to prove.” Therefore, the instant action, arising out of Progressive’s reductions and non-payment of Plaintiff’s charges through the use of a computer software/database system, is an action where the only issue is the reasonableness of the Plaintiff’s charges and the amounts paid by Progressive. Thus, it is simply a breach of contract action.
Because this action involves the sole issue of whether Progressive breached the contract of insurance by failing to pay Plaintiff’s full charges, Plaintiff is not entitled to discovery regarding Progressive’s general claims handling practices. Based on the positions of the parties and the information obtained through discovery, including the adjuster’s deposition, general claims handling information is irrelevant to the issue of reasonableness of the charges submitted and the amounts paid. Plaintiff will have the opportunity to present to the jury his basis for the amounts he charged through testimony and exhibits. Progressive will then have the opportunity to present evidence and testimony as to the reasonableness of the amounts it paid, and the jury will determine the issue based upon the evidence submitted by both parties. At no point, however, without a sufficient showing by the appropriate party, will information on the general claims handling procedures of Progressive become relevant as to the issue of reasonableness of the charges submitted or amounts paid.
WHEREFORE, based on the foregoing, it is hereby ORDERED and ADJUDGED that Progressive’s Objection and Motion for Protective Order is hereby GRANTED in that the information sought by the Plaintiff regarding general claims practices is irrelevant. Any of Defendant’s claims that the information Plaintiff has requested are protected by the work product doctrine and/or attorney/client privilege are DENIED, unless and until Defendant can demonstrate as to specific documentation or information the applicability of such privileges on an individual basis. Plaintiff is entitled to discover only non-protected or non-privileged information regarding the reductions and non-payment and the basis for the reductions and nonpayment only for the dates of service at issue. Any additional discovery regarding the general claims handling procedures of Progressive or discovery which does not pertain to the specific dates of service and medical charges at issue is irrelevant and, therefore, not discoverable, unless and until either party makes a sufficient showing or a bad faith action is ripe for adjudication.
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