10 Fla. L. Weekly Supp. 675c

Insurance — Personal injury protection — Medical bills — Reduction — Exhaustion of benefits — Action by medical provider for balance of bill partially paid by insurer claiming charged amount exceeded usual and customary charges — Insurer must pay overdue claims unlawfully withheld even if policy limits have been exhausted — Abuse of discretion in granting summary judgment where there was genuine issue of material fact as to reasonableness of amount charged

PHYSICIANS FIRST CHOICE INTERPRETATION, INC., A/S/O HERLINE DE CASTRO, Appellant, v. ALLSTATE INSURANCE CO., INC., Appellee. Circuit Court, 11th Judicial Circuit (Appellate) in and for Miami-Dade County. Case No. 02-356 AP. July 15, 2003. An Appeal from County Court of Miami-Dade County. Counsel: Marlene S. Reiss, Stephens, Lynn et al., P.A., and Steven L. Lubell, Lubell & Rosen, P.A. for Appellant. Jacqueline G. Emanuel, Riley, Knoerr & Emanuel, P.A., for Appellee.

(Before STUART M. SIMONS, MARIA M. KORVICK and ARTHUR L. ROTHENBERG, JJ.)

(MARIA M. KORVICK, J.) On June 11, 2001, Herline Decastro was injured in an automobile accident. At the time, he was insured for benefits under a personal injury protection (“PIP”) policy with Allstate Insurance (hereinafter referred to as “Appellee”). Thereafter, Physician’s First Choice (hereinafter referred to as “Appellant”) performed radiographic examinations on the insured. After obtaining an assignment of benefits, the Appellant billed Appellee $500.00 for services rendered. On September 5, 2001, Appellee sent Appellant a payment of $184.00, or 80% of “the reasonable amount for this procedure in the region where the service was provided.” On September 27, 2001, all policy benefits for this policy were expended. On November 9, 2001, the Appellant filed a complaint for $216.00 in unpaid PIP benefits, with prejudgment interest, costs and attorney’s fees. The Appellee answered that Appellant was barred from bringing this action because it accepted partial payment; it did not provide any notice of claim or dispute; and, in any event, all benefits had been exhausted. The Appellee later filed an amended motion for summary judgment with substantially the same arguments. The Appellant filed a cross-motion for partial summary judgment arguing that it had no duty to notify Appellee that it disputed the unpaid benefits, and that Appellee had not set aside a reserve. On July 22, 2002, the trial court denied Appellant’s cross-motion for summary judgment and granted Appellee’s motion for summary judgment with prejudice. On October 4, 2002, the trial court entered final judgment.¹ Appellant then filed this appeal.

In the present instance, the parties’ arguments centered on: 1) the amount of unpaid benefits which reflected charges above the usual and customary amounts in the region where services were rendered, and 2) that Appellee was not previously advised the Appellant disputed the manner or amount in which payment was made. Appellee did not challenge the necessity or relatedness of the services rendered, but denied full payment of benefits solely based upon their exceeding the usual amount charged for those services. By doing so, Appellee raised a question of fact as to the “reasonableness” of the charges. However, the lower court failed to make its own determination of reasonableness, and, rather, acceded this analysis to the insurer’s unilateral methodology. The only mention of this approach is in an employee’s supporting affidavit on behalf of Appellee’s motion for summary judgment in which it is referred to as an “adjusting tool.”

Summary judgment is improper where material issues of fact remain as to whether an insurer had reasonable proof of its non-responsibility for a bill; whether such expenses were reasonable, related or necessary; whether the insurer’s evaluation of the medical bills fit the definition of “reasonable,” and/or whether the way in which an assignee’s bill is handled is standard procedure used by an insurer and the insurance industry. See Seminole Casualty Ins. Co. v. Schtupak, 9Fla. L. Weekly Supp. 529a (Fla. 17th Cir. Ct. 2002); Nu-Wave Diagnostics v. Fortune Ins. Co., 8 Fla. L. Weekly Supp. 229b (Fla. 17th Cir. Ct. Jan. 22, 2001); and Pinnacle Medical, Inc. d/b/a ISO Data Diagnostics v. Allstate Ins. Co., 5 Fla. L. Weekly Supp. 663a (Fla. 17th Cir. Ct. April 23, 1998); see also Bartosek Chiropractic Center, P.A. v. Nationwide General Ins., 10Fla. L. Weekly Supp. 199a (Fla. Palm Beach Cty. Ct. Jan. 21, 2003); Cruz v. Union General Ins., 586 So. 2d 91 (Fla. 3d DCA 1991);and Donovan v. State Farm Mutual Auto. Ins. Co., 560 So. 2d 330 (Fla. 4th DCA 1990). Even when the facts are uncontroverted, the entry of a summary judgment is erroneous if different inferences can be reasonably drawn from those facts. See Bowe v. Giardina, 719 So.2d 941, 942 (Fla. 3d DCA 1998).

Florida Statute §627.736, governing PIP benefits, does not define how an insurer is to make a determination of “reasonable” expenses or charges for “necessary” medical services. See State Farm Mutual Ins. Co. v. Sestile, 821 So. 2d 1244,1245-46 (Fla. 2d DCA 2002). If an insurer refuses to pay medical expenses that an insured believes are reasonable, the insured may sue, but he bears the burden of establishing that the charges are, in fact, reasonable. Id. However, §627.736(4), Fla. Stat. (2001), does not contain an express requirement that the insured or provider contest the insurer’s decisions. Seminole Casualty, supra.

If contested, a court must initially determine whether benefits are payable. If PIP benefits are payable, then they were due within thirty (30) days of the date the bills were received, and if they were not paid or contested within that thirty (30) day period, then the insurer is liable for paying ten (10%) percent interest when the bill is paid. Gurney v. State Farm Mutual Auto. Ins. Co., 795 So. 2d 1118, 1120-21 (Fla. 5th DCA 2001); Cannarella v. Allstate Indemnity Co., 809 So. 2d 73, 74 (Fla. 2d DCA 2002); United Auto. Ins. Co. v. Stat Technologies, 787 So. 2d 920 (Fla. 3d DCA 2001). Failure to pay the benefits within thirty (30) days does not deprive the insurer of the right to contest payment. Gurney, supra. Rather, the statutory penalties of interest and attorney fees are the only penalties for an overdue claim. See United Auto. Ins. Co. v. Rodriguez, 808 So. 2d 82, 87 (Fla. 2001).

Florida precedent is clear that the insurer has the burden to authenticate the claim within the statutory period and may not unilaterally define “reasonable proof” to extend the statutory time limitation. Amador v. United Auto. Ins. Co., 748 So. 2d 307, 309 (Fla. 3d DCA 1999). While the statute does not limit reasonable proof to a medical report, and a physical examination of the insured is not required before denying or reducing benefits, neither is an across-the-board gauge of “reasonableness” favored. See Rodriguez, supra; Allstate Indemnity Co. v. Derius, 773 So. 2d 1190 (Fla. 4th DCA 2000), rev. granted Derius v. Allstate Indemnity Co., 837 So. 2d 406 (Fla. 2003); and Sestile, 821 So. 2d 1246. It is for the fact-finder to determine whether an insurer’s evaluation of medical bills fit the definition of “reasonable” on a case-by-case basis. Sestile, supra; see also Palma v. State Farm Fire & Casualty Co., 489 So. 2d 147 (Fla. 4th DCA 1986). “If it were otherwise, insurers could easily escape (or reduce) liability by facilely arguing in every case that the charges are not reasonable.” Blanco v. Liberty Mutual Fire Ins. Co., 6 Fla. L. Weekly Supp. 780a (Fla. Dade Cty. Ct. August 11, 1999).

Even if policy limits are to be exceeded, recent cases suggest an insurer must pay overdue claims which have been unlawfully withheld. See Nu-Wave Diagnostics at 229b, quoting Pinnacle, supra; Seminole Casualty, supra. See also Med+Plus Medical Clinics, Inc. v. Allstate Ins. Co., 8 Fla. L. Weekly Supp. 250a (Fla. Manatee Cty. Ct. Jan. 19, 2001). The case law analyses stem from the premise that the insured is not challenging the insurer’s maximum liability, but the insurer’s priority and method of making payments to various providers. See Nu-Wave Diagnostics, supra; Pinnacle, supra. The insurer may have misapplied benefits, or paid subsequent bills without setting aside a reserve of funds in the amount which would be due a medical provider whose bill has been challenged, at least until the challenge to the denial of payment has been resolved. Nu-Wave, supra. An insurer is not entitled to pay PIP benefit claims in any order it deems appropriate until the benefits are exhausted. Id.

In the case sub judice, it appears the lower court abused its discretion by prematurely granting the insurer’s motion for summary judgment. Even without a transcript of the proceedings, it is apparent from the pleadings that there was a genuine issue of material fact as to the reasonableness of the amount charged for services rendered. Such a question of fact would preclude the entry of summary judgment. Accordingly, this Court hereby reverses the final summary judgment in favor of Appellee, and remands this case to the trial court. (SIMONS and ROTHENBERG, JJ. concur.)

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¹No transcript of the lower court proceedings has been provided. Appellee filed the transcript of another case for this court’s review. However, the rule cited in Appellee’s Notice of Filing, Fla. R. Civ. P. 1.310(f)(3), refers to the filing of depositions. No further explanation is provided.

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