12 Fla. L. Weekly Supp. 486a
Insurance — Personal injury protection — Coverage — Medical expenses — Reduction — Exhaustion of policy limits — Subsequent claim for unpaid portion of medical bills — Summary judgment is precluded by factual issue of whether reduced amount paid by insurer prior to policy limits exhausting was reasonable amount for services provided
GARY H. DIBLASIO, M.D., P.A., Plaintiff, vs. PROGRESSIVE AUTO PRO INSURANCE COMPANY, Defendant. County Court, 15th Judicial Circuit in and for Palm Beach County. Case No. 50-2004-SC-009623-SB-RD. March 7, 2005. Debra Moses-Stephens, Judge. Counsel: Glenn E. Siegel, Boca Raton. Jonathan Brooks, Fort Lauderdale.
Order Denying Defendant Progressive’s Motion for Summary Judgment
This action was heard on January 17, 2005 on Defendant Progressive’s Motion for Summary Judgment. This Court, having been duly advised in the premises, hereby finds as follows:
Dianna Rodriguez (hereinafter “RODRIGUEZ”) was allegedly injured in a motor vehicle accident that occurred on December 11, 2003. As a result, RODRIGUEZ sought medical treatment with the Plaintiff, Gary H. DiBlasio, M.D., P.A., (hereinafter “DIBLASIO”). RODRIGUEZ executed an assignment of benefits in favor of DIBLASIO under her policy of insurance with the Defendant, Progressive Auto Pro Insurance Company, (hereinafter “PROGRESSIVE”).
PROGRESSIVE alleges that it has paid its policy limits of $10,000 P.I.P. coverage. DIBLASIO contends, and the Defendant acknowledges, that PROGRESSIVE paid the charges submitted by DIBLASIO at a reduced rate. PROGRESSIVE contends that it has paid all of the bills it has received, but made what they feel are appropriate reductions based on the usual and customary amount in the area in which the services were rendered. This creates a genuine issue of material fact. Thereafter, on June 9, 2004, the benefits for this claim exhausted, after which the Complaint was filed by DIBLASIO.
PROGRESSIVE provided several cases in support of its argument, including Simon v. Progressive Express Ins. Co., 11 Fla. L. Weekly Supp. 470(a) (Fla. Palm Beach Cty. Ct., Jan 30, 2004, The Hon. Peter M. Evans), which ruled in favor of the Defendant. The Defendant relied upon that case for the proposition that under the Plaintiff’s argument “as long as the insured or medical provider acting by virtue of an assignment, filed a claim within the statute of limitations period, the insurance company could be required to pay even if all benefits were exhausted. The situation would result that all payments requested subsequent to the reduction or denial would be held in limbo until the statute of limitations period expired, or suit was filed and concluded. In the argument set forth by the Plaintiff, this would apparently result whether the insurer did or did not have notice of the challenge to the reduction prior to paying a bill to a subsequent provider. The resulting confusion would make it impossible for an insurer to act properly in handling the PIP claim.” The Defendant goes on to cite from that case that “The Defendant seeks to have a summary judgment on their behalf as they contend that they cannot be liable beyond policy limits.”
The Defendant also cited to the case of Neuro-Imaging Associates, P.A. v. Nationwide Ins. Co. of Florida, 10 Fla. L. Weekly Supp. 738a (Fla. Palm Beach Cty. Ct., Jan. 7, 2002, The Hon. Robert S. Schwartz) based on the “Defendant’s point of view is that their contract was with the insured, not the Plaintiff. That the insured contracted for a fixed amount of coverage, all of which has been paid out under the terms of their contact. Further, that the Plaintiff has no rights against the Defendant, except as can be assigned to them by the insured. The contract, having been fully performed by the original parties in privity, the Plaintiff, as assignee, could not gain more than the rights held by the assignor in the policy assigned to them, which can be no more than the assignor had the ability to assign. The assignor-insured, having used the full amount of the contract funds, cannot expect a right greater than that bargained for, nor assign rights beyond those which he held. The insured could not maintain a contract action against the Defendant under the undisputed facts, as it was fully performed.” The Defendant’s assertion is that is has fully performed the terms of its contract in this case as well, and cannot be held liable to DIBLASIO for anything beyond those contractual rights. In other words, once Progressive has paid its $10,000.00 policy limits, its obligation pertaining to that claim is concluded.
DIBLASIO does acknowledge that he did receive the final $34.21 in P.I.P. benefits to exhaust the P.I.P. policy limits, but contends that he is entitled to the reductions applied prior to exhaustion less that final $34.21 in benefits. Other medical providers received payments prior to that final $34.21 in benefits. DIBLASIO also contends that he is entitled to interest due on those reductions applied prior to the benefits exhausting as interest is not included in the benefits portion of the policy limitations. See Alvarez v. Ocean Harbor Casualty Company, 7 Fla. L. Weekly Supp. 543a (Fla. Miami-Dade Cty. Ct., 11th Judicial Circuit. Apr. 6, 2000); Leigh Taylor v. Florida Farm Bureau Insurance Company, (Fla. Seminole Cty. Ct., 18th Judicial Circuit, Nov. 27, 2000.); Afield v. USAA, 10 Fla. L. Weekly Supp. 546a (Fla. Hillsborough Cty. Ct., 13th Judicial Circuit, Feb. 24, 2003).
DIBLASIO argues that PROGRESSIVE is required to pay the 80% of all reasonable expenses medically necessary medical services in accordance with Florida Statute §627.736. PROGRESSIVE’S maximum liability under its policy is not DIBLASIO’S challenge; it is PROGRESSIVE’S method and priority of making PIP payments. Diblasio’s contention is that the determination of reasonableness is a question of fact, and not for PROGRESSIVE to determine. “The issue here is whether an insurer is entitled to pay PIP claims in any order [it] deem appropriate until the benefits are exhausted; or whether an insurer is required to set aside funds in the amount which would be due a medical provider whose bill has been challenged.” Physicians Diagnostics & Rehab, Inc. v. State Farm Mutual Automobile Insurance Co., Case No. 96-5431 (56) (Fla. Broward Cty. Ct., 17th Judicial Cir., July 8, 1998). DIBLASIO is not contending that PROGRESSIVE should pay over its policy limits, but should pay the limits properly up to the point of exhaustion. In other words, DIBLASIO argued that if PROGRESSIVE did not pay the reasonable expenses of necessary medical services in compliance with Florida Statute §627.736 and with the Defendant’s policy, and thereafter pays another medical provider, PROGRESSIVE could go back to that other provider to get the money back that would then have been paid in excess of their policy limits.
In addressing the Defendant’s argument that the Plaintiff failed to provide any notice of its challenge to the reductions applied prior to benefits exhausting, the Plaintiff referred to a prior decision by Judge Burton in Bartosek Chiropractic Center, P.A. v. Nationwide General Insurance, 10 Fla. L. Weekly Supp. 199a (Fla. Palm Beach Cty. Ct., 15th Judicial Cir., Jan. 21, 2003), who ruled that it is a factual issue regarding whether the Defendant paid the proper amount for the services provided prior to the benefits exhausting. Further, the Defendant may not be the arbitrator in deciding that the reductions applied were proper; and neither the legislature nor the insurance contract imposes a burden on the Plaintiff to put the insurance company on notice of an objection to reductions applied by the defendant.
In further support of its position DIBLASIO relies on Boulevard National Bank of Miami v. Air Metal Industries, Inc., 176 So.2d 94 (Fla. 1965), in which the Florida Supreme Court adopted the “English Rule” of priority between successive assignees of an account receivable, and State Farm Fire and Casualty Co. v. Ray, 556 So.2d 811 (Fla. 5th DCA 1990), in which the Florida 5th District Court of Appeals recognized that the English Rule adopted in the Boulevard case would be applicable to a suit for PIP benefits. DIBLASIO also cites Pinnacle Medical, Inc. d/b/a Iso Data Diagnostics v. Allstate Insurance Co., Case No. 97-12340 (18), L.T. CaseNo. 96-6203 (Fla. Broward Cty. Ct., 17th Judicial Cir., Apr. 23, 1998) and Physicians Diagnostics & Rehab. Inc. v. State Farm Mutual Automobile Insurance Co., Case No. 96-5431 (56) (Fla. Broward Cty. Ct., 17th Judicial Cir., July 8, 1998) in its argument that an insurer is not permitted to apply the payments of medical bills in any manner it chooses and to exhaust PIP benefits so as to deny payment to medical providers who are not favored.
DIBLASIO also filed the following cases in its Notice of Filing Supplemental Authority in support of its position: Seminole Casualty Insurance Company v. Philip D. Schtupak, D.C., 9 Fla. L. Weekly Supp. 529a (Fla. Broward Cty. Circuit Ct.); Tower Health Center v. Lyndon Property Insurance Company, 7 Fla. L. Weekly Supp. 627b (Broward Cty. Ct., June 5, 2000); Med+Plus Medical Clinics, Inc. v. Allstate Insurance Company, 8 Fla. L. Weekly Supp. 250a (Manatee Cty. Ct., Jan. 19, 2001).
DIBLASIO also argues, and this Court now agrees, that the real issue is whether or not PROGRESSIVE paid the provider the reasonable amount for the services provided by DIBLASIO prior to the policy limits exhausting. This is a factual issue that precludes summary judgment. If it is determined that PROGRESSIVE was unreasonable in applying reductions to DIBLASIO’S bills prior to exhaustion, then they should be held liable for reductions. Furthermore, whether or not PROGRESSIVE applied reductions in a reasonable manner is a question of fact for the jury or a trier of fact to determine.
It is therefore ORDERED and ADJUDGED that Defendant’s Motion for Summary Judgment is hereby DENIED.
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