13 Fla. L. Weekly Supp. 889c
Insurance — Personal injury protection — Demand letter — Sufficiency — Where demand letter sent by medical provider contained HCFA forms without specifying exact amount claimed, and letter failed to account for claims not yet overdue or amounts applied to deductible, reduced to reasonable charges or partially paid, letter failed to comply with statute — Summary judgment granted in favor of insurer
PHYSICAL THERAPY GROUP, LLC., as assignee for HARRY E. MORALES, Plaintiff, vs. MERCURY INSURANCE COMPANY OF FLORIDA, Defendant. County Court, 11th Judicial Circuit in and for Miami-Dade County. Case No. 05-1252 SP 24 (1). June 2, 2006. Darrin P. Gayles, Judge. Counsel: Scott E. Danner, Kirwan & Spellacy, P.A., Fort Lauderdale, Richard Shuster.
ORDER ON DEFENDANT’S MOTION FOR SUMMARY JUDGMENT WITH INCORPORATED MEMORANDUM OF LAW
[Editor’s note: Motion for Rehearing has been filed.]
THIS CAUSE having come on to be heard on Defendant’s Motion for Summary Judgment and the Court having considered the Motion and being otherwise duly advised in the premises, finds as follows:FACTS
The Plaintiff has sued the Defendant for alleged breach of contract and asserted that the Defendant wrongfully refused to pay for certain medical expenses incurred as a result of an automobile accident. Plaintiff sought and received medical treatment and claimed PIP benefits under the policy of insurance issued by Mercury Insurance Company of Florida.
LEGAL ANALYSIS
Defendant argued that the Plaintiff’s Pre-Suit Demand Letter failed to comply with Fla. Stat. 627.736(11), because (1) the pre-suit demand letter did not accurately specify what medical bills Defendant failed to pay and what portion of the medical bills were specifically at issue in the lawsuit, (2) the demand letter simply attached Health Insurance Claim Forms and failed to state the exact amount claimed, paid in part, applied to the deductible, reduced or denied, (3) the demand letter was filed prematurely as a portion of the medical bills were not yet overdue and (4) the pre-suit demand letter was addressed to the wrong party and not the individual designated by Mercury Insurance Company of Florida to receive the demand letters pursuant to Fla. Stat. §627.736(11).
Fla. Stat. §627.736 states in pertinent part:
(11) Demand letter.
(a) As a condition precedent to filing any action for benefits under this section, the insurer must be provided with written notice of an intent to initiate litigation. Such notice may not be sent until the claim is overdue, including any additional time the insurer has to pay the claim pursuant to paragraph (4)(b).
(b) The notice required shall state that it is a “demand letter under s. 627.736(11)” and shall state with specificity:
1. The name of the insured upon which such benefits are being sought, including a copy of the assignment giving rights to the claimant if the claimant is not the insured.
2. The claim number or policy number upon which such claim was originally submitted to the insurer.
3. To the extent applicable, the name of any medical provider who rendered to an insured the treatment, services, accommodations, or supplies that form the basis of such claim; and an itemized statement specifying each exact amount, the date of treatment, service, or accommodation, and the type of benefit claimed to be due. A completed form satisfying the requirements of paragraph (5)(d) or the lost-wage statement previously submitted may be used as the itemized statement. To the extent that the demand involves an insurer’s withdrawal of payment under paragraph (7)(a) for future treatment not yet rendered, the claimant shall attach a copy of the insurer’s notice withdrawing such payment and an itemized statement of the type, frequency, and duration of future treatment claimed to be reasonable and medically necessary. . .
[Emphasis added].
The requirements of Fla. Stat. §627.736(11) are unambiguous and adherence to the pre-suit notice requirement promotes the legislative goal of reducing unnecessary litigation, in part, to avoid the overburdening of the courts with actions that could be resolved before suit. Universal Health Care Center, Inc., (a/a/o Texsenia Cross) v. Progressive Express Insurance Company, 11 Fla. L. Weekly Supp. 932b (Fla. 17th Circuit, Broward County, Oct 2004).
Furthermore, the requirements of Fla. Stat. §627.736(11) were designed, in part, to give the insurer an opportunity to know from the Demand Letter the exact amount of the overdue claim, which calculations Plaintiff was depending on in determining the exact amount due and what to pay in order to avoid litigation. Id. See also Urgent Care Center (a/a/o Esperanza Vargas) v. Progressive Express Insurance Company, 12Fla. L. Weekly Supp. 673b (Fla. 11th Circuit, Miami-Dade County, April 15, 2005), Florida MRI, Inc. a/a/o Edouard Joseph v. Allstate Indemnity Company, 12 Fla. L. Weekly Supp. 989a (Fla. 17th Judicial Circuit, Broward County, July 2005).
In an attempt to comply with the requirements of Fla. Stat. §627.736(11), on or about March 14, 2004, the Plaintiff submitted a demand letter to Defendant, Mercury Insurance Company of Florida. The demand letter attached the Health Insurance Claim Association forms and alleged medical billing spanning from November 01, 2004 to February 24, 2005 and totaled $8,550.00.
Dates of service February 02, 2005, February 07, 2005 and February 24, 2005 were not yet overdue, having been received by the insurance company on February 24, 2005 and March 09, 2005. Additionally, the insured’s policy had a $1,000.00 deductible, Mercury had paid $4,656.99 and had taken reductions on some of the medical bills due to duplications in billing, and paid the remainder at the reasonable, related and necessary rates.
If the Health Insurance Claim Forms are to be used as an itemized statement, and all charges contained in the Health Insurance Claim forms have not been denied or reduced, the Plaintiff must provide more specific information than simply providing the Health Insurance Claim forms. Plaintiff must specify each exact amount at issue for each individual service charge at issue, along with an accurate account of total amount that is being claimed as due. Chiro-Medical Rehabilitation of Orlando, Inc. a/a/o Paul Scott v. Progressive Express Insurance Company, 12 Fla. L. Weekly Supp. 162b (Fla. 17th Circuit, Broward County, Oct 15, 2004) (Emphasis added).
During the course of litigation, Defendant asserted that the demand violated Fla. Stat. §627.736(11) and moved for Summary Judgment.
Plaintiff, in an effort to remedy the error, and after the suit was already filed, moved to Amend the Complaint to omit the HCFAs that were attached prematurely and sent a second Fla. Stat. §627.736(11) demand letter which again failed to itemize the bills, deduct the deductible, the reductions or any other charges. Unfortunately, this completely defeats the purpose of Fla. Stat. §627.736(11), which was designed to permit the insurer to determine the exact amount due and what to pay in order to avoid litigation. Urgent Care Center (a/a/o Esperanza Vargas) v. Progressive Express Insurance Company, 12Fla. L. Weekly Supp. 673b (Fla. 11th Circuit, Miami-Dade County, April 15, 2005); Chiro-Medical Rehabilitation of Orlando, Inc. a/a/o Paul Scott v. Progressive Express Insurance Company, 12 Fla. L. Weekly Supp. 162b (Broward County, October 2004); Universal Health Care Center, Inc., (a/a/o Texsenia Cross) v. Progressive Express Insurance Company, 11 Fla. L. Weekly Supp. 932b (Fla. 17th Circuit, Broward County, Oct 15, 2004).
The statute unambiguously requires that the claimant, prior to filing any lawsuit for benefits, must provide the insurer with a demand letter which must specify each exact amount, the date of treatment, service, or accommodation, and the type of benefit claimed to be due. Unless such requirements are met, the lawsuit is premature. The demand letter in question over stated the dates of service, and without taking into account the deductible, bills that were not yet overdue, and reductions, the wrong amount was stated and the insurer was not properly placed on notice of the amount it could have paid to avoid the lawsuit. Physician’s Referral & Medical Services, Inc., a/a/o Redda Porter, v. Progressive Insurance Company, 11 Fla. L. Weekly Supp. 831b (Fla. 11th Judicial Circuit, Miami-Dade County, June 2004).
As a matter of public policy it is of paramount importance that the Demand Letter requirements of Fla. Stat. §627.736(11) are strictly adhered to by the parties. Medical care providers should not be permitted to loosely adhere to the Demand Letter requirements because of the additional costs that would result from litigation that could have been avoided if the insurer would have been given a fair representation of the true amount at issue. Thus, to mitigate the negative consequences of such inevitable mistakes, legislatively prescribed safeguards must be strictly adhered to for the benefit of the insured, medical care provider, and the insurer.
CONCLUSION
Based upon the foregoing analysis, the Court finds that merely attaching HCFAs to the Demand Letter, totaling the amounts of the HCFAs and demanding payment for all charges therein fails to comply with the requirements of Fla. Stat. §627.736(11) as a matter of law.
If the Health Insurance Claim Forms are to be used as an itemized statement, and all charges contained in the Health Insurance Claim Forms have not been denied then Plaintiff must account for the amounts applied to the deductible, amounts reduced to reasonable charges or any partial payments made. Otherwise, Plaintiff has failed to state the exact amount claimed and the demand has not stated with specificity the amount that the insurance carrier could pay in order to avoid the lawsuit.
The Court declines to rule on the other prongs of Defendant’s Motion.JUDGMENT
IT IS HEREBY ADJUDGED that Defendant’s Motion for Summary Judgment be and same is GRANTED. Plaintiff Physical Therapy Group, LLC., (a/a/o Harry E. Morales) take nothing by this action and Defendant, Mercury Insurance Company of Florida, shall go hence without day and the Court will retain jurisdiction for the purposes of determining any motion by Defendant to tax fees and costs.
