14 Fla. L. Weekly Supp. 869a
Insurance — Personal injury protection — Coverage — Medical expenses — Exhaustion of policy limits — Right to contest denial of PIP claim was extinguished through exhaustion of benefits after claim was submitted and suit was filed where there was no showing of bad faith
R.J. TRAPANA, M.D., P.A., (as assignee of Armando Mederos), Plaintiff, vs. PROGRESSIVE AMERICAN INSURANCE COMPANY, Defendant. County Court, 17th Judicial Circuit in and for Broward County, Civil Division. Case No. 06-01697 COSO 62. June 28, 2007. Terri-Ann Miller, Judge. Counsel: Scott E. Danner, Kirwan & Spellacy, P.A., Fort Lauderdale. Christopher M. Tuccitto.
ORDER GRANTING DEFENDANT’S MOTION FOR FINAL SUMMARY JUDGMENT
THIS CAUSE having come before the Court on June 4, 2007 pursuant to Defendant’s Motion for Summary Judgment, and the Court having reviewed the file, considered the argument and Memorandum of Law submitted by the parties, and being otherwise fully advised in this matter, does hereby make the following findings of fact and conclusions of law:
FINDINGS OF FACT
1. On July 17, 2005, Armando Mederos, was allegedly involved in an automobile accident. At the time of the accident, Armando Mederos sought coverage under a policy of insurance issued by Defendant, Progressive American Insurance Company, under a policy, which provided personal injury protection (PIP) benefits to Plaintiff in the amount of $10,000.00.
2. As a result of alleged injuries sustained in the accident, Armando Mederos received medical treatment from R.J. Trapana, M.D., P.A. The bills for said medical treatment were submitted to Defendant for payment, and included bills for services provided on October 13, 2005 in the amount of $1320.00
3. Defendant, Progressive American Insurance Company, made payments to three (3) different providers, including the Plaintiff, R.J. Trapana, M.D., P.A., pursuant to the terms and conditions of the policy of insurance under which this claim was made, and all applicable Florida Statutes governing the payment of Personal Injury Protection Benefits.
4. On or about March 27, 2006, the Defendant, Progressive American Insurance Company, was served with a copy of the Summons and Complaint for damages arising from partial payment of his claims. At the time of the filing of this suit, Defendant still had policy benefits available within which to satisfy the claim submitted by Plaintiff.
5. Progressive American Insurance Company received and made payment in order of receipt upon the bills submitted by the various providers, including R.J. Trapana, M.D., P.A., until all Personal Injury Protection Benefits were exhausted.
6. In support of its Motion for Summary Judgment, Defendant filed the Affidavit of Kristine Scarantino, who is employed as a Claims Representative for Defendant. In the Affidavit, Ms. Scarantino states that the “full amount of Personal Injury Protection benefits available under the policy, in the amount of $10,000.00, was exhausted on August 28, 2006.” There are no facts in the record to dispute that the benefits were exhausted on August 28, 2006.
7. This Court finds that the personal injury protection (PIP) benefits available to Plaintiff, in the amount of $10,000.00, were exhausted on or before August 28, 2006.
8. There has been no allegation by Plaintiff that the actions taken by Defendant were done in bad faith.
CONCLUSIONS OF LAW
The issue presented to the Court is whether Plaintiff, R.J. Trapana, M.D., P.A., is entitled to Personal Injury Protection benefits from Defendant, Progressive American Insurance Company in excess of the policy limits where the benefits were exhausted after Plaintiff filed suit for the bills that were reduced by the Defendant and where there is no allegation that the insurer acted in bad faith.
The court was provided the following facts:
a) Plaintiff received medical treatment following an automobile accident and submitted bills relating to said treatment to Defendant when PIP benefits were available under the policy.
b) Defendant made a partial payment of the bills and reimbursed to a maximum allowable amount of 200% under the Medicare Part B Participating Physician Fee Schedule for the area in which the services were rendered.
c) Plaintiff filed suit against Defendant when PIP benefits were still available under the policy.
d) The PIP benefits available under the policy were exhausted after suit was filed.
e) There is no allegation by Plaintiff that Defendant acted in bad faith.
The insurance company has an obligation to settle as many claims as possible, and has discretion, subject to the requirement of good faith, in how it elects to settle claims, even the ability to settle certain claims to the exclusion of others. See Farinas v. Florida Farm Bureau General Insurance Co., 850 So. 2d 555 (Fla. 4th DCA 2003). Under the particular circumstances of this case, Defendant’s decision to reduce the medical bills was based upon the maximum allowable amount of 200% under the Medicare Part B Participating Physicians Fee Schedule for the area in which the services were rendered. Given this information, Defendant chose to pay this amount for the pending claim and to settle other claims submitted on behalf of Mr. Mederos until the policy limits had been exhausted. This Court concludes that Defendant’s decision to pay other claims submitted on behalf of Mr. Mederos, absent a showing of bad faith, satisfies itsstatutory obligations under Florida’s No-Fault law, as well as its contractual obligations to the insured. See Government Employees Insurance Company v. Robinson, 581 So.2d 230 (Fla. 3rd DCA 1991) and Neuro-Imaging Associates, P.A. v. Nationwide Insurance Company of Florida,10 Fla. L. Weekly Supp. 738a (Fla. 15th Jud. Cir. January 7,2002).
Florida law further provides that an insurer has no duty to escrow funds pending the resolution of a contested claim. See Chambers Medical Group, Inc. v. Progressive Auto Pro Insurance Company, 13 Fla. L. Weekly Supp. 367a (Fla. 13th Jud. Cir. December 16, 2005) and Dr. Robert Simon, M.D., P.A., (a/a/o Hon) v. Progressive Express Insurance Company, 904 So. 2d 449 (Fla. 4th DCA 2005).
Moreover, a decision of a district court is binding statewide in the absence of a conflicting decision from another district court. Howell-Demarest v. State Farm Mut. Auto. Ins. Co.,673 So.2d 526 (Fla. 4th DCA 1996).
In Simon,the Court held that a “reserve” or “hold” provision automatically applied to funds available at the time a claim is submitted “would result in unreasonable exposure of the insurance company and would be to the detriment of the insured and other providers with properly submitted claims. Id. at 450. Additionally, Florida’s “No-Fault” law has no provision allowing funds to be escrowed or reserved for contested claims. The failure of the legislature and the courts to recognize a duty on behalf of an insurance company to reserve funds pending the litigation of a contested PIP claim leads this Court to conclude that the right to contest the denial of a PIP claim, absent a showing of bad faith, can be extinguished through an exhaustion of benefits by the insured after the claim has been submitted, or after the lawsuit has been filed.
In making its decision, the Court is also relying upon the following opinions: Rebecca Burress v. State Farm Insurance Automobile Insurance Company, 13 Fla. L. Weekly Supp. 903b (Fla. 13th Jud. Cir. June 16, 2006), Nu-Best Whiplash Injury Center v. Progressive Auto Pro Insurance Company, 13 Fla. L. Weekly Supp. 830c (Fla. 13th Jud. Cir. May 26, 2006). Premier Open MRI, LLC v. Progressive Express Insurance Company, 11 Fla. L. Weekly Supp. 839a (Fla. 13th Jud. Cir. May 26, 2004); Back In Action Health, LLC v. Progressive Express Insurance Company, 11 Fla. L. Weekly Supp. 1092a (Fla. 15th Jud. Cir. September 17, 2004); Comprehensive Physical Services v. The Hartford Insurance Company of Midwest, 12 Fla. L. Weekly Supp. 351a (Fla. 13th Jud. Cir. January 20, 2005); and Dr. Robert D. Simon, M.D., P.A. v. Progressive Express Insurance Company, 13 Fla. L. Weekly Supp. 502a (Fla. 15th Jud. Cir. December 7, 2005).
WHEREFORE, it is ORDERED and ADJUDGED as follows:
1. That Defendant’s Motion for Summary Judgment is hereby GRANTED.
2. That the Court reserves jurisdiction to award attorney’s fees and costs to Defendant. Defendant shall have thirty (30) days from the date of this Summary Judgment to claim.
