15 Fla. L. Weekly Supp. 621b
Insurance — Personal injury protection — Explanation of benefits — Sufficiency — Statement on checklist that “Bills were not in compliance with Florida statute based on disclosure” is not sufficient EOB — Medical provider’s failure to provide disclosure and acknowledgment form does not excuse insurer’s breach of contract for failure to provide EOB — Fact that provider suffered only nominal damages from breach does not preclude entry of partial summary judgment
D. ABECKJERR, D.C., P.A. D/B/A CLOVERLEAF CHIROPRACTIC CLINIC, Florida Corporation (assignee of Watson, Lottie), Plaintiff, v. UNITED AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 11th Judicial Circuit in and for Miami-Dade County. Case No. 07-15014 CC 23, Div. 05. April 17, 2008. Lisa Walsh, Judge. Counsel: Russel Lazega, Law Office of Russel Lazega, P.A., North Miami, for Plaintiff. Carlie Marsh, for Defendant.
ORDER GRANTING PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT ON COUNT 1
This cause came before this Court on Plaintiff’s Motion for Partial Summary Judgment on Liability on Count 1, Breach of Contract for Failure to Provide an Explanation of Benefits/Itemized Specification per Section 627.736(4)(b), Florida Statutes.1 After a full hearing and review of all relevant motions and responses, the contents of the file and authorities, this Court makes the following findings:
1. This is an action for breach of contract and denial of benefits under Florida’s motor vehicle bodily injury insurance or “PIP” statutes. Plaintiff alleges in Count 1 that after receiving Plaintiff’s demand letter, Defendant failed to provide Plaintiff with a written Explanation of Benefits (“EOB”) pursuant to Section 627.736(4)(b), Florida Statutes.
2. Plaintiff further alleges in Count 1 that it is entitled to attorneys fees for maintaining its action, pursuant to Sections 627.428 and 627.736(8), Florida Statutes.
3. The Plaintiff argues that the insufficient EOB submitted by the Defendant insurer United in response to the Plaintiff’s pre-suit demand letter constituted a breach of Section 627.736(4)(b), Florida Statutes. United’s deficiency under the statute constituted a breach of contract because all PIP statutory provisions are deemed incorporated into the insurance contract between the parties.
4. In response to the Plaintiff’s Motion for Summary Judgment, the Defendant United filed a copy of the EOB it submitted to Plaintiff’s counsel. A copy of the EOB is attached to this order. [Editor’s note: attachment omitted]
5. The EOB provided by United is a form checklist. The checklist contains the following relevant language:
We have received your Pre-Suit Demand letter on 07/03/06. Please refer to our response below:
ş Explanation of Benefits previously sent to your office, please see attached.
ş Explanation of Benefits previously sent to the medical provider, please see attached.
ş Please see the attached Explanation of Benefits.
ş Payment was submitted to the medical provider prior to receipt of this Demand Letter. Please see attached.
ş Payment is forthcoming, please see that attached Explanation of Benefits.
X Other: BILLS WERE NOT IN COMPLIANCE WITH THE FLORIDA STATUTE BASED ON DISCLOSURE.
(Defendant’s Notice of Filing filed March 26, 2008, Exhibit C)
6. Notably, the third item on United’s checklist, “Please see the attached Explanation of Benefits,” suggests that the checklist itself is not meant to be the actual Explanation of Benefits. Rather, reference to an “attached” Explanation of Benefits suggests that the EOB is a separate document, while the checklist is merely a memorandum or cover page.
7. Plaintiff also submitted an affidavit by Dr. Abeckjerr in support of its Motion for Partial Summary Judgment. In it, Dr. Abeckjerr, states, inter alia, “Plaintiff was not forwarded an intelligible statement of the reasons for nonpayment . . . .” and that Plaintiff “extended (sic) approximately $25.00 worth of wasted employee time attempting to determine why this claim was not being paid, whether Plaintiff complied with all conditions precedent . . . .” (Affidavit Filed by Plaintiff January 28, 2008).
8. Further, as Plaintiff’s counsel explained at the hearing on Partial Summary Judgment, Plaintiff incurred additional nominal damages stemming from receipt of the deficient EOB because Plaintiff was forced to expend time retaining counsel to prosecute this claim.
9. Section 627.736(4)(b), Florida Statutes provides as follows:
(b) . . .When an insurer pays only a portion of a claim or rejects a claim, the insurer shall provide at the time of the partial payment or rejection an itemized specification of each item that the insurer had reduced, omitted, or declined to pay and any information that the insurer desires the claimant to consider related to the medical necessity of the denied treatment or to explain the reasonableness of the reduced charge, provided that this shall not limit the introduction of evidence at trial; . . . .
10. Both the County Courts and a Circuit Court sitting in its appellate capacity have upheld the validity of a cause of action for breach of contract where the insurer failed to provide the insured an Explanation of Benefits. See United Automobile Ins. Co. v. Trapana, M.D., P.A., 12 Fla. L. Weekly Supp. 452a (Fla. 17th Cir. Ct. Feb. 14, 2005); United Automobile Ins. Co. v. Stat Tech. Inc., 12 Fla. L. Weekly Supp. 840d (Fla. 17th Cir. Ct. April 12, 2005); County Line Chiropractic Center, Inc. v. United Automobile Ins. Co., 12 Fla. L. Weekly Supp. 1174a (Fla. Miami-Dade County Sept. 16, 2005).
11. The issue here is whether the form checklist generated by United is similarly deficient under the statute. There are no genuine disputed issues of material fact. Both United and the Plaintiff agree that the form checklist was United’s purported EOB.
12. A typed statement on a memorandum checklist that “Bills were not in compliance with the Florida Statute Based on Disclosure” does not constitute an “itemized specification,” as required by the statute. This statement is neither itemized nor specific. The statement has no specific meaning. Indeed, as Dr. Abeckjerr stated in his sworn affidavit, he did not understand the cryptic statement on the form.
13. Defendant United does not posit that its EOB was sufficient under the statute. Instead, United argues that the Plaintiff was not even entitled to an EOB because Plaintiff failed to provide a Disclosure and Authorization (“D & A”) Form pursuant to Section 627.736(5)(e), Florida Statutes. While the Plaintiff’s failure to submit a D & A form may preclude its recovery for medical benefits for the first date of treatment, Count 1 is not an action for denial of benefits. Count 1 states a breach of contract claim — a breach of United’s contractual obligation to abide by the clear statutory terms set forth by Section 627.736(4)(b).2 See, e.g. United Automobile Ins. Co. v. Trapana, M.D., P.A., 12 Fla. L. Weekly Supp. 452a (Fla. 17th Cir. Ct. Feb. 14, 2005) (Plaintiff’s failure to prove that treatments were reasonable and necessary was not fatal to Plaintiff’s cause of action for breach of contract for Defendant’s failure to provide EOB). The Plaintiff’s failure to provide a D & A does not excuse United’s breach of contract for failure to provide an EOB.
14. United makes two final arguments. First, United argues that its breach of contract was not material. Second, United claims that there were no damages to the Plaintiff resulting from the breach. This Court finds that both arguments are tantamount to the same point — that the Plaintiff suffered what may be merely nominal damages, something which the Plaintiff concedes. The amount of damages is not before this Court on the Plaintiff’s motion for partial summary judgment on liability. Damages will be determined at a future proceeding.
15. Since there are no genuine issues of material fact, this Court grants Plaintiff’s Motion for Partial Summary Judgment on Count 1.
16. Plaintiff as the prevailing party is entitled to attorneys fees and taxable costs, in an amount to be determined at a later hearing.
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1Plaintiff has abandoned all other grounds raised in its Motion for Summary Judgment.
2Section 627.736(5)(e)9, Florida Statutes specifically applies the D & A requirement to the initial treatment or service of the insured. As the Plaintiff in Count 1 does not claim entitlement to reimbursement for initial services to the insured, United’s argument is inapposite to the issue on partial summary judgment — whether United’s checklist EOB comports with section 627.736(4)(b).
