17 Fla. L. Weekly Supp. 697a
Online Reference: FLWSUPP 1708FENN
Insurance — Personal injury protection — Coverage — Policy issued during statutory gap period — Where PIP policy was executed during statutory gap period when there was no PIP statute, policy language requiring that insurer pay 80% of medical expenses controls reimbursement — Policy language stating that insurer “will pay in accordance with No-Fault Act” is meaningless or ambiguous where at time of policy inception there was no Florida Motor Vehicle No-Fault Act in effect
OMI OF ORANGE PARK, INC., a Florida Corporation (assignee of Fenner, Barbara), Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. 08-11209 COCE (53). May 24, 2010. Robert W. Lee, Judge. Counsel: Russel Lazega, Law Office of Russel Lazega, P.A., North Miami. Michael A. Rosenberg, Roig, Kasperovich & Tutan, P.A., Deerfield Beach.
FINAL JUDGMENT
THIS CAUSE came before the Court for hearing on April 21, 2010 on Plaintiff’s Motion for Summary Judgment (on the issue of whether Defendant properly issued payment by applying the 2008 OPPS fee schedule) and, having reviewed the motion and entire Court file; heard argument; reviewed the relevant legal authorities; and been sufficiently advised in the premises, the Court finds as follows:
Background:This is a P.I.P. case. Plaintiff is an assignee medical provider who rendered a magnetic resonance image (“MRI”) to Barbara Fenner on April 7, 2008 for injuries sustained in a motor vehicle accident on March 4, 2008. The applicable policy commenced October 26, 2007 and did not contain optional P.I.P. as it was not required at the time the policy was issued, which was when Florida’s Motor Vehicle No-Fault law was not in effect. At the time of the accident, the applicable policy of insurance did contain P.I.P. coverage as, effective January 1, 2008, the Florida Motor Vehicle No-Fault Law required each motor vehicle insurer to provide personal injury protection coverage to each of its motor vehicle insureds.
Plaintiff timely billed Defendant for the MRI service and Defendant reduced the allowable amount for the MRI according to the Outpatient Prospective Payment System (hereafter “OPPS”), which was less than 80% of the amount billed by the provider. The parties have stipulated that the amount of $1,700.00 billed by the provider for CPT Code 72141 for date of service April 7, 2008 was reasonable, related and necessary. Therefore, the only remaining issue in this suit is whether the Defendant was permitted to apply any fee schedule to Plaintiff’s claim where the claim was made under a policy issued during the gap period which did not specifically incorporate or reference that payments would be made according to a fee schedule.
Plaintiff moves for summary judgment asserting that no fee schedule applies to Plaintiff’s claim as the applicable policy language, which provides for payment at 80% of reasonable expenses for necessary medical services, fails to incorporate the permissive language of the 2008 P.I.P. statute, which provides carriers with the option to limit reimbursement to the participating physician’s Medicare Part B fee Schedule. Plaintiff further asserts, in the alternative, that the OPPS fee schedule is not the applicable fee schedule; rather, payment, at the very least, should have been made pursuant to the Medicare Part B Fee Schedule as F.S. s. 627.736 makes no reference to the OPPS fee schedule and because 627.736(5)(a)(4) precludes insurers from applying utilization limits that apply under Medicare.
Defendant maintains that the OPPS fee schedule applies because the statutory phrase in F.S. s. 627.736 (5)(a)(2)(f) providing that the insurer may limit reimbursement to “200 percent of the allowable amount under the participating physician’s schedule of Medicare Part B” includes the OPPS fee schedule as an “allowable amount” under the participating physicians schedule of Medicare Part B for MRIs.
Conclusions of Law:F.S. 627.736(5)(a)(2)(b) provides that “the insurer may limit reimbursement to 80 percent of the following schedule of maximum charges” and includes various rates or schedules, including “200 percent of the allowable amount under the participating physicians schedule of Medicare Part B” (emphasis added).
In the instant case, the policy at issue provides that the insurer “will pay in accordance with the No-Fault Act. . . 80% of the reasonable charges incurred for necessary medical. . .services” (emphasis added). The policy itself does not make reference to either the OPPS fee schedule, the Medicare Part B Fee Schedule, or F.S. 627.736(5)(a)(2)(b). The only relevant provision in the policy which references the P.I.P. statute is the provision that states that benefits are to be paid “in accordance with the No-Fault Act,” however, at the time of the policy inception there was no No-Fault Act in effect.
This Court finds that this policy language is insufficient on its own to place the policy holder on notice that payment for P.I.P. benefits is to be made according to the Medicare Part B Fee Schedule and this Court’s finding is consistent with the analysis of the Fifth District Court of Appeal in State Farm Florida Ins. Co. v. Boyd Nichols and Linda Nichols, et al., 34 Fla. L. Weekly D2275b (Fla. 5th DCA 2009). Accordingly, based on the Court’s finding that no fee schedule was applicable to Plaintiff’s claim, the Court finds it unnecessary to address the Plaintiff’s alternative argument relating to the OPPS schedule specifically.
Nichols involved a dispute between State Farm and its insureds concerning when State Farm was obligated to pay for subsurface sinkhole repairs under its homeowners’ policies. The Nichols Court construed the permissive language of the statute at issue (627.707(5)(b), Florida Statutes (2007)), which provided that “the insurer may limit its payment . . . until the policyholder enters into a contract for the performance of building stabilization or foundation repairs” with the mandatory language of the policy at issue, which provided that the “[l]oss will be payable. . .60 days after we receive your proof of loss,” and held that the statutory language was permissive, not mandatory, and that because it was permissive, the policy language was binding on the parties to the insurance contract. Id.
This Court finds that the language of F.S. 627.736(5)(a)(2)(b) (providing that “the insurer may limit reimbursement”) is permissive and not mandatory and that the policy language at issue (providing that “we will pay. . .80% of the reasonable charges incurred for necessary medical. . .services”) is mandatory and therefore controlling and, as such, payment should have been made according to the policy limits at 80%.
Furthermore, Florida law renders applicable to contracts of insurance the principle that, where a contract of insurance is prepared and phrased by the insurer, it is to be construed liberally in favor of the insured and strictly against the insurer, where the meaning of the language is doubtful, uncertain, or ambiguous. Financial Fire & Cas. Co. v. Callaham, 199 So.2d 529, 532-533 (Fla. 2nd DCA 1967) citing to Fireman’s Fund Ins. Co. of San Francisco, Cal. v. Boyd, 45 So.2d 499 (Fla. 1950). The general rule is that, if there are terms in an insurance policy which are ambiguous, equivocal, or uncertain to the extent that the intention of the parties is not clear and cannot be clearly ascertained by the application of ordinary rules of construction, these terms are to be construed strictly and most strongly against the insurer and liberally in favor of the insured so as to effect the dominant purpose of payment to the insured. Callaham, 199 So.2d 529 at 533 citing to Beasley v. Wolf, 151 So.2d 679 (Fla. 3rd DCA 1963). The accepted rationale of this rule is that insurance policies are prepared by experts in this complex area, and the intricate interplay of their various provisions is difficult for a layman to understand. Callaham, 199 So.2d 529 at 533 citing to Praetorians v. Fisher, 89 So.2d 329 (Fla.1956). Where there are two interpretations which may fairly be given to language used in a policy, the one that allows the greater indemnity will govern. Callaham, 199 So.2d 529 at 533 citing to Howard v. American Service Mut. Ins. Co., 151 So.2d 682 (Fla. 3rd DCA 1963).
Where the meaning of the insurer’s language is doubtful, uncertain or ambiguous, the doubt is resolved in favor of greater coverage. State Farm Mut. Auto. Ins. Co. v. Mallard, 548 So.2d 733, 735 (Fla. 3rd DCA 1989) citing to Joseph Uram Jewelers, Inc. v. Liberty Mutual Fire Insurance Company, 273 So.2d 111, 113 (Fla. 3rd DCA 1972).
If the insurer wanted to limit payment pursuant to any of the fee schedules then it should have included language specifically stating as such. In the instant case, the policy language that provides that the insurer “will pay in accordance with the No-Fault Act” is rendered meaningless as at the time of the policy inception there was no Florida Motor Vehicle No-Fault Law in effect. At the very least, the Court finds that the policy language is ambiguous and, as such, the policy must be construed against the Defendant, who drafted the policy, and in favor of the insured.
Accordingly, it is hereby ORDERED AND ADJUDGED, that Final Summary Judgment is entered in favor of the Plaintiff. The Plaintiff, OMI OF ORANGE PARK, INC., 2021 Kingsley Avenue, Orange Park, FL 32073, shall recover from the Defendant, STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Post Office P.O. Box, Winter Haven, FL 33883, the principal sum of $707.04 together with interest at the rate of 11% pursuant to F.S. s. 627.736(4) in the amount of $156.84.
This judgment shall bear interest at the rate of 6% per year from date of entry until satisfied. The draft shall be made payable to OMI OF ORANGE PARK, INC. and delivered to Russel Lazega, Esq. at the Law Office of Russel Lazega, 13499 Biscayne Blvd., Suite 107, North Miami, Florida 33181 or current business address at the time of payment.
This Court reserves jurisdiction to award attorney’s fees and costs in favor of the Plaintiff, and to enter a Final Judgment for Attorney’s Fees and Costs accordingly.
Let execution issue for the above sums.
