17 Fla. L. Weekly Supp. 28a
Online Reference: FLWSUPP 1701THOMInsurance — Personal injury protection — Coverage — Medical expenses — Insurer properly denied payment for CPT code presented without modifier indicating it was separate from and separately compensable from another comprehensive CPT code charged the same day and paid by insurer
REINHART CHIROPRACTIC CLINIC, a/a/o VIRGINIA THOMAS, Plaintiff(s), vs. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant(s). County Court, 6th Judicial Circuit in and for Pinellas County. Case No. 08004877SC-046. October 23, 2009. Henry J. Andringa, Judge. Counsel: Rick G. Bannon, Law Offices of Rick G. Bannon, St. Petersburg, for Plaintiff. Edwin V. Valen, Oxendine and Oxendine, P.A., Tampa, for Defendant.
ORDER GRANTING DEFENDANT’S AMENDED MOTION FOR FULL AND FINAL SUMMARY JUDGMENT
This case is before the Court on Defendant’s Amended Motion for Full and Final Summary Judgment. The Court has reviewed all of the documentation and authorities presented at the hearing held on September 16, 2009, and considered the argument of the attorneys. Based thereon the Court finds as follows:
1. This suit involves two bills in the amount of $70.00 each, which were submitted byplaintiff to the defendant. The dates of service were March 6th, 2008 and March 13th, 2008.
2. Neither of the submitted bills (CPT Code 97124) included a modifier (CPT Code 59) indicating it was separate from and separately compensable from another comprehensive code (CPT Code 98940) charged from the same day.
3. Defendant notified the plaintiff that it was not paying the bills for CPT Code 97124 as presented, without modifier, as it was included in the bills for CPT Code 98940, which were paid.
4. That the defendant properly denied payment of the two bills as they did not comply with Florida Statutes 627.738(5)(a)2, 627.736(5)(d), and 627.736(5)(e).
5. Defendant’s Amended Motion for Full and Final Summary Judgment is granted.
6. The Court retains jurisdiction for the purpose of assessing court costs and attorney fees, if applicable in this case.
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[Editor’s Note: Motion & Memorandum published below for informational purposes]
DEFENDANT’S AMENDED MOTION FOR FULL AND FINAL SUMMARY JUDGMENT
COMES NOW, the Defendant, STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, by and through the undersigned counsel, and pursuant to Florida Rule of Civil Procedure 1.510, files this its Motion for Full and Final Summary Judgment, and as grounds therefore states as follows:
1. On or about February 21, 2008, the insured, Virginia Thomas was involved in an automobile accident.
2. That on or about February 27, 2008, the insured, Virginia Thomas, began treatment with Plaintiff facility, REINHART CHIROPRACTIC CLINIC.
3. That on or about February 27, 2008, the insured, Virginia Thomas, executed a document that purports to be an Assignment of PIP benefits. See Exhibit “B” to the Affidavit of Thuy Murray.
4. That on or about February 27, 2008, the insured, Virginia Thomas, executed a document that purports to be a Standard Disclosure and Acknowledgment Form. See Exhibit “C” to the Affidavit of Thuy Murray.
5. That on or about April 3, 2008, the Plaintiff, REINHART CHIROPRACTIC CLINIC, by and through its counsel, sent Defendant correspondence that purports to be a demand letter under Florida Statute §627.736(11). See Exhibit “D” to the Affidavit of Thuy Murray.
6. That the document purporting to be an Assignment of PIP Benefits fails to state the insurer for which benefits are being assigned. Specifically, the document is blank where the space for the name of the insurer should be named.
7. That the document purporting to be a Standard Disclosure and Acknowledgment form is blank under section 1, which should contain the list of services actually rendered.
8. That the document purporting to be a demand letter under Florida Statute §627.736(11) fails to specify the specific claim or charge demanded.
9. Because the document purporting to be an Assignment of PIP Benefits executed by the insured, Virginia Thomas, is blank as it pertains to the applicable insurer, Plaintiff lacks standing to bring forth the subject action.
10. Even if the document purporting to be an Assignment of PIP Benefits were deemed by this Honorable Court to be valid, the document purporting to be a Standard Disclosure and Acknowledgment form is invalid under Florida Statute §627.736(5)(e) in that it is blank as it pertains to the services actually rendered. As such, the medical charges submitted by Plaintiff to Defendant are not compensable under Florida’s No-Fault Act because Defendant has not been placed on notice of a covered loss. Specifically, Florida Statute §627.736(5)(e) and Florida Statute §627.736(4)(b).
11. Even if this Honorable Court deems the document purporting to be an Assignment of Benefits and the document purporting to be a Standard Disclosure and Acknowledgment form to be valid, Plaintiff has failed to comply with Florida Statute §627.736(11) in that the document purporting to be a demand letter under that statutory section fails to specifically identify the claim or charges due. As such, Plaintiff has failed to comply with a condition precedent to bringing forth a lawsuit in this matter.
12. Even if this Court deems that Plaintiff has complied with all conditions precedent to bring forth the instant action, Plaintiff improperly billed the alleged treatment rendered to assignor in violation of Florida Statute §627.736(5).
13. Specifically, CPT code 97124 was improperly billed with CPT code 98940 without use of a proper modifier.
14. Accordingly, STATE FARM is entitled to judgment as a matter of law.
WHEREFORE, the Defendant, STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY respectfully requests this Honorable Court grant its Motion for Full and Final Summary Judgment and any other relief this Court deems reasonable, just, and proper under the circumstances.
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DEFENDANT’S MEMORANDUM OF LAW INSUPPORT OF DEFENDANT’S AMENDED MOTION FOR FULL AND FINAL SUMMARY JUDGMENT
COMES NOW, the Defendant, STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, by and through the undersigned counsel, and pursuant to Florida Rule of Civil Procedure 1.510, files this its Memorandum of Law in Support of Defendant’s Motion for Full and Final Summary Judgment, and as grounds therefore states as follows:
STANDARD OF REVIEW
1. Summary judgment shall be rendered “if the pleadings, depositions, answers to interrogatories, admissions, affidavits, and other materials as would be admissible in evidence on file show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Fla. R. Civ. P. 1.510(c).
2. The party filing the motion for summary judgment has the burden of proving the absence of a genuine issue of material fact. Once that burden has been met, the burden shifts to the opposing party to show that a genuine issues of material fact do in fact exist. Williams v. Beckham & McAiley, P.A., 582 So.2d 1206, 1207 (Fla. 2d DCA 1991) (citing Holl v. Talcott, 191 So.2d 40 (Fla. 1966)). See also Daeda v. Blue Cross & Blue Shield of Fla., Inc., 698 So.2d 617, 617 (Fla. 2d DCA 1997).
3. The trial court must view all evidence in a light most favorable to the non-moving party and must draw every reasonable inference in favor of the non-moving party when ruling on a motion for summary judgment. Destiny Construction Co. v. Martin K. Elby Construction, 662 So.2d 388, 390-91 (Fla. 5th DCA 1995) (citing Moore v. Morris, 475 So.2d 666 (Fla. 1985) and Holland v. Verheul, 583 So. 2d 788 (Fla. 2d DCA 1991).
PLAINTIFF LACKS STANDING TO BRING FORTH THE SUBJECT CAUSE OF ACTION
4. On or about February 27, 2008, the insured, Virginia Thomas, executed a document that purports to be an Assignment of PIP benefits. See Exhibit “B” to the Affidavit of Thuy Murray.
5. The document that purports to be an Assignment of PIP benefits does not state the insurer with which benefits are being assigned under the contract.
6. As such, Plaintiff medical provider lacks standing to bring forth the subject cause of action and Defendant is entitled to summary judgment.
PLAINTIFF FAILED TO COMPLY WITH FLORIDA STATUTE §627.736(5)(e)
7. That being said, and if this Honorable Court does consider Plaintiff medical provider to have standing to bring forth the instant cause of action, on or about February 27, 2008, the insured, Virginia Thomas, executed a document that purports to be a Standard Disclosure and Acknowledgment Form. See Exhibit “C” to the Affidavit of Thuy Murray.
8. Florida Statute §627.736(e) provides, in relevant part:
1. At the initial treatment or service provided, each physician, other licensed professional, clinic, or other medical institution providing medical services upon which a claim for personal injury protection benefits is based shall require an insured person, or his or her guardian, to execute a disclosure and acknowledgment form which reflects at a minimum that:
a. The insured, or his or her guardian, must countersign the form attesting to the fact that the services set forth therein were actually rendered.
b. The insured, or his or her guardian, has both the right and affirmative duty to confirm that the services were actually rendered.
d. That the physician, other licensed professional, clinic, or other medical institution rendering the services for which payment is being claimed explained the services to the insured or his or her guardian.
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9. The requirements of this paragraph apply only with respect to the initial treatment or service of the insured by a provider.
(Emphasis added).
9. The document purporting to be a Standard Disclosure and Acknowledgment form is blank under section 1, which should contain the list of services actually rendered pursuant to Florida Statute §627.736(e).
10. The statute sets forth five “minimum” requirements of the disclosure and acknowledgment form. These minimum requirements are part of the provider’s proof of notice of a covered loss. NW Broward Orthopedic Associates, P.A. v. United Automobile Insurance Company, 13 Fla. L. Weekly Supp. 740a (Fla. Broward Cty. Ct., May 11, 2006). The failure to list the services actually rendered on the Standard Disclosure and Acknowledgment form is fatal to a PIP claim. Preziosi East/West Chiropractic Clinic, P.A. a/a/o Federico Vega v. Progressive American Insurance Company, 14 Fla. L. Weekly Supp. 789a (Fla. Seminole Cty. Ct., May 11, 2007). One of the main purposes of the Standard Disclosure and Acknowledgment form is to divulge the services that were actually rendered. Fort Lauderdale Pain Center, Inc. a/a/o Ulysse Saintelene v. Allstate Insurance Company, 13 Fla. L. Weekly Supp. 1006a (Fla. Miami-Dade Cty. Ct., July 17, 2006). Plaintiff not only failed to satisfy that purpose, but also failed to place Defendant on notice of a covered loss in doing so.
11. As such, the medical bills submitted to Defendant by Plaintiff medical provider are not compensable under the No-Fault Act and, more specifically, Florida Statute §627.736(5)(e) in that Defendant has not been placed on notice of a covered loss.
PLAINTIFF FAILED TO COMPLY WITH FLORIDA STATUTE §627.736(11)
12. On or about April 3, 2008, Plaintiff, by and through its counsel, submitted correspondence to Defendant that purported to be a demand letter pursuant to Florida Statute §627.736(11). §627.736(11)That the document purporting to be a demand letter under Florida Statute §627.736(11) fails to specify the specific claim or charge demanded.
13. Even if this Honorable Court deems the document purporting to be an Assignment of Benefits and the document purporting to be a Standard Disclosure and Acknowledgment form to be valid, Plaintiff has failed to comply with Florida Statute §627.736(11) in that the document purporting to be a demand letter under that statutory section fails to specifically identify the claim or charges due. As such, Plaintiff has failed to comply with a condition precedent to bringing forth a lawsuit in this matter.
14. Plaintiff’s demand letter merely lists two dates of service and a total charge of $140.00 due. The demand letter does not indicate whether such claim due represents the applicable 80% due under PIP or whether the amount represents the total charge before being adjusted for the 80% due under PIP. For that matter, the demand letter does not even indicate what treatments were billed and not paid.
15. The Florida legislature amended the No-Fault statute in October, 2003 to require that a Plaintiff submit a “demand letter” as a condition precedent to filing a lawsuit to recover personal injury protection benefits. The purpose of the statutory provision is to minimize needless litigation and to encourage the payment of outstanding claims. Chambers Medical Group, Inc. (a/a/o Marie St. Hillare) v. Progressive Express Insurance Company, 14 Fla. L. Weekly Supp. 207a (Fla. 13th Cir., December 1, 2006). Strict compliance with the notice requirement is required to affect the purpose of the statute. Id.
16. Florida Statute §627.736(11), as amended to include the pre-suit demand letter requirement, provides, in relevant part:
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 will 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 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. . . (Emphasis added).
17. By failing to submit a demand letter that specified the exact accommodation and type of benefit claimed to be due or include a specific itemization of the service or accomodation for specific dates of service, Plaintiff has failed to comply with the notice requirements of Florida Statute §627.736(11). Strict compliance with the notice requirements is required to affect the purpose of the statute. Chambers Medical Group, Inc. v. Progressive Express Insurance Company, 14 Fla. L. Weekly Supp. 207a (Fla. 13th Cir. 2006).
18. In fact, courts have granted summary disposition of cases in favor of a Defendant, as opposed to a Plaintiff, for failing to comply with Florida Statute §627.736(11). See U.G. Family Chiropractic Health Center Inc. v. First Floridian Auto & Home Insurance Company, 10 Fla. L. Weekly Supp. 358a (Fla. Hillsborough Cty. Ct. 2003). (Summary judgment entered against Plaintiff who did not comply with the pre-suit demand requirement); Simon v. Progressive Express Insurance Company, 11 Fla. L. Weekly Supp. 347a (Fla. Palm Beach Cty. Ct. 2004); Mobile Diagnostic Imaging LLC v. Allstate Indemnity Ins. Company, 11 Fla. L. Weekly Supp. 361a (Fla. Broward Cty. Ct. 2004); Alava v. Omni Ins. Company, 11 Fla. L. Weekly Supp. 446a (Fla. Cty. Ct. 5th Cir. 2004) (dismissing Complaint against insurer where Plaintiff did not comply with the requirements of Florida Statute §627.736(11) (a); and Linda Gordon v. Progressive American Insurance, Case No: 2007-CC-006435-XXXX (Fla. Duval Cty. Ct., August 14, 2007).
19. Based on the foregoing, Defendant is entitled to full and final summary judgment as a matter of law.
PLAINTIFF IMPROPERLY BILLED THE ALLEGED MEDICAL CHARGES IN VIOLATION OFFLORIDA STATUTE §627.736(5)(d)
20. While the statute does not specifically address the Centers for Medicare and Medicaid Services, National Correct Coding Initiative comprehensive edits (NCCI), this Court may nevertheless consider it as proof that code 97124 may not be billed with code 98940 because the NCCI has been expressly adopted and endorsed by the Office of the Inspector General (OIG).
21. The PIP statute (as amended) specifically allows an insurer to not pay for “[s]ervices, supplies, or care that is not reimbursable under Medicare or workers’ compensation.” Fla. Stat. 627.736 (5)(2)(f)(2008) and states that guidance shall be given to authoritative sources such as the Office of the Inspector General (OIG). Fla. Stat. 627.736(5)(d).
22. In understanding this complex issue, however, some background understanding of the NCCI’s history and its mechanics is necessary.
23. In 1996, the federal Centers for Medicare & Medicaid Services (CMS) developed and implemented the NCCI in order to “promote correct coding of health care services by providers and to prevent Medicare payment for improperly coded services.” Medicare’s National Correct Coding Initiative, Department of Health and Human Services Office of Inspector General report 0EI-03-02-00770, p.i (September 2003) (hereinafter OIG NCCI Report).
24. The NCCI policies are based “on coding conventions defined in the American Medical Association’s Current Procedural Terminology (CPT) Manual, national and local medicare policies and edits, coding guidelines developed by national societies, standard medical and surgical practice, and/or current coding practices.” National Correct Coding Initiative Policy Manual for Medicare Services, CMS, p. viii, (version 13.3, 2006).
25. The NCCI Manual specifically mentions unbundling, or fragmenting a single procedure into component part codes, as an example of incorrect coding that the NCCI seeks to rectify, and that physicians should not “unbundle services that are integral to a more comprehensive code.” Id. at p. xi-xii.
26. The NCCI is fairly straightforward: it contains pairs of codes that “should not be billed together by a provider for the same beneficiary on the same date of service.” OIG NCCI Report at i. These code pairs represent comprehensive and component codes, which should not be billed together; doing so avoids improper unbundling. Id.
27. The NCCI edits are extremely effective, as the OIG NCCI Report notes that in 2001, the edits “prevented payment for 98 percent of services that should have been denied when a provider billed more than one service for the same beneficiary on the same date of service.” Id. at ii.
28. The NCCI does not require any interpretation whatsoever; its exhaustive list makes it easy to determine which code pairs CMS has determined constitutes improper bundling. Moreover, the NCCI contains the precise codes at issue in this case; code 97124 may not be billed with code 98940.
29. Therefore, the NCCI clearly resolves the issue of whether the codes were improperly billed in favor of STATE FARM.
30. The PIP Statute, Fla. Stat. 627.736(5)(d) says, in relevant part:
In determining compliance with applicable CPT and HCPCS coding, guidance shall be provided by the Physicians’ Current Procedural Terminology (CPT) or the Healthcare Correct Procedural Coding System (HCPCS) in effect for the year in which services were rendered, the Office of the Inspector General (OIG), Physicians Compliance Guidelines, and other authoritative treatises designated by rule by the Agency for Health Care Administration.
Fla. Stat. 627.736(5)(d) (emphasis added).
31. Of critical importance in this case is the comma which follows OIG. This comma clearly indicates that a court may consider guidance, in any form, offered, by “the Office of the Inspector General.” Therefore, if the OIG, in any of its rules, publications, or reports, endorses or adopts the use of the NCCI, this Court may consider the NCCI edits as proof that code 97124 may not be billed with code 97140.
32. As stated above, the NCCI was created by the Centers for Medicare and Medicaid Services, which is an agency of the federal Department of Health and Human Services (DHHS). The OIG is also a DHHS agency, whose mission is “to protect the integrity of (DHHS) programs, as well as the health, and welfare of the beneficiaries of those programs.
33. The OIG has a responsibility to report both to the Secretary and to the Congress program and management problems and recommendations to correct them.” Office of the Inspector General, The OIG Mission (visited June 29, 2009) <http://www.oig.hhs.gov/organization.asp>. The OIG functions as a watchdog, and comments, as a neutral observer, on the effectiveness of programs implemented by the various DHHS agencies. The NCCI, as a program implemented by CMS, falls under the OIG’s purview; common sense dictates this is the precise reason why the Statute allows a court to consider OIG guidance in determining CPT code compliance.
34. Therefore, if the OIG, in any of its rules, publications, or reports, endorses or adopts the use of the NCCI, this Court must consider the NCCI edits as proof that codes 97124 may not be billed with code 98940.
35. The OIG has specifically adopted and endorsed the edits by the NCCI. In its Supplemental Compliance Program Guidance for Hospital, the OIG took a clear position on the NCCI edits:
CMS developed the National Correct Coding Initiative. . . to promote correct coding methodologies. The NCCI identifies certain codes that should not be used together because they are either mutually exclusive or one is a component of another. If a hospital uses code pairs that are listed in the NCCI and those codes are not detected by the editing routines in the hospital’s billing system, the hospital may submit duplicate or unbundled claims. Intentional manipulation of code assignments to maximize payments and avoid NCCI edits constitutes fraud. Unintentional misapplication of NCCI coding and billing guidelines may also give rise to overpayments or civil liability for hospitals that have developed a pattern of inappropriate billing. To minimize risk, hospitals should ensure that their coding software includes up-to-date NCCI edit files.
Supplemental Compliance Program Guidance for Hospitals, 70 Fed. Reg. 4858, 4860-4861 (2005).
36. Thus, the OIG has clearly endorsed and adopted the NCCI. Since this endorsement is contained in guidance provided by the OIG, this Court may therefore consider the NCCI as proof that it is inappropriate to bill for code 97124 with code 97140.
37. Furthermore, as stated above, Florida Statute 627.736(5)(2)(f) specifically states that an insurer is not required to pay for charges that would not be payable by Medicare or workers compensation. Fla. Stat. 627.736(5)(2)(f)(2008). In addition, support from case law can be found in Tran Chiropractic & Wellness Center, Inc. v. State Farm Mutual Automobile Insurance Co., 15 Fla. L. Weekly Supp. 726a (13th Judicial Circuit March 19, 2008). The court reasoned:
Florida Statutes §627.736(5)(d) is unambiguous. It requires compliance with the Office of Inspector General, Physician Compliance Guidelines and other authoritative treatises designated by rule by the Agency for Health Care Administration. Those authoritative, controlling documents include the Compliance Program Guidance for Individual and Small Group Physician Practices developed by the Office of the Inspector General, located at Vol. 65, No. 194 Federal Register, pp. 59434-59452 (October 5, 2000). Page 59439 includes a section entitled “Coding and Billing.” It references “Failure to Use Coding Modifiers,” the CPT Manual and the NCCI. The explicit, unambiguous provisions of the NCCI prohibit Plaintiff from billing the Unpaid Charges separately from Chiropractic Manipulative Treatment under the circumstances at issue here.
38. For the reasons stated above, the CPT codes at issue are not payable under Medicare. Therefore, STATE FARM is not required to pay for said charges.
WHEREFORE, the Defendant, STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, respectfully requests this Honorable Court grant its Motion for Full and Final Summary Judgment and any other relief this Court deems reasonable, just, and proper under the circumstances.
