17 Fla. L. Weekly Supp. 394b
Online Reference: FLWSUPP 1705SOLO
Insurance — Personal injury protection — Coverage — Medical expenses incurred during statutory “gap period” — Insurer correctly applied MRI fee schedule contained in 2007 PIP statute, which was in effect at time policy was issued, to MRI rendered during “gap period” created by sunsetting of PIP statute
WIDE OPEN MRI, INC., (A/A/O VALERIE SOLOMON), Plaintiff, vs. USAA CASUALTY INSURANCE COMPANY, Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. 08-11815 COCE 55. February 10, 2010. Sharon Zeller, Judge. Counsel: Amir Fleischer, for Plaintiff. Reuven Herssein, Herssein & Herssein, P.A., Miami, for Defendant.
REVERSED. FLWSUPP 2009VSOL (17th Jud. Circuit, 9-21-2012, Case No. 10-027835 CACE (08)
ORDER GRANTING USAA’S MOTION FOR FINAL SUMMARY JUDGMENT AS TO COUNT I OF PLAINTIFF’S SECOND AMENDED COMPLAINT
THIS CAUSE, having come before this Court on USAA’s Motion for Final Summary Judgment, and Plaintiff’s cross Motion for Final Summary Judgment as to Count I of Plaintiff’s Second Amended Complaint on December 21, 2009, and the Court having heard the respective arguments of counsel, and being otherwise fully advised in the premises, the court finds as follows:
UNDISPUTED FACTS
1. WIDE OPEN MRI, INC. (a/a/o Valerie Solomon) (“Plaintiff’), filed the above styled personal injury protection (“PIP”) lawsuit against USAA based on an alleged breach of an automobile insurance contract which was issued on June 6, 2007, with effective periods of July 8, 2007 through January 8, 2008.
2. Plaintiff is a healthcare provider, who rendered a Magnetic Resonance Image (“MRI”) to Valerie Solomon on November 26, 2007, for injuries sustained in a motor vehicle accident, occurring on or about September 24, 2007.
3. The policy of insurance specifically states that the Florida Motor Vehicle No-Fault Law will apply to PIP benefits paid under the policy, and the policy at issue includes Medical Payment (“MedPay”) coverage, which defines a “reasonable fee” as “The charge authorized, established, or approved by the Department of Insurance under Florida’s PIP law. . .”
4. USAA received a CMS 1500 form from the Plaintiff on December 6, 2007, wherein Plaintiff billed using CPT Code 72141 (MRI Neck Spine without dye) charging $2,150.00, to which USAA responded with an Explanation of Reimbursement on or about December 27, 2007, explaining that Plaintiff’s charge had been allowed at $1,414.25 according to the 2001 Medicare Part B Fee Schedule with the applicable CPI adjustment as specified in Florida Statute §627.736(5)(b)(5) (2007).
5. The 2007 Florida Motor Vehicle No-Fault Law contained an MRI fee schedule, set forth in Fla. Stat. §627.736(5)(b)5., which regulated and set forth the maximum allowable amounts chargeable to PIP insurers and insured for the rendering of MRI scans.
6. The 2007 Florida Motor Vehicle No-Fault Law expired, or sunset by operation of law on October 1, 2007, but was re-enacted, revived, and amended as of October 11, 2007 to take effect as of January 1, 2008.
7. The Plaintiff filed suit on July 28, 2008, seeking declaratory relief to determine the propriety of USAA’s application of the MRI fee schedule set forth in §627.736(5)(b)5.
8. The issue presented to the Court, therefore, is whether or not USAA correctly applied the 2007 MRI fee schedule set forth in Florida Statute §627.736(5)(b)5 to the Plaintiff’s charges when the policy was issued on June 6, 2007, and the accident and services were rendered during the “gap” period.
FINDINGS OF LAW
1. As will be explained below, USAA correctly applied the fee schedule set forth in Florida Statute §627.736(5)(b)5. to the Plaintiff’s charges, and therefore the Plaintiff is not entitled to declaratory relief in this case.
2. First, the analysis must begin with the plain language of the subject policy of insurance which states in pertinent part:
“Part B-1 – Person Injury Protection coverage:
Insuring Agreement: We will pay, in accordance with the Florida Motor Vehicle No-Fault Law, to or for the benefit of the covered person. . .”
3. Additionally, Part B-2 – Medical Payments Coverage states:
“E. Reasonable fee is the amount, as determined by us or someone on our behalf, which we will pay for charges made by a licensed hospital, licensed physician, or other licensed medical provider for medically necessary and appropriate medical services. We will pay the lesser of: . . . 3. The charge authorized, established, or approved by the Department of Insurance under Florida’s PIP law. . .”
4. The insurance policy made explicit reference to the 2007 Florida Motor Vehicle No-Fault Law, and defined reasonable fee to include amounts authorized under the PIP law.
5. The policy incepted prior to the PIP sunset, and continued on through the legislative PIP revival.
6. Most importantly, “An insurance policy is a contract. It is well settled in Florida that the statute in effect at the time the insurance contract is executed governs any issues arising under that contract.” Lumbermens Mutual Casualty Co. v. Ceballos, 440 So.2d 612, 613 (Fla. 3d DCA 1983). [emphasis added]; See also Allison v. Imperial Casualty & Indemnity Co., 222 So.2d 254, 256 (Fla. 4th DCA 1969)(“Because the insurance contract was issued subsequent to Section 627.0851, F.S. (Ch. 61-175 Laws of 1961, effective 1 July 1961; Amended Laws 1963, Ch. 63-148, effective 1 July 1963), the pertinent portions of that statute became a part of the insurance contract.”), Metropolitan Life Ins. Co. v. Fugate, 313 F.2d 788 (5th Cir. 1963); Poole v. Travelers Ins. Co., 130 Fla. 806, 170 So.138 (1937).
7. The Florida Supreme Court has cited Lumbermens with approval, holding that “it is generally accepted that the statute in effect at the time an insurance contract is executed governs substantive issues arising in connection with that contract.” Hassen v. State Farm Mut. Auto. Ins. Co., 674 So.2d 106, 108 (Fla. 1996). [emphasis added]
8. Moreover, “it is not the accident date that controls. When [the insured] and [the insurer] negotiated for and entered into the subject contract of insurance, its terms were set in accordance with the law in effect at that time. . .” Hausler v. State Farm Mut. Auto. Ins. Co., 374 So.2d 1037 (Fla. 2nd DCA 1979). [emphasis added]
9. Accordingly, consistent with the foregoing authorities, at the time Valerie Solomon’s policy was issued, the 2007 Florida Motor Vehicle No-Fault Law, including the fee schedule mandated by §627.736(5)(b)5., was incorporated into the contract of insurance by and between USAA and the insured.
10. Because Valerie Solomon’s policy incorporates the 2007 PIP statute — both by specific reference thereto and by operation of law — issues of reimbursement are governed by Florida Statute §627.736 (2007).
11. Specifically, Florida Statute §627.736(5)(b)5. (2007) sets forth the following fee schedule:
“Allowable amounts that may be charged to a personal injury protection insurer and insured for magnetic resonance imaging services shall not exceed 175 percent of the allowable amount under the participating physician fee schedule of Medicare Part B for year 2001, for the area in which the treatment was rendered, adjusted annually on August 1 to reflect the prior calendar year’s changes in the annual Medical Care Item of the Consumer Price Index for All Urban Consumers in the South Region. . . except that allowable amounts that may be charged to a personal injury protection insurance insurer and insured for magnetic imaging services provided in facilities accredited by the Accreditation Association for Ambulatory Health Care, the American College of Radiology, or the Joint Commission on Accreditation of Healthcare Organizations shall not exceed 200 percent of the allowable amount under the participating physician fee schedule of Medicare Part B 2001 . . .” [emphasis added]
12. Therefore, in accordance with the policy of insurance and Florida law, USAA properly applied the 2007 MRI fee schedule to the Plaintiff’s claims.
13. Plaintiff’s motion cites to McKesson Corporation v. Shieffelin & Co., 499 So.2d 6 (Fla. 3d DCA 1987), for its argument that USAA “could have inserted provisions into the contract which would have extended the MRI payment limitation beyond October 1, 2007.”
14. However, this Court is not persuaded that McKesson stands for this proposition, and in fact, as argued by Defense counsel, Section 19, ch. 2003-411, provides that “(2) Insurers are authorized to provide, in all policies issued or renewed after October 1, 2006, that such policies may terminate on or after October 1, 2007, as provided in subsection (1).”
15. The Florida Legislature allowed insurers to include an automatic termination of PIP coverage as of October 1, 2007 into their policies. The policy at issue does not contain any terms or provisions that terminate PIP coverage as of October 1, 2007, as authorized by law. As such, this Court can only assume that the parties intended and contracted for payments to be made “in Accordance with the Florida Motor Vehicle No-Fault Law” for the duration of the policy effective period.
16. Moreover, there is no requirement within the PIP statute, or under Lumbermens or Hassen that USAA explicitly state that the law in effect at the time the contract was entered into will continue to govern the rights of the parties throughout its duration. By operation of law, the law in effect at the time of the issuance of the policy governs the rights of the parties, even if the policy does not so state.
17. In fact, as the McKesson Court noted,“Unless they are waived by the parties,the laws and statutes in effect at the time that a contract is entered into are made a part of that contract.” Citing Cycle Dealers Ins. Inc. v. Bankers Ins. Co. 394 So.2d 1123 (Fla. 5th DCA 1981).
18. The plain and unambiguous terms of the policy at issue does not evidence that the parties intended to, or did in fact waive the laws and statutes in effect at the time the contract was entered into, which in this case was the 2007 Florida Motor Vehicle No-Fault Law. On the contrary, the policy by its very terms indicates that USAA will pay PIP and MedPay benefits in accordance with the Florida Motor Vehicle No-Fault Law.
19. As the case law cited by the Plaintiff’s Motion for Summary Judgment provides, “Where a contract is simply silent as to a particular matter, that is, its language neither expressly nor by reasonable implication indicates that the parties intended to contract with respect to the matter, the court should not, under the guise of construction, impose contractual rights and duties on the parties which they themselves omitted. . . .Courts may not rewrite, alter, or add to the terms of a written agreement between the parties and [they] may not substitute their judgment for that of the parties in order to relieve one from the alleged hardship of an improvident bargain. . . . The words found in a contract are to have a meaning attributed to them, and are the best possible evidence of the intent and meaning of the contracting parties” Jacobs v. Petrino, 351 So.2d 1036 (Fla. 4th DCA 1976) [emphasis added]
20. The plain, unambiguous language of the contract which is consistent with Florida law, is that the parties contracted for PIP coverage in accordance with the 2007 PIP statute — including the mandatory MRI fee schedule — from July 8, 2007 through January 8, 2008.
21. Finally, this Court finds that Florida Beverage Corp. v. Division of Alcoholic Beverages and Tobacco, et. al., 503 So.2d 369 (Fla. 1st DCA 1987) applies to the facts of this case, and further validates USAA’s application of the MRI fee schedule to the Plaintiff’s claim. In Florida Beverage Corp., the First District Court of Appeal held:
“The laws in force at the time of the making of a contract enter into and form a part of the contract as if they were expressly incorporated into it. . . . the statutory rights and obligations which had become a part of the contract between the parties were not affected by the Statute’s repeal. At the time the parties entered into their brand distribution agreement, when the subject Statute was in force, they are presumed, consistent with the authorities mentioned above, to have agreed that the brands could not be withdrawn during the term of the agreement absent good cause therefore. Assuming, as we must, that such was legally regarded as a part of their agreement, to adopt Barton’s assertion regarding the effect of the statute’s repeal would constitute a prohibitive impairment of the obligations of the contract.”[emphasis added]
22. In this case, USAA had an obligation to pay Valerie Solomon’s medical providers in accordance with the 2007 Florida Motor Vehicle No-Fault Law. The expectation and method of payment is a legally regarded part of the agreement by and between USAA and its insured. Because the laws in force at the time of the making of a contract enter into and form a part of the contract, the rights and obligations arising there under cannot be affected by the PIP Statute’s expiration. Based upon the forgoing, it is hereupon
ORDERD AND ADJUDGED that USAA CASUALTY INSURANCE COMPANY’s Motion for Final Summary Judgment as to Count I of the Plaintiff’s Second Amended Complaint be, and the same is hereby GRANTED. The Defendant shall go hence forth without day. This Court reserves jurisdiction to determine the issue of entitlement to and the amount of attorney’s fees and costs.
