20 Fla. L. Weekly Supp. 442a

Online Reference: FLWSUPP 2004ESTRInsurance — Personal injury protection — Exhaustion of policy limits — Insurer entitled to summary judgment in action brought by provider challenging insurer’s payment of reduced amounts based on state fee scheduling guidelines where it is undisputed that benefits payable under policy were exhausted before suit was filed — Absent any allegation or finding of bad faith on insurer’s part when it exhausted benefits, insurer is not required to set aside a reserve fund with which to supplement reduced payments to a provider in the event those payments are subsequently challenged

WESTLAND SOUTH MEDICAL CENTER, INC., a/a/o MIRIAM ESTRADA, Plaintiff, vs. UNITED AUTOMOBILE INSURANCE COMPANY, a Florida corporation, Defendant. County Court, 11th Judicial Circuit in and for Miami-Dade County, Civil Division. Case No. 11-19738 SP 25 (04). December 10, 2012. Nuria Saenz, Judge.

ORDER GRANTING DEFENDANTS MOTIONFOR FINAL SUMMARY JUDGMENT re: EXHAUSTIONOF BENEFITS AND FINAL JUDGMENT

THIS CAUSE having come before the Court on October 25 2012, upon Defendant’s Motion for Final Summary Judgment re: Exhaustion of Benefits And Request For §57.105 Sanctions and after hearing the argument of counsel and considering the pleadings, motions and other papers filed herein, and being otherwise advised in the premises, the Court finds as follows:

I. FINDINGS OF FACT

The underlying facts of this claim as reflected in the parties’ respective affidavits and attachments thereto are not in dispute. The claimant, Miriam Estrada, was entitled to claim benefits on an insurance policy issued by the Defendant that provided personal injury protection benefits and was involved in an automobile accident on April 27, 2010. The Defendant received medical bills for treatment rendered to its insured and on July 22, 2010, made payments totaling $10,000.01 as follows:

Provider	Dates of Service	Amount Charged	Benefits Paid	Interest paid	Date received
Westland South	4/28/10-5/14/10	$7,428.00	$5,769.62	$73.98	5/20/10
Westland South	5/17/10-5/21/10	$2,526.00	$1,969.90	$23.64	5/27/10
Westland South	5/24/10-5/28/10	$1,626.00	$1,240.00	$13.25	6/4/10
Westland South	6/1/10-6/2/10	$1,080.00	$843.65	$8.32	6/9/10
Millennium DX	5/4/10	$275.00	$52.96	$0.50	6/11/10
Westland South	6/7/10	$250.00	$123.88/benefits exhausted	$1.08	6/16/10
Millennium DX	6/10/10	$1,255.00	Benefits exhausted		6/23/10
Westland South	6/17/10	$250.00	Benefits exhausted		6/24/10
Westland South	7/9/10	$280.00	Benefits exhausted		7/14/10
		TOTAL PAID	$10,000.01

There is no dispute that the Defendant paid the bills correctly in the order in which they were received. According to the explanations of review that accompanied the payments, Defendant calculated the reasonable amounts for the medical services according to “state fee scheduling guidelines,” which is acknowledged to be 200% of Medicare Part B.

Subsequent to those payments, Defendant received demand letters from two different attorneys on behalf of the Plaintiff. On January 25, 2011, Defendant received a demand letter from Deprimo & Fleites, Attorneys at Law, on behalf of the Plaintiff and on February 18, 2011, Defendant provided Deprimo & Fleites with a demand response advising that the benefits were exhausted. Then on October 28, 2011, Defendant received a second demand letter on behalf of the Plaintiff, this time from Christian D. Walled, P.A., and on November 21, 2011, Defendant provided Christian Walled, P.A., with a demand response advising that the benefits were exhausted.

Plaintiff brought the instant action on December 7, 2011, seeking to receive additional benefits of $52.96, which is the amount that Defendant paid to Millennium Diagnostic. On May 7, 2012, Defendant served Plaintiff with its proposed motion for summary judgment regarding benefits exhausted and notice of intent to pursue sanctions pursuant to Fla. Stat. §57.105.

II. CONCLUSIONS OF LAW

There is no allegation in pleading or fact that the Defendant acted in bad faith when it paid out the benefits on its insured’s policy. The gravamen of Plaintiff’s action is, rather, that Defendant should not have calculated reasonable charges based upon the Medicare Part B schedule and should have instead paid 80% of the charges submitted less the applicable deductible and that Defendant’s exhaustion of benefits was therefore somehow improper. Defendant asserts that it acted in conformity with the PIP statute and its own policy when it paid out the full limits of Ms. Estrada’s PIP benefits.

A party moving for summary judgment must establish that there arc no genuine issues of material fact and that it is entitled to judgment as a matter of law. Holl v. Talcott, 191 So.2d 40 (Fla. 1966); Calarese v. Weissfisch, 87 So.3d 1225 (Fla. 3rd DCA 2012) [37 Fla. L. Weekly D1238c]. As set forth above, the record conclusively establishes that there are no genuine issues of material fact regarding Defendant’s payment of $10,000.01 in policy limits towards Miriam Estrada’s claim for PIP benefits. The question then becomes whether Defendant is therefore entitled to judgment as a matter of law on its exhaustion affirmative defense.

An insurance company has an obligation to settle as many claims as possible and, in so doing, it is the prerogative of insurers to pay, reduce or even deny claims. Farinas v. Florida Farm Bureau General Insurance Co., 850 So. 2d 555, 560 (Fla. 4th DCA 2003) [28 Fla. L. Weekly D1023b]; Simon v. Progressive Express Ins. Co., 904 So.2d 449 (Fla. 4th DCA 2005) [30 Fla. L. Weekly D1156b] rev. denied 919 So.2d 436 (Fla. 2005). Once an insurer has paid out the policy limits to the insured (or to various providers as assignees), it is not liable to pay any further PIP benefits, even those that are in dispute. Richard A. Sheldon, D.C. v. United Services Automobile Ass’n, 55 So.3d 593 (Fla. 1st DCA 2010) [36 Fla. L. Weekly D23a]. “The reason an insurer that has paid out policy limits may not be held liable on a claim for disputed benefits is that it has already fulfilled its contractual obligation to pay a given amount of benefits, and it cannot be required to pay more than it agreed to pay under the policy.” Id. at 595-596 (emphasis added). “It logically follows that once such a contract has been fulfilled, the reason for a denial of a claim is no longer relevant.” USAA Casualty Ins. Co. v. Shiver, 19 Fla. L. Weekly Supp. 780a (Cir. Ct., 1st Judicial Circuit (Appellate) October 18, 2011).

The uncontested record establishes that the Defendant paid out the full amount of the policy benefits, which is the legislative intent of §627.736, before suit was filed in this case. See Ivey v. Allstate Ins. Co., 774 So.2d 679 (Fla. 2000) [25 Fla. L. Weekly S1103a]. The insured, therefore, has received the full bargain of her insurance contract with the Defendant and in this case it is not she who claims injury but one of her medical providers. However, the PIP statute does not recognize the priority of one particular medical provider over another and it is the interests of the insured, not the insurer or a particular provider, that are paramount. Here, the insured’s interests have been fully protected. Indeed, the Defendant has gained nothing by paying Miriam Estrada’s providers at the “reduced” fee schedule rate because it still paid out the full $10,000. United Auto,

. . . saved no money by their actions; what is the basis of their wrongdoing? It surely can’t be that they were careful about the amount of the payments that they made to a given provider as other providers’ claims continued to come in from more assignees demanding payment out of the diminishing pool, which ran out. [Why should the Defendant] be punished for having fully performed their contract . . . [and] have to pay more than 100% of the benefits because the assignor kept assigning and the assignees kept accepting the assignments.

Progressive American Ins. Co. v. Stand-Up MRI of Orlando, 990 So.2d 3, 7 (Fla. 5th DCA 2008) [33 Fla. L. Weekly D1746a](internal citation omitted).

Plaintiff asserts that Defendant erred as a matter of law by paying its bills at the Medicare Part B fee schedule rate and that this error renders the payment to Millennium Diagnostic “gratuitous” and therefore entitles the Plaintiff medical provider to an additional $52.96 in benefits. Defendant made its payments on July 22, 2010, based upon the language in its insurance policy that incorporated the entirety of the PIP statute including §627.736(5)(a)(2)(f)(2008), which permitted reimbursement at 200% of Medicare Part B. At the time of those payments in 2010, there was no binding legal authority that suggested Defendant’s interpretation was incorrect. The case upon which Plaintiff relies for its claim that Defendant’s payments in this case were legally erroneous, Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So.3d 63 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D1062a], was not decided until ten months later on May 18, 2011. Defendant, therefore, had a good faith basis to believe that its payments in this case were correct and in conformity with the PIP statute’s mandate. Its payment to Millennium Diagnostic was not gratuitous or otherwise improper.

Absent any allegation or finding of bad faith on Defendant’s part when it exhausted benefits, an insurer is not required to set aside a reserve fund with which to supplement reduced payments to a provider in the event those payments are subsequently challenged. “Holding funds in reserve until the completion of litigation is detrimental to everyone except the provider(s) who is keeping the funds tied up. It subjects the insurer to unreasonable exposure, is detrimental to other providers with properly submitted claims, and detrimental to the insured who is entitled to both prompt treatment and prompt payment for that for that treatment. Furthermore, it is contrary to the legislative intent to have these bills paid quickly.” Progressive American, 990 So.2d at 6. See also Simon, 904 So.2d at 450.

For the foregoing reasons, it is therefore ORDERED AND ADJUDGED,

Defendant’s Motion for Final Summary Judgment is GRANTED. Plaintiff, WESTLAND SOUTH MEDICAL CENTER, INC., a/a/o MIRIAM ESTRADA, shall take nothing by this action and Defendant, UNITED AUTOMOBILE INSURANCE COMPANY, shall go hence without day. The Court reserves jurisdiction to determine Defendant entitlement to §57.105 attorney’s fees and costs.

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