21 Fla. L. Weekly Supp. 603a
Online Reference: FLWSUPP 2107NEALInsurance — Personal injury protection — Coverage — Medical expenses — PIP policy which states that insurer will pay 80% of reasonable expenses and makes general references to section 627.736 and fee schedules does not clearly and unambiguously elect to limit reimbursement pursuant to Medicare Part B fee schedule
ALLSTATE PROPERTY AND CASUALTY INSURANCE COMPANY & ALLSTATE INSURANCE COMPANY & ALLSTATE FIRE AND CASUALTY INSURANCE COMPANY, Appellants, v. NEAL CLINIC OF COMPREHENSIVE HEALTHCARE, P.I. & EDGE FAMILY CHIROPRACTIC P.A., Appellees. Circuit Court, 1st District (Appellate) in and for Escambia County. Case Nos. 2013-AP-000005, 2013-AP-000006, 2013-AP-000009, 2013-AP-000012, Division “A”. L.C. Case No. 2011-SC-004049, 2011-SC-004086, 2012-SC-003630, 2012-SC-003234, Division “5”. October 3, 2013.
OPINION AFFIRMING THE LOWER COURT’S ORDERS AND FINAL JUDGMENTS INTRODUCTION
(DUNCAN, Judge.) Appellant Allstate (herein “Allstate”) appeals an Order Granting Appellee Neal Clinic’s Motion for Summary Disposition dated October 11, 2012 (11-SC-4049), an Order Granting Appellee Edge’s Motion for Summary Disposition dated October 11, 2012 (11-SC-4086), a Final Judgment entered in favor of Edge on January 24, 2013 (12-SC-3630), and a Final Judgment entered in favor of Allstate on February 7, 2013 (12-SC-3234). Allstate seeks reversal of the lower court’s Orders Granting Summary Disposition and the respective Final Judgments.
ANALYSIS
The sole legal issue to be decided is whether Allstate’s automobile liability insurance policy permits it to reimburse Appellees for medical services rendered to the insured based upon the Medicare Part B fee schedules described in Section 627.74(5)(a)2a-f, Florida Statutes (2008). Allstate claims its policy plainly and unambiguously elected to use the fee schedules described in Section 627.736(5)(a)2a-f. Appellees argue that the policy language is ambiguous and does not give the insured notice that Allstate is electing to reimburse medical services based upon the fee schedules in Section 627.736(5)(a)2a-f. The lower court found that the insurance policy was ambiguous and ruled in favor of Appellees.
Section 627.736, Florida Statutes created a methodology for reimbursements of medical services under PIP claims. Section 627.736(5)(a)1 mandates that a reasonable amount be paid for medical services, while Section 627.736(5)(a)2a-f permits an insurer to reimburse for medical services based upon the fee schedules described therein. Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So.3d 63, 67-68 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D1062a]. Kingsway held that the plain language of the statute allowed an insurer to choose between these two payment options. Id. However, if the insurer wanted to use the permissive payment option described in Section 627.736(5)(a)2a-f, it must make reference to that option in the policy. Id.
The rationale of Kingsway has now been adopted and amplified by the Florida Supreme Court in Geico Gen. Ins. Co. v. Virtual Imaging Services, Inc. 2013 WL 3332385, (July 3, 2013) [38 Fla. L. Weekly S517a]. The Court held that if an insurer elects to reimburse medical services pursuant to the Medicare fee schedules described in Section 627.736(5)(a)2a-f, it is necessary that its policy give notice of that election to the insured. Id. The Court also emphasized that “the insurer must clearly and unambiguously elect the permissive payment methodology in order to rely on it.” Id. Because its policy did not reference the permissive Medicare fee schedule method of calculating reasonable medical expenses, GEICO was not permitted to limit reimbursements in accordance with those schedules. Id. In coming to its conclusion, the Court described the use of the Medicare fee schedules as a permissive option that an insurer could exercise if it provided notice in the policy of its election to use the fee schedules. Agreeing with the rationale of Kingsway, the Court held that where the statute affords insurers two different mechanisms for calculating reimbursements, the insurer must clearly and unambiguously elect the permissive payment methodology in order to rely on it. Id.
This Court must accept and follow the Florida Supreme Court’s holding in Geico Gen. Ins. Co. v. Virtual Imaging Services, Inc. By adopting the Kingsway rationale, it appears the Florida Supreme Court has adopted the view that Section 627.736 gives two distinct options to insurers for PIP payment claims. An insurer can either pay “reasonable expenses” or pay pursuant to the Medicare fee schedules. Further, the insurer is required to give the insured clear and unambiguous notice of which option it elects.
Applying the reasoning of Kingsway and Virtual Imaging Services to the instant case, this Court finds that Allstate’s policy did not plainly and unambiguously elect the option to reimburse medical services pursuant to the Medicare fee schedules described in Section 627.736(5)(a)2a-f. The policy at issue states that “Allstate will pay to or on behalf of the injured person the following benefits . . . Eighty percent of reasonable expenses for medically necessary medical, surgical, X-ray, dental, and rehabilitative services . . .” Such policy language on its face indicates that Allstate elected the option described in Section 627.736(5)(a)1 as the method of payment because it made no reference to the permissive option described in 627.736(5)(a)2a-f. Allstate argues it did indeed invoke the provisions of 627.736(5)(a)2a-f in the limits of liability section of the policy. However, Allstate merely made general references to “Section 627.736” and “fee schedules”, and did not include any additional specific language in this portion of the policy that would give an insured clear notice that the payment method previously described in the “Personal Injury Protection Coverage” portion of the policy would not apply, and that it was electing to reimburse under an alternative option. This Court determines Allstate’s “notice” is not adequate to suffice as the clear and unambiguous notice contemplated by Kingsway and Virtual Imaging Services. Because there was no clear notice of which payment option Allstate chose to exercise, this Court affirms the lower court’s Orders Granting Summary Disposition and Final Judgments.
The trial court’s orders and final judgments are hereby AFFIRMED.
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