21 Fla. L. Weekly Supp. 159a
Online Reference: FLWSUPP 2102MRIInsurance — Personal injury protection — Declaratory action — Coverage — Medical expenses — Policies that provide that insurers will pay PIP claims based on “reasonable” amount and do not mention Medicare fee schedules or other statutory limitations are insufficient to allow insurers to utilize permissive fee schedule methodology of section 627.736(5)(a)2-5 in calculating PIP benefits — Insurers are not allowed to rely on Medicare Outpatient Prospective Payment System to pay less than minimum level under fee schedule methodology
MRI ASSOCIATES OF ST. PETE, INC., d/b/a SAINT PETE MRI., as assignee, individually, and on behalf of all those similarly situated, Plaintiff, vs. FIRST FLORIDIAN AUTO AND HOME INSURANCE COMPANIES, THE TRAVELERS HOME AND MARINE INSURANCE COMPANIES AND TRAVELERS INDEMNITY COMPANY OF AMERICA, Defendant. Circuit Court, 13th Judicial Circuit in and for Hillsborough County, Civil Division. Class Representation. Case No. 10-CA-013131, Division C. November 1, 2013. Honorable James M. Barton, II, Judge. Counsel: David M. Caldevilla, de la Parte & Gilbert, Tampa; Scott R. Jeeves, Jeeves Law Group, P.A., St. Petersburg; Craig E. Rothburd, Tampa; and Lorca J. Divale, St. Petersburg, for Plaintiff. Scott Hutchens, William Keebler, and Dale Parker, Banker Lopez Gassler P.A., St. Petersburg, for Defendant.
NON-FINAL ORDER ON COMPETING MOTIONS FOR SUMMARY JUDGMENT
THIS CAUSE was considered by the Court on October 22, 2013 concerning: (1) the Motion for Partial Summary Judgment as to Counts I and/or IV filed by the Plaintiff, MRI Associates of St. Pete, d/b/a Saint Pete MRI, as assignee, individually, and on behalf of all those similarly situated; and (2) the Motion for Summary Judgment filed by the Defendants, First Floridian Auto and Home Insurance Companies, Travelers Home and Marine Insurance Companies, Travelers Indemnity Company of America, and Phoenix Insurance Companies. The Court, having considered the motions, the parties’ memoranda of law, the arguments of counsel, the parties’ proposed orders, and the record, and being otherwise advised in the premises,
ORDERED AND ADJUDGED as follows:Introduction
1. This is putative class action, where the Plaintiff asserts claims that the Defendant routinely relied on the incorrect payment calculation methodology when paying personal injury protection (“PIP”) claims pursuant to the versions of the PIP statute (§627.736, Fla. Stat.) in effect during January 1, 2008 through June 30, 2012. This case does not implicate the latest version of Section 627.736, which took effect on July 1, 2012. See, Ch. 2012-197, Laws of Fla. (2012).
2. The Plaintiff seeks partial summary judgment on its declaratory relief claims in Counts I and IV. In contrast, the Defendants’ competing motion for summary judgment seeks a final judgment of dismissal of all claims.Analysis
3. On October 17, 2013, the Defendants filed copies of the subject PIP insurance policies as Exhibits A-D. Three of the policies (Exhibits A-C) use the following standardized provision:
SECTION I
COVERAGE Q — PERSONAL INJURY
PROTECTION
We will pay, in accordance with the Florida Motor Vehicle No-Fault Law, as amended, to or for the benefit of the injured person;
(a) 80% of “medical expenses”, and
See, Defendants’ Notice of Filing (dated Oct. 17, 2013). See also, Complaint at ¶¶ 39-40 and Exhibit E; Second Am. Answer at ¶¶ 39-40. In addition, those policies also define “medical expenses” as follows:
“medical expenses” means reasonable expenses for “medically necessary” medical, surgical, x-ray, dental, and rehabilitative services, including prosthetic devices, and medically necessary ambulance, hospital, and nursing services. Such expenses shall also include necessary remedial treatment and services recognized and permitted under the laws of the state for an injured person who relies upon spiritual means through prayer alone for healing in accordance with his or her religious beliefs; however, this sentence does not affect the determination of what other services or procedures are medically necessary.
Id. The fourth policy (Exhibit D) uses the following provision that describes the Defendants’ methodology for paying PIP claims:
A. Coverage
We will pay Personal Injury Protection benefits in accordance with the Florida Motor Vehicle No-Fault Law to or for an “Insured” who sustains “bodily injury” in an “accident arising out of the ownership, maintenance or use of a “motor vehicle”. Subject to the limits shown in the schedule, these Personal Injury Protection benefits consist of the following:
1. Medical Expense
All reasonable “medically necessary” expenses for medical, surgical, x-ray, dental, ambulance, hospital, professional nursing and rehabilitative services, for prosthetic devices and for necessary remedial treatment and services recognized and permitted under the laws of the state for an “insured” who relies upon spiritual means through prayer alone for healing in accordance with his or her religious beliefs. However, payment of expenses for spiritual healing shall not affect the determination of what other services or procedures are “medically necessary”.
Id. Notably, all of the four policies promise to pay PIP claims based on the “reasonable” amount, and none of the policies mention any Medicare fee schedules or the other terms and conditions of Section 627.736(5)(a)2-5.
4. With respect to the PIP insurance policies issued during January 1, 2008 through December 31, 2012, controlling Florida case law holds that an insurance company may not limit reimbursement based on the Medicare fee schedules identified in Section 627.736(5)(a)2.a-f, without clearly and unambiguously providing notice in the PIP insurance policy of its election to use those fee schedules as the basis for calculating PIP claims. If a PIP insurance policy does not clearly and unambiguously notify the insured that the payment calculation method will based on those Medicare fee schedules, then the insurance company cannot not limit reimbursement based on the fee schedule method described in Section 627.736(5)(a)2-5. See, Geico Gen. Ins. Co. v. Virtual Imaging Services, Inc., __ So. 3d __, 2013 WL 3332385 (Fla. July 3, 2013) [38 Fla. L. Weekly S517a] (“Virtual III”). See also, Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So.3d 63 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D1062a]; DCI MRI, Inc. v. Geico Indem. Co., 79 So.3d 840 (Fla. 4th DCA 2012) [37 Fla. L. Weekly D170e]; Geico Indemnity, Co. v. Virtual Imaging Services, Inc., 79 So.3d 55 (Fla. 3d DCA 2011) [36 Fla. L. Weekly D2597a] (“Virtual I”); Geico Gen. Ins. Co. v. Virtual Imaging Services, Inc., 90 So.3d 321 (Fla. 3d DCA 2012) [37 Fla. L. Weekly D985b] (“Virtual II”). Likewise, PIP insurance policies that were issued before the January 1, 2008 effective date of the 2008-2011 version of the PIP statute are also prohibited from retroactively applying the fee schedule method to such policies. See, Geico Indemnity Co. v. Physicians Group, LLC, 47 So.3d 354, 357 (Fla. 2d DCA 2010) [35 Fla. L. Weekly D1850a].
5. Moreover, controlling Florida case law also holds that the fee schedule method of Section 627.736(5)(a)2-5 sets the “minimum” level of PIP benefits payable, and a PIP insurance company may not rely on the Medicare OPD fee schedule, also known as the Outpatient Prospective Payment System (“OPPS”), to pay less than that minimum level under the fee schedule methodology. See, Nationwide Mut. Fire Ins. Co. v. AFO Imaging, Inc., 71 So.3d 134 (Fla. 2d DCA 2011) [36 Fla. L. Weekly D1463b]; DCI MRI, 79 So.3d at 842.Conclusion
6. The pleadings, stipulations, and admissible evidence of record demonstrate that there is no genuine issue of material fact as to the particular legal issues decided by this order. The specific legal issue decided by this Order is limited to a declaration of whether the policy language specifically described above satisfies the requirements of the PIP statute and permits the Defendants to make payment pursuant to the fee schedule methodology. The Court makes no determination as to whether the amount of any payment made by the Defendants was actually improper or insufficient under the reasonable amount methodology set forth in Section 627.736(5)(a)1, Florida Statutes (2008-2011).
7. Accordingly, for the time period of January 1, 2008 through June 30, 2012, with respect to the subject PIP insurance policies issued by the Defendants in the State of Florida, partial summary judgment is hereby granted in favor of the Plaintiff and against the Defendants on: (a) Count I, declaring as a matter of law that the subject PIP insurance policies are insufficient to invoke the fee schedule method of Section 627.736(5)(a)2-5, Florida Statutes (2008-2011) for calculating PIP benefits; and (b) Count IV, declaring as a matter of law that the Defendants are not authorized to rely on the OPD fee schedule, also known as OPPS.
8. Therefore, the Plaintiff’s motion for partial summary judgment is hereby GRANTED, and the Defendants’ motion for summary judgment is hereby DENIED, without prejudice to the Defendants’ defenses concerning the merits of the Plaintiff’s remaining claims and/or concerning class certification issues.
9. This is a non-final order, and the Court hereby reserves jurisdiction to determine all other outstanding claims and issues in this case.
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