21 Fla. L. Weekly Supp. 838b
Online Reference: FLWSUPP 2108WILLInsurance — Personal injury protection — Fraud — False or misleading statement relating to claim or charge — Statute which relieves insurer or insured from paying claims to any person who knowingly submits false or misleading statement relating to claim or charges does not relieve insurer from paying claims that contained name of physician who no longer worked for provider when services were rendered where provider had no actual knowledge that billing software continued to insert name of physician in Box 31 of claim forms after physician’s departure — No merit to argument that provider acted with reckless disregard or deliberate ignorance where billing clerk took affirmative steps to change information in software and had good faith belief that she had properly done so
NORTH BROWARD HEALTH & REHAB, INC., (Peniel William, Patient), Plaintiff, vs. STATE FARM FIRE AND CASUALTY COMPANY, Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. 12-09916CONO (72). March 25, 2014. Jill K. Levy, Judge. Counsel: Thomas J. Wenzel, Cindy A. Goldstein, P.A., Coral Springs, for Plaintiff. Matt Hellman, Matt Hellman, P.A., Plantation, for Defendant.
AFFIRMED. 2/15/2017 (17th Judicial Circuit, Appellate Case Number: CACE14-009477 (AP).
ORDER ON THE PARTIES’ CROSS-MOTIONS FOR SUMMARY JUDGMENT
THIS CAUSE came before the Court on February 17, 2014, on Defendant’s Motion for Final Summary Judgment and Plaintiff’s Cross Motion for Summary Judgment, and the Court having reviewed the Motions, the exhibits, the Court file, the relevant legal authorities, and having heard argument, and having been sufficiently advised in the premises, the Court hereby makes the following findings:
Based upon the evidence before the Court, the Court finds the following facts undisputed: (1) The claimant, Peniel William, was injured in an auto accident on June 14, 2012; (2) Defendant provided a no-fault insurance policy that provided coverage for the claimant; (3) The claimant received treatment from the Plaintiff from June 18, 2012 through September 11, 2012. The treatment was medically necessary and related to the claimant’s auto accident. The prices for the services were reasonable. All of the services billed for were rendered. (4) The Plaintiff submitted a series of bills to Defendant on Health Care Financing Administration Form 1500 (herein after “HCFA”); (5) All of the Plaintiff’s bills contained, in Box 31, the name “Frank P. Diblase”; (6) Dr. Diblase ceased working at the Plaintiff facility on July 23, 2012. Plaintiff’s HCFAs continued to display Dr. Diblase’s information in Box 31 after Dr. Diblase’s departure from the facility; (7) after Dr. Diblase ceased working at the Plaintiff facility, Dr. Melissa Cruz took over treatment of the claimant; and (8) Plaintiff’s employee had no actual knowledge that it was submitting a false or misleading statement.
The case sub judice concerns application of Florida Statutes § 627.736(5)(b)(1)(c). This statute provides that “[a]n insurer or insured is not required to play a claim or charges: . . .[t]o any person who knowingly submits a false or misleading statement relating to the claim or charges.” The word “Knowingly” is defined by Florida Statutes § 627.732(5)(10) to mean that a “person, with respect to information, has actual knowledge of the information; acts in deliberate ignorance of the truth or falsity of the information; or acts in reckless disregard of the information, and proof of specific intent to defraud is not required.”
In addressing the “false or misleading statement” portion of the statute, the Defendant asserted that Plaintiff submitted HCFAs for dates of service July 25, 2012 to September 11, 2012 and four physical therapy notes. The Defendant contends that this amounts to a false representation because it incorrectly represents that: (1) Dr. DiBlase continued to work for the Plaintiff after July 23, 2012, that (2) Dr. DiBlase provided treatment to the insured for dates of service July 25, 2012 to September 11, 2012, and that (3) Dr. DiBlase had signed approved, or given the Plaintiff permission to use his name and license number to bill for dates of service July 25, 2012 to September 11, 2012. The Defendant contended that the Plaintiff must have known the aforementioned statements were false. Based on these arguments, the Defendant claims that it may deny every bill from this provider. To support its position, Defendant relies on the case Chiropractic One, Inc. v. State Farm Mut. Auto. Ins. Co., 92 So.3d 871 (Fla. 5th DCA 2012) [37 Fla. L. Weekly D1565a]. However, as discussed infra, the Court rejects Defendant’s position for several reasons.
In Chiropractic One, the 5th DCA held that Florida Statutes § 627.736(5)(b)(1)(c) could invalidate an entire set of bills from a provider. In reaching its conclusion, the Fifth District Court of Appeal of Florida (herein after “5th DCA”) examined the legislative purpose for this section of the statute finding “[t]he revision of the PIP statute had as a goal, among other things, the curtailment of the perceived fraud in the PIP billing of medical services”. Id. at 875. The 5th DCA also found that Chiropractic One engaged in “virtually admitted improper billing practices. . .primarily rooted in the [provider’s] intentional or recklessly improper use of Current Procedural Terminology codes, including billings for services not rendered, wrongly billed, or undocumented. The manipulations were designed to misrepresent to State Farm the services supplied to the insureds and to inflate the associated billing statements.” Id. at 873. However, the case sub judice is easily distinguishable from Chiropractic One on several issues.Lack of Evidence Concerning Knowledge
In Chiropractic One, the 5th DCA noted that the trial court “itemized the evidence that led it to conclude that Chiropractic One ‘knowingly’ made the false and misleading claims”. This trial court is unable to make such a determination. Defendant has relied solely on the existence of the incorrect name in Box 31. The mere existence of a fact does not prove the existence of knowledge as required by the statute. Plaintiff provided the sole evidence on the issue of knowledge which came in the form of an affidavit from Plaintiff’s billing clerk. Plaintiff’s uncontested proffer provides that (1) the billing clerk did not have knowledge that the incorrect doctor’s name was present in Box 31; (2) that Plaintiff used billing software that automatically populated the doctor’s name into Box 31; (3) that the billing clerk believed she had correctly switched Dr. Diblase’s name for Dr. Cruz’s name in the software; and (4) that due to the software, Dr. Diblase’s name continued to populate for pre-existing patients. Therefore, this Court finds uncontested the fact that Plaintiff, by and through its employees, had no actual knowledge that it was submitting a false or misleading statement.
Defendant then urged that this Court find that Plaintiff met one of the other definitions of “knowledge”. Based on the record, there is nothing to support Defendant’s bare allegation that Plaintiff was either acting with deliberate ignorance or acting with a reckless disregard for the truth. To the contrary, Plaintiff’s uncontested affidavit shows that Plaintiff’s billing clerk took affirmative steps and had a good faith belief that she had properly changed the information in the billing software and therefore there was no reckless disregard for the truth. Additionally, there is nothing in the record to support any inference that Plaintiff or its employees were acting with deliberate ignorance. Based on the record, but for the Box 31 error, Defendant would not have contested Plaintiff’s bills. It is highly improbable, and unsupported by the record, that Plaintiff would act with deliberate ignorance as a billing error could only act to its own detriment. It was uncontested that the services were actually performed in this case. Therefore, this Court finds that these mistakes were made without knowledge. Accordingly, Defendant is unable to rely on Florida Statutes § 627.736(5)(b)(1)(c) to deny payment of Plaintiff’s substantially compliant bills.Legislative Intent
The 5th DCA in Chiropractic One relied extensively on the legislative purpose while interpreting Florida Statutes § 627.736(5)(b)(1)(c). The 5th DCA cited the 2001 legislative findings which stated “The Legislature finds that the Florida Motor Vehicle No-Fault Law is intended to deliver medically necessary and appropriate medical care quickly and without regard to fault, and without undue litigation or other associated costs. The Legislature further finds that this intent has been frustrated at significant cost and harm to consumers by, among other things, fraud. . .” Id. at 874. The Court additionally cited the Report of the Fifteenth Statewide Grand Jury that “harshly criticized the disappointing history of PIP fraud. . .” and the Legislative History regarding the 2003 amendments where the Legislature “once again declared that the goals underpinning the no-fault laws ‘have been significantly compromised due to the fraud and abuse that has permeated the PIP insurance market’ ”. Id. at 874, 875.
This Court agrees that the legislative intent underpinning § 627.736(5)(b)(1)(c) is the curtailment of fraud. As the 5th DCA found in Chiropractic One, it would be inconsistent with this legislative purpose to permit a provider to take a “hide-and-seek” position with regard to its fraud as a corporate practice. However, in the case sub judice, North Broward’s actions have absolutely no nexus whatsoever to fraud. It was uncontested that the services were actually performed. Therefore, this Court finds inappropriate Defendant’s attempted application of § 627.736(5)(b)(1)(c) to the facts present in the instant case. Without any nexus to fraud, the legislative purpose behind this section is not served. Defendant seems to be urging an interpretation of strict liability with regard to application of this section of the statute. However Defendant’s interpretation, taken to its logical conclusion, would not allow for simple scrivener’s errors or software errors — errors that all persons, including the Defendant and its attorneys, may inadvertently commit from time to time. This was not the legislative intent behind §627.736(5)(b)(1)(c). Defendant’s interpretation also does not comport with substantial compliance precedent including other examinations of Box 31 defects. See e.g. United Auto. Ins. Co. v. Prof’l Med. Group, Inc., 26 So. 3d 21 (Fla. 3d DCA 2009) [34 Fla. L. Weekly D2500a] and Old Masters Medical, Inc. (as assignee of Janice Guerrier) v. Progressive Auto Pro Insurance Company, 12 Fla. L. Weekly Supp. 163a (Fla. Broward Cty. Ct. 2011). The result of Defendant’s interpretation would be wholesale denials of otherwise valid bills for services that were rendered. This result cannot align with the primary purpose and constitutional foundation of the no-fault statute of “swift and virtually automatic payment” of medical claims. See Gov’t Employees Ins. Co. v. Gonzalez, 512 So. 2d 269, 271 (Fla. Dist. Ct. App. 1987) (citing Comeau v. Safeco Ins. Co., 356 So. 2d 790 (Fla. 1978)). Therefore, this Court finds § 627.736(5)(b)(1)(c) inapplicable to the facts of the instant case.Plaintiff’s Alternative Arguments
Due to this Court’s finding in Plaintiff’s favor on the aforementioned grounds regarding Defendant’s § 627.736(5)(b)(1)(c) Affirmative Defense, the Court at this time declines to address the remainder of Plaintiff’s arguments which included inter alia the application of Florida Rule of Civil Procedure 1.120(b), waiver, and the applicability of Florida Statutes § 627.736(5)(f).Prima Facie Elements of the Case
Additionally, the remaining prima facie elements of the case were uncontested or admitted by Defendant. Plaintiff proffered uncontested evidence, which included an affidavit from the Plaintiff’s Records Custodian and an affidavit from the Plaintiff’s Treating physician. Based on the record and admissions before the Court, this Court grants Summary Judgment for Plaintiff on the issues of reasonableness, relatedness, and medical necessity, accident, and insurance coverage.
Therefore, it is ORDERED AND ADJUDGED, that Defendant’s Motion for Summary Judgment is DENIED. Final Summary Judgment is GRANTED for the Plaintiff.
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