21 Fla. L. Weekly Supp. 445a
Online Reference: FLWSUPP 2105GOMEInsurance — Personal injury protection — Coverage — Medical expenses — Exhaustion of policy limits — Where insurer wrongly paid medical bills out of order by skipping over medical provider’s bill and exhausting benefits on payment of bills received after provider’s bill, insurer is prohibited from asserting that insufficient benefits remained for payment of plaintiff’s bill or that benefits were properly exhausted on claim
Y.H. IMAGING, INC. a/a/o (Gomez, Iris), Plaintiff(s), vs. ALLSTATE PROPERTY AND CASUALTY INSURANCE COMPANY, Defendant(s). County Court, 17th Judicial Circuit in and for Broward County. Case No. 11-011193 COSO 60. November 7, 2012. Honorable Eric M. Beller, Judge. Counsel: Wajih A. Shirazi, Hollywood, for Plaintiff. Frantz Nelson, for Defendant.
ORDER GRANTING PLAINTIFF’SMOTION FOR SUMMARY JUDGMENT
THIS CAUSE, having come before this Honorable Court, and the Court being otherwise fully advised in the premises, it is hereupon ORDERED AND ADJUDGED:
That Plaintiff’s Motion for Summary Judgment is hereby GRANTED and Defendant’s Motion for Final Summary Judgment is hereby DENIED.
The facts of this case are not in dispute. This is a suit for No-Fault Personal Injury Protection (PIP) benefits pursuant to Florida Statute §627.736 for medical treatment rendered by the Plaintiff, Y.H. Imaging, Inc., to the claimant, Iris Gomez, on April 5, 2011 in the amount of $3,470.00 as a result of a motor vehicle accident which occurred on March 28, 2011. At the time of both the accident and treatment, Iris Gomez qualified for insurance under a policy with the Defendant, Allstate Property and Casualty Insurance Company.
Plaintiff provided medical diagnostic treatment to the claimant and in exchange accepted an Assignment of Benefits which permitted Plaintiff to litigate the rights of the claimant in order to receive payment for benefits under the subject policy issued to insured by Defendant. Plaintiff submitted its bill for treatment rendered to Iris Gomez which was timely received by Defendant on May 17, 2011. Defendant’s Explanations of Benefits for this claim indicates that the Plaintiff’s bill was received on May 17, 2011 confirming that Plaintiff’s bill had been received prior to the bills submitted by Park Blvd Rehab, Inc. (the other medical provider rendering treatment to Iris Gomez). Moreover, Defendant did not provide a reason for failing to make payment to Plaintiff other than that the benefits were subsequently exhausted under the subject policy on July 24, 2011.
Plaintiff moves for summary judgment as to the issue of exhaustion of benefits under the subject policy arguing that Defendant improperly paid out PIP benefits under the subject policy out of order in violation of The English Rule on priority among assignees claiming an interest in the same fund which accords priority in the order in which assignees give notice to the debtor. It is undisputed that the Plaintiff’s bill for treatment rendered to Iris Gomez was received prior to the bills submitted by Park Blvd. Rehab, Inc., that the Defendant exhausted benefits by paying bills which were subsequently received from Park Blvd. Rehab, Inc., and that the Defendant never made any payment towards the Plaintiff’s bill on this claim.
Defendant moves for final summary judgment as to the issue of exhaustion of benefits arguing that PIP benefits under the subject policy are exhausted and therefore, that Defendant is not liable for benefits once benefits have been exhausted in the absence of bad faith. Although Defendant acknowledges that it paid the other medical provider’s bills out of order and never made any payment towards Plaintiff’s bill on this claim, Defendant maintains the position that an exhaustion of benefits under an insurance policy, relieves an insurance company of any and all liability for having to make further payments in the absence of bad faith.
In support of Plaintiff’s Motion for Summary Judgment, Plaintiff filed the Affidavit of its billing clerk and records custodian, Yamir Hernandez, who testified as to the medical treatment Plaintiff rendered to the claimant, the reasonableness of the charges for treatment, the actual bill submitted by the Plaintiff to Defendant and the lack of payment received by Defendant towards the Plaintiff’s bill. In support of Defendant’s Motion for Final Summary Judgment, Defendant filed the Affidavit of its litigation adjuster, Shawna Diamond, who testified as to insurance policy coverage, the PIP policy limits of $10,000, the Plaintiff’s bill was received by Defendant on May 17, 2011 and the PIP Log verifying that Defendant made payments made out of order in addition to alleging that Defendant exercised no bad faith in their exhaustion of benefits for this claim on July 24, 2011.
An insurance company’s payment of $10,000 in PIP benefits on a policy is not the only hurdle to clear when determining whether an insurance company has appropriately exhausted benefits. A crucial factor to consider is the insurer’s chosen method and priority of making PIP payments as it relates to whether the insurer appropriately exhausted benefits under the subject policy according to the law. In general, an insurer is required to process all bills in the order in which they are received. . .The English Rule applies among assignees of PIP benefits. See Boulevard National Bank of Miami v. Air Metal Industries, Inc., 176 So.2d 94 (Fla. 1965). See also State Farm Fire and Casualty Company v. Ray, 556 So.2d 811 (Fla. 5th DCA 1990).
Allstate’s maximum liability is not Appellant’s challenge; it is Allstate’s method and priority of making PIP payments. The issue presented is whether an insurer is entitled to pay PIP benefit claims in any order they deem appropriate until the benefits are exhausted; or whether an insurer is required to ‘set aside’ funds in the amount which would be due a medical provider whose bill has been challenged, at least until challenges to the denial of payment are resolved. If the procedure used in this case was allowed in each instance as a matter or law, it would permit and sanction allowing an insurer to apply the payments of medical bills in any manner it chose and, in some cases, to exhaust PIP benefits so as to deny payment to any medical providers who are not ‘favored’. The courts cannot be unwitting facilitators of such a manipulation. See Pinnacle Medical, Inc. d/b/a Iso Data Diagnostics v. Allstate Ins. Co., 5 Fla. L. Weekly Supp. 663a (Fla. 17th Cir. Ct. App. 1998). See also Bennet v. State Farm Mutual Automobile Ins. Co., 580 So.2d 217 (Fla. 2nd DCA 1991).
Defendant primarily relies on the case of Simon v. Progressive Express Insurance Company, 904 So.2d. 449 (Fla. 4th DCA 2005) [30 Fla. L. Weekly D1156b] alleging that there was no bad Faith and that Allstate properly exhausted benefits under the subject policy. However, bad faith is not the only issue to consider and Simon, is easily distinguishable from the facts present here as the insurance company in Simon actually paid the Plaintiff medical provider a reduced amount of its bill which the Plaintiff accepted as payment. See Pembroke Pines MRI, Inc. a/o/o Gabriel Garcia v. Garrison Property and Casualty Ins. Co., 18 Fla. L. Weekly Supp. 558a (Fla. 17th Cir. Ct. 2011). Moreover, Simon is so factually distinguishable from the case at bar, that its holding is inapplicable to this case. . .In Simon, the available benefits had either been paid to other providers or committed to other providers before notice was given by the provider that there was an objection to the reduced payment. . .In addition, Simon does not address the issue of reason behind the reduction of benefits. See Progressive Express Ins. Co. v. South Florida Institute of Medicine, Inc., 14 Fla. L. Weekly Supp. 520a (Fla. 11th Cir. Ct. App. 2007).
Coral Imaging Services a/o/o Virgilio Reyes v. Geico Indemnity Ins. Co., 955 So.2d 11 (Fla. 3rd DCA 2006) [31 Fla. L. Weekly D2478a] offers direction to the Court in situations where providers are paid in a manner not contemplated by Florida Statute §627.736. Although Coral Imaging is not an exhaustion of benefits case, it is a case where provider who should not have been paid was paid by the insurer, rather than a provider who should have been paid first. The Coral Imaging decision held that those wrongful payments should be considered gratuitous in nature and required the insurance company to pay additional benefits even though the PIP benefits had been exhausted.” See Progressive Express Ins. Co. v. South Florida Institute of Medicine, Inc., 14 Fla. L. Weekly Supp. 520a (Fla. 11th Cir. Ct. App. 2007) citing Coral Imaging Services a/a/o Virgilio Reyes v. Geico Indemnity Ins. Co., 955 So.2d 11 (Fla. 3rd DCA 2006) [31 Fla. L. Weekly D2478a].
“When an insurer reduces a reasonable bill for necessary and related services, it does so at its own risk. . . . It is the incorrect denial of benefits, not the presence of some sinister concept of ‘wrongfulness’ that generates the basic entitlement to the fees if such denial is incorrect.” Seminole Casualty Ins. Co. v. Philip D. Schtupak, D.C., P.A., 9 Fla. L. Weekly Supp. 529a (Fla. 17th Cir. Ct. App. 2001) citing Ivey v. Allstate Ins. Co., 774 So.2d. 679 (Fla. 2000) [25 Fla. L. Weekly S1103a].
In the case at bar, the Defendant incorrectly paid bills out of order under the subject policy in violation of The English Rule. Defendant effectively skipped over Plaintiff’s bill and as a result, Defendant improperly exhausted benefits by paying later received bills without making any payment whatsoever on Plaintiff’s bill which was received prior to the other provider’s bills. As such, the Defendant is prohibited from asserting that insufficient benefits remained for payment of Plaintiff’s bills under the subject policy or that benefits were properly exhausted on this claim. Therefore, if the Plaintiff can establish that the medical treatment rendered to Iris Gomez was reasonable, related and medically necessary, then the Defendant will be liable for payment of Plaintiff’s bills.
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