22 Fla. L. Weekly Supp. 733a

Online Reference: FLWSUPP 2206FLORInsurance — Personal injury protection — Discovery — Depositions — Where insurer utilized permissive statutory fee schedule to calculate reimbursement rate although policy is devoid of any provision electing to use fee schedule to calculate reimbursement rate, insurer unilaterally determined “reasonableness” and deposition of medical provider on issue of reasonableness is not relevant or necessary — Protective order is granted

FLORIDA HOSPITAL MEDICAL CENTER, as assignee of Farah Ignace-Jean, Plaintiff, vs. PROGRESSIVE AMERICAN INSURANCE COMPANY, Defendant. County Court, 9th Judicial Circuit in and for Orange County. Case No. 2013-SC-6527-O. April 1, 2014. A. James Craner, Judge. Counsel: David B. Alexander, Orlando, for Plaintiff. Henry R. Ramos, Orlando, for Defendant.

ORDER ON PLAINTIFF’S MOTIONFOR PROTECTIVE ORDER

This matter having come before the Court on the plaintiff’s Motion for Protective Order and the Court having reviewed the court file and being otherwise duly advised, the Court hereby ORDERS AND ADJUDGES:

FACTS:

1). The plaintiff, Florida Hospital Medical Center (Florida Hospital) provided services to the insured following her involvement in an automobile accident.

2). The defendant herein, Progressive American Insurance Company (Progressive) elected to calculate reimbursement rates for services provided under the Medicare fee schedule.

3). In determining whether the charge for a particular service or treatment is reasonable, there are two (2) methods by which an insurer may calculate reimbursement methods: i). the fact dependent method under 627.736(5)(a)(1)¹, and ii). by utilizing Medicare fee schedules under 627.736(5)(a)(2)².

4). The policy governing the parties herein did not reference the permissive method of calculating reimbursement rates.

5). Progressive seeks to depose a witness from the provider to ascertain ‘reasonableness’; Florida Hospital seeks to prohibit said deposition under the theory that ‘reasonableness’ is not an issue based upon Progressive’s election.

6). The matter was set for a hearing before the court and the parties argued same on March 6, 2014. No evidence was presented. Case law was provided.

7). Florida Hospital, citing Geico General Insurance Company vs. Virtual Imaging Services, Inc., __ So.3d __, 2013 WL 3332385 (Fla.)(Geico) [38 Fla. L. Weekly S517a], argues that its witness is not subject to deposition since reasonableness is not an issue to be resolved in this matter.

8). Further, Florida Hospital argues that the case can be resolved at a motion for summary judgment.

9). Progressive, on the other hand, interprets Geico, supra. differently. It argues that it is fundamentally fair to permit a deposition of Florida Hospital’s witness if the court grants a deposition of Progressive’s witness. Further, it argues that reasonableness is always an issue to be resolved regardless of the insured’s election under Florida Statute section 627.736(5)(a)(1) or (5)(a)(2).

ISSUE, LAW, AND ANALYSIS

10). The issue in this matter is whether Progressive will be permitted to depose a witness designated by Florida Hospital, to determine reasonableness, or whether the Court will grant the protective order and prohibit the deposition of said witness. Florida Statute sections 627.736(5)(a)(1) and (a)(2) apply.

11). The Florida Supreme Court addressed the issue in Geico, supra.

12). The Florida Supreme Court held that i). the insurer must clearly and unambiguously elect to determine ‘reasonableness’ using either the fact-dependent method [(5)(a)(1)], or the Medicare fee schedule method [(5)(a)(2)] and ii). the insurer must notify the insured of its election to utilize either Florida Statute section 627.736(5)(a)(1) or (5)(a)(2).

13. The Supreme Court reached its determination after careful and thorough consideration of the history of the PIP statute.

14). The Florida Supreme Court in Geico did not address what language would constitute sufficient notice.

15). Various courts have evaluated the language of various policies and ruled either the relevant language within the policy is either clear and unambiguous, or it is unclear and ambiguous. See: Maldonaldo-Garcia , MD, PA A/A/O Ubaldo Delgado v. Mercury Indemnity Co. of America, 2013 WL 6646823 (Miami-Dade Circuit Court, December, 2013) [21 Fla. L. Weekly Supp. 434a] (in the context of defendant’s motion for summary judgment, the Court interpreted defendant’s insurance policy and concluded the defendant breached the contract with the insured; Court entered final judgment for the plaintiff). Contrarily, a county court in South Florida Chiropractic Centres A/A/O Ann Plitnick v. Allstate Fire and Casualty Insurance Company, 2013- 1110 SP 23 (06) (Miami-Dade County) concluded that the language in Allstate’s policy complies with the requirement of the Supreme Court that the insurer put the insured on notice of its election, and therefore the policy was clear and unambiguous.

16). The Court is cognizant of Northwoods Sports Medicine and Physical Rehabilitation, Inc., and Wellness Associates of Florida, Inc., vs. State Farm Automobile Insurance Company and USAA Casualty Insurance Company, 4D11-1556 and 4D11-3796 (4th DCA, March 5, 2014) [39 Fla. L. Weekly D491a]. While the language therein is not entirely clear (it says that reasonableness is always an issue, as the defendant herein argued citing the Northwoods opinion), the Court finds it distinguishable since Northwoods relates to a defense of post-exhaustion of benefits.

CONCLUSION

17). In the case sub judice, the court finds that Progressive utilized Florida Statute section 627.736(5)(a)(2) to calculate reimbursement rates. The policy that is the subject matter of this lawsuit is void of any provision for Progressive to elect to use the Medicare fee schedule to calculate reimbursement rates. Hence, Progressive breached the contract with its insured as a matter of law.

18). While it utilized the Medicare fee schedule to calculate reimbursement rates, in so doing, it unilaterally determined ‘reasonableness’.

19). It cannot now seek to fall back to 627.736(5)(a)(1) to determine reasonableness.

20). Since reasonableness is resolved, a deposition of Florida Hospital’s witness is not relevant or necessary. See: Allstate Insurance Company vs. Langston, 655 So.2d 91 (Fla. 1995) [20 Fla. L. Weekly S217a] (discovery in a civil case must be relevant to the subject matter of the case and it must be admissible or reasonably calculated to lead to admissible evidence). Additionally, Florida Hospital was not fairly put on notice as required in Geico.

21). The protective order is therefore GRANTED; Progressive is not permitted to take the deposition of Florida Hospital’s witness.

__________________

¹With respect to a determination of whether a charge for a particular service, treatment, or otherwise is reasonable, consideration may be given to evidence of usual and customary charges and payments accepted by the provider involved in the dispute, and reimbursement levels in the community and various federal and state medical fee schedules applicable to automobile and other insurance coverages, and other information relevant to the reasonableness of the reimbursement for the service, treatment, or supply.

²The insurer may limit reimbursement to 80 percent of the following schedule of maximum charges. [Subsection a-f omitted]