22 Fla. L. Weekly Supp. 722a

Online Reference: FLWSUPP 2206SASSInsurance — Personal injury protection — Coverage — Medical expenses — Lawfully rendered treatment — Affirmative defense of failure to comply with provision of Health Care Clinic Act concerning medical director is stricken — Insurer cannot state cause of action for perceived violation of Act absent independent determination of violation by Agency for Health Care Administration, and affirmative defense is barred by insurer’s own actions in finding claim compensable and reimbursing medical provider under statutory fee schedule

NEW SMYRNA IMAGING, LLC, as assignee of Michaela Sass, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant. County Court, 7th Judicial Circuit in and for Volusia County. Case No. 2013 21870 CONS. September 29, 2014. Shirley A. Green, Judge. Counsel: David B. Alexander, Orlando, for Plaintiff. Robert A. Kingsford, Maitland, for Defendant.

ORDER GRANTING PLAINTIFF’S MOTION FORREHEARING AND GRANTING PLAINTIFF’S MOTIONTO STRIKE DEFENDANT’S SIXTH AFFIRMATIVE DEFENSE, WHICH ALLEGES A FLA. STAT. §400.9935COMPLIANCE VIOLATION

THIS MATTER having come before this Honorable Court on Plaintiff’s Motion for Rehearing of the Court’s July 23, 2014 Ruling Denying Plaintiff’s Motion to Strike Defendant’s Sixth Affirmative Defense, which alleges a Fla. Stat. §400.9935 compliance violation, and this Honorable Court having heard arguments of counsel on September 15, 2014 and being otherwise fully advised in the premises, finds as follows,

1. This is a claim for Personal Injury Protection (hereinafter “PIP”) benefits arising out of a motor vehicle collision that occurred on or about 12/29/2009.

2. The Plaintiff in this matter is NEW SMYRNA IMAGING, LLC, as assignee of Michaela Sass.

3. At all times material to the subject cause of action, the assignor, Sass, was covered under a policy of automobile insurance by the Defendant, STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, (hereinafter “STATE FARM”), which provided PIP benefits for injuries Sass sustained in the above-referenced accident.

4. The Plaintiff provided medical services to Sass on 1/11/2010 and submitted a bill for such services to the Defendant.

5. The Defendant paid Plaintiff’s bill at the reduced amount of 200% of Medicare Part B Fee Schedule.

6. The Defendant issued an Explanation of Review to Plaintiff finding Plaintiff’s claim compensable and partially paid said claim. Within its Explanation of Review, Defendant failed to advise Plaintiff of any alleged defect with Plaintiff’s claim.

7. When Plaintiff’s bill was not paid in full, Plaintiff forwarded to Defendant a Notice of Intent to Initiate Litigation surrounding the date of service at issue.

8. The Defendant responded to said Notice of Intent to Initiate Litigation advising Plaintiff that no additional payment was due. Again, Defendant failed to advise Plaintiff of any alleged defect with Plaintiff’s claim.

9. Prior to the June 18, 2014 hearing on Plaintiff’s Motion to Strike Defendant’s Sixth Affirmative Defense, Plaintiff filed its Florida Agency for Health Care Administration State (3020) Forms, dated 3/26/2009, 4/25/2011, and 5/6/2013 finding no deficiencies with Plaintiff’s license.

10. It is Defendant’s position that it is permitted to challenge Plaintiff’s bill based upon Fla. Stat. §400.9935, specifically regulations concerning Plaintiff’s medical or clinical director, even after the Florida Agency for Health Care Administration has found Plaintiff in compliance with Chapter 400 and after Defendant has affirmed coverage, found Plaintiff’s claim compensable and partially paid Plaintiff’s claim.

11. It is Plaintiff’s position that Defendant cannot raise Chapter 400, specifically Fla. Stat. §400.9935, as an affirmative defense in this PIP breach of contract action considering 1) Defendant has no private right of action or private right of enforcement in Chapter 400, The Health Care Clinic Act (“the Act”); 2) compliance with the Act is determined exclusively by the Florida Agency for Health Care Administration; 3) enforcement of the Act rests with the Florida Agency for Health Care Administration; 4) Defendant is not a member of the class intended to be benefitted under the Act, 5) the Florida Agency for Health Care Administration has found Plaintiff in compliance with the Act; and 6) neither Defendant nor this Court has the authority to challenge the Florida Agency for Health Care Administration’s regulatory authority under the Act. Upon further review of this issue, this Court agrees with Plaintiff and grants Plaintiff’s Motion to Strike Defendant’s Sixth Affirmative Defense.

FINDINGS OF LAW AND RULING

The Health Care Clinic Act is clear in its objective of consumer protection and in the vesting of enforcement powers in the Agency for Health Care Administration for compliance, specifically medical or clinical director compliance under Fla. Stat. §400.9935. As this Court has previously ruled, “whatever decision the court makes should be designed to enforce the legislative intent of the Statute. Fla. Stat. §400.990, provides that the legislative intent is to regulate health care clinics for the purpose of strengthening rules to prevent significant cost and harm to consumers. A further purpose was to provide for the licensure, establishment, and enforcement of basic standards for health care clinics and to provide administrative oversight by the Agency for Health Care Administration . . .” Steward v. Progressive Auto Pro Ins. Co., 13 Fla. L. Weekly Supp. 888a (7th Jud. Cir., County Ct., June 14, 2006).

In addition to Steward, in 2006, this Court heard this same argument from PIP insurer Progressive in approximately fifty (50) matters against medical provider, All Family Clinic. This Court ruled that Progressive did not have standing to challenge the medical director of All Family Clinic under Fla. Stat. §400.9935.

Chapter 400, specifically Fla. Stat. §400.9935, fails to express any private right of action or private right of enforcement. Hence, in the present matter, Defendant has no legal standing to challenge compliance under Fla. Stat. §400.9935. The 5th DCA has ruled, “[c]ourts are reluctant to read into a statute a new private right of action not expressly provided for by the Legislature. . .” Kaplan v. Peterson, 674 So. 2d 201 (Fla. 5th DCA 1996) [21 Fla. L. Weekly D1293a], See also Goff v. Ehrlich, 776 So. 2d 1011 (Fla. 5th DCA 2001) [26 Fla. L. Weekly D275a]. “Congress having thus specifically addressed the subject of private remedies, it is reasonable to assume that it said all that it intended on the subject.” Mostoufi v. Presto Food Stores, Inc., 618 So. 2d 1372 (Fla. 2d DCA 1993). This Court cannot read into Chapter 400, a private right of action or private right of enforcement that would allow Defendant to challenge the medical or clinical director of the Plaintiff. A private right of action or private right of enforcement under Fla. Stat. §400.9935 would clearly take regulation and enforcement power away from the Agency for Health Care Administration which would directly contradict the Legislative intent. The Florida Supreme Court has found that where there is “no evidence in the language of the statute or the statutory structure that a private cause of action” was contemplated, the legislature is deemed to have intended to exclude a private cause of action or challenge. Murthy v. N. Sinha Corp., 644 So. 2d 983, 986 (Fla. 1994), See also Moyant v. Beattie, 561 So. 2d 1319 (Fla. 4th DCA 1990). The Florida Supreme Court actually narrowed the test for a private right of enforcement. “Today. . .most courts generally look to the legislative intent of a statute to determine whether a private cause of action should be judicially inferred.” Murthy, 644 So.2d at 985.

Volusia County Courts, following the Florida Supreme Court and Fifth DCA opinions, have continuously ruled, that “[t]here is no private right of enforcement by insurance carriers under Fla. Stat. §400.900.” Tampa Chiropractic Center, Inc. v. Allstate Indemnity Co., 18 Fla. L. Weekly Supp. 84a (9th Jud. Cir., County Ct., September 17, 2010); “Defendant, PROGRESSIVE AUTO PRO INSURANCE COMPANY, cannot state a cause of action against FLORIDA MEDICAL ASSOCIATES for any perceived violation of the Health Care Clinic Act absent an independent determination by the Agency for Health Care Administration.” Florida Medical Associates v. Casillas, 13 Fla. L. Weekly Supp. 823b (7th Jud. Cir., County Ct., May 17, 2006). “The Health Care Clinic Act does not provide the insurance carrier with a private right of enforcement.” All Family Clinic of Daytona Beach, Inc. v. Progressive American Insurance Co., 13 Fla. L. Weekly Supp. 824b (7th Jud. Cir., County Ct., May 17, 2006). “Murthy precludes Peachtree from asserting alleged violations of the Act as the legislature did not place a private right of enforcement in the insurance carriers.” DNA Center for Neurology & Rehabilitation, as assignee of Tabitha Walker v. Peachtree Casualty Insurance Company, Case No. 2011-30363 COCI, Volusia County, May 23, 2011. In DNA Center, the Hon. Robert A. Sanders, Jr., rejected the insurer’s position and set forth that legislative intent and Florida law bars the insurer’s “challenge to the ownership of the medical facility or the compliance with the requirements found in the Health Care Clinic Act.” Id.

As briefly discussed above, even if Fla. Stat. §400.9935 included a private right of action, which it does not, the private right of action would follow the class that the Legislature intended to benefit, the consumer. The Defendant is clearly not a consumer and would never be a member of the class of individuals to be benefitted. “Where a statute, though penal in character, plainly imposes a duty for the benefit of a class of individuals, a right of action accrues to a person of such class injured through breach of the duty.” Rosenberg v. Ryder Leasing, Inc., 168 So. 2d 678 (Fla. 3rd DCA 1964) quoting Donaldson v. Tucson Gas, Elec. Light & Power Co., 14 F. Supp. 246, 247 (D.C. Ariz. 1935).

It is of utmost importance to note that in this matter Defendant did not challenge Plaintiff’s claim but found the claim compensable and paid Plaintiff 200% of Medicare Part B for the services rendered. Defendant relying upon Fla. Stat. §627.736(4)(b), argues that it is permitted to raise its Fla. Stat. §400.9935 affirmative defense now although Defendant never challenged Plaintiff’s claim prior to the affirmative defense being served. This Court disagrees with Defendant. Fla. Stat. §627.736(4)(b) does not permit Defendant to raise a Chapter 400 affirmative defense at anytime. “[A]n insurance company must either affirm coverage, or deny coverage, for each medical bill.” Glenn V. Quintana, D.C., P.A. v. State Farm Mutual Auto. Ins. Co., 19 Fla. L. Weekly Supp. 882a (11th Jud. Cir., County Ct., July 11, 2012). “The Court does not feel that when the legislature created 627.736(4)(b), that they intended for insurers to be able to retroactively deny previously paid bills, and so the Court finds in favor of the Plaintiff on this issue. Id. Consequently, in addition to having no authority under the Act to do so, Defendant cannot raise a Fla. Stat. §400.9935 affirmative defense in this action due to Defendant’s own actions in processing Plaintiff’s claim. As a result, Defendant is bared from raising a Fla. Stat. §400.9935 affirmative defense as (4)(b) does not permit a Fla. Stat. §400.9935 challenge anytime. Further, this Court has already ruled that once Defendant utilizes 200% of Medicare Part B, as Defendant has in the present matter, it will not be permitted to challenge the reasonableness of Plaintiff’s charge. See New Smyrna Imaging, LLC, a/a/o Alice Barney v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Marshall Barney v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Rachel Welch v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Billy Cooke v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Joshua Burkhead v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Luca Workman v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Giovanna Contreras v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Robert Sojka v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Curtis Campbell v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o David Soriana v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Michael Montanez v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o John Quantz v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Jason Gibbs v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Abdiel Medina v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Jennifer Gaitan v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Lori Galenski v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o William Wallace v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Myriah Chandler v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013); New Smyrna Imaging, LLC, a/a/o Lauren Purcell v. State Farm Mutual Automobile Ins. Co., No. 2012-21731-CONS (7th Jud. Cir., New Smyrna, April 17, 2013).

This Court is aware of the cases cited by Defendant, including Active Spine Centers, LLC v. State Farm Fire and Casualty Co., 911 So. 2d 241 (Fla. 3rd DCA 2005) [30 Fla. L. Weekly D2286a]; Allstate Insurance Company v. Vizcay, 2014 U.S. Dist. LEXIS 57212 (M.D. Fla. April 23, 2014); State Farm v. Silver Star Health and Rehab, Inc., 739 F. 3d 579 (11th Cir. Fla. 2013); GEICO General Ins. Co. v. United Health & Rehab Associates of Florida, Inc., Case No. 2011-CV-90 (9th Jud. Cir. Court June 13, 2013) [22 Fla. L. Weekly Supp. 39a]. The Court finds these cases distinguishable from the present matter and/or not binding on this Court. Volusia County Courts have relied upon the Florida Supreme Court and the Fifth DCA opinions of Murthy v. N. Sinha Corp., 644 So. 2d 983, 986 (Fla. 1994); Kaplan v. Peterson, 674 So. 2d 201 (Fla. 5th DCA 1996) [21 Fla. L. Weekly D1293a]; and Goff v. Ehrlich, 776 So. 2d 1011 (Fla. 5th DCA 2001) [26 Fla. L. Weekly D275a]. These opinions have not been overruled and continue to be good law today and therefore the Court finds in favor of the Plaintiff.CONCLUSION

The Court finds based on the facts of the case at hand and law governing same 1) Defendant has no private right of action or private right of enforcement in Chapter 400, The Health Care Clinic Act; 2) compliance with Chapter 400, The Health Care Clinic Act, is determined exclusively by the Florida Agency for Health Care Administration; 3) enforcement of Chapter 400, The Health Care Clinic Act rests with the Florida Agency for Health Care Administration; 4) Defendant is not a member of the class intended to be benefitted under Chapter 400, The Health Care Clinic Act; 5) the Florida Agency for Health Care Administration has found Plaintiff in compliance with Chapter 400, The Health Care Clinic Act; and 6) neither Defendant nor this Court has the authority to challenge the Florida Agency for Health Care Administration’s regulatory authority under Chapter 400, The Health Care Clinic Act. Therefore it is hereby,

ORDERED AND ADJUDGED that:

1. Plaintiff’s Motion for Rehearing of the Court’s July 23, 2014 Ruling Denying Plaintiff’s Motion to Strike Defendant’s Sixth Affirmative Defense is hereby GRANTED.

2. The Court’s Order executed on July 23, 2014 in this matter is hereby VACATED.

3. Plaintiff’s Motion to Strike Defendant’s Sixth Affirmative Defense is hereby GRANTED. Defendant’s Sixth Affirmative Defense, which alleges a Fla. Stat. §400.9935 compliance violation, is hereby stricken from the record with prejudice.