24 Fla. L. Weekly Supp. 619b
Online Reference: FLWSUPP 2408RENEInsurance — Personal injury protection — Coverage — Medical expenses — Approval of PIP policy by Office of Insurance Regulation does not constitute de facto proper election to limit reimbursement to permissive statutory fee schedule — PIP policy providing that insurer will pay 80% of reasonable charges, but also providing that in no event will insurer pay more than 80% of No-Fault Act schedule of maximum charges, does not provide clear and unambiguous notice of intent to limit reimbursement to permissive statutory fee schedule
ARGYLE CHIROPRACTIC CENTER a/a/o Nina Renella, Plaintiff, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY (“STATE FARM”), Defendant. County Court, 4th Judicial Circuit in and for Duval County. Case No. 16-2015-SC-157 MA(CC-M). April 20, 2016. Mose Floyd, Judge. Counsel: Adam Saben, Shuster & Saben, Jacksonville, for Plaintiff. David Gagnon, Taylor, Day, Grimm & Boyd, Jacksonville, for Defendant.
ORDER DENYING DEFENDANT’S MOTIONAND GRANTING PLAINTIFF’S COUNTERMOTIONFOR SUMMARY JUDGMENT
THIS CAUSE came to be heard at the March 29, 2016 hearing on the Defendant’s Motion for Summary Judgment and the Plaintiff’s Countermotion for Summary Judgment and having reviewed the case law provided, heard argument of counsel, and being otherwise fully advised of the premises herein, the Court makes the following findings and rulings:
1. Florida Statute (F.S.) 627.736(5)(2013) authorizes two payment methodologies for an automobile insurance carrier. First, the carrier can opt for either a fact-dependent methodology based upon various factors such as those enumerated in (5)(a), or, second, it can elect to use the permissive payment methodology by applying the schedule of maximum charges to the charge submitted pursuant to section 5(a)1.
2. The Florida Supreme Court in GEICO General Insurance Company vs. Virtual Imaging Services, Inc., 141 So.3d 147 (Fla. 2013) [38 Fla. L. Weekly S517a] held that if the second methodology is elected, the insurer must clearly and unambiguously elect the permissive payment methodology in order to rely upon it.
3. The Defendant asserts that language contained in the 9810A policy covering treatment provided to the patient treated by the Plaintiff in this case placed the insured on proper notice of its clear and unambiguous election to reimburse PIP benefits pursuant to F.S. 627.736(5)(a)1.
4. The Plaintiff disagrees and argues that the language contained in the policy issued to the insured by the Defendant, when read as a whole, does not contain language which constitutes a clear and unambiguous election as to whether PIP reimbursements would be made based upon F.S. 627.736(5)(a) or 627.736(5)(a)1.
5. PIP benefits, when reimbursed based upon the payment methodology contained in F.S. 627.736(5)(a)1, do not involve any analysis regarding reasonableness; instead it is based upon fee schedules. In identifying State Farm’s clear and unambiguous election of (5)(a)(1), the Defendant points to the following paragraph contained on page 16 of State Farm’s 9810A policy, which reads as follows:
“We will limit payment of Medical Expenses described in Insuring Agreement of this policy’s No Fault Coverage to 80% of a properly billed and documented reasonable charge, but in no event will we pay more than 80% following No-Fault Act “schedule of maximum charges” including the use of Medicare coding policies and payment methodologies of the Federal Centers for Medicare and Medicaid Services. . .”
6. The Plaintiff concedes that State Farm attempts to track the language contained in the Office of Insurance Regulation’s Sample Fee Schedule Endorsement, which Plaintiff states, in a vacuum, would constitute a clear an unambiguous election. However, Plaintiff argues that State Farm then comingles language in (5)(a) when it defines “reasonable charge” by including the factors in the fact-dependent methodology of 5(a). The definition of “reasonable charge” on page 5 of policy 9810A reads as follows:
“Reasonable Charge which includes reasonable expense, means an amount determined by us to be reasonable in accordance with the No-Fault Act, considering one or more of the following:
1. usual and customary charges;
2. payments accepted by the provider;
3. reimbursement levels in the community;
4. various federal and state medical fee schedules applicable to motor vehicle and other insurance coverages;
5. the schedule of maximum charges in the No-Fault Act;
6. other information relevant to the reasonableness of the charge for the service, treatment, or supply; or
7. Medicare coding policies and payment methodologies of the federal Centers for Medicare and Medicaid Services, including applicable modifiers, if the coding policy or payment methodology does not constitute a utilization limit.”
7. It is a well-settled principle that ambiguity in the language of the insurance policy will be construed liberally in favor of the insured (or the medical provider who steps into the shoes of the insured by virtue of an assignment) and strictly against the insurer. This Court finds that by incorporating fee schedule payment methodology language from (5)(a)1 and by reference to “reasonable charge” payment methodology language from (5)(a), State Farm commingles both payment methodologies, thereby running afoul of the Supreme Court’s ruling in the Virtual case.
8. The Defendant also argues that the Office of Insurance Regulation’s (OIR) prior approval of its 9810A policy constituted a determination that the policy’s “election language” constituted a clear and unambiguous election. This Court does not reach the same conclusion on this matter. The OIR’s approval of the policy does not take a specific position on whether State Farm made a clear and unambiguous election, which is the issue before this Court. In fact, the OIR Informational Memorandum contains a disclaimer on the Sample Fee Schedule Endorsement, which states in part that:
“Depending upon the existing language, the same language may be suitable to address the notice requirement of House Bill 119 or the insurer may already have approved language that satisfies the notice requirement. Ultimately, it is insurer’s responsibility to develop its own language after researching the law, reviewing its contract forms, and conferring with its legal staff.”
Therefore, based on the OIR’s own directive, mere approval of the policy form does not rise to a de facto proper election of the permissive payment methodology.
This Court finds that the language contained in Defendant’s policy form 9810A does not make a clear and unambiguous election to pay pursuant the permissive payment methodology contained in Florida Statute 627.736(5)(a)1. Therefore the Defendant’s Motion for Summary Judgment is respectfully Denied and the Plaintiff’s Motion for Summary Judgment is Granted.
