23 Fla. L. Weekly Supp. 264a
Online Reference: FLWSUPP 2303PAREInsurance — Personal injury protection — Coverage — Medical expenses — Deductible is to be applied to 100% of expenses and losses incurred
FLORIDA HOSPITAL MEDICAL CENTER, as assignee of Jonathan Parent, Plaintiff, v. PROGRESSIVE SELECT INSURANCE COMPANY, Defendant. County Court, 9th Judicial Circuit in and for Orange County. Case No. 2014-SC-7202-O. June 5, 2015. Honorable Andrew L. Cameron, Judge. Counsel: William England, Bradford Cederberg, P.A., Orlando, for Plaintiff. Whitney E. Dort, Orlando, for Defendant.
AFFIRMED. 24 Fla. L. Weekly Supp. 318a (Progressive Select Ins. Co. v. Florida Hospital Medical Center, Case No. 2015-CV-76-A-O, 6-14-2016)
Cert. review of circuit court opinion denied. Question certified. (On Rehearing and Motion to Certify) 43 Fla. L. Weekly D318a (Progressive Select Ins. Co. v. Florida Hospital Medical Center, Fla. 5DCA, Case No. 5D16-2333, 11/17/2017)
DCA OPINION APPROVED. 44 Fla. L. Weekly S59a (Progressive Select Ins. Co. v. Florida Hospital Medical Center, SC18-278, 12-28-2018)
ORDER GRANTING PLAINTIFF’S MOTIONFOR FINAL SUMMARY JUDGMENT ANDDENYING DEFENDANTS MOTION FORFINAL SUMMARY JUDGMENT
This matter having come before this Court on competing Motions for Final Summary Judgment based upon the application of the PIP deductible, and having reviewed the file, heard arguments of counsel and being otherwise fully advised in the premises, finds as follows:
UNDISPUTED FACTS
1. Plaintiff, Florida Hospital Medical Center, filed a personal injury protection lawsuit, as assignee of Jonathan Parent, against Defendant, Progressive Select insurance Company for medical bills arising from treatment rendered to Jonathan Parent, resulting from injuries sustained in an automobile accident.
2. At the time of the accident, Jonathan Parent was covered under an automobile insurance policy issued by Progressive Select Insurance Company, which provided No Fault coverage in the amount of $10,000.00.
3. In accordance with Section 627.739(2), Florida Statutes (2014), the subject policy of insurance offered its insured the option of selecting a policy deductible in the amount of $250.00, $500.00 or $1,000.00. Jonathan Parent elected a policy of insurance with a deductible of $1,000.00.
4. There was no medical payments coverage purchased
5. As a result of the subject motor vehicle accident, Jonathan Parent sought medical treatment from the Plaintiff.
6. On January 29, 2014, Plaintiff submitted a bill to Defendant for date of service January 17, 2014, in the amount of $2,781.00
7. This was the first bill received and therefore was subject to the $1,000.00 deductible elected, before the $10,000.00 in benefits became due and owing.
8. Upon review of the medical bill, Defendant determined that only $2,085.75 was compensable under the subject policy of insurance. Defendant calculated said reimbursement pursuant to 627.736(5)(a)(1), Florida Statutes (2014), and the subject policy, which limits reimbursement to 75% of the hospital’s usual and customary charges for emergency services and care.
9. Defendant applied the $1,000.00 deductible elected by Jonathan Parent to the compensable bills resulting in a payment of $868.60, which is 80% of the amount allowed after the application of the policy deductible ($2,781.00 x 75% = $2,085.75 – $1,000.00 = $1,085.75 x 80% = $868.60).
10. It is undisputed that Defendant properly endorsed its policy, including notice that it would be applying the fee schedules contained in Florida Statute 627.736(5)(a)(1) as the method for determining the reasonable charge.ISSUES PRESENTED
The sole issue in this matter is whether an insurer must apply 100% of expenses and losses toward an elected deductible as set forth in Fla. Stat. 627.739; or whether it is permitted to subject 100% of the expense to fee schedule before applying the deductible.POSITIONS OF THE PARTIES
Progressive argues that PIP benefits are applicable only to compensable bills and since it determined that only 75% of Florida Hospital’s charge was compensable under PIP, it was permitted to reduce Florida Hospital’s bill to 75% of its usual and customary charge, before applying the elected deductible. It cites General Star Indemnity v. West Florida Village Inn, Inc., 874 So.2d 26 (Fla. 2d DCA 2004) [29 Fla. L. Weekly D348a] for this premise.
Progressive also contends that the permissive fee schedule limitations, specifically 75% of a hospital’s usual and customary charge for emergency services and care in this case, apply both before and after Personal Injury Protection Benefits are reimbursed by the insurer.
Finally, Progressive argues that according to Florida Hospital’s interpretation of Section 627.739(2), the deductible applies to 100% of whatever amount a provider bills. Thus, an insurer would have to apply the deductible to 100% of its billed charges, irrespective of whether those billed charges were reasonable, related or medically necessary.
Florida Hospital asserts that Progressive is only permitted to apply the fee schedule to bills that fall under its policy. The patient’s elected deductible falls outside the PIP benefits for which Progressive contracted to provide, and as such is not subject to the fee schedule.
Florida Hospital further argues that the deductible must be applied to “100% of expenses and losses”. Only after the deductible is met, does the the fee schedule come into play. Florida Hospital cites the evolution of the deductible statute, from its wording in 2002, in which the deductible was applied to “the expenses otherwise due” (80% owed by PIP); to the challenges to the statute resolved by the Supreme Court of Florida in the cases of International Bankers Ins. Co. v. Govan, 521 So.2d 1086 (Fla. 1988) and International Bankers Ins. Co. v. Arnone, 552 So.2d 908 (Fla. 1989); the subsequent amendment of Fla. Stat. 627.739 in 2003 to include its current language, “must be applied to 100% of expenses and losses” and its reenactment in conjunction with the PIP statute in 2007.
Florida Hospital agrees that the treatment rendered for the loss must be reasonable in amount, related and medically necessary and the carrier has a multitude of tools available to assess the reasonableness, relatedness and medical necessity. These include denying the charge, requesting more information from the provider, conducting an IME or Peer review or sending a request pursuant to Fla. Stat. 627.736(6)(b).
CONCLUSIONS OF LAW
The Court first looks to the plain wording of Fla. Stat. Section 627.739:
“The deductible amount must be applied to 100 percent of the expenses and losses described in s. 627.736. After the deductible is met, each insured is eligible to receive up to $10,000.00 in total benefits described in s. 627.736(1).”
The Court finds this language to be clear. “Where the wording of the (No-Fault) law is clear and amenable to a logical and reasonable interpretation, a court is without power to diverge from the intent of the Legislature as expressed in the plain language of the statute.” Warren vs. State Farm Mutual Auto Ins. Co., 899 So.2d 1090, 1095 (Fla. 2005) [30 Fla. L. Weekly S197b].
In 2003, the deductible statute was amended to: a) eliminate $2,000.00 deductibles; b) create $10,000.00 in available benefits over and above an elected deductible; and c) change the calculation to be used when applying bills toward the deductible (from the 80% figure represented by “benefits otherwise due” to the 100% figure represented by “100% of expenses and losses”). All of these changes show a desire by the legislature to create greater benefits, have lower deductibles and most importantly, allow for the deductible to be satisfied in the most expedient manner for the benefit of the insured.
Although Progressive has the right to contract with its insured to reimburse the $10,000.00 benefits portion of its policy pursuant to a reimbursement limitation, that right does not extend to the deductible for which the insurer is not responsible and for which the insured is self-insured.
Until the deductible is satisfied, Progressive is not obligated to reimburse any bills. It is the insured who is responsible for the bills that fall under the deductible. When Progressive reduces Florida Hospital’s bill to 75% of its usual and customary charge, prior to applying the deductible, two things happen:
1) The insured becomes responsible for the difference between submitted charge and 75% of the hospital’s usual and customary charge (here, 25% of the billed amount, totaling $695.25). This is in addition to the $1,000.00 deductible for which the insured contracted to be responsible; and
2) Progressive pays $200.00 less of PIP benefits to Florida Hospital than is actually owed.
The deductible is to be applied to 100% of the expenses and losses incurred. Although the statute does not specifically include the word “reasonable” expenses, the Supreme Court of Florida made it clear in Geico General Ins. Co. v. Virtual Imaging Services, Inc. 141 So.3d 147 (Fla. 2012) [38 Fla. L. Weekly S517a] that payment of 80% of reasonable expenses is and always has been at the heart of the PIP statute. Providers are obligated to submit only reasonable expenses and likewise, carriers are obligated to reimburse only those reasonable expenses.
Progressive is free to challenge that the loss is not compensable, that is, that the loss is not one for which the policy is designed to cover. Progressive is likewise free to challenge that the medical services provided are not reasonable, related or medically necessary.
Here, Progressive accepted the charge as submitted. They did not assert that the charge was not compensable or that the treatment or charge was for unrelated, unreasonable or unnecessary treatment. Florida Hospital’s submission of their bill is prima facie evidence of a reasonable charge. A.J. v. State, 677 So.2d 935 (Fla. 4th DCA 1996) [21 Fla. L. Weekly D1677e].
IT IS HEREBY ORDERED AND ADJUDGED:
1. Plaintiff’s Motion for Final Summary Judgment is GRANTED.
2. Defendant’s Motion for Final Summary Judgment is DENIED.
3. Plaintiff shall recover from Progressive the sum of $200.00 in benefits and accrued interest at the rate of 4.75%, for which sum let execution issue.
4. Plaintiff is entitled to recovery of its reasonable attorneys’ fees and costs.
5. The Court reserves jurisdiction to determine the amount of attorneys’ fees and costs to Plaintiff pursuant to Fla. Stat. §§627.736, 627.428 and 57.041.
