24 Fla. L. Weekly Supp. 618a
Online Reference: FLWSUPP 2408RIZZInsurance — Personal injury protection — Coverage — Medical expenses — PIP policy providing that insurer will calculate reimbursement pursuant to permissive statutory fee schedule, but also reserving insurer’s right to determine whether charge is reasonable, commingles statutory payment methodologies and does not provide clear and unambiguous notice of intent to limit reimbursement to permissive statutory fee schedule — Neither approval of PIP policy by Office of Insurance Regulation nor use of OIR sample language in policy constitutes per se compliance with requirement that policy provide unambiguous notice of intent to limit reimbursement to permissive statutory fee schedule
NEUROLOGY PARTNERS D/B/A EMAS SPINE & BRAIN SPECIALISTS a/a/o Lauren Rizzi, 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-1816-MA Section (CC-J). April 12, 2016. Eleni Derke, Judge. Counsel: Adam Saben, Shuster & Saben, Jacksonville, for Plaintiff. David Gagnon, Taylor, Day Grimm & Boyd, Jacksonville, for Defendant.
ORDER DENYING DEFENDANT’S MOTION FORSUMMARY JUDGMENT and GRANTING PLAINTIFF’SMOTION FOR SUMMARY JUDGMENT
THIS MATTER comes before this Court for hearing on April 5, 2016 on Plaintiff’s and Defendant’s Cross-Motions for Summary Judgment as to whether State Farm properly elected the permissive payment methodology of F.S. 627.736(5)(a)1 in the language of Policy Form 9810A. Having reviewed the file and heard argument of counsel, the Court finds as follows:
In Theramed, LLC d/b/a-Theramed a/a/o Petrine Stanley v. State Farm, case number 16-2015-SC-4069-MA (CC-J) [23 Fla. L. Weekly Supp. 1038a], this Court ruled that the Defendant failed to make a “clear and unambiguous” election in its 9810A policy language regarding the methodology to calculate reimbursements on PIP claims as mandated by the Florida Supreme Court in Geico v. Virtual Imaging Services, 141 So.3d 147 (2013) [38 Fla. L. Weekly S517a]. By, essentially, tracking the Office of Insurance Regulation (“OIR”) Sample Fee Schedule Endorsement, the Defendant attempted to comply with F.S. 627.736(5)(a)5 in providing notice of an intent to calculate PIP reimbursements pursuant to the “permissive” methodology. However, State Farm also reserved the right to determine whether a submitted charge is “reasonable” in its definition of “Reasonable Charge” by employing the factors contained in the “default” payment methodology. This commingling of payment methodologies is incongruous with the holding of Virtual, which requires that the language of a PIP insurance policy makes a “clear and unambiguous” election of the methodology to calculate PIP reimbursements. Under the “permissive” payment paradigm, the reasonableness of a submitted charge is irrelevant because all charges shall be reduced pursuant to application of a fee schedule. Therefore, reserving the right to employ the “reasonableness” factors constitutes a straddling of both methodologies and a failure to make a “clear and unambiguous” election, as required by Virtual.
The Defendant presents Allstate Indemnity Company v. Markley Chiropractic & Acupuncture, LLC a/a/o Ilene Chavez, Case No.: 2D14-3818 (Fla. 2d DCA Opinion of March 30, 2016) [41 Fla. L. Weekly D793b] wherein the Second District Court of Appeal found that the Allstate policy language under review by the Court constituted sufficient notice of an election to comply with Virtual. This ruling is in accord with the First District Court of Appeal in Allstate Fire and Casualty Insurance v. Stand-Up MRI of Tallahassee a/a/o Charles Black, 40 Fla L. Weekly D693 (Fla. 1st DCA Opinion of March 18, 2015), wherein a simple statement regarding payable amounts “shall be subject to any and all limitations, authorized by section 627.736. . . including, but not limited to, all fee schedules” was sufficient to place the insured on proper notice that Allstate was going to pay pursuant to the “permissive” payment methodology. Relying on Stand-Up, this Court found in Theramed that State Farm’s 9810A policy goes further than the language in the Allstate policy; incorporating a definition of “Reasonable Charge” that tracks the language of the “default” payment methodology factors. Therefore, this Court’s ruling is again in accord with Stand-Up, and Markley. Also see, Neurology Partners, P.A. d/b/a Emas Spine & Brain a/a/o Dawn Beals v. State Farm Mutual Automobile Insurance Company, 23 Fla. L. Weekly Supp. 833a (Order of Duval County Court Judge Brent Shore dated December 3, 2015); Neurology Partners, P.A. d/b/a Emas Spine & Brain a/a/o Willie Brown v. State Farm Mutual Automobile Insurance Company, 23 Fla. L. Weekly Supp. 550a (Order of Duval County Court Judge Scott Mitchell dated July 29, 2015); and, First Coast Medical Center a/a/o Kevin Adams v. State Farm Mutual Automobile Insurance Company, (Duval County Court case number 16-2014-SC-3619, Order of Duval County Court Judge Dawn Hudson dated January 15, 2016) [23 Fla. L. Weekly Supp. 943a] (All relying on Stand-Up in finding that State Farm’s 9810A policy does not comply with Virtual).
Next, the Defendant states that its 9810A policy was “approved” by the Office of Insurance Regulation (“OIR”) on October 5, 2012. According to the Defendant, this approval is an imprimatur by the OIR that the State Farm policy properly elected and noticed the insured of its intent to reimburse solely via the permissive payment methodology. This Court disagrees. While a Court must give deference to a regulatory agency in interpreting statutes that the agency is charged with implementing, here, the Defendant asks the Court to infer that the OIR’s “approval” constitutes a finding of a proper election. The Defendant presents no authority showing that the OIR found the 9810A policy, when read as a whole, made a “clear and unambiguous” election to reimburse pursuant to the “permissive” payment methodology. There is no showing that State Farm asked the OIR to make such a determination. There is merely a finding that the 9810A policy was “approved” as a policy that State Farm is allowed to put into the marketplace to insure Floridians.
The Defendant states that it relied on plain reading F.S. 627.736(5)(a)5 wherein the statute states that incorporating the OIR form shall constitute the requisite notice of reliance on the “permissive” payment methodology. However, incorporating the OIR form into an insurance policy does not, in and of itself, constitute notice unless there is a clear and unambiguous election when the policy is read as a whole. See, MR Services I, Inc. a/a/o Chris Hazlett v. Allstate Fire & Casualty Company, (Order of Broward County Court Judge Robert Lee, Case No.: 13-19191 COCE (53) [23 Fla. L. Weekly Supp. 776a], dated November 24, 2015). Further, the Plaintiff presents Pain and Injury Relief of Lake Worth a/a/o Evener Deronvil v. State Farm Fire & Casualty Company, (Broward County Court Case No.: 15-2819-COCE (53), Order of Broward County Court Judge Robert Lee, dated March 30, 2016) [23 Fla. L. Weekly Supp. 1087a], wherein Judge Lee rejects the same argument regarding “OIR approval”, relying, in part, on this Court’s order in Theramed. Therefore, this Court’s sees no reason to change position from its ruling in Theramed.
The Defendant’s Motion for Summary Judgment is DENIED and the Plaintiff’s Motion for Summary Judgment is GRANTED.
