23 Fla. L. Weekly Supp. 653a
Online Reference: FLWSUPP 2306DOWAInsurance — Personal injury protection — Coverage — Medical expenses — MRI — Usual and customary charges — Where policy required reimbursement of 80% of reasonable expenses, insurer erred in reducing claim based on usual and customary charges “in the community” and subsequently paying 80% of the reduced amount — Language referencing usual and customary charges in the community is only located within statutory fee schedule, and policy did not unambiguously give notice of insurer’s election to use statutory fee schedules — Under circumstances, reasonableness of charges is no longer at issue, and provider’s bill represents prima facie evidence of reasonable expense
NEW SMYRNA IMAGING, LLC, as assignee of Jennifer Dowall, Plaintiff, v. SOUTHERN-OWNERS INSURANCE COMPANY, Defendant. County Court, 18th Judicial Circuit in and for Seminole County. Case No. 2012-SC-1223. September 23, 2015. Frederic M. Schott, Judge. Counsel: David B. Alexander, for Plaintiff. Bret Dubbert, for Defendant.
ORDER
THIS MATTER having come before this Honorable Court on Defendant’s Amended Motion to Compel Better responses to Defendant’s First Request for Admissions and Defendant’s Second Request to Produce and this Honorable Court having heard arguments of counsel on August 31, 2015 and being otherwise fully advised in the premises, it is hereby,
ORDERED AND ADJUDGED that:
1. On January 10, 2012, Defendant’s insured, Ms. Jennifer Dowall (herein after “Ms. Dowall”), was injured in a motor vehicle accident. As a result of the accident, Ms. Dowall sought medical services in the form of an MRI from Plaintiff on February 9, 2012.
2. Following said medical services provided by Plaintiff to Ms. Dowall, Plaintiff issued a CMS-1500 bill to Defendant. The bill contained a $1,695.00 charge for CPT code 72148 (MRI of Lumbar). Defendant’s policy requires reimbursement of 80% of “reasonable expenses” pursuant to Personal Injury Protection coverage under the subject policy. Rather than paying 80% of Plaintiff’s $1,695.00 billed charge, Defendant reduced Plaintiff’s bill by $40.05 and paid Plaintiff 80% of the reduced amount of $1,654.95, rather than paying Plaintiff 80% of $1,695.00.
3. Pursuant to the deposition testimony of Defendant’s representative Linda Lapp, Defendant utilized a third party bill review company to reduce Plaintiff’s bill. Pursuant to the deposition testimony of Linda Lapp and the “Re-Evaluation” Explanation of Review. Defendant, through the third party company, attempted to utilize the “usual and customary charges in the community” to arrive at the “Allowed” amount. The “Re-Evaluation” Explanation of Review specifically states “[r]eimbursement amount based on U&C allowance.” Further, Defendant has admitted that Defendant’s policy of insurance at issue fails to elect “the schedule of maximum charges” set forth within Fla. Stat. 627.736(5)(a)2. (2008-2011).
IT IS HEREBY ORDERED AND ADJUDGED:
4. Since Defendant admittedly failed to elect “the schedule of maximum charges” within the subject contract, Defendant was not permitted to attempt to utilize the permissive “usual and customary charges in the community” to calculate reimbursement. The language “usual and customary charges in the community” is only located within “the schedule of maximum charges” set forth in Fla. Stat. 627.736(5)(a)2.c. (2008-2011). An insurer may only utilize the permissive “usual and customary charges in the community” if, and only if, the contract unambiguously gives notice of its election to utilize “the schedule of maximum charges” pursuant to Fla. Stat. 627.736(5)(a)2. (2008-2011). See GEICO Ins. Co. v. Virtual Imaging Services, Inc., 141 So. 3d 147 (Fla. 2013) [38 Fla. L. Weekly S517a]. Based upon Defendant’s utilization of “the usual and customary amount in the community” without unambiguously electing “the schedule of maximum charges” set forth in Fla. Stat. 627.736(5)(a)2. (2008-2011), Defendant breached the policy of insurance as soon as Defendant processed Plaintiff’s bill pursuant to a “fee schedule” that was not properly elected within the contract.
5. This Court finds that the reasonableness of a medical provider’s charge or charges is only at issue in PIP litigation when the subject insurer utilizes the fact-dependent methodology as set forth in Fla. Stat. 627.736(5)(a)1. (2008-2011). Indeed, the Florida Senate’s Bill And Fiscal Impact Statement for CS/SB 40-C, which became the amendments to Florida Statutes Section 627.736(5) in 2008, indicated that the statutory amendments were “designed to reduce costs and eliminate litigation regarding what is a ‘reasonable’ charge.” Florida Senate’s Bill And Fiscal Impact Statement for CS/SB 40-C, Part V(B).
6. In the present matter, it is clear that the Defendant utilized “the schedule of maximum charges” payment methodology of Fla. Stat. 627.736(5)(a)2. (2008-2011). An insurer may only elect to utilize one of the two distinct and mutually exclusive reimbursement methodologies under the PIP Statute. Virtual Imaging, supra.
7. Due to the fact that Defendant in this case chose not to employ the “reasonableness” method to calculate reimbursement, it cannot switch boats midstream. The reasonableness of the Plaintiff’s charge is not at issue in this case. Once the Defendant processed and reimbursed Plaintiff’s bill under Fla. Stat. 627.736(5)(a)2. (2008-2011), it unilaterally determined reasonableness, and so it cannot fall back on Fla. Stat. 627.736(5)(a)1. (2008-2011) to challenge the reasonableness of the bill. The Plaintiff’s bill is in the record and represents prima facie evidence of a reasonable expense pursuant to Fla. Stat. 627.736(1)(a). See A.J. v. State, 677 So. 2d 935 (Fla. 4th DCA 1996) [21 Fla. L. Weekly D1677e]; see also Pan Am Diagnostic Svcs. a/a/o Fritz Telusma v. United Auto. Ins. Co., 21 Fla. L. Weekly Supp. 200a (Fla. 17th Jud. Cir., Broward County ourt, Court, October 1, 2013). Defendant has waived, via its own actions in this claim, its ability to challenge said prima facie evidence. Virtual Imaging, supra.
8. Defendant’s Amended Motion to Compel Better responses to Defendant’s First Request for Admissions and Defendant’s Second Request to Produce is DENIED.
