23 Fla. L. Weekly Supp. 772a
Online Reference: FLWSUPP 2307TLEWInsurance — Personal injury protection — Coverage — Medical expenses — PIP policy that subjects payments to applicable fee schedules and states that methodology for determining amount insurer will pay shall be limited to 80% of 200% of Medicare Part B fee schedule or to 80% of maximum reimbursable allowance under workers’ compensation if item is not reimbursable under Medicare Part B clearly and unambiguously elects to limit reimbursement to permissive statutory fee schedule
SOUTHSIDE CHIROPRACTIC CENTER, INC. (a/a/o Travis Lewis), Plaintiff, vs. PERMANENT GENERAL ASSURANCE CORPORATION, Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. 14-006951 COCE (55). November 4, 2015. Honorable Daniel J. Kanner, Judge. Counsel: Chris Tadros, Law Office of Chris Tadros, P.A., Ft. Lauderdale, for Plaintiff. Frantz Nelson, Vernis & Bowling of Broward, P.A., Hollywood, for Defendant.
ORDER GRANTING DEFENDANT’S MOTIONFOR PARTIAL SUMMARY JUDGMENT AS TO THEPROPER APPLICATION OF THE PERMISSIVE FEESCHEDULE PURSUANT TO FLA. STAT.§ 627.736(5)(a)(2)(f) AND DENYING PLAINTIFF’SCROSS-MOTION FOR SUMMARY JUDGMENT AS TOTHE PROPER APPLICATION OF THE PERMISSIVE FEESCHEDULE PURSUANT TO FLORIDA STATUTE § 627.736
THIS CAUSE having come to be considered before the Court on Defendant’s Motion for Partial Summary Judgment as to the Proper Application of the Permissive Fee Schedule Pursuant to Fla. Stat. § 627.736(5)(a)(2)(f) and Plaintiff’s Cross-Motion for Summary Judgment as to the Proper Application of the Permissive Fee Schedule Pursuant to Florida Statute § 627.736, and the Court having reviewed the Motions, the entire Court file, and the relevant legal authorities, having heard arguments, having made a thorough review of the matters filed of record, and having been sufficiently advised in the premises; it is hereby ORDERED AND ADJUDGED as follows:Background
This issue arose from a suit for personal injury protection (“PIP”) benefits, arising out of a motor vehicle accident that occurred on or about November 16, 2013 involving Travis Lewis The Defendant, Permanent General Assurance Corporation, issued a policy of insurance to Adriana Valencia as its named insured. The policy provided for $10,000.00 in personal injury protection benefits. There was no medical payments coverage available. The policy had three applicable endorsements: (1) PA 039-611-FL; (2) PA 001-0110-FL; and (3) PA 033-0113-FL. The Plaintiff provided medical treatment and services to Mr. Lewis for injuries sustained in the aforementioned motor vehicle accident. Portions of the Plaintiff provider’s charges were reduced to an allowed amount which corresponded with the permissive fee schedule reimbursement set forth in Florida Statute § 627.736(5)(a)(2)(f). In applying the permissive fee schedule, the Defendant relied upon the PA 033-0113-FL endorsement which states as follows:
SECTION 4 — PERSONAL INJURY PROTECTION BENEFITS
INSURING AGREEMENT. The entire Insuring Agreement Section is deleted and replaced with the following:
INSURING AGREEMENT. In accordance with the Florida Motor Vehicle No-Fault Law, “we” will pay for 80% of “medical expenses” subject to the applicable fee schedule, pursuant to Florida Statutes, to or on behalf of an “injured person” the following benefits subject to the limits of liability. The coverage provided may be subject to a deductible or other modifications as shown on the “declarations page”. Payments will be made only when “bodily injury” is caused by an accident arising from the ownership, maintenance or use of a “motor vehicle”.
DEFINITIONS APPLICABLE TO THIS SECTION ONLY. The following definitions are replaced:
B. “Medical expenses” means properly billed and lawfully rendered reasonable charges, limited to the Medical Expense Limitations Schedule set forth in Section 627.736(5)(a), Florida Statutes, as amended, and subject to the Limitations of Liability in this “PIP” (or any lower amount set forth in any other fee schedule or limitation which may be enacted, amended or otherwise set forth in Florida law), for “medically necessary” medical, surgical, X-ray, dental, and rehabilitative services, including prosthetic devices and “medically necessary” ambulance, hospital and nursing services. “Medical expenses” do not include any charge for massage as defined in Section 480.033, Florida Statutes, or acupuncture, as defined in Section 457.102, Florida Statutes, regardless of the person, entity or licensee providing the massage or acupuncture.
BENEFITS. — The entire Benefits Section is deleted and replaced with the following:
In accordance with the Florida Motor Vehicle No-Fault Law, “we” will pay to or on behalf of the “injured person” the following benefits. Payments will be made only when “bodily injury” is caused by an accident arising from the ownership, maintenance or use of a “motor vehicle”.
A. “Medical Expenses” — Pursuant to the requirements of Section 627.736(1)(a) of the Florida Statutes: eighty percent of reasonable expenses; for medical, surgical, X-ray, dental, and rehabilitative services, including prosthetic devices, and ambulance, hospital and nursing services; which are “medically necessary” ‘ only if the “injured person” receives initial services and care within 14 days after the “motor vehicle” accident. The methodology for determining the amount “we” will pay for such expenses shall, pursuant to the fee schedule limitations under Section 627.736(5)(a), of the Florida Statutes, or any other limitations established by Section 627.736, of the Florida Statutes, or any other provisions of the Florida Motor Vehicle No-Fault Law, as enacted, amended or otherwise continued in the law, be limited to eighty percent of the following schedule of maximum charges (or any other fee schedule limitation which may be enacted, amended or otherwise continued in the law):
6. for all other medical services, supplies and care, 200 percent of the allowable amount under:
a. the participating physicians fee schedule of Medicare Part B, except as provided in subparagraphs b. and c. below.
b. Medicare Part B, in the case of services, supplies and care provided by ambulatory, surgical centers and clinical laboratories.
c. the Durable Medical Equipment Prosthetics/Orthotics and Supplies fee schedule of Medicare Part B, in the case of durable medical equipment.
If a provider submits a charge for an amount less than the amount determined by the fee schedule or other limitations established by Section 627.736 of the Florida Statutes, or any provisions of the Florida Motor Vehicle No-Fault Law as described above, “we” will pay eighty percent of the charge that was submitted.
However, if such services, supplies or care is not reimbursable under Medicare Part B, as provided above, “we” will limited reimbursement to 80 percent of the maximum reimbursable allowance under worker’s compensation, as determined under Section 440.13 of the Florida Statutes, and rules adopted thereunder which are in effect at the time such services, supplies or care is provided. Services, supplies or care that is not reimbursable under Medicare or worker’s compensation will not be reimbursed by “us”.
The applicable fee schedule or payment limitation under Medicare is the fee schedule or payment limitation in effect on March 1 of the year in which the services, supplies or care is rendered and for the area in which such services, supplies or care is rendered. The applicable fee schedule or payment limitation applies throughout the remainder of that year, notwithstanding any subsequent change made to the fee schedule or payment limitation, except that it may not be less than the allowable amount under the applicable fee schedule for Medicare Part B for 2007 for medical services, supplies and care subject to Medicare Part B.
The Plaintiff filed the instant action, in part challenging the fee schedule reductions implemented by the Defendant. On September 11, 2014, the Defendant filed its Motion for Partial Summary Judgment as to the Proper Application of the Permissive Fee Schedule Pursuant to Fla. Stat. § 627.736(5)(a)(2)(f). On September 23, 2014, Plaintiff filed its Cross-Motion for Summary Judgment as to the Proper Application of the Permissive Fee Schedule Pursuant to Florida Statute § 627.736. Both matters were heard by the Court on October 15, 2015.Analysis
Pursuant to Fla. R. Civ. P. 1.510(c), summary judgment is warranted “if the pleadings, and summary judgment evidence on file show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Fla. R. Civ. P. 1.510(c). This matter is ripe for summary judgment consideration, as there are no genuine issues of material fact. It is left to the Court to view the policy language at issue, and determine whether it is sufficient to permit the Defendant to apply the permissive fee schedule methodology contemplated by subsection (5)(a)(2)(f) of the no-fault statute.
Under Fla. Stat. § 627.736, an insurer may “choose between two different payment calculation methodology options.” Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So.3d 63, 67 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D1062a] review denied Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 86 So.3d 1113 (Fla. Mar 16, 2012). The insurer may either pay reasonable medical expenses as provided in subsection (5)(a)(1), or the insurer may limit reimbursement according to the parameters of subsection (5)(a)(2). The latter subsection provides the following relevant language:
2. The insurer may limit reimbursement to 80 percent of the following schedule of maximum charges:
. . . .
f. For all other medical services, supplies, and care, 200 percent of the allowable amount under the participating physicians schedule of Medicare Part B. However, if such services, supplies, or care is not reimbursable under Medicare Part B, the insurer may limit reimbursement to 80 percent of the maximum reimbursable allowance under worker’s compensation, as determined under s. 440.13 and rules adopted thereunder which are in effect at the time such services, supplies, or care is provided. Services, supplies, or care that is not reimbursable under Medicare or workers’ compensation is not required to be reimbursed by the insurer.
Fla. Stat. § 627.736(5)(a)(2)(f) (emphasis added). Thus, under section 627.736(5)(a)(2)(f), if services are not “reimbursable” under Medicare Part B, they may be reimbursed under the workers’ compensation schedule. The issue to be decided is whether Permanent General properly applied the permissive fee schedule set forth in Fla. Stat. § 627.736(5)(a)2.f.
In Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So.3d 63 (Fla. 4th DCA, 2011) [36 Fla. L. Weekly D1062a], a PIP suit was filed against the insurer for payment of chiropractic bills for treatment of the insured at 80% of 200% of the Medicare Part B fee schedule. The County Court granted summary judgment for the chiropractor’s office, and certified the issue as one of great public importance. On appeal, the 4th District Court held that statute allowing an insurer to limit reimbursement according to federal and state medical fee schedules did not allow an insurer whose policy did not mention the limitation to limit its reimbursement. The policy of insurance for Kingsway Amigo contained applicable language as follows:
The Company will pay in accordance with the Florida Motor Vehicle No Fault Law, as amended, to or for the benefit of the injured person:
1. 80% of medical expenses;
. . . . .
Medical expenses means those expenses that are required to be reimbursed pursuant to Florida Motor Vehicle No Fault Law, as amended, and that are reasonable expenses for medically necessary . . . services.
Subsequent to the 4th DCA’s ruling, the very same issue was examined by the 3rd district court of appeals in the case of Geico Indem. Co. v. Virtual Imaging Services, Inc., 79 So.3d 55 (Fla 3rd DCA, 2011) [36 Fla. L. Weekly D2597a] (hereinafter “Virtual Imaging I”). The holding of the 3rd DCA in Virtual Imaging I was essentially identical to that of the 4th DCA in Kingsway Amigo. The Court stated as follows:
“A policy indicating that an insurer may distribute reimbursements according to one method without clarifying alternative methods or identifying the factors to be considered in selecting among methods is ambiguous. Ambiguities in insurance contracts are resolved in favor of the insured. See, e.g., State Farm Mutual Auto. Ins. Co. v. Menendez, 70 So.3d 566, 570 (Fla.2011) [36 Fla. L. Weekly S469a]. Therefore, even if Geico were correct that section 627.736(5)(a)(2) is incorporated into the policies, the resulting ambiguity regarding which method Geico would use in determining a reimbursement amount supports the conclusion that Geico should have reimbursed Virtual Imaging for the greatest amount possible within the language of the policies.”
The applicable policy language in Virtual Imaging I “the Company [Geico] will pay . . . 80% of medical expenses,” defining “medical expenses” as “reasonable expenses for necessary medical, surgical, [and] X-ray . . . services.”
The decision was later validated by both the third district Court of appeals as well as the Florida Supreme Court. In Geico Gen. Ins. Co. v. Virtual Imaging Services, Inc., 90 So.3d 321 (Fla. 3d DCA 2012) [37 Fla. L. Weekly D985b](hereinafter “Virtual Imaging II”), an MRI provider filed a PIP suit for outstanding balances due and owing in the County Court in Miami-Dade County. The County Court entered summary judgment in favor of the provider. In so doing, the county court certified the following question Fla. Stat. § 34.017 (2011):
MAY AN INSURER LIMIT PROVIDER REIMBURSEMENT TO 80% OF THE SCHEDULE OF MAXIMUM CHARGES DESCRIBED IN F.S. 627.736(5)(a) IF ITS POLICY DOES NOT MAKE A SPECIFIC ELECTION TO DO SO?
On appeal, the 3rd DCA in Virtual Imaging II essentially affirmed the lower court ruling, and in so doing, adopted its prior reasoning from Virtual Imaging I, and certified the issue as a question of great public importance pursuant to Florida Rule of Appellate Procedure 9.030(a)(2)(A)(v). The certified question was stated as follows:
WITH RESPECT TO PIP POLICIES ISSUED AFTER JANUARY 1, 2008, MAY THE INSURER COMPUTE PROVIDER REIMBURSEMENTS BASED ON THE FEE SCHEDULES IDENTIFIED IN SECTION 627.736(5)(a), FLORIDA STATUTES, EVEN IF THE POLICY DOES NOT CONTAIN A PROVISION SPECIFICALLY ELECTING THOSE SCHEDULES RATHER THAN “REASONABLE MEDICAL EXPENSES” COVERAGE BASED ON SECTION 627.736(1)(a)?
This certified question was ultimately addressed by the Florida Supreme Court in Geico Gen. Ins. Co. v. Virtual Imaging Services, Inc., 141 So.3d 147 (Fla. 2013) [38 Fla. L. Weekly S517a](hereinafter “Virtual Imaging III”). The Supreme Court in Virtual Imaging III held that insurer was required to give notice to its insured before using the Medicare fee schedules to limit reimbursements for medical services. “. . .we hold that under the 2008 amendments to the PIP statute, a PIP insurer cannot take advantage of the Medicare fee schedules to limit reimbursements without notifying its insured by electing those fee schedules in its policy.” Id.Opinion
In the instant case, Plaintiff argues that the policy endorsement form 033-0113-FL is ambiguous, citing to the language which states “ ‘we’ will pay for 80% of ‘medical expenses’ subject to the applicable fee schedule, pursuant to Florida Statutes, to or on behalf of the ‘injured person.‘ ” Plaintiff argues that the policy language is ambiguous, presenting many possible payment methodologies, many of which run contrary to one another.
The language of an insurance policy is ambiguous only when it is susceptible to more than one interpretation. See State Farm Fire & Cas. Co. v. Metropolitan Dade County, 639 So.2d 63, 65 (Fla. 3d DCA 1994). Ambiguous policy provisions are interpreted liberally in favor of the insured and strictly against the drafter who prepared the policy. Auto-Owners Ins. Co. v. Anderson, 756 So.2d 29, 34 (Fla.2000) [25 Fla. L. Weekly S211a]. However, “the rule of liberal construction in favor of the insured applies only when a genuine inconsistency, uncertainty, or ambiguity in meaning remains after resort to the ordinary rules of construction,” and the fact that a policy fails to define an operative term does not, by itself, create an ambiguity. See Gen. Star Indem. Co. v. W. Fla. Vill. Inn, Inc., 874 So,2d 26, 30 (Fla. 2d DCA 2004) [29 Fla. L. Weekly D348a]. Insurance contracts, like other contracts, “should receive a construction that is reasonable, practical, sensible, and just.” Id. at 29.
The policy endorsement form specifically states in pertinent part:
The methodology for determining the amount “we” will pay for such expenses shall . . . be limited to eighty percent of the following schedule of maximum charges (or any other fee schedule limitation which may be enacted, amended or otherwise continued in the law):
6. for all other medical services, supplies and care, 200 percent of the allowable amount under:
a. the participating physicians fee schedule of Medicare Part B, except as provided in subparagraphs b. and c. below.
— See Florida Policy Endorsement PA033-0113-FL, Pg. 2 of 6 — pg. 3 of 6.
The endorsement goes on to state that “[I]f a provider submits a charge for an amount less than the amount determined by the fee schedule or other limitations established by Section 627.736 of the Florida Statutes, or any provisions of the Florida Motor Vehicle No-Fault Law as described above, “we” will pay eighty percent of the charge that was submitted. However, if such services, supplies or care is not reimbursable under Medicare Part B, as provided above, “we” will limited reimbursement to 80 percent of the maximum reimbursable allowance under worker’s compensation, as determined under Section 440.13 of the Florida Statutes, and rules adopted thereunder which are in effect at the time such services, supplies or care is provided. Services, supplies or care that is not reimbursable under Medicare or worker’s compensation will not be reimbursed by “us”.”
The Court finds that the Defendant’s policy endorsement form PA033-0113-FL clearly and unambiguously adopts and incorporates the permissive fee schedule payment calculation methodology as contemplated by the Florida legislature.
IT IS HEREBY ORDERED AND ADJUDGED, that the Defendant’s Motion for Partial Summary Judgment as to the Proper Application of the Permissive Fee Schedule Pursuant to Fla. Stat. § 627.736(5)(a)(2)(f) is GRANTED and the Plaintiff’s Cross-Motion for Summary Judgment as to the Proper Application of the Permissive Fee Schedule Pursuant to Florida Statute § 627.736 is DENIED.
