23 Fla. L. Weekly Supp. 212a
Online Reference: FLWSUPP 2303WEINInsurance — Personal injury protection — Coverage — Medical expenses — Reasonableness of charges — Fact that policy is silent as to reasonableness requirement does not preclude insurer from challenging charges as unreasonable — PIP statute, which is incorporated in all PIP policies, requires only that reasonable expenses be paid
UNITED AUTOMOBILE INSURANCE CO., Appellant, vs. MARC K. WEINBERG, D.C., PA., Appellee. Circuit Court, 11th Judicial Circuit (Appellate) in and for Miami-Dade County. Case No. 13-439 AP. L.T. Case No. 12-003569-SP-23. August 25, 2015. An appeal from the County Court in and for Miami-Dade County, Judge Myriam Lehr. Counsel: Michael Neimand, for Appellant. Marlene Reiss, and Kenneth J. Dorchak, for Appellee.
(Before BAGLEY, MILLER, and THORNTON, JJ.
(THORNTON, Judge.) This is an appeal of a summary judgment entered against appellant, United Auto Insurance Company (United Auto), in an action for breach of a PIP contract by appellee, medical provider Marc K Weinberg, D.C., P.A. The medical provider and United Auto disagree about the amount that the medical provider sought for the treatment it provided. In the court below, United Auto admitted that the treatment provided was related to the covered accident and that it was medically necessary, but denied that the charges for the treatment were reasonable. The medical provider filed a motion for summary judgment, arguing that reasonableness was not at issue because United Auto’s policy provides that it will pay eighty percent of all medically necessary expenses and does not explicitly limit those expenses to a reasonable amount. The trial court granted summary judgment and United Auto appeals. We reverse.
United Auto’s contract states that “[t]he company will pay, in accordance with Florida Motor Vehicle No-Fault law . . . Eighty percent of all medically necessary expenses . . .” and does not explicitly include any limitation as to the reasonableness of the charges that it will pay. Thus, the medical provider argues that United Auto is obligated to pay 80% of the amount of the bills that it receives, and cannot deny or reduce the amount of those bills on the ground that the charges are unreasonable. In other words, under the medical provider’s argument, United Auto has agreed, by the terms of its contract, to pay unreasonable bills. Therefore, the question that this Court must answer is whether, under a PIP policy that is silent as to reasonableness, an insurance company must pay unreasonable charges.1
United Auto argues that it must only pay for reasonable expenses under the PIP statute. It cites to Geico General Insurance Co. v. Virtual Imaging Services, Inc., 141 So. 3d 147, 150 (Fla. 2013) [38 Fla. L. Weekly S517a]. In Virtual, the Court held that only the mandatory provisions of the No-Fault law are automatically incorporated into No-Fault policies. Insurers are mandated to pay reasonable charges under the law. Thus, reasonableness is a mandatory provision in PIP contracts.
Furthermore, United Auto’s contract specifically incorporated the PIP statute by providing that it would pay “in accordance with Florida Motor Vehicle No-Fault law.” And, Section 627.7407(2), Fla. Stat. (2011) provides that “Any personal injury protection policy in effect on or after January 1, 2008, shall be deemed to incorporate the provisions of the Florida Motor Vehicle No-Fault Law, as revived and amended by this act.” Therefore, United Auto argues that the statutory reasonableness requirement is incorporated into its contract, so that it is only required to pay for “reasonable expenses.”
The Appellee, however, asserts that the statute only sets forth a minimum set of requirements that insurance companies must follow, but that companies are free to add additional benefits to their contracts. So, under Appellee’s argument, United Auto was free to add the benefit of agreeing to pay all medically necessary expenses regardless of whether or not the charges for those expenses are reasonable. United Auto asserts that in order to provide such greater coverage, the policy would have to explicitly state that it was doing so, and that mere silence as to whether or not it would pay only reasonable charges should not be interpreted to mean that it was agreeing to pay unreasonable charges.
We agree that an insurer could choose, through contract, to provide greater coverage than is required by the PIP statute. But, we also agree that the method of providing greater coverage would be to state plainly, in the contract, the terms that differ from the statutory minimum requirements, and we do not believe that an insurer could expand its coverage by remaining silent as to a term that would otherwise be included in the contract pursuant to statute or case law. Compare Green v. Life & Health of Am., 704 So. 2d 1386 (Fla. 1998) [23 Fla. L. Weekly S42a] and Wright v. Auto-Owners Ins. Co., 739 So. 2d 180 (Fla. 2d DCA 1999) [24 Fla. L. Weekly D2033a] (both cases interpreting contracts to provide greater coverage than they would under statute when the plain language of the contracts indicated that such greater coverage would be provided) with Wimberg v. Chandler, 986 F. Supp 1447 (M.D. Fla. 1997) (finding that a contract did not provide greater coverage than would be required under statute when the contract was silent as to that issue).
As noted, the Florida Motor Vehicle No-Fault law requires only that “reasonable expenses” be paid. Furthermore, as United Auto points out, when a contract fails to fix a price, a reasonable price is implied. Payne v. Human Hosp. Orange Park, 661 So. 2d 1239, 1241 (Fla. 1st DCA 1995) [20 Fla. L. Weekly D2301a].2 Thus, there is both a statutory and case-law basis for including, by default, an agreement to pay only reasonable price in a PIP policy. Therefore, a contract that is silent as to a reasonableness requirement should not be interpreted as agreeing to pay unreasonable amounts charged. Accordingly, the fact that United Auto’s policy in the instant case is silent as to reasonableness3 should not be interpreted to mean that it may not challenge the reasonableness of the amounts charged. Since reasonableness is normally a part of a PIP contract under statute and case law, it would seem that in order to interpret a PIP contract to agree to pay charges without regard to whether or not they are reasonable, the contract would have to explicitly state that reasonableness would not be a factor. Since the instant contract does not explicitly state that United Auto will not challenge the reasonableness of amounts charged, it should not be precluded from doing so.
If the Appellee were correct that United Auto could not challenge the reasonableness of any charges presented to it under this policy, that would mean that a person with United Auto PIP coverage could go to a medical provider to be treated for a headache resulting from an automobile accident, and the medical provider could treat him by giving him an aspirin and then charge United Auto $10,000.00 for that treatment, and United Auto would be required to pay eighty percent of that charge. It is easy to think of similar absurd examples. In short, it is not reasonable to interpret a contract that is silent as to reasonableness as agreeing to pay unreasonable amounts.
Given that reasonableness of fees is incorporated into contracts in Florida, that PIP law requires only that reasonable charges be paid, that the insurance policy at issue agreed to pay in accordance with PIP law, and that requiring United Auto to pay for unreasonable charges could lead to absurd results, the fact that United Auto’s policy is silent as to reasonableness of fees does not preclude it from challenging fees as unreasonable.
As such, the order granting summary judgment is REVERSED and this case is REMANDED with directions to allow United Auto to challenge the reasonableness of the charges at issue. We make no findings as to whether the charges in the instant case were reasonable or not. (BAGLEY and MILLER, JJ., concur.)
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1A previous appellate panel of this court recognized that United Auto’s policy language did not impose a reasonableness requirement on charges that it would pay, but indicated that there could be another basis to impose such a requirement. However, although it raised the issue, it did not resolve it. Virtual Imaging Servs., Inc. a/a/o Figuerora v. United Auto. Ins. Co., 22 Fla. L. Weekly Supp. 421a (Fla. 11th Cir. Sept. 9, 2014) (“Respondent asserts that the information is relevant to the reasonableness of the charges. A review of the subject insurance policy, however, illustrates that Respondent agreed to reimburse ‘eighty percent of all medically necessary expenses. . . .’ The policy language does not impose a reasonableness requirement. Unless there is another basis to impose a reasonableness requirement, no inquiry into the reasonableness of the charges is necessary. For example, there may be a statutorily imposed reasonableness requirement which even supersedes the Respondent’s contract.”).
2Although the medical provider asserts that United Auto failed to make this argument below and therefore failed to preserve it for appellate review, an examination of the transcript of the proceedings below shows that United Auto did, in fact, make the argument at pages 18 and 19 of the transcript.
3But, it did state that it would it will pay “in accordance with Florida Motor Vehicle No-Fault law,” and, as noted, the Florida Motor Vehicle No-Fault law requires only that “reasonable expenses” be paid.
