26 Fla. L. Weekly Supp. 50a

Online Reference: FLWSUPP 2601MOYNInsurance — Personal injury protection — Coverage — Medical expenses — Deductible — No merit to argument that insurer that received bills from multiple medical providers on same day is required to look to dates of service and apply deductible to earliest date of service first — Exhaustion of policy limits — Insurer did not act in bad faith by making decision to use 2007 Medicare fee schedule as a baseline for reimbursement of providers — Even if insurer had ability to reimburse other providers’ claims at less than fee schedule amounts, decision to use fee schedule does not alter fact that provider exhausted benefits through payment of bills for reasonable, related and necessary services — Further, insurer’s decision to issue additional reimbursements to some providers upon receipt of pre-suit demand letters was proper and consistent with insurer’s obligations under law — Insurer’s motion for summary judgment on issue of exhaustion of benefits is granted

FAMILY WELLNESS AND CHIROPRACTIC CENTER OF WEST LAKE WORTH, FL a/a/o John Moynihan, Plaintiff, v. PROGRESSIVE AMERICAN INSURANCE COMPANY, Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. CONO16004915 (70). Civil Division. March 6, 2018. John D. Fry, Judge. Counsel: Frank T. Noska, Palm Beach, for Plaintiff. Patrick J. Gerace & Antonio Roldan, Progressive PIP House Counsel, Fort Lauderdale, for Defendant.

[Editor’s note: Rehearing denied March 22, 2018.]

ORDER GRANTING DEFENDANT’S MOTIONFOR FINAL SUMMARY DISPOSITION ANDFINAL JUDGMENT FOR DEFENDANT

THIS CAUSE having come on to be heard on Defendant’s Motion for Final Summary Judgment/Disposition on Exhaustion of Benefits and Plaintiff’s Amended Response in Opposition and Plaintiff’s Motions for Partial Summary Judgment, and the Court having reviewed the pleadings, motions, affidavits and evidence filed, and having heard extensive argument of counsel, and being otherwise advised in the premises, it is hereupon,

ORDERED AND ADJUDGED that Defendant’s Motion be, and the same is hereby GRANTED and Plaintiff’s Motions are hereby DENIED, as stated in the record and for the reasons stated below.

Plaintiff filed the instant lawsuit against Defendant for PIP benefits under a breach of contract theory. It is undisputed that on or about August 23, 2016, the Defendant paid $10,000.00 in PIP benefits. Defendant filed its Motion for Final Summary Judgment on Exhaustion of Benefits. In response Plaintiff filed its Amended Response in Opposition to Defendant’s Motion for Summary Judgment and a series of Partial Summary Judgment motions alleging that the Defendant had acted in bad faith and manipulated the handling of the claim, and made gratuitous payments to other providers. Plaintiff relied on Coral Imaging Services v. Geico Indem. Ins. Co., (Fla. 3rd DCA 2006) [31 Fla. L. Weekly D2478a], and Ocean Harbor Casualty Insurance Company v. Medical Specialists of Tampa Bay, LLC d/b/a Gulf Coast Injury Center, et al., (2011-AP-9-WS, L.T. No. 2010-CC-1145WS), as well as various other county court orders in support of the position that the Defendant had the ability under the No Fault Law and the policy of insurance to reduce other providers’ bills further than the rates at which they were paid and the Defendant’s payments to those providers were gratuitous overpayments as a result.

Specifically, Plaintiff argued the Defendant improperly processed bills received on the same day from the Plaintiff and another provider, which were applied to the insured’s deductible. Plaintiff argued that when an insurer receives bills from multiple providers on the same day the insurer is required to look further to the dates of service and apply the deductible to the earliest date of service first. This Court finds no such requirement under the law. The evidence shows the Defendant applied the bills to the deductible in the order they were received and processed. The Court finds the Defendant did not act in bad faith when applying the deductible in this claim. Defendant’s processing of these bills was consistent with its’ obligations under the statute.¹ Additionally, Plaintiff argued the Defendant improperly overpaid other providers by reimbursing those providers at the 2007 Medicare Participating Physicians Fee Schedule, under the theory Defendant had the ability to reduce those charges further under the policy. Plaintiff further advanced the argument that the Defendant’s decisions to issue additional reimbursements to other providers upon receipt of pre-suit demand letters from those providers amounted to gratuitous overpayments under the Defendant’s policy.

This Court finds Plaintiff’s arguments unavailing. The Plaintiff’s position is based upon a misunderstanding of the binding Florida law on exhaustion of PIP benefits. Plaintiff relies on the Circuit Appellate decision of Ocean Harbor Casualty Insurance Company v. Medical Specialists of Tampa Bay, LLC d/b/a Gulf Coast Injury Center, et al., (2011-AP-9-WS, L.T. No. 2010-CC1145-WS), in support of the position that when an insurer pays more than the absolute lowest amount possible to other medical providers those additional payments are gratuitous and cannot be counted toward the statutory/policy limit of $10,000.00. This Court finds that Medical Specialists of Tampa Bay, is a dated opinion decided prior to the most recent binding cases on exhaustion of PIP benefits.

The most recent Florida District Court of Appeal cases on exhaustion of PIP benefits address the crux of the issue. In Geico Indem. Co. v. Gables Ins. Recovery, Inc. [39 Fla. L. Weekly D2561a],² the Third District directly addressed “gratuitous payments” under a PIP policy, which were first described in the matter of Coral Imaging Services v. Geico Indem. Co. [31 Fla. L. Weekly D2478a].³ In Gables, the Third District held that Coral Imaging, only applies where the PIP insurer exhausts benefits by improperly paying untimely claims.⁴ In Northwoods Sports Medicine and Physical Rehabilitation, Inc. v. State Farm Mut. Auto. Ins. Co. [39 Fla. L. Weekly D491a],⁵ the Fourth District held that until the necessity of the services and reasonableness of the charges [in a PIP claim] is settled, their compensability under PIP is not established, and [the] assignment of PIP benefits has not matured. Thus, the English Rule has application only to those claims which are settled either by insurance company acceptance or by resolution of disputed charges through suit.⁶

This Court finds that the insurer is permitted under the law to reimburse medical providers at amounts the insurer determines in good faith to be reasonable. In this matter, Progressive made a business decision to pay medical providers at the 2007 Medicare Participating Physicians Fee Schedule as a baseline.⁷ In this Court’s opinion, this is proper application of the insurer’s obligations under the law. Even assuming in arguendo that insurers have the ability to reimburse claims at amounts less than the 2007 Participating Physicians Fee Schedule, Progressive’s decision to use the 2007 Participating Physicians Fee Schedule for reimbursement to providers in this claim does not have any bearing on the Defendant’s defenses in this lawsuit and does not change the fact that Defendant properly exhausted benefits through payment of bills for reasonable, related, and necessary medical services timely received under Fla. Stat. §627.736(5)(c). Furthermore, Progressive’s decisions to issue additional reimbursements to providers upon receipt of pre-suit demand letters from those providers were consistent with the Defendant’s obligations under the law and proper in this matter.⁸ This Court finds that an insurer may resolve contested claims under a PIP policy and the payments of disputed medical benefits must be deducted from the available PIP benefits under the policy so long as the payments are for lawfully submitted, reasonable, related, and necessary medical services, supplies, or care. Once the PIP benefits are exhausted through the payment of valid claims, an insurer has no further liability on unresolved, pending claims, absent bad faith in the handling of the claim by the insurance company. See Northwoods Sports Medicine and Physical Rehabilitation, Inc. v. State Farm Mut. Auto. Ins. Co., 137 So.3d 1049 (Fla. 4th DCA 2014) [39 Fla. L. Weekly D491a].

ORDERED AND ADJUDGED that,

Defendant’s Motion for Final Summary Disposition on Exhaustion of Benefits is hereby GRANTED. Plaintiff’s Motions for Partial Summary Judgment are hereby DENIED.

Final Judgment is hereby entered in favor of Defendant. The Plaintiff shall take nothing by this action. The Defendant shall go hence forth without day. The Court reserves jurisdiction to determine Defendant’s entitlement to reasonable attorney fees and costs.

__________________

¹See Ivey v. Allstate Ins. Co., 774 So. 2d 679 (Fla. 2000) [25 Fla. L. Weekly S1103a] (“The purpose of the no-fault statutory scheme is to provide swift and virtually automatic payment so that the injured Insured may get on with his life without undue financial interruption.”)

²See Geico Indem. Co. v. Gables Ins. Recovery, Inc., 159 So.3d 151 (Fla. 3rd DCA 2014) [39 Fla. L. Weekly D2561a]

³See Coral Imaging Services v. Geico Indent. Co., 955 So.2d 11 (Fla. 3rd DCA 2006) [31 Fla. L. Weekly D2478a]

⁴See Gables, 159 So.3d 151 (Fla. 3rd DCA 2014) [31 Fla. L. Weekly D2478a] (Emphasis added)

⁵See Northwoods Sports Medicine and Physical Rehabilitation, Inc. v. State Farm Mut. Auto. Ins. Co., 137 So.3d 1049 (Fla. 4th DCA 2014) [39 Fla. L. Weekly D491a]

⁶See Id., 137 So.3d 1049 (Fla. 4th DCA 2014) (Emphasis added)

⁷See Allstate Fire & Cas. Ins. Co. v. Perez ex rel. Jeffrey Tedder, M.D., P.A., 111 So. 3d 960, 963 (Fla. 2nd DCA 2013) [38 Fla. L. Weekly D915a] (“Allstate should have referred to the Medicare Part 13 schedule for 2007, which is the baseline for services reimbursable under Medicare Part B.”) (Emphasis added)

⁸See Simon v. Progressive Exp. Ins. Co., 904 So. 2d 449, 450 (Fla. 4th DCA 2005) [30 Fla. L. Weekly D1156b] (“It is the obligation of insurance companies to attempt to settle as many claims as possible. Farinas v. Florida Farm Bureau General Insurance Co., 850 So.2d 555, 560 (Fla. 4th DCA 2003) [28 Fla. L. Weekly D1023b]. It is also a prerogative of insurance companies to pay, reduce, or deny claims.” Id.)