26 Fla. L. Weekly Supp. 510a

Online Reference: FLWSUPP 2606PORFInsurance — Personal injury protection — Coverage — Deductible — Insurer is required to apply deductible to 100% of insured’s expenses and losses prior to applying permissive statutory fee schedule

MIAMI MEDICAL GROUP, (a/a/o Valeria Porfilo), Plaintiff, v. UNITED AUTOMOBILE INSURANCE COMPANY, Defendant. County Court,11th Judicial Circuit in and for Miami-Dade County, Civil Division. Case No. 16-3047 SP 05 04. August 2, 2018. Lourdes Simon, Judge. Counsel: Gregg Pessin, Miami, and Thomas J. Wenzel, Cindy Goldstein, PA, Coral Springs, for Plaintiff. Christina J. Hudson Flores, United Automobile Insurance Company, Miami, for Defendant.

ORDER ON THE PARTIES CROSS MOTIONS REGARDINGTHE REQUIREMENT TO APPLY THE DEDUCTIBLE TOONE HUNDRED PERCENT OF MEDICAL EXPENSES

THIS CAUSE having come before the Court on the parties’ cross motions for summary judgment, the Court having reviewed the motions, the exhibits, the Court file, and relevant legal authorities, and the Court having heard oral arguments on May 3, 2017 and May 31, 2017, the Court hereby GRANTS Plaintiffs motion and DENIES Defendant’s motion for the reasons described herein.

Valeria Porfilo (“insured”) was involved in a motor vehicle accident on January 16, 2014. At the time of the accident, she was insured by a policy of insurance issued by Defendant. The policy of insurance had a $10,000 limit for Personal Injury Protection (“PIP”) benefits. The policy also contained a $1,000 PIP deductible election. After the accident, the insured was examined and treated by Plaintiff. Plaintiff submitted bills for two dates of service in the aggregate amount of $1,782.26. Defendant did not issue any reimbursements, but instead contends that the aforementioned $1,782.26 falls below the $1,000 deductible threshold necessary to trigger Defendant’s payment obligations.

The dispute in this case concerns a question of whether an insurer is required to apply the deductible to 100% of an insured’s expenses and losses prior to applying any permissive fee schedule payment limitation found in §627.736(5)(a)1, Fla. Stat. (2013)¹. Under both the statute and the enforceable portions of the subject policy of insurance, the Court must answer that question in the affirmative.

The Court first looks to §627.739, Fla. Stat. (2003) (“the deductible statute”) which provides, in pertinent part:

The deductible amount must be applied to 100 percent of the expenses and losses described in s. 627.736. After the deductible is met, each insured is eligible to receive up to $10,000 in total benefits described in s. 627.736(1).

The Court finds this statute to be clear and unambiguous. The term “100 percent” has a clear and unambiguous meaning. Accordingly, the statue requires the insurer to apply 100 percent of the medical bills to the deductible in this case.

Notwithstanding the unambiguous language of the deductible statute, Defendant did not apply 100 percent of its insured’s bill to the deductible. Instead, Defendant first reduced the subject bill in accordance with the insurer’s permissive reimbursement methodology. Defendant’s errs in its belief that an insurer’s ability to limit its reimbursement responsibilities has any relevance to the issue presented in the case at bar. The fee schedule methodology merely provides that “the insurer may limit reimbursement to 80 percent of the following schedule of maximum charges”. There is absolutely no statutory language or enforceable contractual language that would permit the extension of the permissive fee schedule reimbursement limitation beyond the time period that begins when insurer’s duty to issue benefits payments ripens and terminates when the $10,000 of PIP benefits reimbursement obligation has exhausted. Instead, the obligation of a deductible is solely the responsibility of the insured and is treated similarly to medical expenses incurred by an insured after exhaustion of policy benefits.

This point is further reinforced by several appellate courts which described a deductible as “self-insurance”. See, e.g., General Star Indem. v. W. Fla. Vill. Inn, 874 So. 2d 26 (Fla. 2d DCA 2004) [29 Fla. L. Weekly D1070b]. “Where an accident occurs, the insured (not the insurer) becomes responsible for payment of claims that are otherwise impacted by the deductible amount in the insurance policy.” Mercury Ins. Co. v. Emergency Physicians of Cent., 182 So. 3d 661 (Fla. 5th DCA 2015) [40 Fla. L. Weekly D2364a].

The Court’s conclusion is further confirmed when examining the history of the deductible statute. The current language in the deductible statute came into effect in 2003. Prior to this change, the relevant portion of the deductible statute read:

Insurers shall offer to each applicant and to each policyholder, upon the renewal of an existing policy, deductibles, in amounts of $250, $500, $1,000, and $2,000, such amount to be deducted from the benefits otherwise due each person subject to the deduction.

The Legislature’s distinction between “expenses and loss” in the amended statute and “benefits otherwise due,” in the prior version of §627.739(2), is critical to the analysis. See League of Women Voters of Fla. v. Detzner, 172 So.3d 363 (Fla. 2015) [40 Fla. L. Weekly S432a] (“Courts determine legislative intent through statutory construction, looking to the actual language used and any other tools — such as the history of legislative changes and any appropriate interpretive canons — to assist in discerning the Legislature’s intent in enacting the law.”) (italics added). The term “benefits” is an unambiguous term referring to insurance payments. Defendant’s position fails to give full effect to every word of the relevant statutes and would require the Court to overlook the significance of the 2003 amendment to the deductible statute.

Therefore, based on the foregoing, it is hereby ORDERED AND ADJUDGED that Plaintiff’s motion is GRANTED and Defendant’s motion is DENIED.

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¹§627.736(5)(a)1, Fla. Stat. (2013) provides an optional payment limitation colloquially referred to as the “fee schedule”. If properly elected, an insurer may limit its reimbursement to 80 percent of the statutory fee schedule methodology. For purposes of the instant motion, Plaintiff did not contest whether Defendant was permitted to issue its reimbursements according to the fee schedule methodology.