26 Fla. L. Weekly Supp. 603a
Online Reference: FLWSUPP 2607DUCTInsurance — Personal injury protection — Coverage — Medical expenses — Exhaustion of policy limits — Where insurer exhausted policy limits by gratuitously overpaying another medical provider for CPT code that was not reimbursable under Medicare Part B and should have been reimbursed at 80% of maximum allowance under workers’ compensation fee schedule, PIP benefits are not exhausted, and plaintiff provider is entitled to additional benefits
PLANTATION OPEN MRI, LLC. a/a/o Fabreece Ductan, Plaintiff, v. GEICO GENERAL INSURANCE COMPANY, Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. 16-15816 COCE 53. November 15, 2016. Robert W. Lee, Judge. Counsel: Todd A. Landau, for Plaintiff. Lubna Abualown, for Defendant.
ORDER GRANTING PLAINTIFF’S MOTION FORSUMMARY JUDGMENT AS TO EXHAUSTION THROUGHINVALID, IMPROPER OR GRATUITOUS PAYMENT
THIS CAUSE having come on to be heard on Plaintiff’s Motion for Summary Judgment the Court having reviewed the Motion, the entire Court file, the relevant legal authorities; having heard argument; 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:
1. Plaintiff’s Motion for Summary Judgment is GRANTED.
2. Plaintiff moved for summary judgment that PIP benefits are not exhausted. Plaintiff’s motion is premised on the fact that the parties agree Defendant’s insurance policy elects the “schedule of maximum charges”. The “schedule of maximum charges” contains fee schedules, each of which must be unambiguously incorporated. In this case, the policy states that:
The Company will pay. . .(A) Eighty percent (80%) of medical benefits, which are medically necessary, pursuant to the following schedule of maximum charges contained in the Florida Statutes §627.736(5)(a)1., (a)2. and (a)3:
. . .
6. For all other medical services, supplies, and care, 200 Percent of the allowable amount under:
(I.) The participating physicians fee schedule of Medicare Part B [. . .]
. . .
However, if such services, supplies, or care is not reimbursable under Medicare Part B (as provided in (A)6. above), we will limit reimbursement to eighty percent (80%) of the maximum reimbursable allowance under workers’ compensation, as, determined under Florida Statutes. §440.13 and rules adopted thereunder which are in effect at the time such services, supplies, or care is provided.
3. In this case it is undisputed that Defendant received bills from Pompano Beach Healing Center, which is another provider, for CPT code 97010. The record evidence adduced shows that CPT code 97010, pursuant to the fee schedule, is not payable under Medicare Part B; thus, CPT code 97010 must be paid pursuant to the Workers Compensation fee schedule maximum reimbursable allowance, which is $10.00. Yet, Defendant allowed $12.88, which is $2.88 more than the maximum reimbursable allowance under the schedule of maximum charges. Defendant did not file any record evidence to assert that it had allowed the proper amount for CPT code 97010. Indeed, at the hearing, the Defendant offered no explanation as to why it overpaid this code.
4. Plaintiff submitted that Defendant voluntarily overpaid for CPT code 97010, which overpayment should not count against the PIP policy limit of $10,000.00. Plaintiff submits that the voluntary overpayment is gratuitous and that the overpayment led to Defendant alleging premature exhaustion.
5. Defendant argued that an overpayment of a medical bill cannot be a basis to deny a claim of exhaustion based on the principles enunciated in Northwoods Sports Med. & Physical Rehab., Inc. v. State Farm Mut. Auto. Ins. Co. 137 So. 3d 1049 (Fla. 4th DCA 2014) [39 Fla. L. Weekly D491a].
6. This Court finds that Northwoods dealt with situation where the PIP insurer paid a valid claim at the proper amount, not where the PIP insurer, without explanation, overpaid a claim, which resulted in a premature exhaustion.
7. Plaintiff’s position is consistent with logic and commonsense. The PIP insurer does not get to credit an overpayment of PIP benefits to a limited $10,000.00 policy, thereby resulting in a premature exhaustion and diminishing treatment paid under the policy for other valid claims, like Plaintiff’s claim in this case. This Court also rejects Defendant’s contention that “gratuitous” payments can only apply to untimely bills because Northwoods requires that a claim is “valid” to effectuate a proper exhaustion.
8. There is only one appellate case on point, which is Ocean Harbor Casualty Ins. Co. v. Medical Specialist of Tampa Bay, Case No 2011-AP-9-WS (Fla. 6th Cir. App. Ct. January 22, 2013) [26 Fla. L. Weekly Supp. 534a]. A unanimous three judge appellate panel ruled that payment above the policy fee schedule reimbursement by an insurer is considered gratuitous and voluntary and should not count against the $10,000 limit of liability for the insured’s PIP. Specifically, in Ocean Harbor, the plaintiff-medical provider was on the short-end of PIP benefits because the PIP insurer received bills from an MRI center and paid the MRI bills at 80% of the submitted reasonable charges, instead of 80% of 200% of Medicare. Thus, Ocean Harbor overpaid the PIP benefits to another provider, which was “more than it was required to pay under the insurance policy.” The appellate court agreed that Ocean Harbor, “in effect, [should] be held to only have paid what it properly should have paid under the terms of the contract and [should] get no credit for what it paid over and above the contractual, amount. The improper payments [should] be considered gratuitous and voluntary.” The appellate court agreed that “[i]f payment of the amount that it should have paid under the contract leaves an unpaid balance of PIP benefits, then Ocean Harbor [should] be required to pay the amount to other medical providers, even if the total paid exceeded the $10,000 PIP limit.”
9. A recent appellate case further clarified that there is such a thing as “non-exhaustion of benefits.” In State Farm Auto. Ins. Co. v. Roberto Rivera-Morales, MD. a/a/o Thomas Mayeko-Coklee, 24 Fla. L. Weekly Supp. 101a (Fla. 11th Cir. Ct. App. May 10, 2016), the three judge appellate panel, affirmed the trial court’s finding of non-exhaustion and remanded that the gratuitous payments made to the insured and other, medical provider shall be deducted from the limits so a final judgment up to $10,000.00 can be awarded. Notably, the appellate court reiterated that no more than $10,000.00 can be awarded absent a finding of bad faith, but that gratuitous payments are deducted from any calculation of the limits. See also Advanced Orthopedics & Pain Management, PL. a/a/o Hans Rohrer v. GEICO Indemnity Co., Case no 16-003939 COSO 61 (denying GEICO’s affirmative defense of exhaustion based on overpayment of CPT code 97010); Stuart B. Krost M.D. P.A. a/a/o Renato Teixera v. Allstate Fire and Casualty Ins. Co., Case no. 13-009880 COSO, 62 (denying exhaustion where insurer made voluntary, gratuitous overpayment by paying in excess of applicable fee schedule).
10. For these reasons and the Record and arguments, Plaintiff’s Motion is GRANTED and the Court finds that PIP benefits are not exhausted and that Plaintiff is entitled to additional PIP benefits.
