26 Fla. L. Weekly Supp. 49a
Online Reference: FLWSUPP 2601TEAMInsurance — Personal injury protection — Coverage — Emergency services — Exhaustion of policy limits — Where PIP insurer failed to maintain entire statutorily required reserve for emergency service providers after making partial payment to plaintiff provider within that classification, payments made to other non-emergency service providers that resulted in exhaustion of policy limits were improper, unauthorized and gratuitous
TEAM HEALTH, INC. f/k/a INPHYNET SOUTH BROWARD, Plaintiff, v. GEICO GENERAL INSURANCE COMPANY, Defendant. County Court, 17th Judicial Circuit in and for Broward County. Case No. 17-2695 COCE 53. March 8, 2018. Robert W. Lee, Judge. Counsel: J.D. Underwood, Florida Advocates, for Plaintiff. Christopher E. Marshall, The Law Office of George L. Cimballa, III , for Defendant.
ORDER GRANTING PLAINTIFF’S AMENDEDMOTION FOR PARTIAL SUMMARY JUDGMENT
THIS CAUSE having come before this Court for hearing on February 27, 2018, on Plaintiff’s Amended Motion for Partial Summary Judgment, and the Court having reviewed the evidence, the relevant legal authorities, after hearing arguments of counsels, and being otherwise fully advised in the premises, the Court finds as follows:
1. The issue in Plaintiff’s Amended Motion for Partial Summary Judgment was whether GEICO improperly exhausted Personal Injury Protection [PIP] benefits by failing to abide by the emergency room provider reserve contained in Fla. Stat. 627.736(4)(c).
2. The evidence provided by the Plaintiff included the deposition transcript of GEICO’s corporate representative Tanya Viera, which included among the exhibits a certified copy of the insurance policy at issue, and the payment log. Ms. Viera’s testimony established the following:
The claimant was insured with GEICO for Personal Injury Protection benefits, and was covered for injuries sustained in the automobile accident that occurred on June 1, 2012.
Team Health submitted a claim for $764 for CPT code 99284 to GEICO for services rendered to the Patient on June 1, 2012. Said bill was received by GEICO of June 29, 2012.
Team Health’s claim of $764 was for an exam by a physician licensed under chapter 458, Fla. Stat., who provided emergency services and care, as defined by Fla. Stat. 395.002(9).
Team Health’s claim qualified for the Fla. Stat. 627.735(4)(c) reserve for emergency services and care.
Upon GEICO receiving Team Health’s claim of $764 for emergency services rendered to Patient, GEICO reduced Team Health’s claim to $7261. The amount held in reserve by GEICO was $580.80 [$580.80 was paid by GEICO on July 13, 2012], not the amount of the claim GEICO received from Team Health ($611.20, which is 80%of $764).
Ms. Viera testified that GEICO alleges to have exhausted benefits on September 12, 2012.
After the payment of $580.80 was issued to the Plaintiff by GEICO on July 13, 2012, $8,444.30 was issued in payments to other medical providers who did not qualify for the mandatory reserve under Fla. Stat. 627.736(4)(c).
There were only two medical providers who qualified as protected medical providers under Fla. Stat. 627.736(4)(c): Radiology Associates of Hollywood [date of service 6/1/12, claim received 6/20/12, $46.00 claimed, $36.80 payment issued on 7/13/12], and Plaintiff Inphynet South Broward Inc. [date of service 6/1/12, claim received 6/29/12, $764 claimed, $580.80 payment issued on 7/13/12]. Of the two protected medical providers, only the Plaintiff’s claim was not paid at 80% of the total amount claimed.
The insurance policy at issue had a $1000 deductible with no medical payments coverage. The $1000 deductible was applied to the first claim received, which was from Miramar Memorial Hospital [claim totaling $1463 received on 6/18/12].
3. The statute at issue is Fla. Stat. 627.736(4)(c), which states:
Upon receiving notice of an accident that is potentially covered by personal injury protection benefits, the insurer must reserve $5,000 of personal injury protection benefits for payment to physicians licensed under chapter 458 or chapter 459 or dentists licensed under chapter 466 who provide emergency services and care, as defined in s. 395.002, or who provide hospital inpatient care. The amount required to be held in reserve may be used only to pay claims from such physicians or dentists until 30 days after the date the insurer receives notice of the accident. After the 30-day period, any amount of the reserve for which the insurer has not received notice of such claims may be used by the insurer to pay other claims. The time periods specified in paragraph (b) for payment of personal injury protection benefits are tolled for the period of time that an insurer is required to hold payment of a claim that is not from such physician or dentist to the extent that the personal injury protection benefits not held in reserve are insufficient to pay the claim. This paragraph does not require an insurer to establish a claim reserve for insurance accounting purposes.
4. This Court finds the language of Fla. Stat. 627.736(4)(c) to be clear and unambiguous. The Court also finds persuasive and adopts the reasoning in the case of Auto-Owners Insurance Co. v. Florida Emergency Physicians Kang & Associates, a/a/o Nicole Lockeywerner, 23 Fla. L. Weekly Supp. 513a (Fla. 9th Judicial Circuit (Appellate), 2016). In Florida Emergency Physicians, the emergency physicians group filed a lawsuit to recover a reduction of $83.32 “asserting that Auto-Owners failed to honor the statutorily-mandated set aside of $5,000 for payment to emergency providers per section 627.736(4)(c), Florida Statutes, by not keeping in reserve the disputed unpaid portion of the claim.” The Lockeywerner appellate court stated:
[T]he amount in the reserve that has been “claimed” (not necessarily paid out), within the thirty days, may not be used to pay other claims. If the insurer were not required to hold the disputed portion of a claim submitted within the thirty days in reserve, then the emphasized language would be unnecessary. Using “claim” indicates that it is the claimed amount that is held in reserve, not an undisputed amount or an amount that the insurer deems reasonable.
In this case, Florida Emergency Physicians claimed $987.00 within thirty days. Because Auto-Owners had notice of that $987.00 claim, the $987.00, does not fall into the provision that it could be released from the reserve to pay other claims. Auto-Owners was thus required to hold the difference between the amount it paid Florida Emergency Physicians and Florida Emergency Physicians’ claimed amount in the reserve under section 627.736(4)(c). Because it did not, Auto-Owners now owes Florida Emergency Physicians the once-disputed portion of the claim. The exhaustion of benefits defense is unavailing because the benefits would not have been exhausted before paying the amount owed Florida Emergency Physicians if Auto-Owners had complied with the statute.
5. The Lockeywerner appellate court held that an exhaustion of benefits defense is not available to the insurer when “it failed to reserve the entire amount of a timely claim from an emergency service provider under the reserve requirement of Florida Statute section 627.736(4)(c)”.
6. In reaching the above holding, the Lockeywerner appellate court considered the exhaustion cases of Dr. Robert D. Simon, M.D., P.A. v. Progressive Express Insurance Co., 904 So. 2d 449, 450 (Fla. 4th DCA 2005) [30 Fla. L. Weekly D1156b], Progressive Am. Ins. Co. v. Stand-Up MRI of Orlando, 990 So.2d 3, (Fla. 5th DCA 2008) [33 Fla. L. Weekly D1746a], Sheldon v. United Services Automobile Ass’n, 55 So. 3d 593, 595-96 (Fla. 1st DCA 2010) [36 Fla. L. Weekly D23a], 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], and GEICO Indem. Co. v. Gables Ins. Recovery, Inc., 159 So. 3d 151 (Fla. 3d DCA 2014) [39 Fla. L. Weekly D2561a]. Referring to said exhaustion cases, the Lockeywerner appellate court stated, and this Court agrees, that “[t]hese cases described above are inapposite, however, because they either involved the previous version of section 627.736(4)(c), before it was amended in 2008, or they did not implicate subsection (4)(c), which expressly requires insurers to reserve funds for emergency service providers.”
7. Based on Fla. Stat. 627.736(4)(c), the facts provided by the deposition testimony of GEICO’s corporate representative, and the case law cited above, this Court concludes that GEICO’s payments made in contravention to Fla. Stat. 627.736(4)(c) were improper, unauthorized, and gratuitous, and as a result they improperly exhausted the PIP benefits as it relates to Plaintiff’s timely received Fla. Stat. 627.736(4)(c) claim for emergency services and care. Accordingly, it is hereby
ORDERED AND ADJUDGED that the Plaintiff’s Amended Motion for Partial Summary Judgment is GRANTED.
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1The insurance policy at issue, page 8 of 20, permits GEICO to pay 80% of “emergency care and services as defined by Florida Statutes Title 29 chapter 395.002(9) provided in a facility licensed under chapter 395 rendered by a physician or dentist, and related hospital inpatient services rendered by a physician or dentist, the usual and customary charges in the community.” Said policy language matches Fla. Stat. 627.736(5)(a)2.c. (2012).
