5 Fla. L. Weekly Supp. 207b
Insurance — Arbitration — Personal injury protection — Arbitration of dispute between insurer and medical provider to whom insured had assigned PIP benefits was required under terms of policy — Insured’s revocation of assignment was untimely where insurer did not receive revocation until after insured and his attorneys became aware that insurer intended to pursue arbitration rights
SECURITY NATIONAL INSURANCE COMPANY, Appellant, v. ERIC LEIVA, Appellee. 11th Judicial Circuit in and for Dade County, Appellate Division. Case No. 96-450 AP. Opinion filed December 5, 1997. Counsel: Rosner & Simon and Jeanne Heyward for appellant. Arnold D. Hessen, for appellee.
(Before AMY N. DEAN and GERALD D. HUBBART)
(AMY N. DEAN, J.) This is an appeal by the appellant, SECURITY NATIONAL INSURANCE COMPANY (“Security”) to review an order denying its motion for final summary judgement which in effect precluded the parties from proceeding to arbitration below.1
The unrefuted facts below adduced that appellee, ERIC LEIVA, (“Leiva”), received medical treatments from C.M. Medical Center (“C.M. Medical”) from August 14, 1995 thru November 17, 1995 resulting in a bill for $6,050. On November 21, 1995, Security requested all bills and therapy records for services rendered to Leiva and further requested an Assignment of Benefits form to be completed by C.M. Medical and Leiva. The Assignment of Benefits form was completed by Leiva and C.M. Medical on November 24, 1995.
After a review of the records submitted, Security sent C.M. Medical a check for $1,096. Security had determined that only a portion of the medical bills was reasonable and necessary medical treatment pursuant to the contract of insurance between Security and Leiva. The payout sheet accompanying the check indicated “any bill received from a medical provider who has accepted an assignment of benefits may be processed in accordance with the arbitration provisions of F.S. 627.736(5). Any claims dispute over the bill will be resolved directly between the medical provider and the insurance carrier.”
On February 16, 1996, Security sent a letter to C.M. Medical indicating that it would pursue its contractual arbitration rights if there were any disputes regarding treatment received by Leiva. A copy of this letter was sent to Leiva’s attorneys. On April 2, 1996, after the lawsuit was filed below, Security advised C.M. Medical that it would pursue arbitration in order to resolve the disputed bill. On April 9, 1996, C.M. Medical sent a letter to Security indicating that Leiva had revoked his assignment of benefits by letter dated February 26, 1996. It is undisputed that Security was not advised of this revocation of assignment of benefits until the April 9, 1996 letter from C.M. Medical.
In this regard, section 627.736(5), Florida Statute, provides in pertinent part;
…every insurer shall include a provision in its policy for personal injury protection benefits for binding arbitration for any claims dispute involving medical benefits arising between the insurer and any person providing medical services or supplies if that person has agreed to accept assignment of personal injury protection benefits. The provision shall specify that the provisions of Chapter 682 relating to arbitration shall apply …
Such a clause exists in the contract herein between Security and Leiva. Public policy favors arbitration and even in situations where the policy lacks an arbitration provision, the courts read such requirements into the contract of insurance in matters regarding medical benefits. See Orion Insurance Company v. Magnetic Imaging Systems, 696 So.2d 475 (Fla. 3d DCA 1997). In fact, the denial of a right to arbitrate constitutes a departure from the essential requirements of the law. U.S. Fire Insurance Company v. Franko, 443 So.2d 170 (Fla. 1st DCA 1983).
However, Leiva asserts that his revocation of the assignment of benefits was timely and thus made arbitration unwarranted. As noted infra, the undisputed facts indicate that no notice was received by Security until April 9, 1997 regarding a revocation of the assignment of benefits nor was any revocation sent until Leiva’s counsel was advised that Security would pursue its arbitration rights to the fullest as noted in the letter of February 16, 1997.2 Thus, the case of State Farm Mutual Auto Insurance v. Gonnella, 677 So.2d 1355 (Fla. 5th DCA 1996) is dispositive herein. Once Leiva and his attorneys were aware that Security intended to pursue their arbitration rights, the April 9th receipt of a revocation of the assignment of benefits was untimely.
Based upon the foregoing the decision below is REVERSED and this cause is REMANDED for the entry of orders consistent with this opinion requiring the parties to participate in arbitration in accordance with the insurance contract. (GERALD D. HUBBART, J. Concurs.)
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1At the oral argument the parties agreed that this matter could be heard by a panel composed of only two members.
2A concern below was that Leiva would not be allowed to appear at arbitration and assert his rights. In a lawsuit, Leiva will be required to demonstrate the reasonableness and necessity of the medical care received from C.M. Medical which are the same issues which will be asserted at arbitration. Thus the participation of Leiva and C.M. Medical will be needed. Moreover, there is nothing that prohibits the joinder of Leiva in arbitration.
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