6 Fla. L. Weekly Supp. 793a
NOT FINAL VERSION OF OPINION
Subsequent Changes at 7 Fla. L. Weekly Supp. 63a
Insurance — Personal injury protection — Insurer may not reduce bills submitted on behalf of insured on ground that treatment was not medically necessary unless it obtains reasonable proof that it does not owe benefits within thirty days of receipt of bills
OUIDA SCHALL, Plaintiff, v. ALLSTATE INSURANCE COMPANY, Defendant. County Court, 15th Judicial Circuit, in and for Palm Beach County, Civil Division. Case No. MS-97-21375-RL. August 20, 1999. Krista Marx, Judge. Counsel: Brian W. Smith, West Palm Beach. Joseph G. Murasko, West Palm Beach.
Amended opinion at 7 Fla. L. Weekly Supp. 63a.
ORDER
THIS CAUSE came before the Court, in chambers, on its own Motion. Based on the foregoing it is
ORDERED AND ADJUDGED that the Order Granting in Part and Denying in Part Plaintiff’s Motion for Summary Judgment was misplaced by the Clerk’s office. This Order is thereupon a replacement of said Order.
THIS CAUSE came before the Court on July 13, 1999 on Plaintiff’s Motion for Summary Judgment. Based on the proceedings before the Court and having heard argument of counsel and having considered authority cited by the parties, the Court finds as follows:
FINDINGS OF FACT
1. The facts material to Plaintiff’s motion for summary judgment are undisputed and are established by the pleadings and depositions of record.
2. The Plaintiff was injured in an automobile accident which occurred on March 22, 1997. At the time of the accident, Plaintiff had a policy of insurance with Allstate Insurance Company which provided PIP benefits in accordance with the requirements of Section 627.736, Florida Statutes.
3. As a result of injuries sustained in the accident, Plaintiff sought treatment with a chiropractor, William Omar Wright, D.C., a physician licensed under Section 460, Florida Statutes. Bills for Dr. Wright’s treatment were submitted to Allstate for payment under the PIP coverage afforded by Plaintiff’s policy. Dr. Wright determined that Plaintiff required certain diagnostic testing, including nerve testing, which was performed on July 9, 1997. Bills for the nerve testing were submitted to Allstate for payment under the PIP coverage on August 5, 1997.
4. On September 8, 1997, the Defendant, ALLSTATE INSURANCE COMPANY, (34 days after the bill had been received by Allstate) sent the bill out for review to MTC, Inc. Allstate received a report from MTC, Inc. (hereinafter “paper review”) on October 7, 1997 and, based on the report, denied payment of benefits for the aforesaid nerve testing under Plaintiff’s PIP coverage. The “paper review” determined that the diagnostic testing performed on the Plaintiff was not medically necessary.
5. The Defendant also reduced certain bills submitted for treatment of the Plaintiff by Dr. Wright based on a determination as to what a reasonable and customary charge would be for the same service in this geographical area.
6. It is undisputed that the Defendant did not obtain a report from a physician licensed under the same chapter as Dr. Wright within thirty (30) days of receipt of the bills for diagnostic treatment. In fact, the Defendant did not send the bills out for review until the thirty day period had already passed.
7. Furthermore, it is undisputed that the Defendant never obtained a report from a physician licensed under the same chapter as Dr. Wright stating that the bills for Dr. Wright’s treatment that were submitted by the Plaintiff (and then reduced by the Defendant) were not reasonable or customary.
ANALYSIS AND CONCLUSIONS OF LAW
Plaintiff has moved for summary judgment on the grounds that Section 627.736(4)(b), Florida Statutes, requires the Defendant to pay bills submitted on behalf of the Plaintiff, or obtain reasonable proof that the bills are not owed, within thirty (30) days of receipt of the bills from the Plaintiff. This Court agrees with the Plaintiff. See Martinez v. Fortune Ins. Co., 684 So.2d 201 (Fla. 4th DCA 1996); Fortune Ins. Co. v. Pacheco, 695 So.2d 394 (Fla. 3rd DCA 1997); Dunmore v. Interstate Fire Insurance Company, 301 So.2d 502 (Fla. 1st DCA 1974); and Crooks v. State Farm Mutual Insurance Company, 659 So.2d 1266 (Fla. 3rd DCA 1995). In the instant case, it is undisputed that the Defendant did not pay or send the bills out for review within the thirty day period. This Court finds that to allow an insurer to obtain “reasonable proof” that it does not owe benefits after the thirty day period mandated by Section 627.736(4)(b) had run would render that Section meaningless. Such an interpretation of the Statute would, arguably, allow Defendant to wait until trial of the case to obtain the “reasonable proof” that it does not owe the benefits claimed. Clearly, this was not the intention of the Legislature in enacting this Section.
This Court finds Castillo v. Star Casualty Insurance Company, 1 Fla. Law Weekly Supp. 64a, (Dade County Circuit Court, Appellate Division 1992) to be instructive on this issue. As in the instant case, the insurer in Castillo waited until after the thirty (30) day period had expired to send the bills out for review. The Castillo court held that the insured would be entitled to recovery “unless STAR had reasonable proof within thirty (30) days of CASTILLO’S claim of November 6, 1990 that STAR was not responsible for payment of PIP benefits. We conclude that STAR did not have such reasonable proof by December 6, 1990, and as such should have provided CASTILLO with his PIP benefits” (Emphasis supplied).
Defendant cites several other Dade County Circuit Court decisions for the proposition that Section 627.736(4)(b) does not require an insurer to obtain “reasonable proof” during the thirty (30) day period. State Farm Fire and Casualty Company v. Perez, 6 Fla. Law Weekly Supp. 471a (Dade County Circuit Court, Appellate Division May 7, 1999); and Allstate Insurance Company v. Cofino, 6 Fla. Law Weekly Supp 470a (Dade County Circuit Court, Appellate Division May 7, 1999). However, those cases cited by the Defendant are somewhat distinguishable from the instant case in that, in those cases, the insurer had at least sent the bills out for review within the thirty (30) day period. Such was not the case here.
For the foregoing reasons, this Court finds that the Defendant is in violation of Section 627.736(4)(b) and, therefore, Plaintiff is entitled to a judgment in her favor on this issue as a matter of law.
Plaintiff also moved for Summary Judgment on the grounds that, pursuant to Section 627.736(7)(a), Florida Statutes, the Defendant must obtain a report from a physician licensed under the same chapter as the testing physician, whose report states that the treatment is not reasonable, necessary or related, before withdrawing payment of benefits. Plaintiff argues that this section has been interpreted to include reduction of bills by an insurance company, citing United Automobile Insurance Company v. Viles, 726 So.2d 320 (Fla. 3rd DCA 1998).
This Court disagrees that Viles applies to reduction of bills. Although the certified question to the 3rd District Court of Appeal used the term “reduced benefits” and “reductions”, the statement of facts contains no reference to reduction of bills but rather speaks of a termination of benefits. The trial Court in Viles was not even presented with a bill reduction issue. As such, this Court interprets that the certified question in Viles did not include a situation where an insurer has reduced bills.
The Trial Court in Viles was presented with a situation where the insurance company determined not to pay for any further treatment. This is commonly referred to as a cut-off or discontinuation of benefits which thereby reduces total available benefits and is to be contrasted to a situation where the insurance company adjusts or reduces amounts paid on individual bills yet continues to pay benefits and perhaps exhausts available benefits.
Furthermore, the report requirement discussed by the Appellate Court in Viles, is found at 627.736(7)(a) whereas bill reductions or payment of “Eighty percent of all reasonable expenses…” is controlled by 627.736(1)(a). The two subsections speak to two different situations.
For the foregoing reasons, this Court denies Plaintiff’s Motion for Summary Judgment as to the issue of the reductions. Accordingly, it is
ORDERED AND ADJUDGED that the Plaintiff’s Motion for Summary Judgment is granted as to the bill for the diagnostic testing but denied as to the reduction of bills for the above-stated reasons.
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