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 — Court disagrees with insured’s contention that section 627.736(7)(a), providing that insurer, before withdrawing payment of benefits, must obtain a report from a physician licensed under the same chapter as the treating physician, whose report states that treatment is not reasonable, necessary or related, should be interpreted to include reduction of bills by an insurance company — Question certified: Must an insurance company, who seeks to reduce bills for medical treatment, pursuant to Section 627.736(1)(a), first obtain a report from a physician licensed under the same licensing chapter as the treating physician stating that the bills for treatment are not reasonable, pursuant to Section 627.736(7)(a), Florida Statues?
OUIDA SCHALL, Plaintiff, vs. ALLSTATE INSURANCE COMPANY, Defendant. County Court in and for Palm Beach County, Civil Division. Case No: MS 97-21375 RL. October 22, 1999. Krista Marx, Judge. Counsel: Brian W. Smith, Brian W. Smith, P.A., West Palm Beach, for Plaintiff. Joseph G. Murasko, Dickstein, Reynolds & Woods, West Palm Beach, for Defendant.
Insurer’s appeal from partial summary judgment: REVERSED. Cross-appeal by insured: AFFIRMED. 26 Fla. L. Weekly D8c
AMENDED FINAL JUDGMENT CONTAINING ORDER ON PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT AND CONTAINING CERTIFIED QUESTION OF GREAT PUBLIC IMPORTANCE
[Original Opinion at 6 Fla. L. Weekly 793a]
THIS CAUSE came before the Court on July 13, 1999 on Plaintiff’s Motion for Summary Judgment. The Court entered an Order on July 20,1999 which granted in part Plaintiff’s Motion for Summary Judgment. Thereafter, the remaining issues were tried to jury verdict on July 28, 1999 which resulted in a defense verdict and for which this Court entered a Final Judgment in favor of the Defendant on August 3, 1999. This Amended Final Judgment does not abrogate the Final Judgment entered on August 3, 1999. Based on the proceedings before the Court and having heard argument of counsel for the respective parties and having considered authority cited by the parties, this 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 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. 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 didn’t even 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 Automobile 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 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 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 distinguishable from the instant case in that, in those cases, the insurer had at least sent the bills out for review within the 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 treating 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. However, this Court, pursuant to Fla.R.Civ.P. 9.160(e), certifies a question of great public importance to the Fourth District Court of Appeal as follows:
Must an insurance company, who seeks to reduce bills for medical treatment, pursuant to Section 627.736(1)(a), first obtain a report from a physician licensed under the same licensing chapter as the treating physician stating that the bills for treatment are not reasonable, pursuant to Section 627.736(7)(a), Florida Statues?
This Court bases this certification on its observations that there are an over abundance of cases in No-Fault litigation in County Court which require the guidance of the appellate courts, that it would be in the best interests of judicial economy to allow the parties to bring this matter directly to the District Court of Appeal at this point in the proceedings, that the single judge appellate system in Broward County has resulted in many diametrically opposed opinions in PIP cases, and finally that the Fourth District Court of Appeal in Fortune Insurance Company v. Everglades Diagnostics, Inc., 721 So. 2d 384 (Fla. 4th DCA 1998) granted certiorari review, and in doing so observed that review was necessary “given the pervasiveness of automobiles and PIP coverage…”, and because these PIP cases involving the interpretation of PIP law are serious enough to result in a miscarriage of justice. It is therefore
ORDERED AND ADJUDGED that 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. It is further
ADJUDGED that Plaintiff OUIDA SCHALL, recover from the Defendant, ALLSTATE INSURANCE COMPANY, the sum of $2,284.72 that shall bear interest at the rate of 10% per year for which let execution issue. The Court reserves jurisdiction to determine taxable costs and attorney’s fees.
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