7 Fla. L. Weekly Supp. 541a
Insurance — Personal injury protection — Insurer, who denied claim for medical expense pursuant to provision of insurance policy which permits insurer to decide unilaterally what treatment is reasonable and medically necessary and to deny payment, not entitled summary judgment on claim for payment of PIP benefits — Policy provision directly contravenes purpose of PIP statute to provide swift and virtually automatic payment of benefits and to discourage companies from contesting valid claims — Policy provision leaves insureds powerless to challenge insurer’s decision as to what medical care is medically necessary, exposing insureds to lawsuits, judgments and subsequent harmful credit consequences — Enforcing policy provision would create adversarial relationship between medical care providers and patients and inevitably will have chilling effect on willingness of medical providers to treat persons injured in motor vehicle accidents — Policy provision violates no-fault act as insurance companies cannot impose requirements that are more onerous than those specified in PIP statute — Argument that plaintiff will sustain no damages as result of wrongful non-payment fails because provision to indemnify insured by providing legal representation in lawsuits filed against them by medical care providers ignores harmful consequences to an insured’s credit history and financial future caused by mere filing of credit driven lawsuit — Notwithstanding insurer’s payment of any judgment obtained by medical care provider, insured’s credit history will reflect untimely payment and subsequent judgment — Court rejects argument that insurer’s promise to defend insured should his medical care provider sue him for non-payment is sufficient as matter of law to establish insured cannot be damaged and therefore has no cause of action
REGINALD JONES, Plaintiff, v. ALLSTATE INSURANCE COMPANY, Defendant. County Court, 1st Judicial Circuit in and for Escambia County. Case No. 99-3696-SP-11, Division 5. March 26, 2000. Patricia A. Kinsey, Judge. Counsel: Robert Heath, Pensacola, for Plaintiff. Yancey Langston, for Defendant.
ORDER DENYING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT
A hearing on defendant’s Motion for Summary Judgment was held in chambers on March 16, 2000. Having reviewed the pleadings and memorandums of law provided by both parties, the court finds:
On or about August 10,1998, plaintiff was injured in a motor vehicle collision. As a result of his injuries plaintiff incurred medical expenses and filed a claim for PIP benefits with his insurer, Allstate Insurance Company. The particular medical expense in question in this action is a cinematic x-ray1 which was performed by Nu-Best Diagnostics. The charge for this test was $650.00. When the bill was submitted to Allstate, it denied the claim stating “[t]he service has been determined not to be medically necessary.” Plaintiff then filed this action seeking payment.
Defendant moved for summary judgment relying on language in the insurance policy which provides:
If an insured person incurs medical expenses which we deem to be unreasonable or unnecessary, we may refuse to pay for those medical expenses and contest them. If the insured person is sued by a medical services provider because we refuse to pay medical expenses which we deem to be unreasonable or unnecessary, we will pay resulting defense costs and any resulting judgment against the insured person. We will choose the counsel. The insured person must cooperate with us in the defense of any claim or lawsuit. If we ask an insured person to attend hearings or trials, we will pay up to $50.00 per day for loss of wages or salary. We will also pay other reasonable expenses incurred at our request. (Emphasis added)
Plaintiff admits he has not personally paid this $650.00 medical expense and that his provider has not yet sued him for payment. Allstate argues that because the medical provider has not sued plaintiff, plaintiff has not been damaged and therefore has no cause of action under the insurance contract.
While Allstate contends this is a simple contract case where it is only enforcing a provision of its insurance contract, the court is compelled to look beyond the contract where it is apparent a contract provision contravenes the purpose of the PIP statute. The Florida Motor Vehicle No-Fault Law, Sections 627.730 through 627.7405, Florida Statutes, was enacted to provide swift and virtually automatic payment of benefits and to discourage companies from contesting valid claims. Comeau v. Safeco Ins. Co., 356 So.2d 790 (Fla. 1987), Government Employees Inc. Co. v. Gonzalez, 512 So.2d 269 (Fla. 3d DCA 1987), Delta Casualty Company v. Pinnacle Medical, Inc., 721 So.2d 321 (Fla. 2000).
The legislature’s intent was to enhance the public welfare through “a lessening of the congestion of the court system, a reduction in concomitant delays in court calendars, a reduction of automobile insurance premiums and an assurance that persons injured in vehicular accidents would receive some economic aid in meeting medical expenses and the like, in order not to drive them into dire financial circumstances with the possibility of swelling the public relief rolls.” Lasky v. State Farm Insurance Co., 296 So.2d 9 (Fla.1974).
Section 627.418(1), Florida Statutes, provides that policy provisions “which contain any condition or provision not in compliance with the requirements of this code… shall be construed and applied in accordance with such conditions and provisions as would have applied had such policy, rider, or endorsement been in full compliance with this code . . .” See also Section 627.412(2). The courts have steadfastly required insurance policies to comply with Florida statutory law. See State Farm v. Chapman, 415 So.2d 47 (Fla. 5th DCA 1982), rev. den. 426 So.2d 29 (Fla. 1983), New Hampshire Ins. Co. v. Knight, 506 So.2d 75 (Fla. 5th DCA 1987), Auto Owners Ins. Co. v. Dejohn, 640 So.2d 158 (Fla. 5th DCA 1994).
This court finds defendant’s insurance policy provision directly contravenes the stated purpose of the PIP statute and leaves insureds powerless to challenge Allstate’s decision as to what medical care is medically necessary, exposing insureds to lawsuits, judgments and subsequent harmful credit consequences. It also potentially will cause a chilling effect on the willingness of medical providers to treat persons injured in motor vehicle accidents. This policy provision (“medical expenses which we deem to be unreasonable or unnecessary, we may refuse to pay”) allows the insurer, rather than treating physicians, to unilaterally decide what medical treatment is reasonable and necessary. The plain language of this provision negates the current legal requirement for an IME (independent medical examination) opinion prior to reducing or terminating PIP benefit. See United Auto Ins. Co. v. Viles, 726 So.2d 320 (Fla. 3d DCA 1998).
The ultimate determination of whether medical treatment is “reasonable and necessary” has always been a question for the trier of fact. Dungan v. Ford, 632 So.2d 159 (Fla. 1st DCA 1994), Derius v. Allstate, 723 So.2d 271 (Fla. 4th DCA 1998). Defendant’s policy provision effectively denies plaintiff access to the courts.
Additionally, by unilaterally permitting Allstate to decide what medical treatment is “reasonable and necessary,” the policy provision violates the no-fault act as insurance companies cannot impose requirements that are more onerous than those specified in the PIP statute. Dunsmore v. Interstate Fire Ins. Co., 301 So.2d 502 (Fla. 1st DCA 1974), see also Fortune Insurance Co. v. Pacheco, 695 So.2d 394 (Fla. 3d DCA 1997).
The doctor/patient relationship is a time honored and valuable tradition. A necessary element of the healing process is the mutual respect and trust that must exist between the physician and patient both in the diagnostic and treatment phases of any illness or injury. Allstate’s policy provision effectively drives a wedge between the medical care provider and the patient by forcing them into adversarial positions. If insurers are permitted to unilaterally decide what treatment is medically necessary and deny payment, insureds/patients must decide whether to forgo insurance benefits they purchased and pay for the treatment themselves to protect the doctor/patient relationship and their credit or to inform the medical provider the insurance company has determined the treatment was not medically necessary and the health care provider must sue the patient to receive payment.
Allstate argues their “indemnity” provision protects insureds by providing them legal representation in any law suit filed against them by a medical care provider. However, the PIP statute clearly intends all claims for benefits should be handled without delay. Rather than complying with the statute, Allstate’s policy provision imposes additional expense and delay in payment of contested medical benefits by requiring the medical provider to file suit against the insured. The physician/patient relationship should not be forced to suffer the damage that will inevitably result from litigation when the objectives of the PIP statute are clear.
It is not difficult to imagine the following scenario. A medical care provider sues a patient because an insurer has denied payment for medical treatment. The insurer responds by providing counsel to argue (ostensibly on behalf of the patient) that the medical care provider should not be paid for the treatment it provided as the insurer has determined the treatment was not medically necessary. Since Allstate’s policy imposes an obligation on the insured to “cooperate with us in the defense of any claim or lawsuit,” the insured must participate and cooperate in the litigation or risk losing the “protection” of the indemnification. Now the insured is forced to sit back and watch as their counsel argues the treatment should not have been provided and the medical provider should not be paid for treatment the insured accepted and continued because they found it beneficial.
Enforcing this policy provision would create an adversarial relationship between medical care providers and patients and will inevitably have a chilling effect on physicians’ willingness to treat patients injured in motor vehicle accidents.2 As a result, this policy provision fundamentally undermines the purposes of the PIP statute and the doctor/patient relationship.
In addition to the inevitable effects on the doctor/patient relationship, Allstate’s argument that plaintiff will sustain no damages as a result of wrongful non-payment fails because the indemnification provision ignores the harmful consequences to an insured’s credit history and financial future caused by the mere filing of a credit driven law suit. Even if Allstate pays any judgment obtained by the medical care provider, the insured’s credit history will reflect the untimely payment and subsequent judgment.
Should plaintiff elect to pay the rejected medical expenses himself to protect either his ability to continue to receive medical treatment or his credit rating, this provision appears to foreclose any subsequent challenge of the insurer’s denial of benefits as the policy requires the medical provider file a complaint against the insured as a prerequisite to payment. To be eligible for PIP benefits, the insured must expose himself to these foreseeable financial consequences — the very “dire financial circumstances” the no-fault statute was created to prevent. See Lasky v. State Farm, 296 So.2d 9 (Fla. 1974). The promise to indemnify insureds by satisfying judgments and paying litigation expenses when insureds are sued cannot provide compensation for these damages.
Allstate does not deny its insurance policy is in fact a contract of adhesion and does not deny that whether medical treatment was “reasonable and necessary” is ultimately a question for the finder of fact. Allstate contends its promise to defend plaintiff should his medical care providers sue him for non-payment is sufficient as a matter of law to establish plaintiff can not be damaged and therefore has no cause of action to permit him to bring this action. For the reasons previously stated, the court disagrees. Allstate has not established it is entitled to judgment as a matter of law.3
ORDERED that defendant’s Motion for Summary Judgment is denied.
________
1The court presumes this x-ray test was prescribed by plaintiff’s treating physician as it would be highly unusual for an imaging center to perform such a test without a medical referral.
2It is common knowledge that in the Escambia County area there are physicians who either will not or are extremely reluctant to accept patients who have been involved in automobile collisions.
3Obviously, Allstate is entitled to have the trier of fact determine if the questioned medical treatment was reasonable and medically necessary.
* * *
