7 Fla. L. Weekly Supp. 1a

Insurance — Personal injury protection — Arbitration — No abuse of discretion in finding that insured assigned PIP benefits to medical providers based upon evidence that insured signed form authorizing medical providers to file for and receive payment for medical benefits, that insured received services from providers but was not required to pay at time of service, that providers submitted forms to insurer for direct payment, and that all parties treated insured’s signature as an assignment up to the point a claim dispute arose — Once assignment is made and a claim dispute arises, assignment is irrevocable and insured no longer has standing to argue that no assignment occurred — Court rejects insured’s contention that the only method for assigning PIP benefits is a direct counter-signature on the actual invoice submitted to the insurer — Section 627.736(5) may be constitutionally applied to order arbitration of dispute between medical provider and insurer — Insurance policy language at issue provided separate and independent basis to enforce arbitration — Arbitrable issues — Trial court appropriately found that arbitrators should determine whether, under facts before them, the medical benefits at issue were causally related to either or both accidents and whether such medical services were reasonable and necessary

STACEY MOCHNICK, Plaintiff/Appellant, vs. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant/Appellee. 4th Judicial Circuit in and for Duval County, Division FM-A. Appellate Case No. 99-1AP. Lower Case No. 98-04270 CC. August 31, 1999. E. McRae Mathis, Judge. An Appeal from the County Court, In and for Duval County. Counsel: Niels P. Murphy, Jacksonville, for Plaintiff/Appellant. Raymond L. Roebuck, Taylor, Day & Currie, Jacksonville, for Defendant/Appellee.

ORDER AND DECISION AFFIRMING THE ORDER OF COUNTY COURT GRANTING MOTION TO COMPEL ARBITRATION

This case came before this Court in its appellate capacity pursuant to Florida Rules of Appellate Procedure 9.130(a)(3)(C)(v). On appeal is the Order Granting Defendant State Farm Mutual Automobile Insurance Company’s Motion to Compel Arbitration rendered on December 3, 1998 by the Honorable John A. Moran, County Court Judge in and for Duval County, Florida. (Apx. 14)¹

Ms. Mochnick, the Plaintiff, sued State Farm in Duval County Court seeking payment of personal injury protection benefits pursuant to Florida Statutes 627.730 – Section 627.7405 for medical charges she alleged related to motor vehicle accidents occurring on or about February 25, 1997 and March 2, 1997. (Apx. 1). In response to such Complaint, State Farm filed Motions to Compel Arbitration Or, in the Alternative, Motion to Dismiss. (Apx. 2, 9). State Farm asserted that Ms. Mochnick had previously assigned PIP benefits issued to her medical providers such that the medical providers were to be paid directly by State Farm for treatment rendered to Ms. Mochnick. In support of its contentions, State Farm filed the affidavit of Art Ashcraft (Apx. 3) and the affidavit of Felicia Seabury. (Apx. 8). In opposition to the Motion to Compel Arbitration, Plaintiff/Appellant filed an affidavit by Ms. Mochnick. (Apx. 6). In addition, the parties authenticated through Request for Admissions relevant health insurance claim forms or HCFA forms as well as other documents. (Apx. 5, 7)²

After reviewing the evidence, Judge Moran determined in his discretion that Ms. Mochnick had executed assignments of benefits to Salisbury Imaging, Alfredo Jacome, M.D., and Jacksonville Neurological Clinic, Inc., P.A. (hereafter “Jax Neuro”). Therefore, Judge Moran granted Defendant’s Amended Motion to Compel Arbitration and ordered arbitration between medical providers and State Farm as to the issues of medical necessity and causation.³

Plaintiff/Appellant Mochnick then appealed to this Court on three issues: whether she assigned her PIP benefits to these medical providers, whether Judge Moran could constitutionally compel arbitration pursuant to Section 627.736(5), Florida Statutes (1997), and whether the arbitration should include issues of medical necessity and causation.

Importantly, this Court’s standard of review as to whether Ms. Mochnick assigned her PIP benefits to the medical providers, pursuant to Section 627.736, is whether the Trial Court, Judge Moran, abused his discretion in so finding. Island House Developers, Inc. v. Amac Construction, Inc., 686 So. 2d 1377, 1377 (Fla. 1st DCA 1997). Upon review of the evidence before Judge Moran, this Court cannot agree that Judge Moran abused his discretion in his findings that Ms. Mochnick assigned her PIP benefits to the medical providers such that the medical providers may be paid directly by State Farm for treatment rendered to Ms. Mochnick.

This Court acknowledges that Ms. Mochnick has stated in her affidavit that she did not assign her benefits. (Apx. 6). Whether an assignment occurred, however, is an issue for this Court to determine and is not dependent on the parties’ self-servi ng statement s. The evidence is clear that Ms. Mochnick received medical care and services from these providers, yet she was not required to pay for such services at the time of service. Instead, the evidence shows Ms. Mochnick executed forms which transferred and assigned her interests to the medical providers to directly bill State Farm. The medical providers, relying on such forms as assignments, accordingly submitted HCFA forms to State Farm for direct payment.

Specifically, as to medical care provided by Salisbury Imaging, Ms. Mochnick indicated in the Patient Registration form that she was seeking medical treatment for a condition relating to an automobile accident which occurred on March 2, 1997 (Apx. 6, Ex. B). She signed a form, the purpose of which when read as a whole, authorizes the medical provider to file for benefits and to receive payment of insurance benefits. Ms. Mochnick contended that because she did not check a box indicating whether the applicable insurance was liability, Medigap, worker’s compensation or Medicare, that her signature on such form was ineffective. However, as a matter of law, this Court must presume that Ms. Mochnick read the form and was fully aware that the purpose of the form was to authorize Salisbury Imaging to seek payment directly from the applicable insurer. The evidence is also clear that Salisbury Imaging, relying on the same forms referred to by Ms. Mochnick, in fact sought payment of medical payments directly from State Farm. The records indicate a “HCFA” form submitted by Salisbury Imaging to State Farm, which noted that the patient’s signature was on file authorizing payment of medical benefits to the undersigned physician or supplier for services described below, that Salisbury Imaging accepted assignment, and that Salisbury was billing State Farm for the cost of services provided. (Apx. 5, 7, Ex. A). Finally, the affidavit of Felicia Seabury, which was before Judge Moran, establishes that State Farm even received a Request for Arbitration on behalf of Salisbury Imaging based on an assignment of benefits executed by Ms. Mochnick. (Apx. 8, Ex. A). In short, all parties treated Ms. Mochnick’s signature as an assignment up to the point the claim dispute arose. Once an assignment is made and a claim dispute arises, the assignment is irrevocable and Ms. Mochnick no longer has standing to argue that no such assignment occurred. See State Farm Auto. Ins. Co. v. Gonnella, 677 So. 2d 1355, 1356 (Fla. 5th DCA 1996).

This Court also finds that Judge Moran did not abuse his discretion in finding that Ms. Mochnick, in fact, assigned her PIP benefits to Dr. Nabizadeh and Jax Neuro. Ms. Mochnick has, in fact, admitted that she did authorize direct payment to Jax Neuro on August 9, 1997. (See Exhibit “A” to Ms. Mochnick’s Affidavit). (Apx. 6, Ex. A).⁴ However, Ms. Mochnick argues that she only authorized payment of “Medicare benefits” for the July 18, 1998 visit. Ms. Mochnick’s argument elevates form over substance. Ms. Mochnick did execute a statement which states, “I authorize the release of any medical information necessary to process this claim and request payment of Medicare payments either to myself or the party who accepts assignment below.” (Apx. 6, Ex. A). Judge Moran, therefore, correctly reasoned that Ms. Mochnick understood that she was authorizing the medical provider to submit a claim to the applicable third-party payer and to receive direct payment. Plaintiff/Appellant also argues that because Dr. Nabizadeh did not check box 13 “accept assignment,” on such form that Dr. Nabizadeh did not accept assignment of such benefits. This argument is directly countered by the HCFA form submitted to State Farm by Dr. Nabizadeh’s Jax Neuro requesting payment directly from State Farm and expressly stating that Dr. Nabizadeh and Jax Neuro accepted assignment. (Apx. 5, 7, Ex. C).

Finally, the evidence also supports Judge Moran’s decision that Ms. Mochnick assigned her PIP benefits to Dr. Jacome such that Dr. Jacome could be directly paid by State Farm. There is no evidence that Ms. Mochnick ever submitted a claim to State Farm for services received by Dr. Jacome. Instead, Dr. Jacome submitted a HCFA form to State Farm which advised State Farm that Ms. Mochnick’s signature was on file authorizing payment and that he accepted assignment. (Apx. 5, 7, Ex. B). Once again, the medical provider contended that it had received an assignment from Ms. Mochnick. Based on the record evidence, this Court will not find that Judge Moran abused his discretion.

This Court also notes that even if an express written assignment was not executed by Ms. Mochnick, certainly an equitable assignment arose as to these providers such that it would be reasonable for State Farm to make payment to these medical providers based on the HCFA forms submitted. See Giles v. SunBank, N.A., 450 So. 2d 258, 260 (Fla. 5th DCA 1994) (equitable assignments will be recognized to effectuate the plain intent of the parties). State Farm, in fact, even made payments to Jax Neuro. Cf. State Farm Fire and Casualty Co. v. Ray, 556 So. 2d 811, 813 (Fla. 5th DCA 1990) (assignments are irrevocable when given in exchange for medical care). To hold otherwise would undercut the desired policy of prompt payment of PIP claims by insurers. See 627.736(4), Fla. Stat. (1997).

This Court also rejects Plaintiff’s contention that the only method for assigning PIP benefits is a direct counter-signature on the actual invoice submitted to the insurer. As set forth above, Ms. Mochnick executed forms which authorized direct payment to the provider, an assignment. See, Orion Ins. Co. v. Magnetic Imaging Systems, One, 696 So. 2d 475, 477 (Fla. 3d DCA 1997). The HCFA form submitted by the insureds indicated that the insured’s signature was on file. Section 627.736(5), while authorizing payment based on counter-signatures, does not preclude an assignment of benefits from arising as a matter of law by other written documents. Section 627.736(5) recognizes that medical providers may accept “assignments.” See also Ray, 556 So. 2d at 813 (assignment arising from written document entitled irrevocable assignment of benefits).

In addition, this Court rules, as a matter of law, that in this Circuit, Section 627.736(5) may be constitutionally applied to enforce arbitration in the instant matter. While recognizing that a conflict does exist between the District Courts of Appeal, the First District Court of Appeal, whose decisions are binding on this Court, has upheld a court’s right to order mandatory arbitration of Pip benefits pursuant to § 627.736(5). Rittman v. Allstate Ins. Co., 627 So. 2d 391 (Fla. 1st DCA 1999). While the First District Court of Appeal did not directly rule on the constitutionality of Section 627.736(5) in Rittman, the court cited the Omni Ins. Co. v. Special Care Clinic, Inc., 708 So. 2d 314, 315 (Fla. 2d DCA 1998) decision, as well as the Fourth District Court’s decision in Southeast Diagnostic Services v. State Farm Mutual Auto. Ins. Co., 697 So. 2d 988 (Fla. 4th DCA 1997) and the Third DCA’s decision in Orion, 696 So. 2d at 477. The Court did not cite the previously issued decision of Delta Casualty Co. v. Pinnacle Medical, Inc., 721 So. 2d 321 (5th DCA 1998), review granted sub. nom. Nationwide Mutual Fire Ins. Co. v. Pinnacle Medical, Inc., 732 So. 2d 328 (Fla. 1999) (table), although such decision was in direct conflict with Orion in that the Court refused to apply Section 627.736(5) on constitutional grounds. The primary issue in Delta Casualty, Omni, Orion and Southeast was the constitutionality of Section 627.736(5), and as such, the First District Court of Appeal was certainly aware of a constitutional issue yet chose to enforce Section 627.736(5).

In addition, this Court also finds that, even absent the Rittman decision, the Third District Court of Appeal’s Orion decision is more apposite than the Fifth District Court of Appeal’s decision in Delta Casualty. While the Fifth District Court of Appeal held in Delta Casualty that Section 627.736(5) violates the due process rights of medical providers, this decision is not binding, and the Delta Casualty Court acknowledged conflict with the Third District’s Orion decision. In the instant case, the affidavit of Art Ashcraft establishes that there is an insurance policy which provided for mandatory arbitration of PIP benefits. (Apx. 3). As such, the medical providers certainly are third-party beneficiaries of such policy as in Orion.⁵ Like the facts in Orion, and unlike the facts in Delta Casualty, the Trial Court appropriately determined, based on the affidavit of Art Ashcraft, that the insurance policy language at issue provided a separate and independent basis to enforce arbitration.

Finally, this Court questions whether Ms. Mochnick even has the right to assert that the medical providers’ due process rights have been violated. Once an assignment is made, Ms. Mochnick no longer has any right to make any claim on the contract. See Rittman, 727 So. 2d at 394. Ms. Mochnick is not a medical provider and has no standing to assert that the medical providers’ due process rights have been violated. See Florida v. Summers, 651 So. 2d 191 (Fla. 2d DCA 1995) (party to whom statute can he applied has no standing to attack constitutionality of statute). Ms. Mochnick also lacks standing to attack the factual validity of such statute. See Section 86.091, Florida Statutes (1997).

Given the presumption of constitutionality of statutes, Florida League of Cities, Inc. v. Administration Commission, 586 So. 2d 397, 412 (Fla. 1st DCA 1991), and the First District Court’s Rittman decision, this Court finds that Judge Moran appropriately and constitutionally applied Section 627.736(5) in the instant case.

Finally, this Court upholds Judge Moran’s ruling that the arbitration between the medical providers and State Farm should include issues of medical necessity and causation. Section 627.736(5) clearly provides for arbitration of “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 case law is clear that while courts are required to determine issues of insurance coverage, whether a party is entitled to recover based on particular facts is an arbitrable decision. See, e.g., Liscio v. Montgomery Ward Ins. Co., 603 So. 2d 76, 77 (Fla. 4th DCA 1992); Stack v. State Farm Mutual Auto. Ins. Co., 507 So. 2d 617, 620 (Fla. 3d DCA 1987); see also U.S. Security Ins. Co. v. Magnetic Imaging Systems One, Ltd., 678 So. 2d 872, 873 (Fla. 3d DCA 1996) (arbitration of interest on late payment of PIP fees is appropriate). Judge Moran appropriately found that the arbitrators should determine whether, under the facts before them, the medical benefits at issue were causally related to either or both accidents and whether such medical services were reasonable and necessary. § 627.736(1)(a), Fla. Stat. (1997).

Judge Moran’s decision granting State Farm’s Motion to Compel Arbitration rendered on December 3, 1998, is hereby AFFIRMED.

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¹Unless otherwise noted, cites to the Appendix refer to documents contained in Appellant Mochnick’s Appendix filed with this Court.

²The parties agreed that Defendant’s limited participation in such discovery, which was intended to facilitate the hearing, would not constitute a waiver of the right of arbitration. (Appellee’s Apx. 6).

³Although Judge Moran’s Order also addressed Medical Imaging, the parties have agreed that this claim is no longer in dispute, and, therefore, Medical Imaging will not be addressed.

⁴The record is devoid of any evidence that Ms. Mochnick, who is 31 years old, had a right to receive Medicare benefits. See Apx. 5, Ex. A., Box 3.

⁵The Delta Casualty court distinguished Orion, in part, because the Court in Orion found that the medical providers were third-party beneficiaries to the insurance policy in the record.

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