STATE OF NEW JERSEY v. PETER J. DESCHENES, JR., D.D.S

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0570-09T10570-09T1

STATE OF NEW JERSEY,

Plaintiff-Respondent,

v.

PETER J. DESCHENES, JR., D.D.S.,

Defendant-Appellant.

__________________________________

 

Argued May 26, 2010 - Decided

Before Judges Stern and Sabatino.

On appeal from the Superior Court of New Jersey, Law Division, Somerset County, Docket No. L-1312-07.

Stephen H. Schechner argued the cause for appellant (Law Offices of Stephen H. Schechner, attorneys; Mr. Schechner, of counsel; Christine M. Gefaell and Mr. Schechner, on the brief).

Joan M. Scatton, Deputy Attorney General, argued the cause for respondent (Paula T. Dow, Attorney General, attorney; Melissa H. Raksa, Assistant Attorney General, of counsel; Ms. Scatton, on the brief).

Arthur Meisel argued the cause for amicus curiae New Jersey Dental Association.

PER CURIAM

The New Jersey Insurance Fraud Protection Act ("the IFPA" or "the Act"), N.J.S.A. 17:33A-1 to -30, among other things, subjects a health care professional or other person to civil penalties if he or she "[p]resents or causes to be presented any written or oral statement" in support of an insurance claim "knowing that the statement contains any false or misleading information concerning any fact or thing material to the claim" N.J.S.A. 17:33A-4a(1). Applying that provision, the trial court granted summary judgment to plaintiff, the State of New Jersey, against defendant, Peter J. Deschenes, Jr., D.D.S. ("Dr. Deschenes"), finding that Dr. Deschenes had violated the Act in signing a dental insurance claim form that misstated the correct dates on which Dr. Deschenes inserted six crowns in one of his patients. The trial court also imposed a $1000 fine and ordered Dr. Deschenes to reimburse the state $20,438 in counsel fees and investigative costs.

We vacate the summary judgment order and remand for a trial in the Law Division, at which the factfinder will determine in a plenary fashion whether, as the State contends, Dr. Deschenes actually knew at the time that he signed the claim form prepared by his office that the treatment dates listed within it were incorrect, or whether, as the defense contends, Dr. Deschenes lacked such conscious awareness, and that the situation is not one of a "knowing" misrepresentation but rather one of an innocent clerical mistake. We remand for a trial because there are genuine and material factual issues regarding Dr. Deschenes's state of mind that require testimonial proof and associated credibility assessments.

I.

Dr. Deschenes is a dentist with offices in Warren Township. He has been licensed to practice dentistry in New Jersey for thirty years. There is no indication in the record before us that Dr. Deschenes has ever been charged with insurance fraud, other than with respect to the single claim form at issue in this appeal.

At the times relevant to this matter, Dr. Deschenes was a participating dental provider for patients insured by the Delta Dental Plan of New Jersey ("Delta Dental"). In connection with that role as a provider, Dr. Deschenes agreed to abide by the insurer's policies and procedures. Those policies and procedures included obtaining, for certain specified kinds of treatments, prior approval from Delta Dental and a corresponding estimate of the insurance benefits to be paid. Dr. Deschenes also agreed to complete and submit to Delta Dental signed claim forms after the procedures had been approved and the patient had been treated.

In June 2000, Dr. Deschenes examined one of his long-standing patients, M.C., who was insured by Delta Dental. Based upon his diagnosis, Dr. Deschenes determined that M.C. needed to have six crowns inserted, specifically for teeth numbered 6, 7, 8, 9, 10 and 11.

Following M.C.'s diagnosis, Dr. Deschenes's office submitted to Delta Dental on June 20, 2000 a pre-treatment claim form. The submission sought the insurer's authorization for the installation of the six crowns, with an estimated billing charge of $750 per crown, for a projected billing total of $4500. The pre-treatment claim form, which Dr. Deschenes signed, left blank the actual dates of service, since the work had yet to be performed.

On July 5, 2000, Delta Dental responded to Dr. Deschenes's office with a written "Pre-Treatment Estimate of Benefits Voucher." The voucher indicated that the insurer anticipated paying $1614.50 in benefits for the six crowns $525 each for the first three crown insertions; $39.50 for the fourth; and nothing for the fifth and sixth. The column on the voucher entitled "Date Service Completed" was left blank.

The terms of M.C.'s coverage with Delta Dental apparently capped the annual benefits payable within a given calendar year at $2000. Because of that coverage limitation, the voucher issued by Delta Dental in July 2000 initially assumed that all six crowns would be inserted within the same calendar year, thereby resulting in only $39.50 in estimated benefits to M.C. for the fourth crown and no benefits for the fifth and sixth crowns.

After receiving Delta Dental's authorization to proceed with the six crown insertions, Dr. Deschenes originally scheduled to have three of the crowns installed on December 18, 2000 and the three remaining crowns to be inserted in January 2001. According to Dr. Deschenes's deposition testimony, the crown procedures were deliberately planned to straddle two calendar years in order to "get the maximum insurance benefit" under M.C.'s dental plan.

When M.C. arrived at Dr. Deschenes's office as scheduled, on December 18, 2000, Dr. Deschenes observed that she had extensive gingival bleeding. In Dr. Deschenes's professional judgment, the bleeding required treatment before any of the crowns could be inserted. Consequently, the crown insertions were postponed while M.C.'s bleeding problems were addressed.

M.C. returned to Dr. Deschenes's office on December 29, 2000, at which time she was reexamined and given a prescription for mouth rinses. On January 9, 2001, M.C. was seen again by Dr. Deschenes, at which time he made a pre-surgical impression for the six crowns.

Dr. Deschenes's office completed and returned the voucher, which functions as a claim form, to Delta Dental on January 12, 2001. In the "Date Service Completed" column on the voucher, the date of "12/18/00" is handwritten alongside the entry for the first three crowns, and the date of "1/9/01" is handwritten next to the entry for the last three crowns. Dr. Deschenes admittedly signed the voucher. His signature appears above a signature line and below preprinted language in small print, certifying that "the procedures as indicated by date have been completed[.]"

After receiving the returned voucher, Delta Dental paid Dr. Deschenes's practice the sum of $3150 for all six crowns combined $1575 for the listed December 18, 2000 appointment date and $1575 for the January 9, 2001 listed appointment date. On March 5, 2001, Dr. Deschenes completed the necessary procedures and physically inserted all six crowns into M.C.'s mouth. When subsequently asked by the State's investigators why his office had submitted the completed voucher for M.C. in January 2001 after her crown impressions were taken, but before the crowns were actually inserted in March 2001, Dr. Deschenes reportedly told them that there was confusion because "some companies want you to bill on the date of impression" and others "want[] you to bill on the date of insertion." Dr. Deschenes acknowledged, however, that under his provider agreement with Delta Dental, the crown insertion date, not the impression date, functions as the billing trigger, and that he is bound by those billing requirements.

Meanwhile, pursuant to its claim auditing functions, Delta Dental sent a letter to Dr. Deschenes dated February 5, 2001, requesting M.C.'s office records, her corresponding financial ledger, and the laboratory receipts for the six crowns. Dr. Deschenes's office did not respond to that first letter, so Delta Dental sent a second letter on April 22, 2004 requesting the same paperwork. Both letters went unanswered. At his deposition, Dr. Deschenes did not recall receiving either of those letters.

On August 16, 2004, Delta Dental sent a third letter to Dr. Deschenes, again seeking the same information concerning M.C.'s treatment and billing. Dr. Deschenes did recall receiving that third letter. In fact, the letter prompted Dr. Deschenes to review M.C.'s patient records. According to Dr. Deschenes, after completing that review, he first noticed that the wrong insertion dates had been handwritten on the 2001 payment voucher.

Consequently, without receiving any specific request from Delta Dental for a refund, Dr. Deschenes mailed a check to Delta Dental on August 24, 2004, in the amount of $1575. The check amount represented the $1285 that Delta Dental was erroneously billed for and had paid, plus $290, representing the balance of insurance benefits available to M.C. for the 2001 calendar year. A letter from Dr. Deschenes accompanied the check, explaining that "[t]reatment was claimed incorrectly." Dr. Deschenes did not bill M.C. for these refunded sums.

In August 2005, Delta Dental alerted the Division of Criminal Justice to a potential violation by Dr. Deschenes of the IFPA in connection with the claim for M.C.'s six crowns. This led the State to investigate Dr. Deschenes to determine if he had violated the IFPA. During that investigation, Dr. Deschenes spoke with the State's investigators and supplied requested information, apparently in a cooperative manner.

On August 15, 2007, the State filed a civil complaint in the Law Division against Dr. Deschenes for violating the IFPA in connection with the insurance claim for his work on M.C.'s six crowns. Among other things, the complaint accused Dr. Deschenes of "knowingly submitting" false material billing information to Delta Dental, thereby allegedly violating N.J.S.A. 17:33A-4.

While discovery was still incomplete, Dr. Deschenes moved for summary judgment. That motion was denied by the Law Division judge who was then handling the case ("the first motion judge"). Thereafter, discovery proceeded, including the deposition of Dr. Deschenes and the deposition of the Delta Dental auditor who had investigated the circumstances involving the insurance claim. The State then itself moved for summary judgment. Dr. Deschenes opposed the motion, but did not cross-move for summary judgment in his own right.

Following oral argument before another Law Division judge who had, by that point, assumed responsibility for the case ("the second motion judge"), the State was denied summary judgment. In his decision, the second motion judge determined that the record, when viewed in a light most favorable to defendant as the non-moving party, contained "no indication that (Dr. Deschenes) willfully submitted a fraudulent claim." The judge further noted that "[a]though the date of the claim was incorrect, the record indicates that it was merely a mistake, and it was a mistake that was corrected, albeit after a length of time[.]"

The State then renewed its motion for summary judgment, this time attaching additional discovery materials and also relying in its new brief on this court's then-recent opinion in Open MRI of Morris & Essex, L.P. v. Frieri, 405 N.J. Super. 576 (App. Div. 2009) ("Open MRI") (holding that proof of a civil violation of the IFPA does not require evidence of defendant's intent to deceive an insurance company). The State also moved to recover $35,641 in counsel and investigative fees.

Dr. Deschenes opposed the State's renewed summary judgment motion. He also cross-moved for reconsideration of his earlier application for summary judgment, which the first motion judge had denied.

Upon examining the parties' additional submissions and points of law, including our opinion in Open MRI, the second motion judge reconsidered his initial views of the case. In a written decision on August 14, 2009, the judge granted the State summary judgment and denied Dr. Deschenes's cross-motion.

The second motion judge stated in his opinion that "on reflection," his first decision was incorrect and not consistent with the purposes or requirements of the IFPA. In particular, the judge noted that, although the facts in Open MRI were "distinguishable" from the instant case, the opinion did reaffirm the legal principle that "intent to commit insurance fraud [is] not a necessary element of a violation of the IFPA." The judge also was ultimately persuaded by the State's assertion that, because Dr. Deschenes was "the person who actually performed the services" on M.C., he necessarily "knew" that the dates listed for those services on the claim form were incorrect. The judge characterized the actual date of service as an "objective fact which was known by defendant." Consequently, on final reflection, the judge concluded that "there was knowledge by the defendant that he submitted a material false statement in the insurance claim involved here[,]" and that "[n]o responsible jury could conclude that defendant did not knowingly submit false information in the insurance claim."

The second motion judge invited the parties to submit arguments concerning the appropriate penalty for the IFPA violation, and also directed the State to submit an updated certification in support of its request for counsel fees and costs. Following those submissions, the court entered an order on August 31, 2009 memorializing its grant of summary judgment to the State, imposing a $1000 fine, and ordering Dr. Deschenes to pay the State a modified sum of $20,438 in fees and costs.

Dr. Deschenes now appeals the trial court's final disposition. In essence, he argues that the inclusion of the incorrect treatment dates in the claim form was merely a clerical error, and that the trial court erred in summarily determining that he had "knowingly" submitted false and material treatment information to Delta Dental. He seeks reversal of the summary judgment order or, at a minimum, requests that this court vacate the order and allow the factfinder at a plenary trial to decide if he actually did engage in any "knowing" falsehood. Further, Dr. Deschenes argues that the trial court erred in denying his own motion for summary judgment, and that the facts and circumstances here can only be reasonably construed as presenting a situation of an innocent mistake on his part.

The New Jersey Dental Association, appearing as amicus curiae, likewise argues that the trial court erred in finding a violation of the IFPA in this case. It maintains that the statute should not be construed in a fashion that penalizes dental practitioners for mere clerical errors. Amicus further argues that the trial court's construction of the statute, if adopted by our courts, would have "very broad" adverse implications. Amicus asserts that "[i]n most dental offices . . . information that either is included on dental claim forms or is provided in electronic [claim] transmissions typically is entered by [the practitioner's] office staff," and thereby "a violation of the IFPA could occur almost any time there is an error, whether intentional or inadvertent."

The State maintains that the trial court's ultimate construction and application of the IFPA was proper, and was consistent with the strong anti-fraud policies underlying the statute. It contends that no genuine material issues of fact exist here to justify a trial.

II.

We approach the issues presented in this appeal mindful of the strong public policies underlying the Legislature's adoption of the IFPA in 1983. That comprehensive statute codifies the State's intent "to confront aggressively the problem of insurance fraud[.]" N.J.S.A. 17:33A-2; see also State v. Fleischman, 189 N.J. 539, 545 (2007); Liberty Mut. Ins. Co. v. Land, 186 N.J. 163, 170-72 (2006).

The Legislature recognized that insurance fraud is "a problem of massive proportions that currently results in substantial and unnecessary costs to the general public in the form of increased rates." Merin v. Maglaki, 126 N.J. 430, 436 (1992). The IFPA aims to address those societal harms "by facilitating the detection of insurance fraud, eliminating the occurrence of such fraud through the development of fraud prevention programs, requiring the restitution of fraudulently obtained insurance benefits, and reducing the amount of premium dollars used to pay fraudulent claims." N.J.S.A. 17:33A-2; see also Sailor, supra, 355 N.J. Super. at 319 (quoting and applying these legislative purposes).

The key provision of the Act relevant to this civil penalty action by the State, N.J.S.A. 17:33A-4a(1), provides that "a person or practitioner" violates the IFPA if he or she:

presents or causes to be presented any written or oral statement as part of, or in support of . . . a claim for payment or other benefit pursuant to an insurance policy . . . knowing that the statement contains any false or misleading information concerning any fact or thing material to the claim[.]

[N.J.S.A. 17:33A-4a(1) (emphasis added).]

The critical term "knowing" is not defined within N.J.S.A. 17:33A-4a(1), nor, for that matter, within various definitions of other terms in the Act set forth at N.J.S.A. 17:33A-3. Consequently, we must consider the most commonly-understood legal meaning of "knowing" when interpreting and applying that statutory term. See State v. Afanador, 134 N.J. 162, 171 (1993) ("Absent any explicit indications of special meanings, the words used in a statute carry their ordinary and well-understood meanings.").

The most logical and proximate definition of "knowingly" appears in the Code of Criminal Justice, N.J.S.A. 2C:2-2b(2). We consult that definition from the Criminal Code, not only because it is one of long-standing and widespread application, but also because a "knowing" state of mind of a defendant is comparably required in criminal, as opposed to civil, prosecutions for insurance fraud. See N.J.S.A. 2C:21-4.6.

As defined in N.J.S.A. 2C:2-2b(2):

(2) Knowingly. A person acts knowingly with respect to the nature of his conduct or the attendant circumstances if he is aware that his conduct is of that nature, or that such circumstances exist, or he is aware of a high probability of their existence. A person acts knowingly with respect to a result of his conduct if he is aware that it is practically certain that his conduct will cause such a result. "Knowing," "with knowledge" or equivalent terms have the same meaning.

[N.J.S.A. 2C:2-2(b) (emphasis added).]

This classic definition, which is rooted in Section 2.02 of the Model Penal Code, distinguishes a "knowing" state of mind from a more-culpable "purposeful" state of mind, see N.J.S.A. 2C:2-2b(1), and a less-culpable "reckless" or "negligent" state of mind, see N.J.S.A. 2C:2-2b(3)-(4).

"A person acts purposely with regard to the nature of his conduct or a result thereof if it is his conscious object to engage in conduct of that nature or to cause such a result." N.J.S.A. 2C:2-2b(1). By comparison, a "knowing" state of mind does not require that certain outcomes be the actor's "conscious object," but rather that he is "aware" of the nature or attendant circumstances of the conduct or at least a "high probability of their existence." N.J.S.A. 2C:2-2b(2). On the other hand, a "knowing" state of mind goes beyond merely "negligent" behavior, which, under the Criminal Code, requires that the actor "should be aware of a substantial and unjustifiable risk" that a material element will flow from his or her conduct, and that the actor's failure to perceive that risk "involves a gross deviation from the standard of care that a reasonable person would observe in the actor's situation." N.J.S.A. 2C:2-2b(4). This definition of "knowing" conduct is instructive in this civil setting under the IFPA, recognizing that the State's burden of proof is a lesser standard of the preponderance of the evidence, rather than the criminal standard of proof beyond a reasonable doubt. Liberty Mut. Ins. Co., supra, 186 N.J. at 175-79.

Moreover, civil law at times distinguishes between actual knowledge, which necessitates proof that the actor actually became aware of the information in question, as opposed to "constructive" knowledge, wherein such awareness is presumed or imputed. See, e.g., Sourlis v. Red Bank, 220 N.J. Super. 434, 440 (App. Div. 1987). In that vein, Black's Law Dictionary defines "knowing" as "having or showing awareness or understanding; [or] well informed." Black's Law Dictionary 876 (7th ed. 1999).

The published cases arising under the IFPA have reflected a sensitivity to these distinctive gradations of an actor's potential state of mind. For example, it is now well-established that proof of a civil violation of the IFPA does not require "proof of an intent to deceive." Open MRI, supra, 405 N.J. Super. at 583 (citing State v. Nasir, 355 N.J. Super. 96, 106 (App. Div. 2002), certif. denied, 175 N.J. 549 (2003)). In Open MRI, we found that the State was entitled to summary judgment in proving that the principal defendants in that case had violated the IFPA by knowingly operating an MRI facility without a license, having been previously told on two occasions that the facility required such a license before commencing operations. Id. at 584-85.

In Nasir, a policyholder was found liable under the IFPA for knowingly providing false statements on an application for disability benefits and on an associated claim form to recover such benefits. Nasir, supra, 355 N.J. Super. at 100 In that case, the defendant falsely answered "no" to the questions "(1) '[h]ave you had any physical, mental or emotional condition, injury, or sickness in the past 5 years?', and (2) '[h]ave you consulted or been attended by a physician or practitioner for any cause during the past 5 years?'" Id. at 106. In fact, the defendant had actually been consulted by a physician two weeks prior to his submission of the application. Id. at 100. These circumstances supported the finding of a "knowing" misstatement to the insurer. Id. at 106.

In Ledley v. William Penn Life Ins. Co., 138 N.J. 627 (1995), a beneficiary on a life insurance policy was denied coverage because the decedent had materially misrepresented his health on a policy application only two months before his death. Id. at 632. In particular, the decedent had misrepresented his health by falsely responding to several questions on the application. Ibid. Among other things, the decedent falsely stated that he had not consulted with any other physicians in the past five years, when in fact he had recently consulted at least two other physicians within the three months prior to his application. Id. at 632-33. The insured also falsely asserted that certain thyroid tests that he had undergone "came back [ok]" when, in reality, he was told that those tests had revealed nodules and possible cancer in his thyroid gland. Ibid.

Although Ledley was not a case brought under the IFPA, the Supreme Court found particularly significant that the insured had given false answers about "objective" statements of fact, such as the existence or non-existence of consultations with doctors, as opposed to "subjective" questions that may call for personal opinions. Id. at 635-37. Consequently, the Court found that the decedent had "knowingly" misrepresented material facts relating to his health, and that the insurance company had no duty to conduct an independent investigation of the truth of those objective assertions, at least in the absence of the insurer's knowledge of conflicting facts. Id. at 631-32.

On the other hand, our case law has also recognized that patients and medical providers may at times present inaccurate information to insurance companies that, although material, comprise innocent mistakes resulting from no more than simple oversight, carelessness, or negligence. In Longobardi v. Chubb Ins. Co., 121 N.J. 530, 540 (1990), the Supreme Court explained that forfeiting the coverage of an insured who commits such an "honest mistake" is unwarrented. In support of that proposition, the Court cited the IFPA, N.J.S.A. 17:33A-4a(1) and the statute's requirement of a "knowing" misrepresentation by an insured. Ibid. Moreover, such an expansive application of the statute would discourage individuals from correcting such simple errors in the future.

We apply these various state-of-mind principles here in the context of reviewing a trial court's grant of a motion for summary judgment. In that context, the court, even on appeal, must consider the facts in a light most favorable to the non-moving party. See Liberty Surplus Ins. Corp., Inc. v. Nowell Amoroso, P.A., 189 N.J. 436, 445 (2007). The court must determine "'whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.'" Id. at 445-46 (quoting Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 536 (1995)); see also R. 4:46-2(a). "A 'genuine issue of material fact' does not exist, if there is only one 'unavoidable resolution of the alleged disputed issue of fact.'" Id. at 446 (quoting Brill, supra, 142 N.J. at 540). It is also well-established that state-of-mind issues are frequently not suited for disposition through the pretrial device of summary judgment, and must instead await plenary testimony at a trial and credibility assessments by the factfinder. See, e.g., Mayo, Lynch & Assocs., Inc., v. Pollack, 351 N.J. Super. 486, 500 (App. Div. 2002).

Having closely examined the record in light of these governing legal principles, we conclude that the trial court erred in this case by granting summary judgment to the State, although parenthetically we agree that the penalty imposed and counsel fees awarded were reasonable if liability were established at an ensuing trial.

Viewing the record in a light most favorable to Dr. Deschenes, there are genuine issues of material fact as to whether he consciously "knew" at the time he signed the claim form that the dates contained within it were incorrect. The dates were not made up out of thin air, but instead appeared to correspond to the two dates on M.C.'s chart originally planned for her crown insertions. Although Dr. Deschenes is professionally responsible for the entries on the claim form, as prepared by his office staff, see N.J.A.C. 13:30-8.10(b) and -8.10(d), that vicarious responsibility does not necessarily mean that he realized when he signed the form, or had "a high probability" of awareness when he signed it, that the dates contained within it were incorrect.

We recognize that the date of a surgical or medical procedure is an objective fact. Even so, we do not read the statute to require a practitioner's perfect recall of treatment dates when he or she signs a claim form, or to impose strict liability for civil penalties arising out of what truly may be an innocent clerical or administrative error. Conversely, for the State to establish liability, the defendant need not have admitted actual knowledge of the misstatement, and the State can attempt to prove such knowledge circumstantially. The surrounding circumstances must be examined to test the doctor's assertions of an "honest mistake," including but not limited to such considerations as: whether there were multiple incorrect statements; whether they occurred on multiple occasions; the manner in which the claim form was prepared and presented for signature; the reliability of the internal office procedures in place to reduce errors; the promptness by which the error was rectified once it was spotted; and whether the misstatement resulted in a pecuniary or other benefit to the provider.

If the State's interpretation of the statute were taken to its logical outer limits, a simple unnoticed typographical error contained in a submitted claim form could produce a finding of insurance fraud. For example, a single digit within a date on the form could be mistakenly set forth (e.g., "2000" rather than "2001"), which is a common sort of error that easily can escape the attention of even the most astute proofreader. The statute cannot sensibly or fairly be read to justify civil penalties in such innocuous and commonplace situations. Moreover, we must bear in mind that a finding of insurance fraud can generate significant adverse collateral consequences for a defendant, although we were advised at oral argument in the present case that Dr. Deschenes's licensure and his ability to treat insured patients has not, thus far, been jeopardized by the instant judgment.

The fact that Dr. Deschenes unilaterally sent a full refund to Delta Dental, before even receiving a request for one, after he allegedly first became aware of the mistake, is also relevant to, although not dispositive of, the state-of-mind analysis. Because there are circumstances here reasonably suggestive of a benign state of mind on the part of Dr. Deschenes, summary judgment in favor of the State was inappropriately granted.

On the other hand, we reject Dr. Deschenes's contention that the chronology of events and the other proofs are so one-sided as to warrant summary judgment in his own favor. In particular, the fact that Dr. Deschenes signed and his office submitted the claim form and accepted payment on the claim in January 2001 before the crowns were actually placed in March 2001 is problematic, and weighs against his assertion that the form was submitted as the result of a clerical error. At trial, the judge will have to assess the veracity of Dr. Deschenes's explanation that he was confused about Delta Dental's procedures, and that he had mistakenly believed at the time that the insurer would accept and process claims after crown impressions were made but before they were actually inserted. The paper record before us does not suffice to make such credibility assessments. Instead, they are reserved for the trial judge, who will develop a "feel for the case" and have the chance to see the witnesses first-hand. Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 483-84 (1974). To be sure, the fact that Dr. Deschenes submitted the claim form and was paid by Delta Dental before he completed his work on M.C.'s crowns raises significant concerns, but those concerns do not permit affirmance of the trial court's ruling in light of the applicable summary judgment standards.

Consequently, this matter must be remanded for a plenary trial to assess, in particular, whether Dr. Deschenes signed and authorized the submission of the claim form "knowing" that it contained incorrect treatment dates. We realize that it has been nearly a decade since the events in question took place, and that memories may well have faded and relevant witnesses might not be readily available to the parties. Even so, the discrete and important state-of-mind assessment required in this case necessitates such additional proceedings, no matter how remote in time the underlying events may be.

Out of an abundance of caution, and without by any means presuming that a bench trial could not be fairly conducted by either of the two successive judges who ruled on the summary judgment motions, we direct that a different Law Division judge preside over the trial and serve as the ultimate factfinder on remand. See State v. Henderson, 397 N.J. Super. 398, 416 (App. Div.) certif. granted on other grounds, 195 N.J. 521 (2008); State v. Gomez, 341 N.J. Super. 560, 579 (App. Div.) certif. denied, 170 N.J. 86 (2001).

Vacated and remanded for further proceedings consistent with this opinion. Jurisdiction is not retained.

 

For privacy reasons, we use initials to refer to the patient, who is not a party to the litigation.

The State does not dispute that sequencing the crown insertions in this fashion over two calendar years, in order to maximize the patient's insurance benefits, was not inherently wrongful.

Although defense counsel has characterized this request as part of a "random" audit by the insurer, the State contends that many carriers such as Delta Dental regard claims for service straddling the end of calendar year and the start of a new year as "red flag" events that warrant closer examination, and that such multi-year charges are routinely audited for that reason.

The record does not explain the three-year gap between Delta Dental's first two informational requests.

The parties have not supplied us with a transcript of the first motion judge's oral decision, and that transcript is not necessary for our review of the ensuing summary judgment order entered by the second motion judge.

The judge does not explain why he referred to a potential jury trial. See State v. Sailor, 355 N.J. Super. 315, 322 (App. Div. 2001) (noting that there is no right to a jury trial in civil penalty actions brought under the IFPA).

(continued)

(continued)

26

A-0570-09T1

August 3, 2010