All Healthy Style Med., P.C. v ELRAC, Inc.
Annotate this CaseDecided on May 16, 2018
Civil Court of the City of New York, Kings County
All Healthy Style Medical, P.C., a/k/a All Healthy Style, P.C. a/a/o Maria Batista, Plaintiff,
against
ELRAC, Inc., Defendant.
46060/14
For plaintiff:
David Landfair Esq.
Kopelovich & Feldsherova, PC
3rd Fl., Suite NE1
Brooklyn, NY 11323
For defendant:
Paul A. Barrett Esq.
Carman, Callahan & Ingham LLP
266 Main St.
Farmingdale, NY 11735
Odessa Kennedy, J.
RECITATION, AS REQUIRED BY CPLR 2219(A), OF THE PAPERS CONSIDERED IN THE REVIEW OF THIS MOTION:
Notice of Motion 1
Affirmation in Opposition 2
In an action to recover assigned first-party no fault insurance benefits, defendant moves for summary judgment to dismiss the complaint on the basis that defendant properly denied bills which exceeded the permissible amount under the Worker's Compensation fee schedule, and bills received after the policy had been exhausted.
FEE SCHEDULE DEFENSE
Defendant received a bill on July 29, 2013 in the amount of $359.35 for services provided on June 20, 2013, and issued partial payment in the sum of $180.73. On August 19, 2013, defendant denied plaintiff's remaining claim for $178.62 as exceeding the permitted amount under the Worker's Compensation fee schedule.
On August 19, 2013, defendant received a bill in the amount of $180.73 for services provided on July 18, 2013, and issued partial payment in the sum of $135.02. On September 6, [*2]2013, it denied plaintiff's remaining claim of $45.71 as exceeding the permitted amount under the Worker's Compensation fee schedule.
An insurer is only required to pay for claimed services in the amounts prescribed by the fee schedule (Oleg's Acupuncture, P.C. v. Hereford Ins. Co., 58 Misc 3d 151(A), 2018 NY Slip Op. 50095(U) [App. Term, 2d Dept, 2d, 11th & 13th Jud. Dists. [2018]), and has the burden to establish that the amounts charged exceeded the permitted amounts (Rogy Med., P.C. v. Mercury Cas. Co., 23 Misc 3d 132(A), 2009 NY Slip Op. 50732(U) [App Term, 2d, 11th & 13th Jud Dists 2009]). To establish entitlement to summary judgment, insurer must demonstrate that all sums paid to a provider were pursuant to the fee schedule, even if less than the amount billed (Z.M.S. & Y Acupuncture, P.C. v. GEICO Gen. Ins. Co., 58 Misc 3d 143(A), 2017 NY Slip Op. 51891(U) [App. Term, 2d Dept, 2d, 11th & 13th Jud. Dists. 2017]).
To substantiate that the bills exceeded the permitted amount under the fee schedule, defendant requests that the Court take judicial notice of portions of the fee schedule annexed to its moving papers.
Defendant further submits an affidavit of Corinne Garner, a claims representative employed by ELCO Administrative Services Company ("ELCO"), who states that she has personal knowledge of the subject claims as she is the assigned adjuster in the matter.
While the Court is permitted to take judicial notice of the Workers Compensation fee schedule, the fee schedule in and of itself does not establish that a defendant properly utilized the codes within the fee schedule to calculate the amount a plaintiff is entitled to recover (Acupuncture Healthcare Plaza I, P.C. v. Metlife Auto & Home, 54 Misc 3d 142(A), 2017 NY Slip Op. 50207(U) [App Term, 2d Dept, 2d, 11th and 13th Jud. Dists., 2017]). An insurer may establish that the fees charged for medical services exceeded the rates in the fee schedule, through an affidavit of an employee with personal knowledge of the claim, in conjunction with excerpts from the Worker's Compensation fee schedule. See, (Natural Acupuncture Health, P.C. v. Praetorian Ins. Co., 30 Misc 3d 132(A), 2011 NY Slip Op. 50040(U) [App. Term, 1st Dept, 2011]).
In the case at bar, Garner's affidavit is insufficient to establish that the bills exceeded the permissible amount under the Worker's Compensation fee schedule.
Garner's claim to have personal knowledge of the file based on her assignment to the file is inadequate. The affiant does not specify when she was assigned to the file, or whether there were any preceding adjusters assigned to the claim. Notably, the NF-10 lists someone other than Garner as the adjuster on the matter, which Garner does not address.
Garner's knowledge of the file is further undermined by her inconsistent accounts of the claim. Paragraph 20 of her affidavit states that the second bill at issue with the date of service of July 18, 2013 was paid in full in the sum of $180.73 while paragraph 23 states that only $135.02 of the bill was paid.
Moreover, Garner fails to demonstrate in any details that she has sufficient training or experience regarding the Worker's Compensation fee schedule. Nor does she explain the basis that the bills exceeded the permitted amount under the Worker's Compensation fee schedule, the nature of the services billed, the specialty of the provider, nor the section(s) of the code mandating the reductions of the bills.
The affiant claims that her review of the file and computer notes for the subject claims indicate that the bills at issue were reduced by defendant pursuant to the fee schedule which is conclusory, and without probative value (East Coast Acupuncture, P.C. v. Hereford Ins. Co., 51 [*3]Misc 3d 441, 26 N.Y.S.3d 684 [Civ. Ct., N.Y.C., Kings Cty, 2016]).
EXHAUSTION OF BENEFITS DEFENSE
On December 3, 2013, December 17, 2013, and December 30, 2013, defendant denied three of plaintiff's claims based on the defense of policy exhaustion.
Pursuant to 11 NYCRR 65-3.15, when an insurer receives claims for more than $50,000, payments for claims that are submitted prior to the exhaustion of the $50,000, shall be made in the order in which each service was rendered or each expense was incurred. Claims are payable in the order they are received (Alleviation Medical Services, P.C. v. Allstate Ins. Co., 55 Misc 3d 44, 49 N.Y.S.3d 814 [App. Term, 2nd Dept., 2d, 11th & 13th Jud. Dists., 2017]). The term "claims" in the priority of payment regulation excludes claims that are incomplete because verification requests are outstanding (Nyack Hospital v. General Motors Acceptance Corp., 8 NY3d 294, 832 N.Y.S.2d 880, 864 N.E.2d 1279 [2007], affg, modfg and remanding 27 AD3d 96 [2d Dept 2005]). Consequently, while an insurer is awaiting verification of a claim not verified, it may pay subsequently received verified claims, even if that will result in exhaustion of the policy before the requested verification is finally received (id.).
An insurer is not required to pay a claim where the policy limits have been properly exhausted (Hospital for Joint Diseases v. State Farm Mut. Auto Ins. Co., 8 AD3d 533, 779 N.Y.S.2d 534 [2nd Dept., 2004]). Insurer's payment of full monetary limits set forth in the policy, terminates its duties under the contract (Presbyterian Hosp. in City of New York v. Liberty Mut. Ins. Co., 216 AD2d 448, 628 N.Y.S.2d 396 [2nd Dept., 1995]).
To demonstrate that the policy had been exhausted when defendant received the bills at issue, Garner refers to a ledger created by an unnamed employee of defendant.
Garner does not explain the substance of the ledger. She identifies the ledger as the "custodian of the no fault file" and the source containing the details of defendant's policy exhaustion defense.
The ledger however, does not specify when defendant received or paid any of the prior bills leading to the exhaustion of the policy. The ledger contains ambiguous headings such as 'posting date,' 'invoice date' and 'service date' without any evidence to establish that any of the headings represent the date that defendant in fact received or paid the bills prior to the exhaustion of the policy. Accordingly, defendant fails to establish as a matter of law that the policy was exhausted at the time of defendant's receipt of the bills at issue.
Based on the foregoing, defendant's motion for summary judgment is denied.
Dated: May 16, 2018
ODESSA KENNEDY
Judge of the Civil Court
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