—[*1] Short & Billy, P.C., New York, N.Y. (Helene Jnane of counsel), for appellant.

Joseph Henig, P.C., Bellmore, N.Y., for respondent.

In an action to recover no-fault medical payments under certain insurance contracts, the defendant appeals, as limited by its brief, from (1) so much of an order of the Supreme Court, Nassau County (McCormack, J.), dated January 21, 2008, as granted that branch of the plaintiffs’ motion which was for summary judgment on the first cause of action asserted by the plaintiff Westchester Medical Center, as assignee of Daphne McPherson, and (2) so much of a judgment of the same court entered April 16, 2008, as, upon the order, is in favor of the plaintiff Westchester Medical Center, as assignee of Daphne McPherson, and against it in the principal sum of $6,993.96. The notice of appeal from the order is deemed also to be a notice of appeal from the judgment (see CPLR 5501 [c]).

Ordered that the appeal from the order dated January 21, 2008 is dismissed; and it is further,

Ordered that the judgment is reversed insofar as appealed from, on the law, that branch of the plaintiffs’ motion which was for summary judgment on the first cause of action asserted by the plaintiff Westchester Medical Center, as assignee of Daphne McPherson, is denied, and the order dated January 21, 2008 is modified accordingly; and it is further,

Ordered that one bill of costs is awarded to the appellant.

The appeal from the intermediate order must be dismissed because the right of direct appeal therefrom terminated with the entry of judgment in the action (see Matter of Aho, 39 NY2d 241, 248 [1976]). [*2]The issues raised on the appeal from the order are brought up for review and have been considered on the appeal from the judgment (see CPLR 5501 [a] [1]).

The plaintiff Westchester Medical Center (hereinafter WMC), among others, commenced this action to recover no-fault medical benefits allegedly owed its patient/assignor Daphne McPherson for injuries sustained by her in a motor vehicle accident involving an insured of the defendant American Transit Insurance Company. The plaintiffs moved for summary judgment on the first cause of action asserted by WMC, as assignee of McPherson, arguing that the defendant received a demand for payment of such benefits on February 20, 2007 and neither paid nor denied such benefits within 30 days. WMC asserted that the defendant did not deny benefits until April 5, 2007. Thus, WMC argued, the benefits were now “overdue” (see 11 NYCRR 65-3.8). In opposition, the defendant argued, inter alia, that its denial of benefits was timely as a result of the toll of its time within which to pay or deny a claim arising from its demand for additional verification of the claim. The Supreme Court, among other things, awarded WMC summary judgment on the first cause of action. We reverse the judgment entered upon the order insofar as appealed from.

The defendant does not dispute that it received a demand for no-fault benefits from WMC on February 20, 2007 and that it neither paid nor denied such benefits within 30 days thereof (see 11 NYCRR 65-3.8 [c]; Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750 [2007]). However, the defendant demonstrated, prima facie, that it made a timely request for additional verification of the claim, and that its denial of benefits was timely as measured from the receipt of additional verification which allegedly revealed that McPherson was entitled to workers’ compensation benefits for the underlying accident (see 11 NYCRR 65-3.5 [b]; 65-3.8 [b]; Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d 750 [2007]; Montefiore Med. Ctr. v Government Empls. Ins. Co., 34 AD3d 771 [2006]). Thus, that branch of the plaintiffs’ motion which was for summary judgment on the first cause of action asserted by WMC, as assignee of McPherson, should have been denied.

We decline the defendant’s request, in effect, to search the record and award it summary judgment dismissing WMC’s cause of action and to refer the matter to the Workers’ Compensation Board for a determination as to whether McPherson is entitled to workers’ compensation benefits for the underlying accident (see generally O’Hurley-Pitts v Diocese of Rockville Ctr., 57 AD3d 633 [2008]; Catapane v Half Hollow Hills Cent. School Dist., 45 AD3d 517 [2007]). The defendant, inter alia, failed to proffer competent evidence in admissible form of the alleged facts giving rise to its contention that workers’ compensation benefits are available. Rivera, J.P., Spolzino, Ritter and Miller, JJ., concur. [See 19 Misc 3d 1104(A), 2008 NY Slip Op 50546(U).]

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS

Appeal and cross appeal from an order of the Civil Court of the City of New York, Queens County (Thomas D. Raffaele, J.), entered May 19, 2006. The order, insofar as appealed from by plaintiff, denied plaintiff’s motion for summary judgment and, upon a search of the record, granted defendant summary judgment dismissing plaintiff’s second cause of action. The order, insofar as cross-appealed from by defendant as limited by its brief, denied its application in the Civil Court to search the record and grant defendant summary judgment dismissing plaintiff’s first cause of action.

Order modified by providing that the branch of plaintiff’s motion seeking summary judgment on its first cause of action is granted; as so modified, affirmed without costs and matter remanded to the Civil Court for the calculation of statutory interest and an assessment of attorney’s fees thereon.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. Defendant opposed the motion, and while it did not cross-move for any relief, it requested that the court search the record and grant it summary judgment. The Civil Court denied plaintiff’s motion and, upon a search of the record, granted defendant summary judgment dismissing plaintiff’s second cause of action on the ground that it was premature. Plaintiff appeals from said order. Defendant cross-appeals, arguing that, upon the search of the record, the court should have granted defendant summary judgment dismissing plaintiff’s first cause of action on the ground that it too was premature (see Coleman v Hayes, 294 AD2d 458 [2002]).

Plaintiff established its prima facie entitlement to summary judgment by proving the submission of statutory claim forms, setting forth the fact and the amount of the loss sustained, [*2]and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]). We note that the affidavit submitted by plaintiff’s corporate officer demonstrated that the annexed claim forms constituted evidence in admissible form (see CPLR 4518; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]). The burden then shifted to defendant to raise a triable issue of fact (see Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]).

Defendant established that its requests for verification and follow-up verification of the claim upon which plaintiff’s second cause of action was based, were timely mailed by setting forth the office practices or procedures used to ensure that such items are properly addressed and mailed (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]). Inasmuch as plaintiff did not demonstrate that it provided defendant with the verification sought by defendant in its verification and follow-up verification requests, the Civil Court, under the circumstances presented, upon searching the record, properly granted defendant summary judgment dismissing plaintiff’s second cause of action, since said cause of action is premature as payment upon this claim is not overdue (see Central Suffolk Hosp. v New York Cent. Mut. Fire Ins. Co., 24 AD3d 492 [2005] [failure to respond to request and follow-up request for verification renders action premature]).

It is uncontroverted that defendant received plaintiff’s claims for the services upon which plaintiff’s first cause of action is based and issued timely NF-10 denial of claim forms, which denied said claims due to the alleged failure of the assignor to attend independent medical examinations (IMEs). However, the affidavit submitted by the general manager/marketing director for the company defendant employed to issue verification requests on its behalf was insufficient to show that any verification requests for IMEs were mailed and that the assignor failed to appear at the IMEs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720, 721 [2006]). Consequently, defendant failed to raise a triable issue of fact, and plaintiff is entitled to summary judgment upon its first cause of action (id.).

Accordingly, plaintiff’s motion for summary judgment upon its first cause of action is granted and the matter is remanded to the Civil Court for the calculation of statutory interest and an assessment of attorney’s fees upon said cause of action pursuant to Insurance Law § 5106 (a) and the regulations promulgated thereunder.

Pesce, P.J., Rios and Steinhardt, JJ., concur.
Decision Date: March 16, 2009

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Diane A. Lebedeff, J.), entered December 19, 2007. The order, insofar as appealed from, denied defendant’s cross motion for summary judgment dismissing the complaint.

Order, insofar as appealed from, affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment and defendant cross-moved for summary judgment dismissing the complaint on the ground of lack of medical necessity. The court denied both plaintiff’s motion for summary judgment and defendant’s cross motion for summary judgment, finding that an issue of fact existed as to whether the supplies provided were medically necessary. The instant appeal by defendant ensued.

Defendant, through the submission of the affidavit of its no-fault litigation claims examiner, and the affirmed peer review report of Dr. Dumesh and the affidavit of Dr. Salayka, established a prima facie case that plaintiff’s claims were properly and timely denied based upon a lack of medical necessity (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins. Cos., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]).

However, in response to defendant’s cross motion, plaintiff submitted an affidavit from Dr. Shapiro in which he stated that he disagreed with the peer review report and affidavit furnished by defendant because he concluded that the supplies provided were medically necessary. Since the affidavit of Dr. Shapiro demonstrated the existence of an issue of fact as to medical necessity (see A.B. Med. Servs., PLLC v American Tr. Ins. Co., 15 Misc 3d 132[A], [*2]2007 NY Slip Op 50680[U] [App Term, 2d & 11th Jud Dists 2007]), the Civil Court properly denied defendant’s cross motion for summary judgment. Defendant’s remaining contention lacks merit. Accordingly, the order, insofar as appealed from, is affirmed.

Weston Patterson, J.P., Golia and Steinhardt, JJ., concur.
Decision Date: March 12, 2009

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Timothy J. Dufficy, J.), entered December 12, 2007. The order, insofar as appealed from as limited by the brief, denied plaintiff’s motion for summary judgment.

Order, insofar as appealed from, reversed without costs, plaintiff’s motion for summary judgment granted and matter remanded to the Civil Court for the calculation of statutory interest and an assessment of attorney’s fees.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. Defendant cross-moved for summary judgment dismissing the complaint and, in opposition to plaintiff’s motion, argued that plaintiff did not make a prima facie showing and, in any event, plaintiff’s assignor failed to appear for independent medical examinations (IMEs). The Civil Court denied both motions. As limited by its brief, plaintiff appeals from the denial of its motion for summary judgment.

A provider establishes its prima facie entitlement to summary judgment by proof of the submission of a statutory claim form, setting forth the fact and the amount of the loss sustained, and that payment of no-fault benefits was overdue (see Insurance Law § 5106 [a]; Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742 [2004]). In the instant case, any deficiency in plaintiff’s moving papers regarding proof of mailing of the claim forms was cured by defendant’s claim denial forms, and the affidavit of defendant’s claims representative in which receipt of the claims in question was conceded (see East Acupuncture, P.C. v Electric Ins. Co., 16 Misc 3d 128[A], 2007 NY Slip Op 51281[U] [App Term, 2d & 11th Jud Dists 2007]; Oleg Barshay, D.C., P.C. v State Farm Ins. Co., 14 Misc 3d 74 [App Term, 2d & 11th Jud Dists 2006]). We note that the affidavit submitted by plaintiff’s billing manager sufficed to establish that the [*2]annexed claim forms constituted evidence in admissible form (see CPLR 4518; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]). Consequently, the record establishes plaintiff’s prima facie entitlement to summary judgment.

While defendant asserts that it timely denied plaintiff’s claim based on the assignor’s failure to appear for two scheduled IMEs, defendant failed to establish by proof in admissible form that the IME requests were timely mailed to the assignor and that the assignor failed to appear for the IMEs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]). Consequently, plaintiff’s motion for summary judgment should have been granted. We reach no other issue.

Accordingly, plaintiff’s motion for summary judgment is granted and the matter is remanded to the Civil Court for the calculation of statutory interest and an assessment of attorney’s fees pursuant to Insurance Law § 5106 (a) and the regulations promulgated thereunder.

Pesce, P.J., Rios and Steinhardt, JJ., concur.
Decision Date: March 10, 2009

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS

Appeal from a “judgment” of the Civil Court of the City of New York, Queens County (Lee A. Mayersohn, J.), dated August 4, 2005, deemed from the judgment entered December 26, 2007 (see CPLR 5520 [c]). The judgment, after a nonjury trial, dismissed the complaint.

Judgment affirmed without costs.

At the trial in this action by a provider to recover assigned first-party no-fault benefits, plaintiff sought to lay a foundation for the admission into evidence of its claim forms by proffering the testimony of an individual that was employed by plaintiff at the time the services at issue were allegedly rendered. The witness testified that she was not involved in billing insurance companies, but that she saw documents like the ones plaintiff sought to introduce into evidence every day and she recognized them as bills for psychological services. Defendant objected to the admission of the bills into evidence, and the court sustained the objection. Plaintiff concluded its case without calling another witness to lay a foundation for the admission into evidence of plaintiff’s claim forms. The court granted defendant’s motion to dismiss due to plaintiff’s failure to prove its prima facie case. This appeal by plaintiff ensued. A judgment was subsequently entered.

It was plaintiff’s burden “to proffer evidence in admissible form, i.e., by introducing into evidence the claim form in question by, inter alia, calling a witness to lay a foundation for the admissibility of the claim form as a business record” (Bajaj v General Assur., 18 Misc 3d 25 [App Term, 2d & 11th Jud Dists 2007]). Plaintiff’s witness “failed to demonstrate that [she] possessed sufficient personal knowledge of plaintiff’s office practices and procedures so as to lay a foundation for the admission of the [proffered] documents as business records” (Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists [*2]2006]; see also Art of Healing Medicine, P.C. v Travelers Home & Mar. Ins. Co., 55 AD3d 644 [2008]). Accordingly, the court properly ruled that plaintiff’s claim forms were not admissible as business records and properly granted defendant’s motion to dismiss the complaint due to plaintiff’s failure to make a prima facie showing.

In light of the foregoing, we reach no other issue.

Weston Patterson, J.P., Golia and Steinhardt, JJ., concur.
Decision Date: March 10, 2009

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Diccia T. Pineda-Kirwan, J.), dated October 6, 2005, deemed from a judgment of the same court entered March 1, 2006 (see CPLR 5520 [c]). The judgment, after a nonjury trial, dismissed the complaint.

Judgment affirmed without costs.

At the trial in this action by a provider to recover assigned first-party no-fault benefits, plaintiff offered the testimony of its file clerk and sought the admission into evidence of, inter alia, its purported claim form. Defendant objected on the ground that said document was hearsay and that plaintiff had failed to lay a foundation for its admission into evidence pursuant to CPLR 4518. Plaintiff then called defendant’s litigation specialist, who testified that defendant received the bill at issue. However, the Civil Court did not admit plaintiff’s bill into evidence. After defendant rested without calling any witnesses, the Civil Court granted defendant’s motion for a directed verdict, finding that plaintiff failed to make a prima facie case. This appeal by plaintiff ensued. A judgment was subsequently entered.

The testimony by the witnesses called by plaintiff did not demonstrate that they possessed sufficient personal knowledge to lay a foundation to establish that plaintiff’s bill was admissible as a business record (see CPLR 4518; Art of Healing Medicine, P.C. v Travelers Home & Mar. Ins. Co., 55 AD3d 644 [2008]; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44 [App Term, 2d & 11th Jud Dists 2006]; Midborough Acupuncture, P.C. v New York Cent. Mut. Fire Ins. Co., 13 Misc 3d 132[A], 2006 NY Slip Op 51879[U] [App Term, 2d & 11th Jud Dists 2006]). Consequently, plaintiff failed to establish a prima facie case (see Bajaj v General Assur., 18 Misc 3d 25 [App Term, 2d & 11th Jud Dists 2007]). Accordingly, the judgment is [*2]affirmed.

In light of the foregoing, we reach no other issue.

Weston Patterson, J.P., Golia and Steinhardt, JJ., concur.
Decision Date: March 10, 2009

[*1]

Supreme Court, Appellate Term, Second Department, March 10, 2009

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellant. Cascone & Kluepfel, LLP, Garden City (Joseph A. Potenza of counsel), for respondent.

{**25 Misc 3d at 49} OPINION OF THE COURT

Memorandum.

Order, insofar as appealed from, affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. Defendant opposed the motion and moved for summary judgment dismissing the complaint, arguing that a conflict of law analysis required the application of New Jersey law, pursuant to which plaintiff’s complaint should be dismissed on the ground that the supplies provided were not medically necessary. By order dated March 13, 2008, the District Court denied both motions. The instant appeal by plaintiff ensued.

There is no dispute that a conflict exists between New York law and New Jersey law with respect to the issues raised herein. New York law requires a claim for no-fault benefits to be timely and properly denied on a prescribed NF-10 denial of claim form (see Nyack Hosp. v State Farm Mut. Auto. Ins. Co., 11 AD3d 664 [2004]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11 [1999]), does not permit insurer’s delay letters, which request no verification, to toll the statutory period in which a claim must be paid or denied (see Nyack Hosp. v Encompass Ins. Co., 23 AD3d 535 [2005]; Ocean Diagnostic Imaging P.C. v Citiwide Auto Leasing Inc., 8 Misc 3d 138[A], 2005 NY Slip Op 51314[U] [App Term, 2d & 11th Jud Dists 2005]), and provides that the defenses of lack of medical necessity and provider fraud are precluded if not timely and properly asserted (see Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556 [2008]; Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]; [*2]Melbourne Med., P.C. v Utica Mut. Ins. Co., 4 Misc 3d 92 [App Term, 2d & 11th Jud Dists 2004]). New Jersey law, on the other hand, permits the defense of lack of medical necessity to be raised at any time (see Kowaleski v Allstate Ins. Co., 238 NJ Super 210, 218, 569 A2d 815, 819 [1990]).

A conflict of law relating to an insurance policy must be resolved by applying the conflict of law rules relevant to contracts (see Zurich Ins. Co. v Shearson Lehman Hutton, 84 NY2d 309, 319 [1994]; Matter of Allstate Ins. Co. [Stolarz—New Jersey Mfrs. Ins. Co.], 81 NY2d 219, 226 [1993]). The Court of Appeals has adopted a “center of gravity” or “grouping of contacts” approach (Auten v Auten, 308 NY 155, 160 [1954]), which gives controlling effect to the law of the state that has “the most significant relationship to the transaction and the{**25 Misc 3d at 50} parties” (Restatement [Second] of Conflict of Laws § 188 [1]). In addition to the traditional determinative factor of the place of contracting, which should be given “heavy weight” in a grouping of contacts analysis (see Haag v Barnes, 9 NY2d 554, 560 [1961]), the places of negotiation and performance, the location of the subject matter of the contract, and the domicile or place of business of the contracting parties are also to be considered (see Zurich Ins. Co., 84 NY2d at 319; Restatement [Second] of Conflict of Laws § 188 [2]). The accident herein occurred in New York. The relevant insurance policy was negotiated and entered into in New Jersey by the insureds who lived in New Jersey, for a vehicle which was garaged and registered in New Jersey. The assignor, who was driving the insureds’ vehicle at the time of the accident, also resided in New Jersey.

While “strong governmental interests . . . [may] be considered” (Matter of Allstate Ins. Co. [Stolarz—New Jersey Mfrs. Ins. Co.], 81 NY2d at 226), we find that governmental policy is not an overriding factor under the circumstances presented herein (see e.g. Matter of Eagle Ins. Co. v Singletary, 279 AD2d 56 [2000]). Therefore, upon the application of a “center of gravity” or “grouping of contacts” analysis, we find that the dispositive factors weigh in New Jersey’s favor and, therefore, its law should control (see e.g. Scotland v Allstate Ins. Co., 35 AD3d 584 [2006]; Matter of Eagle Ins. Co. v Singletary, 279 AD2d at 56). Consequently, since defendant is not precluded from raising the defense of lack of medical necessity under New Jersey law, defendant raised a triable issue of fact. Accordingly, the District Court’s order, insofar as appealed from, is affirmed.

Tanenbaum, J.P., Molia and LaCava, JJ., concur.

Civil Court of the City of New York, Kings County

116467/04

Genine D. Edwards, J.

Plaintiff commenced this action to recover no-fault benefits from the defendant, for acupuncture services performed by its licensed acupuncturist to its assignor, Alan Yensi. A bench trial ensued.

At the outset, the parties stipulated that the plaintiff proved its prima facie case and the defendant timely denied the claims. In addition, the bills and denials were admitted into evidence. Plaintiff rested. At that point the burden of production shifted to the defendant to prove the basis of its denial. Before defendant called its witness, it made a motion to dismiss, based upon Great Wall Acupuncture v. Geico Gen. Ins. Co., 16 Misc 3d 23, 842 N.Y.S.2d 131 (App. Term, 2d Dept. 2007); Ava Acupuncture, P.C. v. Geico Gen. Ins. Co., 17 Misc 3d 41, 844 N.Y.S.2d 570 (App. Term, 2d Dept. 2007), contending that an insurer is entitled to remit payment at the chiropractic rate indicated in the Workers’ Compensation Fee Schedule. The plaintiff argued in opposition that the defendant was required to reveal its procedures for choosing the rate and the calculation of the amount. This Court reserved its decision.

The defendant’s claim representative testified that the Workers’ Compensation Fee Schedule is the tool used to pay healthcare providers. Since that schedule does not address licensed acupuncturists, the defendant compared the educational and licensing requirements and found that the chiropractic requirements are closest to the licensed acupuncturist. Therefore, the plaintiff was paid at the chiropractic rate. On cross-examination the claim representative testified that he was not the representative who denied the plaintiff’s claims, but indicated that the representative processed and issued the claims in accord with defendant’s policies and procedures, including using the Workers’ Compensation Fee Schedule.

After due deliberation of the credible evidence submitted, this Court finds that the defendant shouldered its burden of producing a proper grounds for denying full payment of the no-fault benefits based upon the Workers’ Compensation Fee Schedule. Great Wall Acupuncture, 16 Misc 3d at 23; Ava Acupuncture, P.C., 17 Misc 3d at 41; Ops Gen. Counsel NY Ins. Dept. 10-06-04. The plaintiff did not rebut this defense.

[*2]Accordingly, judgment in favor of the defendant and the complaint dismissed.

This constitutes the decision and order of this Court.

Dated: March 6, 2009

________________________

Genine D. Edwards

Judge of the Civil Court

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd, 11th and 13th JUDICIAL DISTRICTS

Appeal from a decision of the Civil Court of the City of New York, Queens County (Kevin Kerrigan, J.), dated July 25, 2005, deemed from a judgment of the same court entered December 21, 2007 (see CPLR 5520 [c]). The judgment, after a nonjury trial, dismissed the complaint.

Judgment affirmed without costs.

At the trial in this action by a provider to recover assigned first-party no-fault benefits, plaintiff did not call any witnesses. Rather, plaintiff orally moved for the admission into evidence of its notice to admit and defendant’s response thereto, contending that they, and the exhibits annexed to plaintiff’s prior motion for summary judgment and defendant’s papers in opposition thereto, were sufficient to establish plaintiff’s prima facie case. Defendant objected and cross-moved for a directed verdict
dismissing the complaint. The Civil Court granted defendant’s cross motion for a directed verdict, holding that, without testimony from a witness to establish the admissibility of the documents upon which plaintiff sought to rely, plaintiff failed to establish a prima facie case. This appeal by plaintiff ensued. A judgment was subsequently entered dismissing the complaint.

At trial, “it remained plaintiff’s burden to proffer evidence in admissible form, i.e., by introducing into evidence the claim form[s] in question by, inter alia, calling a witness to lay a foundation for the admissibility of the claim form[s] as . . . business record[s], which plaintiff failed to do. Accordingly, in light of plaintiff’s failure to establish the admissibility of its claim form[s] as . . . business record[s], plaintiff did not establish a prima facie case and defendant was entitled to judgment dismissing the complaint” (Bajaj v General Assur. Co., 18 Misc 3d 25, 28-29 [App Term, 2d & 11th Jud Dists 2007] [citation omitted]; see also Art of Healing Medicine, [*2]P.C. v Travelers Home & Mar. Ins. Co., 55 AD3d 644 [2008]).

Weston Patterson, J.P., Golia and Steinhardt, JJ, concur.
Decision Date: March 05, 2009

[*1]

Civil Court of the City of New York, Richmond County, March 5, 2009

APPEARANCES OF COUNSEL

Epstein McDonald & McCarthy, New York City, for defendant. Baker Sanders Barshay Grossman Fass Muhlstock & Neuwirth, Mineola, for plaintiff.

{**24 Misc 3d at 230} OPINION OF THE COURT

Katherine A. Levine, J.

{**24 Misc 3d at 231}This case presents the novel issue of whether the notice requirements for verification requests, as contained in 11 NYCRR 65-3.5 and 65-3.6, apply to examinations under oath (EUO) that are noticed prior to the insurance company’s receipt of claim forms (preclaim EUO). As will be set forth below, this court decides this issue in the negative.

Plaintiff Prime Psychological, a medical services provider, brought this action seeking reimbursement in the amount of $1,341.14 for medical services it provided to assignor Andrea Ortiz stemming from her automobile accident. Defendant Nationwide Property and Casualty Ins. Co. seeks an order granting it summary judgment based upon Ortiz’s failure to appear for an EUO. Plaintiff opposes the motion and argues that defendant’s notice for an EUO was defective and accordingly failed to toll the statutory 30-day period in which defendant must deny the claim, hence rendering the denial untimely.

Plaintiff treated Ortiz in its medical facility on three occasions from November to December 2006, and on December 14, 2006 mailed Nationwide the consolidated bill, which the defendant received on December 18, 2006. Prior to its receipt of the bill, Nationwide scheduled Ortiz for two EUOs, pursuant to the provision in its insurance policy, both of which Ortiz failed to attend. Defendant submitted an affidavit from an investigator of the Special Investigation Unit (SIU) who had personal knowledge of the mailing practices and procedures surrounding EUO scheduling letters and stated that the EUO letters sent to Ortiz were made in the regular course of Nationwide’s business. The SIU investigator stated that he had personal knowledge that defendant mailed Ortiz three letters scheduling EUOs.^[FN*] The first letter was sent to Ortiz via certified mail [*2]on November 30, 2006, advising that her presence was required on December 15, 2006. On December 14, 2006, a voice mail was received from Ortiz’s attorney stating that Ortiz would not be present at the EUO. The next day, the defendant’s investigator spoke with an individual from the office of Ortiz’s attorney and advised him that since his voice mail was received after hours, it would not be counted as an attempt to adjourn. Accordingly, Ortiz’s failure to attend the EUO was counted as a no-show. Nationwide sent another letter to Ortiz on December 15, 2006, scheduling her EUO for January 3, 2007. Ortiz’s attorney called the defendant’s office{**24 Misc 3d at 232} on January 2 and requested an adjournment. Nationwide thus, by letter dated January 2, 2007, scheduled a final adjournment for January 11, 2007, which Ortiz failed to attend. Thus, only the last EUO was scheduled after Nationwide had received the bill.

On January 18, 2007, Nationwide denied the claim on the grounds that plaintiff’s claim was not billed in accordance with the fee schedule and that Ortiz’s failure to attend an EUO constituted a breach of the insurance policy condition that the eligible injured person may reasonably be required to submit to EUOs, which precluded coverage. Nationwide retroactively terminated Ortiz’s coverage, effective October 16, 2006.

To grant a motion for summary judgment it must clearly appear that no material and triable issue of fact is presented. (Manhattan Med. Imaging, P.C. v State Farm Mut. Auto. Ins. Co., 20 Misc 3d 1144[A], 2008 NY Slip Op 51844[U] [2008].) In support of its motion for summary judgment, defendant is required to establish, prima facie, that (1) its insurance policy in effect when the EUOs were sought contained an endorsement authorizing such verification; (2) the EUO scheduling letters were timely mailed; (3) the date and place of EUO were not unreasonable; and (4) assignor failed to appear for the scheduled EUO. (Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720, 721 [2d Dept 2006]; Eagle Surgical Supply, Inc. v Progressive Cas. Ins. Co., 21 Misc 3d 49 [2d Dept 2008].)

Here, plaintiff argues that defendant failed to satisfy the second prong of its prima facie case since it did not notify Ortiz’s attorney about the “follow-up EUO.” While the SIU investigator’s affidavit is silent about any mailings to the applicant’s attorney, the EUO notifications that were sent to Ortiz were cc:ed to her attorney. The issue thus presented is whether the language requiring that an applicant’s attorney be notified of a follow-up verification request applies to a preclaim EUO.

As a condition to coverage under the revised mandatory personal injury protection endorsement, “the eligible injured person . . . shall . . . as may reasonably be required submit to examinations under oath by any person named by the [insurer] and subscribe the same” (11 NYCRR 65-1.1 [d] [Sec I, Conditions, Proof of Claim (b)]). Another condition to coverage under this section sets forth that an eligible person “shall submit to medical examination by physicians selected by, or acceptable to, the [insurer], when, and as often as, the [insurer] may reasonably require.” (11 NYCRR 65-1.1 [d] [Sec I, Conditions, Proof of Claim].){**24 Misc 3d at 233}

11 NYCRR 65-3.5 details the verification procedures to be followed after the insurer receives the completed application for no-fault benefits (NYS form N-F 2). The injured party or that party’s assignee medical services provider must then submit written proof of claim (claim form—usually verification of treatment by attending physician or other health care [*3]provider—NYS form N-F 3) to the insurer within 45 days after the date the medical services are rendered. Pursuant to Insurance Law § 5106 (a) and 11 NYCRR 65-3.5, an insurer is required to either pay or deny a claim for no-fault automobile insurance benefits within 30 days from the date an applicant supplies proof of claim or it will be precluded from offering any defenses at trial. (Mount Sinai Hosp. v Chubb Group of Ins. Cos., 43 AD3d 889-890 [2d Dept 2007]; see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 278 [1997].)

However, an insurer may toll the 30-day period by properly requesting verification within 15 days from the receipt of the proof of claim form or bill (Psych. & Massage Therapy Assoc., PLLC v Progressive Cas. Ins. Co., 5 Misc 3d 723, 724 [Civ Ct, Queens County 2004], citing 11 NYCRR former 65.15 [d] [1]). The insurance regulations provide for an independent medical examination (IME) (and EUOs) as part of an insurer’s “entitlement to ‘additional verification’ ” following receipt of a provider’s statutory claim forms. (Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 7 Misc 3d 18, 19 [App Term, 2d Dept 2004], affd in part 35 AD3d 720 [2006]; see 11 NYCRR 65-1.1 [d]; 65-3.5 [d]; see also All-Boro Med. Supplies, Inc. v Progressive Northeastern Ins. Co., 20 Misc 3d 554 [Civ Ct, Kings County 2008]; Lumbermens Mut. Cas. Co. v Inwood Hill Med., P.C., 8 Misc 3d 1014[A], 2005 NY Slip Op 51101[U] [Sup Ct, NY County 2005]; Inwood Hill Med. P.C. v Allstate Ins. Co., 3 Misc 3d 1110[A], 2004 NY Slip Op 50565[U] [Civ Ct, NY County 2004].) Where an EUO or IME is requested as additional verification after receipt of the claim, the insurer must schedule the IME within the same time frame as medical examinations—within 30 days from the date of receipt of the prescribed verification form (11 NYCRR 65-3.5 [d])—and must schedule an EUO within a reasonable time frame and as “expeditiously as possible.” (Eagle Surgical Supply, Inc. v Progressive Cas. Ins. Co., 21 Misc 3d 49, 51 [App Term, 2d Dept 2008].)

“[If the] requested verification[ ] has not been supplied to the insurer 30 calendar days after the original request, the insurer shall, within 10 calendar{**24 Misc 3d at 234} days, follow up with the party from whom the verification was requested, either by telephone call . . . or by mail. At the same time the insurer shall inform the applicant and such person’s attorney of the reason(s) why the claim is delayed by identifying in writing the missing verification and the party from whom it was requested.” (11 NYCRR 65-3.6 [b] [emphasis added].)

“A claim need not be paid or denied until all demanded verification is provided” (New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568, 570 [2d Dept 2004]; see Insurance Law § 5106 [a]; 11 NYCRR 65-3.5 [c]; 65-3.8 [a] [1]).

In the instant matter, it is clear that the defendant made two requests in writing to the insured for an EUO prior to its receipt of the statutory claim form from plaintiff on December 18, 2006, and that it adjourned the EUO scheduled on December 15th until January 3rd at the request of the assignor’s attorney on January 2, 2007. Therefore both the initial and follow-up scheduling letters preceded defendant’s receipt of the claim.

In Stephen Fogel Psychological (7 Misc 3d 18 [2004]), the Appellate Term found that an insurer had the right to conduct an IME prior to its receipt of the statutory claim form or its [*4]statutory equivalent which, “under the regulations, triggers the verification process.” (Id. at 20.) The insurance regulations first mention the right of an insurer to request an IME (and EUO) in the mandatory personal injury protection endorsement, “which is independent of the verification protocols,” and, in light of the broad language authorizing IMEs, the court found there “to be no reason to preclude an insurer from requesting an IME prior to its receipt of the statutory claim form” (id. at 20). The reviewing court stated that such an interpretation furthers “the policies underlying no-fault insurance, including . . . the expeditious processing of claims” (Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720, 722 [2006]).

The Appellate Term then found that the right to an IME “at this juncture is not afforded by the verification procedures and timetables” because 11 NYCRR 65-1.1 (d) “is not, on its face or contextually, a ‘verification’ provision, and because the detailed and narrowly construed verification protocols are not amenable to application at a stage prior to submission of the claim form.” (7 Misc 3d at 21.) In All-Boro Med. Supplies, Inc. v Progressive Northeastern Ins. Co. (20 Misc 3d 554 [Civ Ct, Kings County{**24 Misc 3d at 235} 2008]), Judge Sweeney extended this reasoning to EUOs, finding that an insurance company acted within its rights under the endorsement by scheduling an EUO before it had received the claim.

In light of the above, and since defendant’s right to conduct an EUO of the assignor, at this juncture, is not afforded by the verification procedures and timetables, it is clear that the language governing the verification procedures and, hence, postclaim EUOs—that the insurer shall inform the applicant and such person’s attorney of the reason(s) why the claim is delayed (11 NYCRR 65-3.6 [b])—is inapplicable to this preclaim EUO. As such, the fact that neither the SIU investigator nor the claims representative mentioned whether the EUO notices were sent to the assignor’s attorney is of no consequence.

Having determined that defendant properly requested an EUO before it received a claim, and that it was not required to send the EUO requests to the attorney, the court must decide whether an insurer’s timely denial of a claim, based upon an insured’s failure to appear for a preclaim EUO, which constitutes a breach of a condition precedent to payment, is a valid ground upon which to award summary judgment to the defendant.

In Stephen Fogel Psychological (35 AD3d 720 [2006]), the Second Department disagreed with the second portion of the Appellate Term decision which had distinguished the contractual remedies available to an insurer based upon whether the IME no-show was preclaim or postclaim. In the case of postclaim IME no-shows, the insurer could rely upon the remedy available upon nonreceipt of requested verification—the 30-day period in which to pay or deny a claim does not begin to run and any claim for payment by the provider is deemed to be premature. (7 Misc 3d at 20, citing New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568, 570 [2004]; see All-Boro v Progressive, 20 Misc 3d at 556-557.) However, this was inapplicable to preclaim IME no-shows, which must be governed by “general principles of no-fault” law; i.e., that a failure to attend a preclaim IME would defeat the presumption of medical necessity that inures to a medical provider’s properly submitted claim and hence would defeat a provider’s motion for a summary judgment (7 Misc 3d at 21-22). [*5]

The Second Department disagreed with this portion of the ruling, declaring that there was no distinction between the contractual remedies an insurance company could invoke{**24 Misc 3d at 236} depending upon whether the failure to appear for an IME occurred before or after the submission of the claim form. Since the appearance of an insured at IMEs (and EUOs) was a condition precedent to the insurer’s liability on the policy, an insurer could retroactively deny a claim to the date of loss for a claimant’s failure to attend IMEs. (See also All-Boro v Progressive, 20 Misc 3d at 556 [where Judge Sweeney opined that a failure to appear for a preclaim EUO was a “valid ground for denying the claim ‘retroactively to the date of loss’ “].) However, once an insurer received a claim, it was “required to adhere to the statutory and regulatory scheme for the processing of no-fault claims” and it therefore had to pay or deny the claim within 30 days of its receipt. (Id.)

Here, the defendant established the standard office practices and procedures used to ensure that the verification requests and the denial were properly addressed and mailed, and presented an affidavit from an SIU investigator who had personal knowledge of both the mailings and the EUO no-show. Defendant has established that it timely denied the claim and summary judgment is granted to defendant.

Footnotes

Footnote *: Defendant also submitted an affidavit from a claims representative who personally denied the claims and had personal knowledge of the office’s business procedures concerning the mailing of denials.