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, Kings County (Bernard J. Graham, J.), entered January 17, 2007, deemed from a judgment of the same court entered April 4, 2007 (see CPLR 5501 [c]). The judgment, entered pursuant to the January 17, 2007 order granting plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $815.

Judgment reversed without costs, order granting plaintiff’s motion for summary judgment vacated and plaintiff’s motion for summary judgment denied.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. In opposition, defendant argued that it timely denied plaintiff’s claim on the ground of lack of medical necessity. The Civil Court granted plaintiff’s motion, finding that plaintiff had established a prima facie case and that defendant had failed to raise a triable issue of fact. This appeal by defendant ensued. A judgment was subsequently entered (see CPLR 5501 [c]).

Inasmuch as defendant raises no issue on appeal with respect to plaintiff’s prima facie case, we do not pass on the propriety of the Civil Court’s determination with respect thereto.

The affidavit submitted by defendant’s claims employee was sufficient to establish that defendant’s denial of claim form, which denied plaintiff’s claim based upon a peer review report, was timely mailed in accordance with defendant’s standard office practice and procedure (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]). In opposition to plaintiff’s motion for summary judgment, defendant annexed an affirmed peer [*2]review report, which set forth the physician’s opinion that the medical supplies at issue were medically unnecessary. As a result, defendant proffered sufficient evidence in admissible form to demonstrate the existence of a triable issue of fact as to medical necessity (see A.B. Med. Servs., PLLC v American Tr. Ins. Co., 15 Misc 3d 132[A], 2007 NY Slip Op 50680[U] [App Term, 2d & 11th Jud Dists2007]).

Plaintiff’s contention that the peer review report was inadmissible since it contained a stamped facsimile of the doctor’s signature, raised for the first time on appeal, was waived (see Dowling v Mosey, 32 AD3d 1190 [2006]; Alur Med. Supply, Inc. v GEICO Ins. Co., 20 Misc 3d 145[A], 2008 NY Slip Op 51867[U] [App Term, 2d & 11th Jud Dists 2008]; cf. Vista Surgical Supplies, Inc. v Travelers Ins. Co., 50 AD3d 778 [2008]; Support Billing & Mgt. Co. v Allstate Ins. Co., 15 Misc 3d 126[A], 2007 NY Slip Op 50496[U] [App Term, 2d & 11th Jud Dists 2007]).

Consequently, plaintiff’s motion for summary judgment should have been denied (see Zuckerman v City of New York, 49 NY2d 557 [1980]).

Pesce, P.J. and Weston, J., concur.

Golia, J., concurs in a separate memorandum.

Golia, J., concurs in the result only, in the following memorandum:

While I agree with the ultimate disposition in the decision reached by the majority, I wish to note that I am constrained to agree with certain propositions of law set forth in cases cited therein which are inconsistent with my prior expressed positions and generally contrary to my views. In particular, I wish to note that, as stated in my dissenting opinion in Uptodate Med. Serv., P.C. v Lumbermens Mut. Cas. Co. (20 Misc 3d 135[A], 2008 NY Slip Op 51501[U] [App Term, 2d & 11th Jud Dists 2008]), an appellate court “should always consider the issue of whether a prima facie showing has been made, irrespective of whether the issue was raised by the defendant” (see also Alvarez v Prospect Hospital, 68 NY2d 320 [1986]).
Decision Date: April 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 January 3, 2008, deemed from a judgment of the same court entered January 25, 2008 (see CPLR 5501 [c]). The judgment, entered pursuant to the January 3, 2008 order granting plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $1,284.78.

Judgment affirmed without costs.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. In opposition, defendant argued that the
supplies plaintiff provided were not medically necessary. The Civil Court granted plaintiff’s motion for summary judgment, finding that defendant was precluded from asserting its defense since it failed to establish that the statutory time period in which it had to pay or deny plaintiff’s claim was tolled, as its follow-up verification request was sent prior to the expiration of the 30-day period within which the requested verification had to be provided. The instant appeal by defendant ensued. A judgment was subsequently entered (see CPLR 5501 [c]).

Inasmuch as defendant raises no issue on appeal regarding plaintiff’s establishment of its prima facie entitlement to summary judgment, we do not pass on the propriety of the implicit determination of the Civil Court with respect thereto.

Since defendant’s papers established that it mailed its follow-up requests for verification on the 30th calendar day after it mailed its verification requests, the follow-up requests were premature and without effect (see General Construction Law § 20; Insurance Department Regulations [11 NYCRR] § 65-3.6 [b]; Infinity Health Prods., Ltd. [*2]
v Eveready Ins. Co., 21 Misc 3d 1 [App Term, 2d & 11th Jud Dists 2008]). Consequently,
defendant failed to timely deny plaintiff’s claim and is precluded from raising most defenses, including its proffered defense of lack of medical necessity (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]). Accordingly, the Civil Court properly granted plaintiff’s motion for summary judgment, and the judgment is affirmed.

Pesce, P.J., Rios and Steinhardt, JJ., concur.
Decision Date: April 07, 2009

District Court of Nassau County, First District

8153/08

Plaintiff: Friedman, Harfenist, Kraut & Perlstein, Esqs.

Defendant: DeMartini & Yi, LLP

Fred J. Hirsh, J.

Defendant Progressive Casualty Insurance Company (“Progressive”) moves for summary judgment. Plaintiff Elmont Open MRI & Diagnostic Radiology, P.C. (“Elmont”) cross-moves for summary judgment.

BACKGROUND

Andrea Henry (“Henry”) was injured in an automobile accident that occurred on October 16, 2007. Her treating doctor prescribed MRI’s of the cervical, thoracic and lumbar spines.

The MRI of the lumbar spine was performed by Elmont on November 24, 2007. The MRI’s of the cervical and thoracic spines were performed by Elmont on December 27, 2007.

Henry assigned her right to receive no-fault benefits for the MRI’s to Elmont.

Elmont submitted the bills for the MRI’s to Progressive, the insurance carrier that provided no-fault benefits for Henry. Progressive received the bill for the MRI of the cervical spine on December 26, 2007 and the bill for the MRI’s of the cervical and thoracic spine on January 11, 2008.

Progressive claims it denied the bill for the lumbar MRI by denial dated January 18, 2008. Progressive claims it denied the bill for the cervical and thoracic MRI’s by denial dated February 1, 2008.

The denial of benefits was based upon the peer review report of Harvey Goldberg, M.D. (“Dr. Goldberg”).

Progressive asserts the peer review report of Dr. Goldberg establishes the MRI’s were not medically necessary. Progressive further asserts the affidavit of Christopher R. Kenny (“Kenny”) establishes Progressive’s office procedures for preparing, addressing and mailing denials of claims. The Kenny affidavit purports to establish [*2]Progressive had established a procedure to ensure proper and timely mailing of denials.

Elmont asserts Dr. Goldberg’s peer review reports are inadequate to entitle Progressive to judgment as a matter of law. They further assert the Kenny affidavit does not establish the denials were timely mailed.

Elmont cross-moves for summary judgment. Elmont establishes it timely filed the claim. The timely filing of the claim is based upon the affidavit of Brijukmar Yamraj (“Yamraj”) Elmont’ s medical billing collection supervisor and Progressive’s NF-10. the Denial of Claim form .

Elmont performed the MRI of Henry’s lumbar spine on November 24, 2007. The bill for this MRI is dated November 29, 2007. Progressive acknowledges receipt of this bill on December 26, 2007.

Elmont performed the MRI’s of Henry’s thoracic and cervical spine on December 12, 2007. The bill is dated December 20, 2007. Progressive acknowledges receipt of this bill on January 11, 2008.

Elmont asserts this establishes the claims were received by Progressive within 45 days of the date services were rendered. 11 NYCRR 65-1.1. Progressive admits it has not paid the bills. Elmont claims the timely submission of the bills coupled with Progressive’s failure to pay within 30 days establishes its entitlement to summary judgment.

DISCUSSION

A no-fault insurer who denies a claim on the basis of lack of medical necessity must establish that the services were inconsistent with generally accepted medical practices. The opinion of the insurer’s expert standing alone is insufficient to establish that the tests were not medically necessary. Delta Medical Supplies, Inc. v. NY Central Mutual Ins. Co., 14 Misc 3d 1231(A) (Civil Ct. Kings Co. 2007); and CityWide Social Work & Psychological Servs. V. Travelers Indem. Co., 3 Misc 3d 608 (Civil Ct. Kings Co. 2004).

Dr. Goldberg’s peer review reports are inadequate as a matter of law to establish lack of medical necessity. Dr. Goldberg’s peer review report regarding the MRI of the lumbar spine does not state an opinion as to the medical necessity of this MRI. Dr. Goldberg does not state in his report he is familiar with the practices and procedures in the field. He adopts an opinion contained in Current Medical Diagnosis and Treatment, 42nd Ed. (“CMDT”). The court is not provided with a copy of the sections of CMDT upon which Dr. Goldberg relies.

Dr .Goldberg never states in his peer review report that he is familiar with generally accepted medical practices regarding the prescribing of a lumbar MRI, what those practices are and how or why ordering of a lumbar MRI when it was ordered departed from those practices.

Similarly, Dr. Goldberg’s peer review report regarding the cervical and thoracic spine is inadequate. He again adopts the opinion of CMDT without stating what that opinion is. He fails to states that he is familiar with the generally accepted medical practices and procedures regarding the ordering of thoracic and/or cervical MRI’s, what those standards are, the basis of those standards and/or how or why the MRI’s ordered [*3]and performed of Henry’s cervical and thoracic spine by Elmont were not in accordance with those practices and procedures.

This problem is compounded by the statement contained in Dr. Goldberg’s report that “I would be unable to certify the medical necessity for MRI studies of the cervical spine and thoracic spine planned on 11/29/2007.” The issue is not whether Dr. Goldberg would order those tests. In determining whether a test is medically necessary, the question is whether the tests or procedures are in accordance with generally accepted medical practices, not whether the peer review doctor’s personal opinion is the tests are not medical necessary. Id. and Nir v. Allstate Insurance Co., 7 Misc 3d 544 (Civil Ct. Kings Co. 2005).

The peer review doctor’s must establish a familiarity with generally accepted practice, must establish what generally accepted practice is under the circumstances and must state the questioned treatment was not in accordance with generally accepted medical practice. Williamsbridge Radiology & Open Imaging .v Travelers Indemnity Co., 14 Misc 3d 1231(A) (Civil Ct. Kings Co. 2007).

Before an expert witness is permitted to offer an opinion, the witness must be qualified as an expert. Price v. New York City Housing Auth., 92 NY2d 553 (1998); Caprara v. Chrysler Corp., 52 NY2d 114, rearg. dnd. 52 NY2d 1073 (1981); and Meiselman v. Crown Heights Hospital, 285 NY 389 (1941). To qualify as an expert, the witness must possess “…the requisite skill, training, education, knowledge or experienced from which it can be assumed that the information imparted or the opinion rendered is reliable (citations omitted).” Matott v. Ward, 48 NY2d 455, 460 (1979); and de Hernandez v. Lutheran Medical Center, 46 AD3d 517 (2nd Dept. 2007). Progressive fails to establish Dr. Goldberg is an expert. Progressive does not submit an affidavit or affirmation from Dr. Goldberg. Progressive relies upon the peer review report which is affirmed. The peer review report does not contain any information about Dr. Goldberg’s education, training or professional experience. Since Dr. Goldberg has not been qualified as an expert, the court cannot accept his opinion regarding the lack of medical necessity for the cervical, thoracic and lumbar MRI’s.

Dr. Goldberg’s peer review states the MRI of the lumbar spine “…has not been established as medically necessary.”This misstates the burden of proof. Plaintiff proves a prima facie case of medical necessity by submitting proof in evidentiary form the statutorily prescribed forms were timely mailed and received, and the no-fault benefits were nottimely paid. Globe Surgical Supply v. Geico Ins. Co., 59 AD3d 129 (2nd Dept. 2008); and Mary Immaculate Hosp. v. Allstate Ins. Co., 5 AD3d 742 (2nd Dept. 2004). Once plaintiff has met this burden, the burden of proof shifts to the defendant to establish the test or treatment were not medically necessary. A Plus Medical P.C. v. Government Employees Ins. Co., 21 Misc 3d 799 (Civil Ct. Kings Co. 2008). Dr. Goldberg’s report does not meet the defendant’s burden.

Since the peer review reports of Dr. Goldberg are inadequate to establish a prima facie entitlement to judgment as a matter of law, defendant’s motion for summary judgment is denied. Widmaier v. Master Products, Mfg, 9 AD3d 362 (2nd Dept. 2004); and Ron v. New York City Housing Auth., 262 AD2d 76 (1st Dept. 1999).

Elmont has established the statutorily prescribed claim forms were received by Progressive within 45 days of the ay upon which the services were rendered. [*4]Progressive has failed to pay the bills. This Elmont has established a prima facie case that the treatment it provided was medically necessary. Fair Price Medical Supply Corp. v. Travelers Indemnity Co., 10 NY3d 556 (2008); and Hospital for Joint Diseases v. Travelers Property Casualty Ins. Co., 9 NY3d 312 (2007)

Progressive claims it timely denied these claims based upon an affidavit of Christopher R. Kenny (“Kenny”). Kenny was not the Progressive claims representative who issued or mailed the denial. The denial of claims forms were issued by David Karhan (“Karhan”).

A no-fault insurance carrier may prove timely mailing of a denial by submitting an affidavit made by the person who actually prepared and mailed the denial attesting to the preparation and mailing of the denial or by submitting an affidavit from an employee with knowledge of its office practice or procedures designed to ensure the denial was timely generated, addressed and mailed and those procedures were followed in connection with the notice involving plaintiff’s claim. St. Vincent’s Hosp. of Richmond v. Government Employees Ins. Co., 50 AD3d 1123 (2nd Dept. 2008). However, the court did not indicate precisely what must be stated in the affidavit to establish the office practices and procedures were designed to ensure the denial was timely generated, addressed and mailed.

Ideally such an affidavit would be made by the person who prepared the denial notice and would state (1) the affiant prepared the denial notice, (2) put the denial notice in the envelope, (3) checked to determine it was properly addressed, (4) stamped the envelope and (5) deposited the stamped envelope in a mail box. An affidavit made by the person who performed the first three elements and then deposited the envelope in the office outgoing mail together with a statement of familiarity with the procedures used to stamp and mail the items placed in the outgoing mail is sufficient to establish due and timely mailing. Lenox Hill Radiology v. Global Liberty Ins., 20 Misc 3d 434 (Civil Ct. NY Co. 2008).

An insurance carrier could meet the requirement of establishing due and timely mailing by attaching an affidavit of mailing to the office copy of the denial notice.^[FN1]

An insurance carrier could meet the requirement of proving due and timely mailing by mailing the denial notice with a certificate of mailing ^[FN2] or by mailing the denial [*5]notice by certified or registered mail, return receipt requested.^[FN3]

The requirement could be met if the medical provider acknowledges or admits the denial notice was timely mailed. This could be accomplished by taking a deposition of the plaintiff (CPLR 3107) at which the plaintiff’s witness could be asked if the Notice of Denial, NF-10 was received and if so, when was it received. Similar information could be obtained through interrogatories in which the plaintiff could be asked if it received the Notice of Denial, NF-10 and the date the NF-10 was received. CPLR 3130.

An insurance carrier could also meet the requirement by having the claims representative prepare as part of the claims processing procedure a log indicating the date the claim was received, the action taken on the claim and the date the payment, the demand for verification or the Notice of Denial, NF-10 was prepared and mailed. Such a record or log could, with proper foundation, be established as a business record. CPLR 4518(a).

Problems arise when the affidavit attesting to the preparation and mailing of the denial notice is made by a claims supervisor who has no personal knowledge of how or when the Notice of Denial, NF-10 was prepared or mailed. That is the situation in this case. The only fact Kenny’s affidavit can actually attest to is that he has reviewed the office file and found a Denial of Claim, NF-10 for the lumbar spine dated 1/18/08 and a Denial of Claim, NF-10 for the thoracic and cervical spine dated 2/1/08 in the file. Kenny has no first hand knowledge as to whether they were actually prepared on the date stated on the NF-10. The confusion as to the date these NF-10’s were actually prepared is compounded by a stamp on the NF-10 for the lumbar spine “Entered by ACL 0006 Jan. 21, 2008” and a stamp on the NF-10 for the thoracic and cervical spine “Entered by SXGD 154 Feb. 4, 2008”.

While evidence of habit or custom and practice may be admitted to establish that a person performed a certain act, the person must establish the habit or custom and practice is “…a deliberate and repetitive practice” by a person”in complete control of the circumstances.” (Citation omitted) as opposed to “conduct however frequent yet likely to vary from time to time depending upon the surround circumstance” (citation omitted).” Rivera v. Anilesh, 8 NY3d 627, 632 citing Halloran v. Virginia Chemicals Inc., 41 NY2d 386 (1977). Before a person can testify regarding whether a person actions constitute habit or custom and practice, the person offering evidence establishing they are familiar with that person’s habits. Halloran v. Virginia Chemicals, Inc., supra; and Beakes v. DaCunha, 126 NY 293 (1891) (plaintiff was permitted to testify it was his practice to be home on a specific day each month to transact business.). Kenny’s affidavit does not establish he was familiar with Karhan’s practices and procedures in preparing, dating or mailing Denial of Claim, NF-10’s. Kenny’s affidavit does not even state Karhan was advised of or familiar with Progressive’s company practices procedures regarding the preparation, addressing and mailing of NF-10’s. Essentially, the court is being asked [*6]to assume Karhan prepared and timely mailed the NF-10’s because they are in Progressive’s file and are dated within the 30 day period in which the carrier has to pay or deny a claim. 11 NYCRR 65-3.8.

The No-Fault Law and Regulations presents unique issues regarding timely mailing. The no-fault insurance carrier has 30 days from the date of receipt of a claim or verification of the claim to pay or deny a claim in whole or in part. 11 NYCRR 65-3.8. A no-fault insurance carrier who fails to deny a claim within 30 days is precluded from asserting most defenses to the claim. Fair Price Medical Supply Corp. v. Travelers Indemnity, Co., supra; and Hospital for Joint Diseases v. Travelers Property Casualty Ins. Co., supra.^[FN4] Therefore, proof of timely mailing of the denial is critical to the defense of lack of medical necessity. Progressive would be precluded from raising this defense unless it proves timely mailing of the denial of claims to Elmont. Careplus Medical Supply, Inc. v. Selective Ins. Co. of America, -Misc.3d-, 2009 WL 679251 (App.Term 9th & 10th Jud. Distrs. 2009).

The proof in this case is insufficient to establish proof of timely mailing. Kenny’s review of Progressive’s file establishes a copy of the NF-10 was in the file.

Progressive does not even state the reason why it did not submit an affidavit from Karhan, the person with actual first hand knowledge of the preparation and mailing of the NF-10.

The oft stated purpose of the No-fault law is “…to ensure prompt compensation for losses incurred by accident victims without regard to fault or negligence, to reduce the burden on the courts and to provide substantial premium savings to New York motorists.” Medical Society of the State of New York v. Serio, 100 NY2d 854, 860 (2003). See, Fair Price Medical Supply Corp. v. Travelers Indemnity Co., supra; and Hospital for Joint Disease v. Travelers Property Casualty Ins. Co., supra.

This court does not believe the stated purpose of the No-fault law is served by permitting the no-fault carrier to defeat a claim by submitting an affidavit by someone who lacks personal knowledge of the facts regarding the preparation and mailing of the Denial of Claim who assumes that because the NF-10 is in the office file and is dated before the 30 day period for paying or denying a claim has expired that the NF-10 was prepared and mailed timely.

This Court believes St. Vincent’s requires that if the no-fault insurance carrier cannot present an affidavit made by the person who actually prepared the NF-10 the [*7]affidavit should state: (1) why an affidavit cannot be obtained from the person who actually prepared and/or posted the NF-10 for mailing, (2) the company policy and procedures for preparing, addressing and mailing an NF-10 in effect at the time the NF-10 was prepared and mailed, (3) the claims representative who issued the NF-10 was aware of and advised to comply with company policy regarding the preparation and mailing of these forms, (4) the person making the affidavit knows the person who prepared the NF-10 was aware of company policy, (5) the person making the affidavit was aware that the claims representative who prepared the NF-10 had the habit of complying with company policy and (6) the basis of the person who makes the affidavit’s knowledge.

Kenny’s affidavit does not contain any of this information other than Progressive’s policy regarding the issuance and mailing of Denial of Claims. It does not establish Karhan was aware of this policy or complied therewith. .

Elmont’s papers establish an entitlement to judgment as a matter of law. The Yamraj affidavit establishes Elmont’s practices and procedures regarding the preparation and mailing of bills. Furthermore, Progressive’s NF-10’s indicate the bills were received within 45 days of the date the services were provided. Progressive admits they did not pay these bills.

.The party seeking summary judgment must make a prima facie showing of entitlement to judgment as a matter of law. Winegrad v. New York University Medical Center, 64 NY2d 851 (1985); and Zuckerman v. City of New York, 49 NY2d 557 (1980). Once the party seeking summary judgment has made a prima facie showing of entitlement to judgment as a matter of law, the party opposing the motion must come forward with proof establishing the existence of triable issues of fact or must demonstrate an acceptable excuse for its failure to do so. Zuckerman v. City of New York, supra; and Davenport v. County of Nassau, 279 AD2d 497 (2nd Dept., 2001); and Bras v. Atlas Construction Corp., 166 AD2d 401 (2nd Dept., 1991). Elmont has made a showing of entitlement to a judgment as a matter of law. Progressive has not.

For the foregoing reasons, defendant’s motion for summary judgment is denied. Plaintiff’s cross-motion for summary judgment is granted. The clerk is directed to enter judgment in favor of the plaintiff and against the defendant in the sum of $2751.34 together with interest in accordance with the No-Fault Regulations and legal fees in accordance with 11 NYCRR 4.6 together with costs and disbursements as taxed by the clerk.

Submit judgment.

So Ordered:

Hon. Fred J. Hirsh

District Court Judge

Dated: April 6, 2009

cc:DeMartini & Yi, LLP

Friedman, Harfenist, Kraut & Perlstein [*8]

Footnotes

Footnote 1:The affidavit of mailing would be similar to and serve the same function as the affidavit of service attached to legal papers served in accordance with CPLR 2103. See, CPLR 2103(f)(1).

Footnote 2:A Certificate of Mailing is document issued by the United States Postal Serivce evidencing that a piece of mail has been delivered to the Postal Service for mailing. The Certificate of Mailing indicates the date the item was mailed. See, United States Postal Service, Domestic Mail Manual, Section 503 – Extra Services 5.0 et. seq. Certificate of Mailing.

Footnote 3:The certified or registered mail receipt would reflect the date the notice was mailed. The return receipt would reflect the date the item was received by the addressee. See, United States Postal Service, Domestic Mail Manual, Section 503 Extra Services – 2.0 et. seq. Registered Mail and 3.0 et. seq. Certified Mail and 6.0 et. seq. Return Receipt.

Footnote 4:The Fair Price case points out the substantial and dire consequences to an insurance carrier who fails to timely deny a claim. Travelers was precluded from asserting a defense of fraud which might rise to the level of penal insurance fraud (See, Penal Law §176.00 et seq.) because the claim was not timely denied. The only defense that are not precluded as a result of an insurance carriers failure to timely deny a claim are lack of coverage [Central General Hosp. v. Chubb Group of Ins. Cos., 90 NY2d 195 (1997)], fraudulent incorporation. [State Farm Mutual Ins. Co. v. Malella, 4 NY3d 313 (2005)], and staged accident [Central General Hosp. v. Chubb Group of Ins. Cos., supra; Allstate Ins. Co. v. Massre, 14 AD3d 610 (2nd Dept. 2005); and V.S. Medical Services P.C. v. Allstate Ins. Co., 11 Misc 3d 334 (Civil Ct. Kings Co. 2006)].

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 February 26, 2008, deemed from a judgment of the same court entered April 11, 2008 (see CPLR 5501 [c]). The judgment, entered pursuant to the February 26, 2008 order granting plaintiff’s motion for summary judgment, awarded plaintiff the principal sum of $223.50.

Judgment reversed without costs, order granting plaintiff’s motion for summary judgment vacated and plaintiff’s motion for summary judgment denied.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff moved for summary judgment. In opposition, defendant argued that there was an issue of fact as to the medical necessity of the supplies. The Civil Court granted plaintiff’s motion for summary judgment, finding that defendant had failed to demonstrate the timely mailing of its requests for verification and its denial of the claim. The instant appeal by defendant ensued. A judgment was subsequently entered (see CPLR 5501 [c]).

Plaintiff established its prima facie entitlement to summary judgment by proof that it submitted the 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]). We note that the affidavit submitted by plaintiff’s billing manager demonstrated that the annexed claim form 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]). Any deficiency in plaintiff’s moving papers regarding proof of mailing of the claim form was cured by defendant’s claim denial form and the affidavit of defendant’s no-fault supervisor in which receipt of the claim in question was conceded (see [*2]Crossbridge Diagnostic Radiology, P.C. v Progressive Ins. Co., 20 Misc 3d 143[A], 2008 NY Slip Op 51761[U] [App Term, 2d & 11th Jud Dists 2008]; 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]). In addition, contrary to defendant’s contention, a “provider is not required to prove its costs to establish its prima facie case for the recovery of no-fault benefits” (Infinity Health Prods. Ltd. v Eveready Ins. Co., 21 Misc 3d 1 [App Term, 2d & 11th Jud Dists 2008]). Consequently, the burden shifted to defendant to raise a triable issue of fact (see Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]).

Defendant, through the submission of the affidavit of its no-fault supervisor and the affirmed peer review, established that plaintiff’s claim was properly and timely denied based upon a lack of medical necessity (see A.B. Med. Servs., PLLC v Liberty Mut. Ins. Co., 39 AD3d 779 [2007]; 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]). Accordingly, the judgment is reversed, the order granting plaintiff’s motion for summary judgment is vacated and plaintiff’s motion for summary judgment is denied.

We reach no other issue.

Pesce, P.J., Rios and Steinhardt, JJ., concur.
Decision Date: April 03, 2009

[*1]

Civil Court of the City of New York, Richmond County, April 3, 2009

APPEARANCES OF COUNSEL

Phillips, Krantz & Levi, Brooklyn, for plaintiff. Law Offices of Teresa M. Spina, Woodbury, for defendant.

{**24 Misc 3d at 543} OPINION OF THE COURT

Katherine A. Levine, J.

This case presents the novel issue of whether an insurance company must notify prospective medical service providers that it will not reimburse them for any services they may provide to an assignor after a determination has been made, pursuant to an independent medical examination (IME) performed on the assignor, that further medical services are not medically necessary. As will be set forth below, since the notice requirements for verification requests, as contained in 11 NYCRR 65-3.5 and 65-3.6, do not apply to IMEs that are noticed and performed prior to the insurance company’s receipt of claim forms (preclaim IMEs), such notification is not necessary.

Plaintiff Bayside Rehab & Physical Therapy, P.C. (plaintiff or Bayside or assignee), a medical service provider, brings this action pursuant to Insurance Law § 5106 (a) seeking to recover $814.19 and $1,131.47 for services it provided to its assignors Aleisha Allen and Angela Allen (collectively referred to as the Allens or assignors), for injuries they sustained in an automobile accident. Bayside moves for summary judgment based upon a claimed prima facie showing that its bills were properly submitted and that the defendant GEICO Insurance Company (defendant or GEICO) failed to pay or deny the claims within 30 days.

Defendant claims that plaintiff is not entitled to summary judgment because it failed to provide adequate proof that its claims were generated or mailed within the regular course of business. In the alternative, defendant argues that plaintiff failed to submit several claims within the statutorily prescribed period of 45 days as prescribed by 11 NYCRR 65-1.1. In its reply papers, plaintiff contends that since the defendant did not notify it about the IME cutoff, it was “not fair” and “not proper” for defendant to issue a denial of claims based upon the IME cutoff. Defendant responded, during oral argument, that because it informed the assignors that no more benefits would be paid as a result of the IME, the assignors were under an obligation to inform any future medical providers of this determination of lack of medical necessity. In light of the [*2]above, defendant contends that the matter should proceed to trial.

The Allens were involved in an automobile accident on June 17, 2006. Pursuant to a request by defendant, the assignors{**24 Misc 3d at 544} underwent IMEs by three different doctors on November 2, 2006. The three doctors determined that no further orthopedic, chiropractic, acupuncture or other types of medical services were medically necessary for the injuries suffered by either Allen related to the accident. Defendant GEICO thereupon terminated all benefits for the various types of medical treatment indicated in the IME reports, effective November 9, 2006. Absent from defendant’s papers is any indication as to how or if defendant notified the assignors of the termination of benefits much less notification of the IME cutoff to plaintiff.

Plaintiff subsequently provided medical services to both assignors in the spring of 2007 and submitted two bills on behalf of Aleisha on May 17, 2007 and June 12, 2007, respectively and three bills on behalf of Angela on May 17, June 6 and June 19, 2007, respectively. Defendant denied the May 17, 2007 bills based on plaintiff’s noncompliance with the 45-day rule and denied all the bills based on lack of medical necessity pursuant to the IME cutoff date of November 9, 2006.

To grant summary judgment, “it must clearly appear that no material and triable issue of fact is presented.” (Forrest v Jewish Guild for the Blind, 3 NY3d 295, 314 [2004, Smith, J., concurring]; Zuckerman v City of New York, 49 NY2d 557 [1980]; see Manhattan Med. Imaging, P.C. v State Farm Mut. Auto. Ins. Co., 20 Misc 3d 1144[A], 2008 NY Slip Op 51844[U] [Civ Ct, Richmond County 2008].) A plaintiff establishes a prima facie entitlement to judgment as a matter of law “by submitting evidentiary proof that the prescribed statutory billing forms ha[ve] been mailed and received, and that payment of no-fault benefits [i]s overdue.” (Mary Immaculate Hosp. v Allstate Ins. Co., 5 AD3d 742, 742-743 [2d Dept 2004]; Second Med., P.C. v Auto One Ins. Co., 20 Misc 3d 291, 293 [Civ Ct, Kings County 2008].)

To lay a proper evidentiary foundation on a summary judgment motion that the tendered records were produced within the regular course of a medical provider’s business, plaintiff must provide a supporting affidavit by an individual who possesses personal knowledge of the office practices. (Complete Orthopedic Supplies, Inc. v State Farm Ins. Co., 16 Misc 3d 996, 999 [Civ Ct, Queens County 2007], citing CPLR 4518 [a]; North Acupuncture, P.C. v State Farm Ins. Co., 14 Misc 3d 130[A], 2006 NY Slip Op 52523[U] [App Term, 2d Dept 2006]; Dan Med., P.C. v New York Cent. Mut. Fire Ins. Co., 14 Misc 3d 44, 45 [App Term, 2d Dept 2006].) Plaintiff meets this burden by{**24 Misc 3d at 545} providing an affidavit of its business manager who exhaustively details the record-keeping procedures of the business that created the records and clearly details the dates of the services, the amounts due, and her personal knowledge of the billing practices. (Manhattan Med. Imaging, P.C. v State Farm Mut. Auto. Ins. Co., supra, citing Second Med., P.C. v Auto One Ins. Co., 20 Misc 3d at 294-295.) In addition, the billing manager personally packaged, sealed, applied postage to and mailed the bills. As such, plaintiff has made a prima facie showing of entitlement. [*3]

Defendant contends that plaintiff failed to submit several bills within the statutorily required period of 45 days as prescribed by 11 NYCRR 65-1.1. Pursuant to Insurance Law § 5106, a complete proof of claim is a prerequisite to receiving no-fault benefits. All automobile insurance policies issued or renewed after April 5, 2002 are required to include a revised mandatory personal injury protection endorsement which provides that claims for medical treatment must be submitted within 45 days after services are rendered. (11 NYCRR 65-1.1 [b]; 65-2.4 [c]; Rockman v Clarendon Natl. Ins. Co., 21 Misc 3d 1118[A], 2008 NY Slip Op 52093[U], *4 n 2 [Civ Ct, Richmond County 2008], citing Matter of Medical Socy. of State of N.Y. v Serio, 298 AD2d 255 [1st Dept 2002]; Eagle Chiropractic, P.C. v Chubb Indem. Ins. Co., 19 Misc 3d 129[A], 2008 NY Slip Op 50525[U] [App Term, 2d Dept 2008].) Where one proof of claim is submitted for several medical treatments, the 45-day period commences the day after the first treatment is rendered. (SZ Med. P.C. v Country-Wide Ins. Co., 12 Misc 3d 52, 55 [App Term, 2d Dept 2006], citing Ops Gen Counsel NY Ins Dept No. 03-06-30 [June 2003].)

Although a health care provider is required to submit its proof of claim within 45 days after the services were rendered, an insurer is precluded from asserting the defense of a provider’s untimely submission of claim if it does not issue a timely denial of claim. (Rockman v Clarendon Natl. Ins. Co., supra, citing Mid Atl. Med., P.C. v Travelers Indem. Co., 12 Misc 3d 147[A], 2006 NY Slip Op 51579[U] [App Term, 1st Dept 2006].) Pursuant to both the Insurance Law and the regulations promulgated by the Superintendent of Insurance, 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 the proof of claim. (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 278 [1997], citing Insurance Law § 5106 [a]; 11 NYCRR former 65.15 [g] [3].){**24 Misc 3d at 546}

Here, plaintiff submitted claims on May 17, 2007 for services provided on March 9, 12, 16, 20 and 28, 2007, which is more than 45 days after each service was provided. Furthermore, since defendant timely denied these claims on May 30, 2007, within 30 days of their receipt, defendant is entitled to assert its defense that the claims were untimely submitted.

As to plaintiff’s contention that the denial based upon the IME cutoff was somehow unfair or defective since defendant assignee never notified plaintiff about the IME cutoff based on lack of medical necessity, an analysis of precedent on what if any notification requirements attach to preclaim IMEs is in order. This issue was recently addressed by this court in Prime Psychological Servs., P.C. v Nationwide Prop. & Cas. Ins. Co. (24 Misc 3d 230, 2009 NY Slip Op 29100 [2009]) wherein the court found that the notice requirements for verification requests, as contained in 11 NYCRR 65-3.5 and 65-3.6, do not apply to examinations under oath (EUOs) that are noticed prior to the insurance company’s receipt of claim forms (preclaim EUOs). The same reasoning applies to preclaim IMEs.

The insurance regulations provide for IMEs and EUOs as part of an insurer’s “entitlement to ‘additional verification’ following the insurer’s 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 [*4]Dept 2004], affd in part 35 AD3d 720 [2d Dept 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. 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].)

11 NYCRR 65-3.6 (b) provides that if the requested postclaim verification

“has not been supplied to the insurer 30 calendar days after the original request, the insurer shall,{**24 Misc 3d at 547} within 10 calendar 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.” (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 addressing whether these requirements applied to preclaim EUO requests, this court looked to Stephen Fogel Psychological (supra), where 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 statutory equivalent which “under the regulations, triggers the verification process.” (7 Misc 3d at 20-21.) The Stephen Fogel Psychological court then found that the right to an IME “at this juncture is not afforded by the verification procedures and timetables” because section 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.” (Id. at 21.) The only party that needed to be notified of the preclaim IME was the assignor-injured party. (Stephen Fogel Psychological, 35 AD3d at 721.) In All-Boro Med. Supplies, Inc. v Progressive Northeastern Ins. Co. (20 Misc 3d 554 [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.

Based upon the above, this court, in Prime Psychological Servs. (supra), found that the postclaim notice requirements did not apply to preclaim EUOs, or by analogy to the instant matter, to preclaim IMEs, and that it therefore was of no consequence that neither the insurer’s Special Investigation Unit investigator nor its claims representative mentioned whether the EUO notices were sent to the assignor’s attorney. As such, this court determined that an insurer’s timely denial of a claim, [*5]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.{**24 Misc 3d at 548}

The same analysis governs what, if any, notice requirements attach to IME cutoff determinations based upon a lack of medical necessity. Where such a determination is made prior to the submission of a claim, there is no statutory requirement as to whom the insurer has to notify. Even the postverification notice requirements, which are inapplicable to preclaim EUOs and IMEs, do not mandate that the assignee medical provider be notified.^[FN*] 11 NYCRR 65-3.5 (e) discusses where EUOs and IMEs are to be held and then sets forth that “[t]he insurer shall inform the applicant at the time the examination is scheduled that the applicant will be reimbursed.” The term “applicant” within the context of 11 NYCRR 65-3.5 (e) specifically refers to the injured party (the assignor). (East Acupuncture, P.C. v Allstate Ins. Co.,61 AD3d 202, 2009 NY Slip Op 01191 [2d Dept 2009].) 11 NYCRR 65-3.6, entitled “Follow-up requirements,” which was ruled upon in Prime Psychological Servs. (supra), refers to the eligible injured person as the applicant in subdivision (a) where it mandates that insurers mail a second application for motor vehicle no-fault benefits to the “eligible injured person.”

Second, from a purely logical vantage point, it would be an exercise in futility to require an insurance company to send a preclaim IME cutoff notice to the assignee since, by definition, an insurance company cannot prophesize which medical service entity, out of the hundreds which exist in the metropolitan area, an injured party might seek services from. Statutory construction must be sought which is “consistent with achieving [the statute’s] purpose and with justice and common sense.” (Freeman v Kiamesha Concord, 76 Misc 2d 915, 920 [Civ Ct, NY County 1974].) The courts are to adopt a construction of a statute “which will not cause objectionable results, or cause inconvenience . . . or absurdity.” (McKinney’s Cons Laws of NY, Book 1, Statutes § 141, at 281; Matter of Medical Socy. of State of N.Y. v State of N.Y. Dept. of Health, 83 NY2d 447, 451-452 [1994].) The common mandate of statutory construction is to assume that the Legislature “did not intend a patently absurd result.” (Covington v Walker, 307 AD2d 908, 909 [2d Dept 2003,{**24 Misc 3d at 549} Feuerstein, J., dissenting]; see Statutes § 145; see In re Adamo, 619 F2d 216, 219 [2d Cir 1980].)

Here, the IME was conducted and the IME cutoff date became effective approximately six months before the Allens even sought treatment from, much less assigned their benefits to, plaintiff. Hence, it would be absurd to require defendant to notify this particular plaintiff provider about the IME cutoff as it had no way of discerning that the Allens might seek [*6]treatment at this provider at some date in the future. Plaintiff implicitly concedes that the Allens were notified of the IME cutoff date by contending that the “IME cut-off was never advised to assignee” and that the “IME exam was kept secret from the assignee” until the denial (reply ¶ 10). Since the Allens attended the IMEs and apparently knew that their no-fault benefits were cut off, they were under an obligation to inform plaintiff and any other medical provider from whom they sought treatment of this cutoff.

In light of the above, and the timely denials submitted by defendants, plaintiff’s motion for summary judgment is denied and this case will proceed to trial.

Footnotes

Footnote *: Parenthetically, in the one apparent case that discusses this issue, the court held that either the medical service provider or the assignor must be notified about the IME cutoff. (Mollins v GEICO, 15 Misc 3d 1103[A], 2007 NY Slip Op 50467[U] [Civ Ct, NY County 2007].) This case, however, provides little guidance since the IME and subsequent cutoff date occurred at or about the same time that the services were rendered at the medical service provider.