SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Ellen Spodek, J.), entered March 31, 2005. The order denied the petition to vacate the master arbitrator’s award.

Order modified by adding thereto a provision confirming the master arbitrator’s award; as so modified, affirmed without costs.

Upon a review of the record, we find a rational basis for the determination of the master arbitrator upholding the arbitrator’s award which denied the petitioner’s claims for no-fault benefits (see e.g. Matter of Smith [Firemen’s Ins. Co.], 55 NY2d 224 [1982]; Matter of Petrofsky [Allstate Ins. Co.], 54 NY2d 207 [1981]; Matter of Shand [Aetna Ins. Co.], 74 AD2d 442 [1980]). Accordingly, the court below properly denied the petition to vacate the master arbitrator’s award. However, upon denying the petition, the court was required, pursuant to CPLR 7511 (e), to confirm the award (see Matter of Exclusive Med. & Diagnostic v Government Empls. Ins. Co., 306 AD2d 476 [2003]).

We note that a special proceeding should terminate in a judgment, not an order (see CPLR 411).

Pesce, P.J., Weston Patterson and Belen, JJ., concur. [*2]
Decision Date: November 15, 2006

Civil Court of the City of New York, Kings County

105406 KCV 2005

Lila P. Gold, J.

Plaintiff commenced this action under the No-Fault provisions of the Insurance Law to recover fees in the amount of $2670.39 for medical services provided to its assignor.

Before the court began to hear testimony, Defendant made a pre-trial motion to dismiss, alleging that there was a lack of standing to bring this action. Defendant then asked the court to order the Plaintiff to produce a contract between himself and Advanced Healthcare Solutions, L.L.C., the billing company for Plaintiff, in order to establish Plaintiff’s standing.

Standing is defined as a party’s right to make a legal claim or seek a judicial enforcement of a duty or right. Black’s Law Dictionary (8th ed. 2004), standing (n.). In the case before the court, Andrew Carothers M.D., P.C. has a legal claim to the no-fault benefits by way of an assignment provided to him for services rendered to the assignor (Exhibits 4, 8 & 12).

Furthermore, even though the Plaintiff was willing to show the contract to the court in camera, the court ruled that a contract showing the relationship between the billing company, Advanced Healthcare Solutions, and Andrew Carothers M.D., P.C. has no bearing on the latter’s issue of standing.

Plaintiff proceeded to offer evidence via the presentation of documents and testimony of Octavio Rodriguez, an office manager of Advanced Heathcare Solutions, L.L.C. in order to establish a prima facie entitlement for payment of the no-fault benefits.

To establish a prima facie case, a plaintiff is required to submit proof that it timely sent its claim for no-fault benefits to the defendant, that defendant received the claim and that defendant failed to pay or deny the claim within thirty days. (See Amaze Medical Supply Inc. v. Allstate Insurance Company, 3 Misc 3d 133A [App Term 2nd & 11th Jud Dists 2003]).

In this action Plaintiff’s evidence included the claim form (NF-3) (Exhibits 2, 6 & 10), [*2]the signed Assignment of Benefits form (NF-AOB) (Exhibits 4, 8 &12), proof of mailing (Exhibit 14), together with the a copy of the treating doctor’s referral (Exhibits 3, 7 & 11), and the MRI narrative (Exhibits 5, 9 & 13).

Plaintiff further strengthened its prima facie case by having Defendant’s denial form (NF-10) (Exhibit 25) admitted into evidence for the limited purpose of showing that the claim was received timely by the Defendant and that the denial was timely. (See A.B. Med. Serv., P.L.L.C. v. New York Central Mut. Fire Ins. Co., 3 Misc 3d 136(A); see also Kings Medical Supply, Inc. v. Country-Wide Ins. Co., 5 Misc 3d 767).

At this point Plaintiff rested and Defendant reiterated his position that Plaintiff did not establish a prima facie entitlement to the no-fault benefits. Defendant’s position was that Plaintiff did not lay the proper foundation to have its documents admitted into evidence.

However, the court finds that Plaintiff did in fact lay the proper foundation to submit the documents into evidence, via the testimony of Mr. Rodriguez. “Where an entity routinely relies upon the business records of another entity in the performance of its own business and fully incorporates said information into the records made in the regular course of its business, the subsequent record is admissible notwithstanding that the preparer lacked personal knowledge of the information’s accuracy.” (See Pine Hollow Medical P.C. v. Progressive Casualty Insurance Co., 2006 NY Slip Op 51870U) Since Advance Healthcare Solutions L.L.C. is a billing company whose regular business is to produce bills based on information imparted to them by Plaintiff and maintained these records in the regular course of its business, the proper business record foundation was established to admit the documents into evidence (CPLR 4518[a]). (See Plymouth Rock Fuel Corp. v. Leucadia Inc., 117A.D. 2d 727; see also West Valley Fire District No. 1 v. Village of Springville,264 AD2d 949)

Once Plaintiff established its prima facie entitlement, the burden shifted to the Defendant to substantiate their basis for denying the claim. The Defendant contended that the services provided lacked medical necessity and therefore Defendant was not obligated to pay the claims.

The Defendant did not call a single witness or introduce a single piece of evidence to substantiate the claim of lack of medical necessity. The Defendant relied on the cross examination of Plaintiff’s witness and the introduction of the peer review report by Plaintiff, which was part of the NF-10. Defendant was of the opinion that if a proper business record foundation was established to properly admit Plaintiff’s documents into evidence, then Defendant’s peer review report, which was in evidence as part of the denial form (NF-10) admitted into evidence, was sufficient to meet Defendant’s burden of proof that the medical services provided by Andrew Carothers M.D., P.C. lacked medical necessity.

The Court rejected Defendant’s argument and finds that Plaintiff’s purpose for submitting the peer review report with the NF-10 was for completeness and accuracy of the document presented to the court. Furthermore, the court admitted the NF-10 together with the peer review report for the limited purpose of showing that the claim was received timely by the Defendant [*3]and that the denial was timely. Plaintiff’s inclusion of the peer review along with the NF-10 does not make the peer review available to the opposing party to use for establishing their burden of lack of medical necessity, (See A.B. Med. Serv. P.L.L.C. v. Travelers Property Casualty Corp., 5 Misc 3d 214) rather, to fortify Plaintiff’s prima facie case. (See A.B. Med. Serv., P.L.L.C. v. New York Central Mut. Fire Ins. Co., 3 Misc 3d 136(A)

Accordingly, based on the evidence, the Court concludes that Defendant failed to sustain the burden of proof on the only issue before this court, lack of medical necessity. Judgment should be entered for the plaintiff in the amount of $2670.39, plus interest and attorneys’ fees as provided by the Insurance Law, together with the statutory costs and disbursements in this action.

This opinion constitutes the decision of the Court. A copy of this decision will be mailed to the parties.

Dated:November 14, 2006

____________________________

Lila P. Gold, J.C.C.

Encl: Exhibits submitted to the court.

—[*1]

In an action to recover no-fault medical payments, the defendants appeal from an order of the Supreme Court, Nassau County (Joseph, J.), dated October 31, 2005, which granted the motion of the plaintiff New York and Presbyterian Hospital for summary judgment on the third cause of action and denied the defendants’ cross motion for summary judgment dismissing that cause of action.

Ordered that the order is affirmed, with costs.

In support of its motion for summary judgment on the third cause of action, the plaintiff New York and Presbyterian Hospital, as assignee of William Browne, made a prima facie showing of entitlement to judgment as a matter of law by submitting a hospital bill with a signed certified mail return receipt and by submitting the affidavit of its third-party biller, who attested that he billed the defendants for the subject medical treatment and that the defendants failed to pay the claim or issue a denial of claim form (see New York & Presbyt. Hosp. v Allstate Ins. Co., 30 AD3d 492, 493 [2006]). In opposition to the motion the defendants failed to raise a triable issue of fact, and in support of their cross motion for summary judgment dismissing the third cause of action the defendants failed to demonstrate their prima facie entitlement to judgment as a matter of law. The defendants’ failure to timely object to the adequacy of the claim forms or seek verification of the assignment constituted a waiver of any defenses based thereon (see Nyack Hosp. v Encompass Ins. [*2]Co., 23 AD3d 535 [2005], lv denied 7 NY3d 741 [2006]; Hospital for Joint Diseases v Allstate Ins. Co., 21 AD3d 348 [2005]; Nyack Hosp. v Metropolitan Prop. & Cas. Ins. Co., 16 AD3d 564 [2005]; New York Hosp. Med. Ctr. of Queens v AIU Ins. Co., 8 AD3d 456 [2004]).

Accordingly, the Supreme Court properly granted the motion and denied the cross motion. Schmidt, J.P., Adams, Skelos and Covello, JJ., concur.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Eileen Nadelson, J.), entered September 26, 2005. The order, insofar as appealed from, denied defendant’s cross motion for summary judgment.

Order, insofar as appealed from, affirmed without costs.

In this action to recover first-party no-fault benefits for medical supplies furnished to its assignor, the court below denied plaintiff’s motion for summary judgment and defendant’s cross motion for summary judgment on the ground that neither party had established its prima facie entitlement to judgment as a matter of law by competent
proof in admissible form. Defendant appeals from so much of the order as denied its cross motion for summary judgment and we affirm.

Defendant timely denied the claim citing a peer review report which, according to the denial form, “revealed that the service provided was not medically necessary.” The denial form did not indicate that the peer review report was attached to the denial. Nor did defendant’s affiant state in its cross motion papers that the report was ever mailed to plaintiff, much less that defendant did so within 30 days of the claim’s receipt. The denial form otherwise contained no facts to satisfy the statutory claim form’s requirement that the insurer: “State reason for denial, [*2]fully and explicitly (attach extra sheets if needed)”. Even a timely denial does not avoid the preclusion sanction “where said denial is factually insufficient, conclusory or vague” (A.B. Med. Servs. PLLC v GEICO Cas. Ins. Co., 12 Misc 3d 30, 31 [App Term, 2d & 11th Jud Dists 2006]; see Nyack Hosp. v Metropolitan Prop. & Cas. Ins. Co., 16 AD3d 564, 565 [2005]; Amaze Med. Supply v Allstate Ins. Co., 3 Misc 3d 43, 44 [App Term, 2d & 11th Jud Dists 2004]). While an insurer is not required to attach the peer review report to its denial of claim form (as implied by 11 NYCRR 65-3.8 [b] [4]), in such a case the denial form itself must set forth, with the requisite particularity, the factual basis and medical rationale for the denial (e.g. A.B. Med. Servs. PLLC v Liberty Mut. Ins. Co., 10 Misc 3d 128[A], 2005 NY Slip Op 51902[U] [App Term, 2d & 11thain Jud Dists 2005]), or at the very least, the insurer must supply claimant with the report within 30 days of the claim’s receipt, absent a tolling of the statutory claim determination period (SZ Med. P.C. v Clarendon Natl. Ins. Co., 12 Misc 3d 144[A], 2006 NY Slip Op 51428[U] [App Term, 2d & 11th Jud Dists 2006]). As defendant proved compliance with neither rule, it is precluded from asserting the defense (Amaze Med. Supply v Allstate Ins. Co., 3 Misc 3d 43, supra; see also A.B. Med. Servs. PLLC v Liberty Mut. Ins. Co., 10 Misc 3d 128[A], 2005 NY Slip Op 51902[U], supra [a denial form’s factual insufficiency with respect to a lack of medical necessity defense is not cured by attaching a peer review report to papers opposing a motion for summary judgment]). In the absence of any other ground to support its cross motion, defendant failed to establish its prima facie entitlement to summary judgment.

Pesce, P.J., Weston Patterson and Belen, JJ., concur.
Decision Date: November 13, 2006

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Queens County (Timothy J. Dufficy, J.), entered August 3, 2005. The order granted plaintiff’s motion for summary judgment and denied defendant’s cross motion for summary judgment.

Order affirmed without costs.

In this action to recover first-party no-fault benefits for medical services provided to its assignor, plaintiff established a prima facie entitlement to summary judgment by proof that it submitted claims, setting forth the facts and the amounts of the losses
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]; Amaze Med. Supply v Eagle Ins. Co., 2 Misc 3d 128[A], 2003 NY Slip Op 51701[U] [App Term, 2d & 11th Jud Dists]). The deficiencies, if any, with regard to plaintiff’s proof of mailing were “cured by defendant’s acknowledgment of receipt on its denial form” which was attached to plaintiff’s papers (Fair Price Med. Supply Corp. v ELRAC Inc. & Enterprise Rent-A-Car, 12 Misc 3d 119 [App Term, 2d & 11th Jud Dists 2006]; A.B. Med. Servs. v New York Cent. Mut. Fire Ins. Co., 3 Misc 3d 136[A], 2004 NY Slip Op 50507[U] [App Term, 2d & 11th Jud Dists]). The denial form, dated [*2]December 3, 2003, alleged that defendant issued a verification request on November 17, 2003, 66 days after the claims’ receipt (September 12, 2003). Even if proof of such verification request had been presented in admissible form, the request was untimely (11 NYCRR 65-3.5 [a], [b]; 11 NYCRR 65-3.8 [a], [1]). Under the circumstances, defendant’s denial was untimely (11 NYCRR 65-3.8 [a] [1], [c]), precluding most defenses (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]).

The untimely denial, however, did not preclude defendant from interposing the defense that the assignor’s injuries were not causally related to the accident (e.g. Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 18-19 [1999]), that is, that there was no causal nexus between the accident and the injuries for which the assignor was treated (Careplus Med. Supply Inc. v Kemper Auto & Home Ins. Co., 8 Misc 3d 127[A], 2005 NY Slip Op 50958[U] [App Term, 2d & 11th Jud Dists]; see Valentine v Grossman, 283 AD2d 571, 572 [2001]). An accident analysis report in the form of a “low impact study” can be a proper basis for a denial (Ocean Diagnostic Imaging P.C. v New York Cent. Mut. Fire Ins. Co., 7 Misc 3d 129[A], 2005 NY Slip Op 50525[U] [App Term, 2d & 11th Jud Dists]; see also A.B. Med. Servs. PLLC v New York Cent. Mut. Fire Ins. Co., 12 Misc 3d 140[A], 2006 NY Slip Op 51347[U] [App Term, 2d & 11th Jud Dists]; Amaze Med. Supply Inc. v New York Cent. Mut. Fire Ins. Co., 12 Misc 3d 131[A], 2006 NY Slip Op 51051[U] [App Term, 2d & 11th Jud Dists]), “provided it is in admissible form” (A.B. Med. Servs. PLLC v New York Cent. Mut. Fire Ins. Co., 12 Misc 3d 140[A], 2006 NY Slip Op 51347[U], supra). However, defendant’s report was not in admissible form (see Amaze Med. Supply Inc. v New York Cent. Mut. Fire Ins. Co., 12 Misc 3d 131[A], 2006 NY Slip Op 51051[U], supra; Ocean Diagnostic Imaging P.C. v New York Cent. Mut. Fire Ins. Co., 7 Misc 3d 129[A], 2005 NY Slip Op 50525[U], supra; Ocean Diagnostic Imaging P.C. v New York Cent. Mut. Fire Ins. Co., 7 Misc 3d 132[A], 2005 NY Slip Op 50607[U] [App Term, 2d & 11th Jud Dists]). Recognizing the deficiency, defendant resubmitted the report in admissible form, but only for the first time in sur-reply when plaintiff had no opportunity to respond to its content (Dannasch v Bifulco, 184 AD2d
415, 416 [1992]). The court below declined to consider the affidavit, and matters disregarded below as improperly raised in reply may not be considered on appeal (e.g. Wager v Hainline, 29 AD3d 569 [2006]).

Pesce, P.J., Weston Patterson and Belen, JJ., concur.
Decision Date: November 13, 2006

APPELLATE TERM OF THE SUPREME COURT, FIRST DEPARTMENT

Defendant appeals from an order of the Civil Court, Bronx County (Julia I. Rodriguez J.), dated January 31, 2006, which denied its motion to compel discovery.

PER CURIAM:

Order (Julia I. Rodriguez J.), dated January 31, 2006, reversed, with $10 costs, and defendant’s motion for discovery granted.

In this action to recover assigned first party no-fault benefits, defendant is entitled to discovery pertaining to its defenses of lack of medical necessity and fraudulent billing, including the deposition of Dr. Arkady Levitan. The record shows that defendant timely denied plaintiff’s claims. Plaintiff’s assignor appeared for an IME performed by defendant on April 25, 2003, which was timely scheduled within 30 days from the date of defendant’s receipt of the claim (see 11 NYCRR 65-3.5 [d]), and in a letter addressed to defendant dated May 9, 2003, plaintiff’s counsel acknowledged receipt of defendant’s denial, which was dated May 6, 2003, thereby establishing a timely denial of claim within 30 days after the IME was performed (see 11 NYCRR 65-3.8 [a][1]).

This constitutes the decision and order of the court.
I concurI concurI concur

Decision Date: November 9, 2006

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 2nd and 11th JUDICIAL DISTRICTS

Appeal from an order of the Civil Court of the City of New York, Kings County (Eileen Nadelson, J.), entered September 28, 2005. The order, insofar as appealed from, denied the branches of plaintiff’s motion which sought summary judgment upon plaintiff’s claims in the amounts set forth in the claim forms dated July 9, 2003, July 22, 2003, August 6, 2003, August 22, 2003, and September 5, 2003.

Order, insofar as appealed from, affirmed without costs.

In this action to recover assigned first-party no-fault benefits, plaintiff appeals from the denial of the branches of its motion for summary judgment which sought to
recover upon its claims in the amounts set forth in the claim forms dated July 9, 2003, July 22, 2003, August 6, 2003, August 22, 2003, and September 5, 2003. Plaintiff asserts that defendant’s denial of claim forms (NF-10) were defective because rather than fully and explicitly setting forth the basis for the denials, the NF-10s stated that plaintiff’s claims were denied based upon a peer review report, a copy of which accompanied the NF-10s. Where, as here, the insurer establishes that it provided a factually sufficient peer review report to plaintiff within the 30-day claim determination period, an NF-10 which states that the claim was denied based upon the peer review report provided to plaintiff is sufficient to preserve a defense of lack of medical necessity (see Psychological Practice, P.C. v Kemper Auto & Home Ins. Co., 12 Misc 3d 137[A], 2006 NY [*2]Slip Op 51289[U] [App Term, 2d & 11th Jud Dists]; Vista Surgical Supplies, Inc. v Metropolitan Prop. & Cas. Ins. Co., 12 Misc 3d 130[A], 2006 NY Slip Op 51047[U] [App Term, 2d & 11th Jud Dists]; see also SZ Med. P.C. v Clarendon Natl. Ins. Co., 12 Misc 3d 144[A], 2006 NY Slip Op 51428[U] [App Term, 2d & 11th Jud Dists]). In view of the fact that defendant’s opposition to plaintiff’s summary judgment motion included an affidavit from the peer reviewer which incorporated the unsworn peer review report, plaintiff was not entitled to summary judgment upon its claims in the
amounts set forth in the aforesaid claim forms (see A.B. Med. Servs. v New York Cent. Mut. Fire Ins. Co., 3 Misc 3d 136[A], 2004 NY Slip Op 50507[U] [App Term, 2d & 11th Jud Dists]).

Pesce, P.J., Weston Patterson and Belen, JJ., concur.
Decision Date: November 08, 2006

—[*1]

In a proceeding pursuant to CPLR article 75 to permanently stay arbitration of an uninsured motorist claim, Fernando Castillo-Gomez appeals from an order of the Supreme Court, Nassau County (Davis, J.), dated August 15, 2005, which denied his motion to dismiss the proceeding as untimely and granted the petition.

Ordered that the order is reversed, on the law, with costs, and the appellant’s motion to dismiss the proceeding as untimely is granted.

The appellant claimed that he was injured as a result of an accident on March 30, 2003 caused by an allegedly uninsured vehicle. On April 9, 2003 his attorney sent to his insurer, the petitioner Government Employees Insurance Company (hereinafter Geico) a letter by certified mail, return receipt requested, claiming no-fault insurance benefits, uninsured motorist benefits, and supplemental uninsured motorist (hereinafter SUM) benefits. The letter contained a statement pursuant to CPLR 7503 (c) that the appellant “intends and provides this notice of claimant’s intention to demand arbitration” and that Geico would be precluded from objecting, inter alia, that a valid agreement had not been made or complied with unless it applied to stay arbitration within 20 days after receipt of the notice.

By document entitled “Request for SUM Policy Arbitration” received May 3, 2005, [*2]the appellant notified Geico that he was demanding arbitration before the American Arbitration Association. Within 20 days of receipt of this demand, Geico commenced this proceeding to stay arbitration on the ground that the offending vehicle was insured on the date of the accident. The appellant moved to dismiss on the ground that the proceeding was not timely commenced, relying on the letter dated April 9, 2003 containing his notice of intention to arbitrate.

The Supreme Court stayed arbitration, finding that the proceeding was timely. It determined that the letter dated April 9, 2003 was not a valid demand for arbitration as it did not contain all of the information required by the American Arbitration Association Rules governing arbitration of SUM disputes, and thus, the 20-day period would be measured from the later demand for arbitration. This was error.

Where an insurance policy contains an agreement to arbitrate, CPLR 7503 (c) “requires a party, once served with a demand for arbitration, to move to stay such arbitration within 20 days of service of such demand, else he or she is precluded from objecting” (Matter of Steck [State Farm Ins. Co.], 89 NY2d 1082, 1084 [1996]). The validity of the 20-day limitation depends on compliance with the requirements of CPLR 7503 (c) (see State Farm Mut. Auto. Ins. Co. v Szwec, 36 AD2d 863 [1971]) and not those of the rules promulgated by the American Arbitration Association. Since the appellant’s April 9, 2003 notice of intention to arbitrate complied with all of the statutory requirements, it was sufficient to commence the 20-day period of limitations (see Matter of Blamowski [Munson Transp.], 91 NY2d 190, 195 [1997]). Accordingly, the instant proceeding to stay arbitration, which was commenced more than 20 days after service of the intention to arbitrate, is time-barred (see Matter of Transportation Ins. Co. v Desena, 17 AD3d 478 [2005]; Matter of Hartford Ins. Co. v Buonocore, 252 AD2d 500 [1998]). Florio, J.P., Schmidt, Krausman and Lifson, JJ., concur.