July 3, 2006

M.G.M. Psychiatry Care P.C. v Utica Mut. Ins. Co. (2006 NY Slip Op 51286(U))


The relevant facts the court considered were that M.G.M. Psychiatry Care P.C. had submitted claims for first-party no-fault benefits to Utica Mutual Insurance Company, and that payment was overdue. The main issue decided was whether the defendant had timely denied the claims within the 30-day statutory period. The holding of the case was that the deficiencies in the plaintiff's moving papers were cured by the denial of claim forms, and that the defendant had failed to timely deny the claims, making them precluded from raising certain defenses. Therefore, the order granting the plaintiff's motion for summary judgment was affirmed.

Reported in New York Official Reports at M.G.M. Psychiatry Care P.C. v Utica Mut. Ins. Co. (2006 NY Slip Op 51286(U))

M.G.M. Psychiatry Care P.C. v Utica Mut. Ins. Co. (2006 NY Slip Op 51286(U)) [*1]
M.G.M. Psychiatry Care P.C. v Utica Mut. Ins. Co.
2006 NY Slip Op 51286(U) [12 Misc 3d 137(A)]
Decided on July 3, 2006
Appellate Term, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and will not be published in the printed Official Reports.
Decided on July 3, 2006



2005-587 K C.
M.G.M. Psychiatry Care P.C. a/a/o JOHN CIANCIOTTA, Respondent,


Utica Mutual Insurance Company, Appellant.

Appeal from an order of the Civil Court of the City of New York, Kings County (Donald S. Kurtz, J.), entered on January 19, 2005. The order granted plaintiff’s motion for summary judgment.

Order affirmed without costs.

In an action to recover assigned first-party no-fault benefits, a plaintiff provider establishes a prima facie entitlement to summary judgment by proof that it submitted the claims, setting forth the fact 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 in plaintiff’s moving papers concerning proof of its submission of the claims were cured by the defendant’s denial of claim forms attached to plaintiff’s moving papers, which adequately established that plaintiff sent, and that defendant received, the claims (see Careplus Med. Supply Inc. v State-Wide Ins. Co., 11 Misc 3d 29 [App Term, 2d & 11th Jud Dists 2005]; Ultra Diagnostics Imaging v Liberty Mut. Ins. Co., 9 Misc 3d 97 [App Term, 9th & 10th Jud Dists 2005]; A.B. Med. Servs. PLLC v Prudential Prop. & Cas. Ins. Co., 7 Misc 3d 14 [App [*2]Term, 2d & 11th Jud Dists 2005]).

Defendant’s denials of plaintiff’s claims were not timely made within the 30-day statutory period within which it was required to pay or deny the claims (11 NYCRR 65-3.8 [c]). An insurer’s timely verification requests and compliance with the follow-up verification requirements may extend the 30-day period (see 11 NYCRR 65-3.5 [b]; 65-3.6 [b]; Hospital for Joint Diseases v ELRAC, Inc., 11 AD3d 432 [2004]). Since defendant failed to establish by proof of proper mailing that it ever requested that plaintiff’s assignor sign and return the transcript of his examination under oath (see Nyack Hosp. v Metropolitan Prop. & Cas. Ins. Co., 16 AD3d 564 [2005]; Hospital for Joint Diseases v Nationwide Mut. Ins. Co., 284 AD2d 374 [2001]), we need not reach the ultimate question of whether such request, if properly made, would have the effect of tolling the 30-day claim determination period. Accordingly, defendant is precluded from raising most defenses (see Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 282 [1997]), including its defense of a fraudulent claim (see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11 [1999]). Defendant also denied the claims on the ground of fraud and/or misrepresentation. However, the record indicates that defendant’s claim of fraud is, in essence, premised on a fraudulent claim which, whether based on fraudulent billing, excessive medical treatment or otherwise, are defenses subject to preclusion (see Central Gen. Hosp., 90 NY2d at 199; Presbyterian Hosp. in City of N.Y. v Maryland Cas, Co., 90 NY2d at 285; Careplus Med. Supply Inc. v State-Wide Ins. Co., 11 Misc 3d 29, supra; Fair Price Med. Supply Co. v Travelers Indem. Co., 9 Misc 3d 76 [App Term, 2d & 11th Jud Dists 2005]; Melbourne Med., P. C. v Utica Mut. Ins. Co., 4 Misc 3d 92 [App Term, 2d & 11th Jud Dists 2004]; cf. State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]).

We note that defendant correctly argues that where medical services are rendered by an independent contractor, the billing provider may not maintain an assigned first-party no-fault action, since it is not a “provider” within the meaning of the
insurance regulations, and hence no-fault benefits are not assignable to it (Rockaway Blvd. Med. P.C. v Progressive Ins., 9 Misc 3d 52 [App Term, 2d & 11th Jud Dists 2005]). Further, such defense is nonwaivable and not subject to the preclusion rule (see Matter of Medical Socy. of State of N.Y. v Serio, 100 NY2d 854 [2003]; Rockaway Blvd. Med. P.C. v Progressive Ins., 9 Misc 3d 52, supra). In opposition to plaintiff’s motion for summary judgment, defendant has failed to offer proof in admissible form in support of the nonwaivable defense that the services were provided by an independent contractor, and that plaintiff therefore could not maintain the instant action.

Defendant’s argument that plaintiff has failed to show entitlement to recover no-fault benefits because the assignment of benefits form is not authenticated is without merit since the lack of authentication does not constitute a cognizable defect (see A.B. Med. Servs. PLLC v Nationwide Mut. Ins. Co., 6 Misc 3d 70 [App Term, 2d & 11th Jud Dists 2004]). In any event, defendant’s failure to seek verification of the assignment, or to allege such deficiency in the assignment in its denial of claim forms, constitutes a waiver of any defenses with respect thereto (see id.; New York Hosp. Med. Ctr. of
Queens v New York Cent. Mut. Fire Ins. Co., 8 AD3d 640 [2004]; Presbyterian Hosp. in
City of N.Y. v Aetna Cas. & Sur. Co., 233 AD2d 433 [1996]; Park Health Ctr. v Eveready Ins. Co., 2001 NY Slip Op 40665[U] [App Term, 2d & 11th Jud Dists]).

Accordingly, summary judgment was properly granted in favor of plaintiff.

Weston Patterson, J.P., and Belen, J., concur.

Golia, J., concurs in a separate memorandum.

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

I am constrained to agree with the ultimate disposition in the decision reached by the majority. I, however, wish to note that I do not 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.

I further wish to note that the objection to the claim is not one that sounds in overbilling but relates to billing for services that may never have been provided. Paying for services that were never provided is not in my estimation, fraudulently overbilling and should not be subject to preclusion.
Decision Date: July 3, 2006