May 9, 2019

Matter of Global Liberty Ins. Co. v McMahon (2019 NY Slip Op 03692)


The court considered a case in which Global Liberty Insurance Co. sought to vacate an award in favor of Dr. Mark S. McMahon, who was an assignee of Rudy Corniel. Global had only partially approved a payment for arthroscopic surgery performed on its insured, and McMahon sought payment for the balance. The lower arbitrator awarded the balance to McMahon, but did not consider a reference to the American Medical Association's CPT Assistant newsletter that Global relied on. The master arbitrator affirmed this decision, and the Supreme Court also denied Global's petition to vacate the award. The Appellate Division reversed this decision, holding that CPT Assistant, which is referenced in the Official New York Workers' Compensation Medical Fee Schedule, should have been considered in the arbitration process. Consequently, the matter was remanded for a new arbitration.

Reported in New York Official Reports at Matter of Global Liberty Ins. Co. v McMahon (2019 NY Slip Op 03692)

Matter of Global Liberty Ins. Co. v McMahon (2019 NY Slip Op 03692)
Matter of Global Liberty Ins. Co. v McMahon
2019 NY Slip Op 03692 [172 AD3d 500]
May 9, 2019
Appellate Division, First Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
As corrected through Wednesday, July 3, 2019


 In the Matter of Global Liberty Insurance Co., Appellant,
Mark S. McMahon, M.D., as Assignee of Rudy Corniel, Respondent.

Law Office of Jason Tenenbaum, P.C., Garden City (Jason Tenenbaum of counsel), for appellant.

Samandarov & Associates, P.C., Floral Park (Eli Shmulik of counsel), for respondent.

Order, Supreme Court, Bronx County (Fernando Tapia, J.), entered November 11, 2018, which denied Global Liberty Insurance Co.’s (Global) petition to vacate the master arbitrator’s award, dated August 15, 2018, affirming the lower arbitrator’s award in favor of respondent, dated April 17, 2018, dismissed the proceeding and confirmed the award, unanimously reversed, on the law, without costs, the petition granted, the award vacated, and the matter remanded to the lower arbitrator for a new arbitration to be conducted consistent with this decision.

Respondent submitted to Global a claim for payment under the No-Fault Law (Insurance Law art 51) in the amount of $5,813,81 for arthroscopic surgery respondent had performed on Global’s insured. Global approved the claim only up to the amount of $2,980.44, basing its position on the American Medical Association’s CPT Assistant newsletter.[FN*] After Global partially paid the claim, respondent commenced a no-fault arbitration, seeking payment of the $1,342.52 balance. The lower arbitrator, in rendering an award to respondent in that amount, refused to consider CPT Assistant, on which Global had relied, based on the arbitrator’s view that CPT Assistant was “not authorized by statute or regulation applicable to the No-Fault Law.” On Global’s appeal, the master arbitrator affirmed the lower arbitrator’s award. Thereafter, Supreme Court denied Global’s petition to vacate the award. On Global’s appeal, we reverse and grant the petition.

The Official New York Workers’ Compensation Medical Fee Schedule, promulgated by the chair of the Workers’ Compensation Board, directs users to “refer to the CPT book for an explanation of coding rules and regulations not listed in this schedule.” The CPT book, in turn, expressly makes reference to CPT Assistant. By both statute and regulation, the fee schedules established by the chair of the Workers’ Compensation Board are expressly made applicable to claims under the No-Fault Law (see Insurance Law § 5108; 11 NYCRR 68.0, 68.1 [a] [1]; see generally Government Empls. Ins. Co. v Avanguard Med. Group, PLLC, 127 AD3d 60, 63-64 [2d Dept 2015], affd 27 NY3d 22 [2016]). Accordingly, because CPT Assistant is incorporated by reference into the CPT book, which is incorporated by reference into the Official New York Workers’ Compensation Medical Fee Schedule applicable to this claim under the No-Fault Law, the award rendered without consideration of CPT Assistant is incorrect as a matter of law (see 11 NYCRR 65-4.10 [a] [4]). We therefore grant the petition to vacate the award and remand the matter to the lower arbitrator for a new arbitral proceeding, at which relevant portions of CPT Assistant shall be given due consideration. Concur—Friedman, J.P., Renwick, Kapnick, Kahn, Oing, JJ.


Footnote *:CPT is an acronym for Current Procedural Terminology.