October 21, 2005

Ocean Diagnostic Imaging, P.C. v Utica Mut. Ins. Co. (2005 NYSlipOp 51745(U))

https://www.beynensonlaw.com/case-law/ocean-diagnostic-imaging-p-c-v-utica-mut-ins-co-2005-nyslipop-51745u/

Court: Appellate Term, Second Department
Decided: October 21, 2005
Citation: 2005 NY Slip Op 51745(U)
Posture: Summary judgment
Outcome: Provider prevailed
Issues: Verification requests Timeliness and preclusion Staged accidents, lack of coverage
Legal questions: No covered accident (founded belief) · Claimant's prima facie case on motions (see the maps)

Cite as

Ocean Diagnostic Imaging, P.C. v Utica Mut. Ins. Co., 2005 NY Slip Op 51745(U) (App Term, 2d Dept, 9th & 10th Jud Dists 2005)

Posture, outcome, issues and treatment by other decisions are Beynenson Law’s classification. Treatment labels are assigned by a language model reading the citing decision; negative and appeal-history labels are checked by a second reader.

Summary

Editorial summary by Beynenson Law, not part of the court’s decision.

The insurer's untimely examination requests failed to toll its denial deadline, and its staged-accident defense lacked admissible proof. The Appellate Term, Second Department, affirmed summary judgment for the provider and denial of the insurer's cross motion for summary judgment or discovery. The insurer received the claim September 12, 2002, but denied it December 2, 2002. Its initial IME and EUO requests were untimely and failed to schedule examinations within 30 days under 11 NYCRR 65-3.5 (a), (b), and (d). The surviving staged-accident defense rested on conclusory assertions and unsworn reports. Investigators' reports addressed treatment and billing irregularities, a precluded defense, while the adverse operator's statements in the police report were inadmissible hearsay. The court did not reach the insurer's remaining contentions.

Reported in New York Official Reports at Ocean Diagnostic Imaging, P.C. v Utica Mut. Ins. Co. (2005 NYSlipOp 51745(U))

[*1]

Ocean Diagnostic Imaging, P.C. v Utica Mut. Ins. Co.

2005 NYSlipOp 51745(U)

Decided on October 21, 2005

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This opinion is uncorrected and will not be published in the printed Official Reports.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 October 21, 2005

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM: 9th and 10th JUDICIAL DISTRICTS

PRESENT: RUDOLPH, P.J., McCABE and TANENBAUM, JJ.
2004-921 N C

Ocean Diagnostic Imaging, P.C., a/a/o SAHARA ABBOTT, Respondent,
against
Utica Mutual Insurance Company, Appellant.

Appeal by defendant from an order of the District Court, Nassau County (S. Jaeger, J.), entered March 31, 2004, which granted plaintiff’s motion for summary judgment and denied defendant’s cross motion for summary judgment, or in the alternative, for an order compelling discovery.

Order unanimously affirmed without costs.

In this action to recover assigned first-party no-fault benefits, plaintiff health care provider established its prima facie entitlement to summary judgment by proof that it submitted a statutory claim form setting forth the fact and 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]; 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 burden shifted to defendant to create a triable issue of fact (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). Defendant’s conceded failure to deny the claim (received September 12, 2002) until December 2, 2002, that is, well beyond the 30-day claim determination period, precluded most defenses unless defendant established a tolling of the statutory time (Hospital for Joint Diseases v ELRAC, Inc., 11 AD3d 432, 434 [2004]; New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d 568, 570 [2004]).

All post-claim independent medical examination and examination under oath verification requests must be made within prescribed time frames (11 NYCRR 65-3.5 [a], [b], [d]; New York Hosp. Med. Ctr. of Queens v Country-Wide Ins. Co., 295 AD2d 583, 584-585 [2002]), and “[a]ny attempt by the insurer to deny the claim prior to exhausting the verification protocols is [*2]premature and of no effect” (King’s Med. Supply Inc. v Allstate Ins. Co., 7 Misc 3d 128[A], 2005 NY Slip Op 50451[U] [App Term, 9th & 10th Jud Dists]; see also New York & Presbyt. Hosp. v Progressive Cas. Ins. Co., 5 AD3d at 570 [2004]; King’s Med. Supply v New York Cent. Mut. Fire Ins. Co., 5 Misc 3d 136[A], 2004 NY Slip Op 51550[U] [App Term, 2d & 11th Jud Dists]). Neither of defendant’s initial examination requests were issued timely nor did they schedule the examination within the requisite 30-day period. Accordingly, defendant’s verification requests failed to toll the 30-day claim determination period.

As to the defense that the incident was staged to defraud, which defense survives the preclusion sanction (Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751 [2002]), as plaintiff properly argued below, none of defendant’s proof offered to establish the defense was submitted in admissible form. Defendant’s counsel alleged no basis to support an inference that the facts asserted in his statements were based on personal knowledge. Defendant’s “no-fault suit specialist” asserted merely the conclusory reference to “a possible staged fraudulent accident” based on unspecified “material misrepresentations made in the presentation of her claims,” an unsworn police accident report, and unsworn investigators’ reports, the latter of which concerned only alleged irregularities in the treatment and billing process, not the traffic incident, and thus, did not support a defense that survived the preclusion sanction (see Ocean Diagnostic Imaging P.C. v Prudential Prop. & Cas. Ins. Co., ____ Misc 3d _____, 2005 NY Slip Op ____ [App Term, 9th & 10th Jud Dists, February 17, 2005] [“Since defendant failed (timely to deny the claim) . . . it is precluded from raising
. . . its defense of provider fraud”]; Melbourne Med., P.C. v Utica Mut. Ins. Co., 4 Misc 3d 92 [App Term, 2d & 11th Jud Dists 2004]). The adverse operator’s statements as recorded on the police accident report, plainly self-serving, hearsay statements, were inadmissible for the purpose offered (Hoffman v Eastern Long Is. Transp. Enter., 266 AD2d 509, 510 [1999]; see also Cover v Cohen, 61 NY2d 261, 274 [1984]; Wolf v We Transp., 274 AD2d 514 [2000]). Thus, defendant failed to establish a triable issue of fraud (see e.g. Ocean Diagnostic Imaging P.C. v Allstate Ins. Co., 6 Misc 3d 134[A], 2005 NY Slip Op 50189[U] [App Term, 9th & 10th Jud Dists] [claims examiner’s conclusory assertions as to fraud insufficient]; Ocean Diagnostic Imaging, P.C. v Lancer Ins. Co., 6 Misc 3d 62 [App Term, 2d & 11th Jud Dists 2004] [unsworn investigation reports inadmissible in opposition to summary judgment motion]; Melbourne Med. P.C. v Utica Mut. Ins. Co., 4 Misc 3d 92 [App Term, 2d & 11th Jud Dists 2004] [attorney’s factual allegations, without personal knowledge of the investigation, mere unsubstantiated hearsay]; Dotzel v Allstate Ins. Co., 2003 NY Slip Op 50853[U] [App Term, 9th & 10th Jud Dists] [unsworn investigation reports inadmissible in opposition to summary judgment motion]). [*3]

In light of the foregoing, defendant’s remaining contentions need not be addressed.
Decision Date: October 21, 2005

Legal questions (2)

Questions of no-fault law this decision rules on, from our Legal Questions pages. Bars count the decisions on the question by year and court, coloured by category; circles are this decision and the decisions on the question it cites or that cite it. Point at a bar or circle for details. The categories and summaries are Beynenson Law’s classification, made by a language model and checked by a second reading.

No covered accident (founded belief)

Open the full map

Did the insurer show the claimed injuries did not arise from a covered accident (staged, intentional, or unrelated)?

This decision: Insurer's proof did not raise an issue or failed at trial; provider prevails on it

Held the staged-accident defense not shown because counsel lacked personal knowledge, the examiner's assertion was conclusory, investigators' reports were unsworn and addressed billing, and the police-report statements were inadmissible hearsay.

Defense establishedTriable issueInsurer's motion failsDefense not shownThis decisionCites it or cited by itCited or followed

Of the 233 decisions on this question in the Second Department courts and the Court of Appeals, 80 (this one included) are in the same category.

Claimant's prima facie case on motions

Open the full map

On summary judgment or another pretrial motion, what must a no-fault claimant show to establish its prima facie case?

This decision: Claimant's proof held to make out its prima facie case (rules on the question, but another ground decided the case)

Held the provider established its prima facie case by proof that it submitted a statutory claim form setting forth the fact and amount of the loss and that payment was overdue, shifting the burden to the insurer.

Proof sufficientMailing/receipt not shownOverdue not shownBusiness-record foundation lackingOther element missingThis decisionCites it or cited by itCited or followed

Of the 1,063 decisions on this question in the Second Department courts and the Court of Appeals, 511 (this one included) are in the same category. One decision in other departments that cites or is cited by this one is on the full map.

Cited in this decision

A label shows how this decision treated the case it cites.

Mary Immaculate Hosp. v Allstate Ins. Co. (2004 NY Slip Op 02359)The hospitals established entitlement to summary judgment by proving that statutory billing forms were mailed and received and payment was overdue.
Amaze Med. Supply v Eagle Ins. Co. (2003 NY Slip Op 51701(U))A provider's completed claim forms establish its prima facie case without additional medical proof when the insurer is precluded.
Hospital for Joint Diseases v ELRAC, Inc. (2004 NY Slip Op 07140)An unanswered verification demand tolls the 30-day payment-or-denial period under 11 NYCRR 65.15 (g) (1) (i).
New York & Presbyt. Hosp. v Progressive Cas. Ins. Co. (2004 NY Slip Op 01750)The insurer proved policy exhaustion on one hospital claim and absence of coverage on another, requiring dismissal of both.
King’s Med. Supply Inc. v Allstate Ins. Co. (2005 NYSlipOp 50451(U)) FollowedThe insurer's failure to send a timely follow-up verification request ended the toll and precluded its verification defense.
King’s Med. Supply Inc. v New York Cent. Mut. Fire Ins. Co. (2004 NY Slip Op 51550(U))An assignor's failure to attend a single IME does not support denial when the insurer has not exhausted follow-up verification procedures.
Melbourne Med., P.C. v Utica Mut. Ins. Co. (2004 NY Slip Op 24221)EUO requests do not toll the claim determination period when the governing no-fault regulations do not authorize EUO verification.
Ocean Diagnostic Imaging P.C. v Allstate Ins. Co. (2005 NY Slip Op 50189(U))The insurer's conclusory submissions failed to raise a triable issue of staged-accident fraud.
Ocean Diagnostic Imaging, P.C. v Lancer Ins. Co. (2004 NY Slip Op 24501)The insurer's submissions failed to raise a factual issue whether the claimed injuries arose from the accident.

Cited by

V.S. Med. Servs., P.C. v Allstate Ins. Co. (2006 NY Slip Op 26000)An insurer asserting a staged collision at trial need only rebut presumed coverage; the provider retains the burden of persuasion.
Devonshire Surgical Facility v AIU Ins. Co. (2007 NY Slip Op 51034(U))The insurer failed to establish grounds to disturb summary judgment or obtain discovery concerning alleged fraudulent incorporation.

Similar decisions

Ocean Diagnostic Imaging P.C. v State Farm Mut. Auto. Ins. Co. (2004 NY Slip Op 51032(U))The insurer's investigator raised a triable staged-collision coverage issue despite the provider's adequate billing proof.
Ocean Diagnostic Imaging P.C. v Utica Mut. Ins. Co. (2005 NYSlipOp 50611(U))The insurer raised a factual issue as to whether the collision furthered an insurance fraud scheme despite its late denial.
Ocean Diagnostic Imaging, Inc. v Utica Mut. Ins. Co. (2005 NY Slip Op 50081(U))The insurer's claims-specialist affidavit raised a triable coverage issue based on a founded belief that the collision involved fraud.
Ocean Diagnostic Imaging P.C. v AIU Ins. Co. (2005 NY Slip Op 50188(U))The insurer's unsworn investigator's report did not supply admissible evidence supporting its staged-accident defense.
Ocean Diagnostic Imaging P.C. v Travelers Indem. Co. (2005 NY Slip Op 50644(U))The insurer's proof failed to establish a founded belief that the collision was part of an insurance fraud scheme.