August 23, 2012

Parsons Med. Supply, Inc. v Progressive Northeastern Ins. Co. (2012 NY Slip Op 51649(U))

Headnote

The relevant facts considered by the court were that a provider, Parsons Medical Supply, Inc., had filed claims for $865 and $1,737 on January 28, 2008 and February 6, 2008, and the defendant insurance company did not pay or deny the claims within 30 days of receipt. The insurance company had sent letters to the provider indicating that they were investigating the claims and obtaining verification, including examinations under oath. The main issue decided by the court was whether the insurance company's delay letters were sufficient to toll the 30-day statutory time period within which a claim must be paid or denied. The holding of the case was that the insurance company's delay letters, which requested no verification, were insufficient to toll the 30-day statutory time period, and therefore the insurance company failed to demonstrate that the claims had been timely denied. As a result, the judgment was reversed, the order granting the insurance company's cross motion for summary judgment dismissing the complaint was vacated, and the insurance company's cross motion was denied.

Reported in New York Official Reports at Parsons Med. Supply, Inc. v Progressive Northeastern Ins. Co. (2012 NY Slip Op 51649(U))

Parsons Med. Supply, Inc. v Progressive Northeastern Ins. Co. (2012 NY Slip Op 51649(U)) [*1]

Parsons Med. Supply, Inc. v Progressive Northeastern Ins. Co.

2012 NY Slip Op 51649(U) [36 Misc 3d 148(A)]

Decided on August 23, 2012

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This opinion is uncorrected and will not be published in the printed Official Reports.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 August 23, 2012

SUPREME COURT, APPELLATE TERM, SECOND DEPARTMENT, 2d, 11th and 13th JUDICIAL DISTRICTS

PRESENT: : PESCE, P.J., RIOS and SOLOMON, JJ
2010-2899 K C.

Parsons Medical Supply, Inc. as Assignee of JERD-MAYER ORIENTAL, Appellant, —
against
Progressive Northeastern Ins. Co., Respondent.

Appeal from an order of the Civil Court of the City of New York, Kings County (Devin P. Cohen, J.), entered July 16, 2010. The order, insofar as appealed from as limited by the brief, granted defendant’s cross motion for summary judgment dismissing the complaint. The appeal is deemed to be from a judgment of the same court entered October 4, 2010 dismissing the complaint (see CPLR 5512 [a]).

ORDERED that the judgment is reversed, without costs, so much of the order entered July 16, 2010 as granted defendant’s cross motion for summary judgment dismissing the complaint is vacated and defendant’s cross motion is denied.

In this action by a provider to recover assigned first-party no-fault benefits, plaintiff appeals, as limited by its brief, from so much of an order of the Civil Court as granted defendant’s cross motion for summary judgment dismissing the complaint. A judgment was subsequently entered, from which the appeal is deemed to have been taken (see CPLR 5512 [a]).

Defendant admits that it received plaintiff’s claims for the sums of $865 and $1,737 on January 28, 2008 and February 6, 2008, respectively, and it is undisputed that the claims were not [*2]paid or denied within 30 days of their receipt. The letters sent by defendant to plaintiff after the receipt of the claims informed plaintiff that defendant was investigating the claims and was in the process of obtaining verification, which included examinations under oath. It is well settled that an insurer’s delay letters, which request no verification, are insufficient to toll the 30-day statutory time period within which a claim must be paid or denied (see Nyack Hosp. v Encompass Ins. Co., 23 AD3d 535 [2005]; Points of Health Acupuncture, P.C. v Lancer Ins. Co., 28 Misc 3d 133[A], 2010 NY Slip Op 51338[U] [App Term, 2d, 11th & 13th Jud Dists 2010]). Consequently, defendant failed to demonstrate that the claims had been timely denied and, therefore, defendant has not established that its defense of lack of medical necessity is not precluded (see Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274 [1997]). Accordingly, the judgment is reversed, so much of the order as granted defendant’s cross motion for summary judgment dismissing the complaint is vacated and defendant’s cross motion is denied.

Pesce, P.J., Rios and Solomon, JJ., concur.
Decision Date: August 23, 2012