Uniondale Chiropractic Off. v State Farm Mut. Auto. Ins. Co. (2008 NY Slip Op 51687(U))

District Court of Nassau County, First District

13451/07

Rachel L. Kaufman, Esq., Law Office of Robert E. Dash, Esqs., 6800 Jericho Turnpike, Suite 200A West, Syosset, New York 11791, (516) 931-5668, for the Plaintiff.

Richard A. D’Arrigo, Esq.

Nicolini, Paradise, Ferretti & Sabella, PLLC, 114 Old Country Road, P.O. Box 9006, Mineola, New York 11501, (516) 741-6355.

Andrew M. Engel, J.

This action seeking to recover no-fault first party benefits involves twenty-three (23) bills for chiropractic services allegedly performed by the Plaintiff totaling $1,975.28. The action was commenced on April 11, 2007. Issue was joined on or about May 22, 2007. The Plaintiff now moves for summary judgment, alleging that it timely submitted its claim forms to the Defendant and that the claims are overdue. The Defendant opposes the motion, alleging that it never received three (3) of the Plaintiff’s bills, that it timely denied seventeen (17) of the Plaintiff’s bills, and that it failed to deny three (3) of the Plaintiff’s bills.

To establish its prima facie right to summary judgment the Plaintiff must demonstrate submit “evidentiary proof that the prescribed statutory billing forms had been mailed and received and that payment of no fault benefits was overdue (citations omitted).” Mary Immaculate Hospital v. Allstate Insurance Company, 5 AD3d 742, 774 NYS2d 564 (2nd Dept. [*2]2004); See also: A.B. Medical Services, PLLC v. Liberty Mutual Insurance Company, 39 AD3d 779, 835 NYS2d 614 (2nd Dept. 2007); Westchester Medical Center v. AIG, Inc., 36 AD3d 900, 829 NYS2d 180 (2nd Dept. 2007); New York & Presbyterian Hospital v. American Transit Insurance Company, 45 AD3d 822, 846 NYS2d 352 (2nd Dept. 2007); New York and Presbyterian Hospital v. Countrywide Insurance Company, 44 AD3d 729, 843 NYS2d 662 (2nd Dept. 2007) Benefits are overdue if “not paid within 30 calendar days after the insurer receives proof of claim ….” 11 N.Y.C.R.R. § 65-3.8(a)(1); Presbyterian Hospital in the City of New York v. Maryland Casualty Company, supra . at 278, 660 NYS2d 536, 537 {90 NY2d 274} (1997); Fair Price Medical Supply Corp. v. Travelers Indemnity Company, 42 AD3d 277, 837 NYS2d 350 (2nd Dept. 2007); New York and Presbyterian Hospital v. Selective Insurance Company of America, 43 AD3d 1019, 842 NYS2d 63 (2nd Dept. 2007)

The Plaintiff attempts to meet its burden with the affidavit of Frank Amatulli, D.C. Dr. Amatulli was the assignor’s treating chiropractor and bases his affidavit upon his personal knowledge of this patient, the office practices and procedures he created and supervises, and his review of the patient’s treatment and billing records. Dr. Amatulli’s affidavit lays a proper business record foundation for the twenty-three (23) bills in question, See: Dan Medical, P.C. v. New York Central Mutual Fire Insurance Company, 14 Misc 3d 44, 829 NYS2d 404 (App. Term 2nd & 11th Jud. Dists. 2006); Fortune Medical, P.C. v. Allstate Insurance Co., 14 Misc 3d 136, 836 NYS2d 492 (App. Term 9th & 10 Jud. Dists. 2007); Ontario Medical, P.C. v. Sea Side Medical, P.C., 15 Misc 3d 129, 2007 WL 926349 (App. Term 9th & 10 Jud. Dists. 2007); V.S. Medical Services, P.C. v. One Beacon Insurance, 14 Misc 3d 142, 836 NYS2d 504 (App. Term 2nd & 11th Jud. Dists. 2006), providing for the admission of the “properly completed claim form[s], which suffice[] on [their] face to establish the particulars of the nature and extent of the injuries and [health benefits] received and contemplated’ (11 NYCRR § 65-1.1), and the proof of the fact and amount of loss sustained’ (Insurance Law § 5106[a])[.]” Amaze Medical Supply Inc. v. Eagle Insurance Company, 2 Misc 3d 128, 784 NYS2d 918 (2nd and 11th Jud. Dist. 2003); Damadian MRI In Elmhurst, P.C. v. Liberty Mutual Insurance Company, 2 Misc 3d 128(A), 784 NYS2d 919 (App. Term 9th and 10th Jud. Dists. 2003)

The Defendant admits the timely receipt of twenty (20) of the Plaintiff’s claim forms, thereby curing any defect which may exist in the Plaintiff’s proof of mailing. Prestige Medical & Surgical Supply Inc. v. Clarendon National Insurance Company, 13 Misc 3d 127(A), 824 NYS2d 758 (App. Term 2nd and 11th Jud. Dists. 2006); Magnezit Medical Care, P.C. v. New York Central Mutual Fire Ins. Co., 12 Misc 3d 144(A), 824 NYS2d 763 (App. Term 2nd and 11th Jud. Dists. 2006) Under such circumstances, the Plaintiff has, prima facie, demonstrated its right to summary judgment on twenty (20) of the twenty-three (23) claims in dispute. Moreover, the Defendant admits that for three (3) of these twenty (20) claims ^[FN1] it failed to pay or deny same, entitling the Plaintiff to summary judgment thereon in the sum of $101.10.

As to the remaining three (3) bills the Defendant denies their receipt. The Plaintiff may nevertheless demonstrate its prima facie entitlement to summary judgment thereon by providing proof of their service through “a standard office practice or procedure designed to ensure that items are properly addressed and mailed” Residential Holding Corp. v. Scottsdale Insurance [*3]Company, 286 AD2d 679, 729 NYS2d 776 (2nd Dept. 2001); See also: New York and Presbyterian Hospital v. Allstate Insurance Co., 29 AD3d 547, 814 NYS2d 687 (2nd Dept. 2006) On this score, Dr. Amatulli alleges that “it was the regular course of business for [his] office, UNIONDALE CHIROPRACTIC OFFICE, P.C., to generate a bill on the computer for all treatment/services rendered to its patients at the time of the patient’s office visit or within a reasonable time thereafter[.]” (Amatulli Affidavit 3/25/08, ¶ 10) According to Dr. Amatulli, these bills are then “placed in a standard envelope with proper postage attached[,] … [e]ither [h]e or a member of [his] office staff checks to ensure the bills are properly addressed … [and] the envelope containing the bill(s) is submitted to the local post office by [him] or another member of the office staff and/or deposited into a receptacle of the USPS.” (Amatulli Affidavit 3/25/08, ¶¶ 11-13)

In the past this court (Engel, J.) has expressed doubts about the sufficiency of various insurance companies’ proof of mailing which essentially alleged that a denial is generated on the date which appears thereon, is placed in an envelope which then travels around the office through a series of mail bins until ultimately delivered to the post office by an outside courier. Absent from these alleged office procedures was any indication that there existed a mailing list used to compare the names and addresses on the denial forms with the items mailed, or a list indicating the number of denial forms generated on a given day along with some identification of the matters in which the denial forms were generated, or a certificate of mailing identifying the items allegedly delivered to the United States Postal Service, or that anyone routinely checked to see if the total number of envelopes mailed matched the number of denial forms generated on a particular day. See: Matter of Lumbermens Mut. Casualty Co., 135 AD2d 373, 521 NYS2d 432 (1st Dept.1987); State-Wide Insurance Co. v. Simmons, 201 AD2d 655, 608 NYS2d 274 (2nd Dept.1994); Clark v. Columbian Mut. Life Insurance Co., 221 AD2d 227, 633 NYS2d 311 (1st Dept.1995); L.Z.R. Raphaely Galleries, Inc. v. Lumbermens Mutual Casualty Co., 191 AD2d 680, 595 NYS2d 802 (2nd Dept.1993) It was the opinion of this court that, when stripped of all of its excess verbiage, the insurance companies’ mailing procedures were simply to place a denial form in an envelope and to have someone subsequently mail same. Carle Place Chiropractic v. New York Central Mutual Fire Insurance Company, 19 Misc 3d 1139(A), Slip Copy, 2008 WL 2228633 (Dist.Ct. Nassau Co. 2008); Acupuncture Prima Care, P.C. v. State Farm Mutual Auto Ins. Co., 17 Misc 3d 1135(A), 851 NYS2d 67 (Dist.Ct. Nassau Co. 2007); New York Hospital Medical Center of Queens v. Liberty Mutual Insurance Company, 16 Misc 3d 1104(A), 841 NYS2d 827 (Dist.Ct. Nassau Co. 2007) Recently, however, the Appellate Division, Second Department has found just such a practice and procedure to adequately describe “a standard office practice[] or procedure[] designed to ensure that items were properly addressed and mailed (citations omitted).” St. Vincent’s Hospital of Richmond v. Government Employees Insurance Company, 50 AD3d 1123, 857 NYS2d 211 (2nd Dept. 2008). This court is now constrained to follow this appellate authority.

The only difference between the standard office practice or procedure approved by the Appellate Division in St. Vincent’s Hospital, id. and the standard office practice or procedure described by Dr. Amatulli is the absence of mail bins in Dr. Amatulli’s office. Accordingly, this court finds that the Plaintiff’s practice of placing its bills in a standard envelope, affixing proper postage, checking the address, and delivering the envelope to the post office or a USPS receptacle to be “a standard office practice[] or procedure[] designed to ensure that items were [*4]properly addressed and mailed (citations omitted).” St. Vincent’s Hospital of Richmond v. Government Employees Insurance Company, id.

“The defendant’s denial of receipt of the claims submitted by plaintiff …, [is] insufficient to rebut the presumption of receipt upon said plaintiff’s proof of proper mailing, and fails to raise an issue of fact as to these claims ( cf. Kihl v. Pfeffer, 94 NY2d 118 [1999]; King’s Med. Supply v. Progressive Ins., 3 Misc 3d 126[A], 2004 NY Slip Op 50311[U] [App Term, 2d & 11th Jud Dists] ).” A.B. Medical Services PLLC v. Motor Vehicle Accident Indemnification Corp., 6 Misc 3d 131(A), 800 NYS2d 341 (App.Term 2nd and 11th Jud. Dists 2005); See also: ATM One, LLC v. Landaverde, 2 NY3d 472, 779 NYS2d 808 (2004); A.B. Medical Services, PLLC v. American Transit Insurance Company, 15 Misc 3d 132(A), 839 NYS2d 431 (App.Term 2nd and 11th Jud. Dists.2007); A.B. Medical Services PLLC. V. USAA Cas. Ins. Co., 6 Misc 3d 126(A), 800 NYS2d 341 (App.Term 2nd and 11th Jud. Dists 2004) Accordingly, the Plaintiff is entitled to summary judgment on the three (3) bills totaling $246.24 which the Defendant denies receiving.^[FN2]

The Defendant having admitted its timely receipt of the remaining seventeen (17) bills, which carry a presumption of medical necessity, All County Open MRI & Diag. Radiology P.C. v. Travelers Insurance Co., 11 Misc 3d 131(A), 815 NYS2d 496 (App. Term 9th and 10th Jud. Depts. 2006); Damadian MRI in Elmhurst, P.C. v. Liberty Mutual Insurance Co., 2 Misc 3d 128(A), 784 NYS2d 919 (App. Term 9th and 10th Jud. Dists. 2003), “[t]he burden then shifts to defendant who, if not precluded, may rebut the presumption and establish the lack of medical necessity by submitting proof, such as a detailed peer review report or the results of an IME, that the health benefits provided were not medically necessary (citations omitted).” Stephen Fogel Psychological, P.C. v. Progressive Casualty Insurance Company, 7 Misc 3d 18, 793 NYS2d 661 (App.Term 2nd and 11th Jud. Dists. 2004) aff’d 35 NY3d 720, 827 NYS2d 217 (2nd Dept. 2006) See also: A.B. Medical Services PLLC v. Utica Mutual Insurance Company, 10 Misc 3d 50, 809 NYS2d 765 (App.Term 2nd and 11th Jud. Dists. 2005); Park Neurological Services P.C. v. Geico Insurance, 4 Misc 3d 95, 782 NYS2d 507 (App.Term 9th and 10th Jud. Dists. 2004)

As a threshold issue the Defendant must demonstrate that, absent timely verification requests, it properly denied the Plaintiff’s claims within thirty (30) days of their receipt, or it will be precluded from raising the defense of lack of medical necessity. Presbyterian Hospital in the City of New York v. Maryland Casualty Company, 90 NY2d 274, 660 NYS2d 536 (1997); Mt. Sinai Hospital v. Triboro Coach Incorporated, 263 AD2d 11, 699 NYS2d 77 (2nd Dept. 1999); Church Avenue Medical Care, P.C. v. Allstate Insurance Company, 189 Misc 2d 340, 731 NYS2d 582 (App. Term 2nd Dept. 2001); Struhl v. Progressive Casualty Insurance Company, 7 Misc 3d 138(A), 801 NYS2d 242 (App. Term 9th and 10th Jud. Dists. 2005) The Defendant attempts to demonstrate the timely service of its denial of claim forms with the affidavits of Linda Bernstein, a Claims Representative, Lisa Russo, a Claims Support Services Supervisor, and Joseph Mandara, the President of All American Transport, Inc., a courier service employed by the Defendant.

The affidavit of Linda Bernstein is insufficient to establish the Defendant’s timely service of its denial of claim forms. While Ms. Bernstein alleges that she made her “affiramations (sic) [*5]based upon [her] personal knowledge[,]” she utterly “failed to set forth a basis to support her conclusory assertion,” First Aid Occupational Therapy, PLLC v. State Farm Fire and Casualty Company, 19 Misc 3d 143(A), Slip Copy, 2008 WL 2284874 (App.Term 2nd and 11th Jud. Dist. 2008) which is insufficient as a matter of law. See: Republic Western Insurance Company v. RCR Builders, Inc., 268 AD2d 574, 702 NYS2d 609 (2nd Dept. 2000); S & M Supply Inc. v. Allstate Insurance Company, 7 Misc 3d 130, 801 NYS2d 242 (App. Term 2nd and 11th Jud. Dists. 2005); Montefiore Medical Center v. Government Employees Insurance Company, 34 AD3d 771, 826 NYS2d 616 (2nd Dept. 2006); Struhl, M.D. v. Progressive Casualty Insurance Company, 7 Misc 3d 138, 801 NYS2d 242 (App. Term 9th and 10th Jud. Dists. 2005) Moreover, nowhere does Ms. Bernstein allege that she has any knowledge of the Defendant’s practices and procedures for the mailing of denial of claim forms. In fact, with regard to the mailing practices and procedures, Ms. Bernstein merely refers the court to the affidavit of Ms. Russo.

While Ms. Russo apparently does have knowledge of the Defendant’s “procedures for mailing of all documents sent from [the Melville State Farm] office,” (Russo Affidavit 6/11/08, ¶ 2), where she is located, the Defendant’s denials bear an address in Parsippany, New Jersey, which is the address to which the Plaintiff sent its bills. Moreover, while Ms. Russo attests that the denials were sent from her office in Melville, Ms. Bernstein attests that the denials were mailed from her office in Ballston Spa, New York. Neither Ms. Russo nor Ms. Bernstein claim to have any knowledge of the mailing procedures in the Defendant’s Parsippany, New Jersey office, nor do they attempt to explain how claims sent to the Parsippany, New Jersey office wind up in the Melville or Balston Spa offices to be denied.

The above notwithstanding, regardless of the office from which the Defendant’s denials were allegedly mailed, the affidavits upon which the Defendant relies do not describe “a standard office practice or procedure designed to ensure that items are properly addressed and mailed.” Residential Holding Corp. v. Scottsdale Insurance Company, supra .; See also: Nassau Insurance Company v. Murray, 46 NY2d 828, 414 NYS2d 117 (1978) [“office practice must be geared so as to ensure the likelihood that a notice … is always properly addressed and mailed.”] While, for the reasons set forth herein above, the Defendant has described a procedure designed to ensure that the denial of claim forms are properly mailed, none of the affidavits submitted by the Defendant describe any procedure used by the Defendant to ensure that they are properly addressed. Ms. Bernstein’s representation that “[a]ll denials on the bills referenced herein was (sic) mailed to the plaintiff at 482 Uniondale Ave., Uniondale, NY 11553[,]” (Bernstein Affidavit 6/11/08, ¶ 10) is conclusory and without probative value. Westchester Medical Center v. Countrywide Insurance Company, 45 AD3d 676, 846 NYS2d 230 (2nd Dept. 2007); Hospital for Joint Diseases v. Nationwide Mutual Insurance Company, 284 AD2d 374, 726 NYS2d 443 (2nd Dept. 2001); Careplus Medical Supply Inc. v. Travelers Home and Marine Insurance Co., 7 Misc 3d 133(A), 801 NYS2d 231 (App.Term 2nd and 11th Jud. Dists. 2005) Neither Ms. Bernstein, Ms. Russo nor Mr. Mandara even suggest how the address to which the Defendant’s denials were allegedly mailed was obtained or verified. While Ms. Russo represents that a Claims Service Assistant will “check to ensure that the document is dated with the actual date[,]” (Russo Affidavit 6/11/08, ¶ 8) neither she, nor anyone else on behalf of the Defendant indicates that anyone checks to ensure that the document is properly addressed. Clearly, half of the requirements necessary to demonstrate adequate proof of mailing is absent from the Defendant’s [*6]proof.

Having failed to properly demonstrate the timely service of denials of claim in response to the remaining seventeen (17) bills in question, the Plaintiff is entitled to summary judgment on these claims as well. Accordingly, the Plaintiff is entitled to the entry of a judgment in the sum of $1,975.28, plus interest and counsel fees pursuant to regulation and statute, along with the costs and disbursements of this action.

This constitutes the decision and order of this court.

Dated: Hempstead, New York

August 7, 2008

___________________________

Andrew M. Engel

J.D.C.

Footnotes

Footnote 1: Bills dated July 15, 2002, January 14, 2003 and January 30, 2003 totaling $101.10

Footnote 2: Bills dated May 31, 2002, June 28, 2002 and March 2, 2004