No-Fault Decisions, June 2005

Appellate Term, Second Department Jun 28, 2005 2005 NY Slip Op 25263 Provider prevailed

Summit Psychological, P.C. v General Assur. Co.

The insurer failed to establish timely mailing of its denials or proper mailing of preclaim IME requests. The Appellate Term, Second Department, affirmed summary judgment for the provider. The claims examiner's affidavit did not establish denial mailing within 30 days under 11 NYCRR 65-3.8 (c), or personal knowledge of IME-request mailing or a standard office mailing procedure. The court rejected the lower court's view that the later denials depended on invalid earlier blanket denials; they independently asserted IME nonappearance, but the proof defects defeated that defense. It also rejected the assignment-authentication challenge because no statute or regulation required authentication, and any cognizable defect was alternatively waived by failing to seek verification or timely deny on that ground.

Appellate Term, Second Department Jun 27, 2005 2005 NY Slip Op 51028(U) Provider prevailed

Shtarkman v Allstate Ins. Co.

An insurer's blanket denial issued before receipt of a provider's claim does not constitute a valid denial of that claim. The provider proved submission and overdue payment, while the insurer neither paid nor denied within 30 days nor requested verification. Its earlier denial also omitted numerous items of required information. Under 11 NYCRR 65.15 (g) (3), now 11 NYCRR 65-3.8 (c), payment or denial must follow receipt of proof of claim; 11 NYCRR 65-3.8 (b) (3) also bars denial before receipt of requested verification. The insurer was precluded from asserting intoxication. The Appellate Term, Second Department, reversed, granted the provider summary judgment, and remanded for interest and attorney fees under Insurance Law § 5106 (a).

Appellate Term, Second Department Jun 27, 2005 2005 NY Slip Op 51027(U) Provider prevailed

Ocean Diagnostic Imaging P.C. v Eagle Ins. Co.

The provider's summary judgment motion was granted despite the insurer's asserted founded belief that the collision was staged. The provider established claim submission and overdue payment under Insurance Law § 5106 (a). The Appellate Term, Second Department, reversed and remanded for interest and attorney fees, relying on A.B. Med. Servs. v Eagle Ins. Co., which involved the same accident, assignor, and insurer's fraud showing.

Appellate Term, Second Department Jun 27, 2005 2005 NY Slip Op 51032(U)

State Farm Mut. Auto. Ins. Co. v Karpen

An insurer's subrogation action for payments exceeding no-fault benefits was time-barred because it began over three years after the accident. The insurer sought reimbursement from the defendant and asserted that an earlier summons and complaint had been served before the limitations period expired. The Appellate Term, Second Department, declined to grant its cross motion under UDCA 411 to file proof of that service nunc pro tunc and affirmed summary judgment dismissing the complaint. Under Allstate Ins. Co. v Stein, the subrogee acquired only the insured's rights, and limitations ran from the accident. Insurance Law § 5105, governing settlements between insurers, did not apply.

Appellate Term, Second Department Jun 9, 2005 2005 NY Slip Op 50959(U) Provider prevailed

A.B. Med. Servs. PLLC v American Tr. Ins. Co.

The insurer failed to show potential merit in its workers' compensation defense sufficient to warrant Workers' Compensation Board review. The providers submitted sworn statements from the assignor and purported employer that the assignor was not working when the accident occurred. The insurer relied on an adjuster's determination based solely on an unsworn employer statement predating the accident by 18 months; a police report first offered in reply was not considered. Following Lanpont v Savvas Cab Corp., the defense was speculative and raised no factual issue requiring Board resolution. The Appellate Term, Second Department, modified the order to grant the providers summary judgment, left denial of the insurer's cross motion intact, and remanded for interest and attorney fees under Insurance Law § 5106 (a).

Appellate Term, Second Department Jun 9, 2005 2005 NY Slip Op 50958(U) Insurer prevailed

Careplus Med. Supply Inc. v Kemper Auto & Home Ins. Co.

The insurer's sworn accident reconstruction report raised a triable issue whether the claimed injuries arose from an insured incident. The medical supply provider established a prima facie case through proof of claim submission and overdue payment under Insurance Law § 5106 (a). In opposition, the insurer submitted a report sworn to by the consultant who prepared it. The report constituted admissible expert evidence supporting a founded belief that the injuries lacked a causal nexus to the accident under Central Gen. Hosp. v Chubb Group of Ins. Cos. The Appellate Term, Second Department, affirmed denial of the provider's summary judgment motion because the insurer raised a factual issue concerning coverage.

Appellate Term, Second Department Jun 9, 2005 2005 NY Slip Op 50960(U) Provider prevailed

Amaze Med. Supply Inc. v General Assur. Co.

The insurer failed to raise a factual issue on IME nonappearance because it offered no competent proof that the requests were mailed. The provider established its entitlement to payment for medical supplies by proving submission of claims and overdue benefits under Insurance Law § 5106 (a). In opposition, the insurer's attorney alleged that several IME requests had been sent and that the assignor failed to appear, but lacked personal knowledge of those facts. The insurer also failed to describe office practices ensuring proper addressing and mailing. The Appellate Term, Second Department, reversed the order, insofar as appealed from, granted the provider summary judgment, and remanded for calculation of statutory interest and assessment of attorney's fees.

Appellate Term, Second Department Jun 3, 2005 2005 NY Slip Op 50861(U) Insurer prevailed

GPM Chiropractic, P.C. v State Farm Mut. Ins. Co

The insurer's investigator affidavit raised a triable staged-collision coverage issue despite an untimely denial. The provider established claim submission and overdue payment under Insurance Law § 5106 (a). The insurer's late denial precluded assignment objections, and its EUO requests did not toll the 30-day determination period because the applicable regulations contained no provision authorizing EUOs. The fraud-based coverage defense nevertheless remained available under Matter of Metro Med. Diagnostics v Eagle Ins. Co. The investigator's affidavit supported a founded belief that the injuries did not arise from an insured incident under Central Gen. Hosp. v Chubb Group of Ins. Cos. The Appellate Term, Second Department, reversed and denied the provider's cross motion for summary judgment.

Appellate Term, Second Department Jun 3, 2005 2005 NY Slip Op 50864(U) Insurer prevailed

Struhl v Progressive Cas. Ins. Co.

The insurer's admissible peer review raised a triable coverage issue despite its untimely denial and failure to prove verification tolling. The provider established its prima facie case with a functional equivalent of a claim form satisfying 11 NYCRR 65-1.1. The insurer's affidavit lacked mailing proof, and no timely initial verification request was established under 11 NYCRR 65-3.5 (a) and (b) and 65-3.6 (b). The late denial precluded fee schedule, medical necessity, and assignment defenses. Under Central Gen. Hosp. v Chubb Group of Ins. Cos., however, preclusion did not bar the defense that the treated condition was unrelated to a covered incident. The Appellate Term, Second Department, reversed the order and denied the provider's summary judgment motion.

Appellate Term, Second Department Jun 3, 2005 2005 NY Slip Op 50859(U) Insurer prevailed

R.M. Med. P.C. v Lumbermens Mut. Cas. Co.

The providers failed to establish their prima facie case because the billing manager's affidavit did not identify which provider employed the affiant. Two providers sued for assigned no-fault benefits, but the summary judgment motion and supporting affidavit referred only to "plaintiff." The affiant described being the practice and medical billing manager without identifying either provider. The court could not assume that the affiant acted for one particular provider or both. The affidavit therefore failed to establish that properly completed claim forms had been supplied to the insurer. The Appellate Term, Second Department, affirmed denial of summary judgment on a ground different from the Civil Court's.

Appellate Term, Second Department Jun 3, 2005 2005 NY Slip Op 50865(U) Insurer prevailed

Ocean Diagnostic Imaging P.C. v GMAC Ins. F/k/a Integon Ins.

The insurer raised a preserved triable issue whether notice of the accident was provided within the required 90 days. The provider established a prima facie entitlement to summary judgment by proving submission of a claim stating the fact and amount of the loss and overdue payment under Insurance Law § 5106 (a). Although the insurer timely denied the claim, it still had to rebut that showing with admissible evidence. The record sufficiently raised the accident-notice issue under the insurance regulations. The Appellate Term, Second Department, affirmed the order, insofar as appealed from, denying the provider's motion for summary judgment.

Appellate Term, First Department Jun 2, 2005 2005 NY Slip Op 50826(U) Provider prevailed

Diagnostic Rehab. Medicine Serv., P.C. v Farm Family Cas. Ins. Co.

The insurer's late denial waived medical necessity and assignment defenses, and its coverage opposition raised no factual issue. The insurer failed to deny the provider's no-fault claim within 30 days after receiving proof of claim under Insurance Law § 5106 (a). It therefore waived objections to the necessity of treatment and the facial sufficiency of the assignment. It also failed to raise a triable issue that its coverage denial rested on a fact or founded belief that the injury did not arise from an insured incident under Central Gen. Hosp. v Chubb Group of Ins. Cos. The Appellate Term, First Department, reversed, granted the provider summary judgment, and remanded for assessment of interest and attorney fees and entry of judgment.

Appellate Term, Second Department Jun 1, 2005 2005 NY Slip Op 50856(U) Split result

Triboro Chiropractic & Acupuncture P.L.L.C. v New York Cent. Mut. Fire Ins. Co.

The provider obtained partial summary judgment on three untimely denied claims; timely fee schedule denials raised triable issues on the rest. The provider established submission of its claims and overdue payment under Insurance Law § 5106 (a). The insurer failed to pay or deny three claims within 30 days under 11 NYCRR 65.15 (g) (3), now 11 NYCRR 65-3.8 (c), precluding defenses to those claims. The remaining claims were timely denied as improperly no-fault rated and exceeding the workers' compensation fee schedule. The Appellate Term, Second Department, modified the order to award partial summary judgment, remanded for interest and attorney fees on that award, and left the remaining claims for further proceedings.

Trial court, Second Department Jun 27, 2005 2005 NY Slip Op 25242 Provider prevailed

East Acupuncture, P.C. v Allstate Ins. Co.

⚠ Not followed by Elmont Open MRI & Diagnostic Radiology, P.C. v Country-Wide Ins. Co. (2007 NY Slip Op 27072)

⚠ Not followed by Tsai Chao v Country-Wide Ins. Co. (2006 NY Slip Op 50794(U))

The interest suspension in 11 NYCRR 65.15 (h) (3) does not apply to a provider assignee that delays suit after receiving a denial. The Civil Court, Kings County, granted the provider's summary judgment motion to the extent of directing calculation of statutory interest under 11 NYCRR 65.15 (h) (1). After settling the claims, the parties left for determination when interest began on untimely or improper denials. The provider sued about two years after receiving the denials. Strictly construing the regulations, the court concluded that the Superintendent intentionally omitted assignees from the suspension provision, which refers only to an applicant, while expressly including them in the interest entitlement provision. Interest therefore ran from 30 days after receipt of proper proof of claim rather than commencement of suit.

Trial court, Second Department Jun 24, 2005 2005 NY Slip Op 50945(U) Insurer prevailed

Advanced Med. v Progressive Cas. Ins. Co.

The provider failed to establish long-arm jurisdiction in Nassau County over an insurer served through the Superintendent of Insurance in Albany. The accident, treatment, and assignor's residence were in Sullivan County, and the provider did not show that the claim arose from the insurer's transaction of business in Nassau County. Applying UDCA 403 and 404 (a) (1), the District Court, Nassau County, granted dismissal under CPLR 3211 (a) (8). It denied transfer to another county because UDCA 306 authorized transfers only within the county. It also denied both summary judgment motions: the provider lacked adequate claim and mailing proof under CPLR 3212 (b), and the insurer failed to establish proper verification procedures and improperly supplied an earlier denial in reply.

Trial court, Second Department Jun 23, 2005 2005 NY Slip Op 25258

PDG Psychological, P.C. v State Farm Ins. Co.

False certifications and knowingly misleading motion submissions support sanctions for frivolous conduct. After a consolidated hearing in provider reimbursement actions, the Civil Court, Queens County, imposed $34,000 in sanctions on the providers' attorney. The attorney filed false service affirmations, substituted affidavits different from those served, and knowingly submitted altered claim forms intended to cure defects identified in prior rulings. The court applied 22 NYCRR 130-1.1 (c) (3) and 130-1.1a (b), and found violations of CPLR 2214 (c), which generally limits motion submissions to served papers. The attorney offered no documentary proof of service or good-faith explanation. The court directed entry of judgment under 22 NYCRR 130-1.2, leaving many underlying motions' merits unaddressed.

Trial court, Second Department Jun 8, 2005 2005 NY Slip Op 25228 Insurer prevailed

Metroscan Imaging P.C. v GEICO Ins. Co.

⚠ Not followed by Multiquest, P.L.L.C. v Allstate Ins. Co. (2005 NY Slip Op 52071(U))

⚠ Not followed by Multiquest, P.L.L.C. v Allstate Ins. Co. (2005 NY Slip Op 52069(U))

A fraudulent-incorporation defense survives untimely denial and applies to unpaid claims predating 11 NYCRR 65-3.16 (a) (12). The Civil Court, Queens County, granted the insurer relief by consolidating 61 actions with this action for amendment of the answers and a framed-issue hearing on fraudulent incorporation under Business Corporation Law §§ 1507 and 1508 and Education Law § 6507 (4) (c). Following Mallela, the court distinguished withholding reimbursement from recovering payments made before the regulation took effect on April 4, 2002. The defense required facts or a founded belief of fraudulent incorporation, involving conduct tantamount to fraud rather than technical violations. Allegations that nonphysicians owned and controlled corporations nominally incorporated by a physician through management agreements supplied a founded belief warranting further inquiry, without a determination of fraud.