SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by plaintiff from an order of the Civil Court, Kings County (A. Schack, J.), entered October 7, 2002, denying its motion for summary judgment. Order unanimously modified by providing that plaintiffs motion for summary judgment is granted to the extent of awarding it partial summary judgment in the sum of $1,695, and matter remanded to the court below for calculation of statutory interest and an assessment of attorney’s fees, and for all further proceedings on the remaining portion of the claim in accordance with the decision herein; as so modified, affirmed without costs.

In this action to recover $1,895 in first-party no-fault benefits, for medical supplies furnished to its assignor, plaintiff moved for summary judgment. The motion papers establish that after plaintiff submitted its proof of claim, i.e., the completed statutory forms (11 NYCRR 65-3.3 [d]; 65-3.5 [a]), defendant denied the claim on the ground that the prescribed medical equipment was medically unnecessary. Defendant did not seek verification of the “proof of the fact and amount of loss sustained” (Insurance Law § 5106 [a]; see 11 NYCRR 65-3.5 [a]) and its denial based on lack of medical necessity, although timely (11 NYCRR 65-3.8 [c]), was Conclusory, unsupported by a peer review or any other proof, such as an independent medical examination, setting forth a sufficiently detailed factual basis and medical rationale for the claim’s rejection (e.g. Choicenet Chiropractic P.C. v Allstate Ins. Co., NYLJ, Mar. 7, 2003 [App Term, 2d & 11th Jud Dists]). Thus, having failed to issue a proper denial of benefits, fully and explicitly supporting its claim that the prescribed equipment was medically unnecessary, and having failed to set forth any other basis for denial of the claim within 30 days of the claims’ receipt, the denial is deemed ineffective and, accordingly, defendant is precluded, with certain [*2]exceptions not relevant here, from interposing a defense (11 NYCRR 65-3.8 [b] [4]; Central Gen. Hosp. v Chubb Group of Ins. Co., 90 NY2d 195, 199 [1997]; New York & Presbyt. Hosp. v American Tr. Ins. Co., 287 AD2d 699, 701 [2001]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 17 [1999]; Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 226 AD2d 613, 614 [1996]; Liberty Queens Med. P.C. v Liberty Mut. Ins. Co., NYLJ, Nov. 4, 2002 [App Term, 2d & 11th Jud Dists]).

In opposition to plaintiffs motion for summary judgment, defendant challenged the equipment’s medical necessity via a physician’s affirmation, dated nine months after the claim’s denial, based on an examination of the insured’s treatment file. In addition, defendant argued that because no-fault compensation is available only for medically necessary health benefits (e.g. Insurance Law § 5102 [a] [1]), on summary judgment, plaintiff must establish medical necessity by proof in admissible form even if defendant is precluded from controverting said proof. Plaintiff contends that its properly completed claim form establishes its prima facie case for the recovery of no-fault benefits in summary judgment, and we agree.

In furtherance of the legislative mandate “to encourage prompt payment of claims, to discourage investigation by insurers and to penalize delays” (Dermatossian v New York City Tr. Auth., 67 NY2d 219, 225 [1986]), the Insurance Department regulations provide that the “written notice [of claim] required by section 65-2.4. . . shall be deemed to be satisfied by the insurer’s receipt of a completed prescribed application for motor vehicle no-fault benefits” (11 NYCRR 65-3.3 [d]), that is, the approved claim forms or their functional equivalent (11 NYCRR 65-3.5 [g]). Because such submissions suffice to place the burden on the insurer to timely interpose its objections, with the requisite supporting allegations where necessary, or be precluded thereafter from asserting those objections or defenses, including the claim that the health benefits were medically unnecessary, the clear implication is that a properly completed claim form, which suffices on its 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]), is all that is necessary at the claim stage to establish the health benefits’ medical necessity (Insurance Law § 5102 [a] [1]; see Dermatossian v New York City Tr. Auth., 67 NY2d at 224 [“to receive payment (a claimant) need only file a ‘proof of claim’ (which) the insurers are obliged to honor. . . promptly or suffer the statutory penalties”]).

While under the facts presented we are only called upon to decide whether a proper proof of claim establishes a prima facie case on a provider’s motion for summary judgment where the insurer is precluded from raising the defense of lack of medical necessity, courts have declined to distinguish a proper proof of claim under the insurance regulations from the quantum of proof necessary to prevail on a motion for summary judgment in an ensuing action on the claim whether or not the defendant was precluded (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 226 AD2d at 614; Interboro Gen. Hosp. v Allcity Ins. Co., 149 AD2d 569, 570 [1989]; see S & M Supply Inc. v Geico Ins., NYLJ, July 17, 2003 [App Term, 2d & 11th Jud Dists] [“(P)laintiff establishes its prima facie entitlement to summary judgment. . . by showing that it submitted a complete proof of claim”]; Choicenet Chiropractic P.C. v Allstate Ins. Co., NYLJ, Mar. 7, 2003 [App Term, 2d & 11th Jud Dists] [“Plaintiff established a prima facie case (for summary judgment) by the submission of statutory forms for proof of claim and the amount of the loss.”]; Liberty Queens Med. P.C. v Liberty Mut. Ins. Co., NYLJ, Nov. 4, 2002 [App Term, 2d & 11th Jud Dists] [same]; Park Health Ctr. v Prudential Prop. & Cas. Ins. Co., NYLJ, Dec. [*3]14, 2001 [App Term, 2d & 11th Jud Dists] [same]; Sehgal v Royal Ins. Co. of Am., NYLJ, Apr. 15, 1999 [App Term, 9th & 10th Jud Dists]; accord Vinings Spinal Diagnostic, P.C. v Liberty Mut. Ins. Co., 186 Misc 2d 287, 291 [Dist Ct, Nassau County 2000]). Indeed, to hold otherwise would undermine the clear legislative mandate to facilitate the prompt and efficient resolution of first-party no-fault claims, many of which involve small sums for medical supplies, by imposing on the provider the unwarranted burden to obtain the necessary affidavits or other proof extrinsic to the forms to establish medical necessity. Thus, we reaffirm our holding that a provider’s proof of a properly-completed claim makes out a prima facie case upon its motion for summary judgment (e.g. Choicenet Chiropractic P.C. v Allstate Ins. Co., NYLJ, Mar. 7, 2003 [App Term, 2d & 11th Jud Dists]; Liberty Queens Med. P.C. v Liberty Mut. Ins. Co., NYLJ, Nov. 4, 2002 [App Term, 2d & 11th Jud Dists]; Park Health Ctr. v Prudential Prop. & Cas. Ins. Co., NYLJ, Dec. 14, 2001 [App Term, 2d & 11th Jud Dists]) thereby shifting the burden to the insurer who, if not precluded, may rebut the inference by proof in admissible form establishing that the health benefits were not medically necessary (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). If not refuted by the no-fault benefits claimant, such proof may entitle the insurer to summary judgment.

An examination of the record on appeal in a recent Appellate Division, Second Department case, St. Luke’s Roosevelt v American Transit Ins. Co., AD2d (2d Dept, Nov. 17, 2003), reveals that the plaintiff therein relied exclusively on proof of its properly-submitted claim forms to establish its case for summary judgment. In its papers in opposition to the motion and on appeal from the order granting the provider’s motion for summary judgment, the insurer contended, as in the instant case, that a claimant must prove that the medical services were “necessary” whether or not the insurer’s default at the claim stage precluded the defense: “[e]ven if the claims were not properly denied . . . [t]he Plaintiff must still prove a prima facie case that the hospital services were necessary.” On appeal, plaintiffs cited Dermatossian v New York City Tr. Auth. (67 NY2d 219) and Liberty Queens Med. P.C. v Liberty Mut. Ins. Co. (NYLJ, Nov. 4, 2002 [App Term, 2d & 11th Jud Dists]) for the proposition that the submission of the statutory forms setting forth the fact and amount of the loss establishes a prima facie case of entitlement to summary judgment. The Appellate Division affirmed the lower court’s order and held that “plaintiffs made a prima facie showing of entitlement to judgment as a matter law” (St. Luke’s-Roosevelt Hosp. v American Tr. Ins. Co., — AD2d — [2d Dept, Nov. 17, 2003]; cf. Wagner v Baird, 208 AD2d 1087, 1088 [3d Dept 1994]).

Where, as here, the insurer is precluded from raising the defense of lack of medical necessity, the logic of the result reached in St. Luke’s-Roosevelt Hosp. v American Tr. Ins. Co. (AD2d [2d Dept, Nov. 17, 2003]) is even more compelling. A contrary rule would require a claimant to prove the health benefits’ medical necessity by evidence additional to the proof necessary to establish a proper claim, even when the insurer has waived the defense, thereby rewarding an insurer’s dilatory response to the claim in the first instance by imposing a greater burden of proof after the action is commenced than was necessary at the claim stage to require that the insurer act on the claim or be precluded from most defenses. Moreover, the situation may be analogized to an account stated where, upon the insurer’s failure timely and properly to deny the bill as embodied in the claim form, the insurer is presumed to have acquiesced to its correctness, thereby rendering the insurer liable thereon. Thus, when an action is commenced, the prima facie case is the unchallenged claim form. Indeed, the Court of Appeals has expressed its impatience with insurers “who sit on their many procedural rights and requirements and then [*4]belatedly deny claims they should have acted upon earlier” (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d at 285).

In light of the foregoing, the plaintiff would normally be entitled to the granting of its motion for summary judgment in its entirety. However, in addition to its claim forms, plaintiffs proof in support of its motion for summary judgment contained documents that had not accompanied the claim form, which revealed that the prescribed medical equipment did not include two items, a TENS belt ($78) and a TENS kit ($122), listed in the invoices of supplies delivered. While the waiver rules generally preclude defenses based on defects in the proof of claim if not timely asserted, plaintiff, having interjected an issue of fact which, if true, amounts to a complete defense to a portion of the claim, should be estopped from invoking waiver to avoid a defense that the cost of unprescribed medical equipment is not a recoverable no-fault benefit. There is no proof that defendant knew or should have known of the discrepancy, and absent an explanation therefor, the non-prescribed equipment cannot be justified as a loss sustained.

Accordingly, the matter is remanded to the court below for a calculation of the statutory interest and an assessment of attorney’s fees due on $1,695, the portion of the claim for which summary judgment is granted (Insurance Law § 5106 [a]; 11 NYCRR 65-3.9 [a]; 65-3.10 [a]; see St. Clare’s Hosp. v Allstate Ins. Co., 215 AD2d 641 [1995]), and for all further proceedings on the remainder of the claim.
Decision Date: December 24, 2003

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 9th and 10th JUDICIAL DISTRICTS

Appeal by defendant from an order of the District Court, Suffolk County (P. Barton, J.), entered on June 11, 2002, which granted plaintiffs motion for summary judgment in the principal sum of $879.73.

Order unanimously affirmed without costs.

In this action to recover $879.73 in first-party no-fault benefits, for medical services provided to its assignor, plaintiff moved for summary judgment. The motion papers establish that after plaintiff submitted its proof of claim, i.e., the completed statutory forms (11 NYCRR 65-3.3 [d]; 65-3.5 [a]), defendant failed to pay or deny the claim within 30 days of receipt of the requested verification (11 NYCRR 65-3.8 [a] [1]) and failed otherwise to set forth any other basis for denial of the claim within 30 days of receipt (Insurance Law § 5106; 11 NYCRR 65-3.8 [c]). Consequently, defendant is precluded, with certain exceptions not relevant here, from interposing a defense [11 NYCRR 65-3.8 [b] [4]; Central Gen. Hosp. v Chubb Group of Ins. Co., 90 NY2d 195, 199 [1997]; New York & Presbyt. Hosp. v American Tr. Ins. Co., 287 AD2d 699, 701 [2001]; Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 17 [1999]).

In opposition to the motion for summary judgment, defendant challenged the treatment’s medical necessity, arguing that because no-fault compensation is available only for medically necessary treatment (e.g. Insurance Law § 5102 [a] [1]), on summary judgment, plaintiff must prove the treatment’s medical necessity by proof in admissible form even if defendant is precluded from controverting said proof. Plaintiff contends that its properly completed claim form establishes its prima facie case for the recovery of no-fault benefits in summary judgment, and we agree.

In furtherance of the legislative mandate “to encourage prompt payment of claims, to [*2]discourage investigation by insurers and to penalize delays” (Dermatossian v New York City Tr. Auth., 67 NY2d 219, 225 [1986]), the Insurance Department regulations provide that the “written notice [of claim] required by section 65-2.4. . . shall be deemed to be satisfied by the insurer’s receipt of a completed prescribed application for motor vehicle no-fault benefits” (11 NYCRR 65-3.3 [d]), that is, the approved claim forms or their functional equivalent (11 NYCRR 65-3.5 [g]). Because such submissions suffice to place the burden on the insurer to timely interpose its objections, with the requisite supporting allegations where necessary, or be precluded thereafter from asserting those objections or defenses, including the claim that the treatment was medically unnecessary, the clear implication is that a properly completed claim form, which suffices on its face to establish the “particulars of the nature and extent of the injuries and treatment received and contemplated” (11 NYCRR 65-1.1), and the “proof of the fact and amount of loss sustained” (Insurance Law § 5106 [a]), is all that is necessary at the claim stage to establish the treatment’s medical necessity (Insurance Law § 5102 [a] [1]; see Dermatossian v New York City Tr. Auth., 67 NY2d at 224 [“to receive payment (a claimant) need only file a ‘proof of claim’ (which ) the insurers are obliged to honor. . . promptly or suffer the statutory penalties”]).

While under the facts presented we are only called upon to decide whether a proper proof of claim establishes a prima facie case on a provider’s motion for summary judgment where the insurer is precluded from raising the defense of lack of medical necessity, courts have declined to distinguish a proper proof of claim under the insurance regulations from the quantum of proof necessary to prevail on a motion for summary judgment in an ensuing action on the claim whether or not the defendant was precluded (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 226 AD2d 613, 614 [1996]; Interboro Gen. Hosp. v Allcity Ins. Co., 149 AD2d 569, 570 [1989]; see S & M Supply Inc. v Geico Ins., NYLJ, July 17, 2003 [App Term, 2d & 11th Jud Dists] [“(P)laintiff establishes its prima facie entitlement to summary judgment. . . by showing that it submitted a complete proof of claim”]; Choicenet Chiropractic P.C. v Allstate Ins. Co., NYLJ, Mar. 7, 2003 [App Term, 2d & 11th Jud Dists] [“Plaintiff established a prima facie case (for summary judgment) by the submission of statutory forms for proof of claim and the amount of the loss.”]; Liberty Queens Med. P.C. v Liberty Mut. Ins. Co., NYLJ, Nov. 4, 2002 [App Term, 2d & 11th Jud Dists] [same]; Park Health Ctr. v Prudential Prop. & Cas. Ins. Co., NYLJ, Dec. 14, 2001 [App Term, 2d & 11th Jud Dists] [same]; Sehgal v Royal Ins. Co. of Am., NYLJ, Apr. 15, 1999 [App Term, 9th & 10th Jud Dists]; accord Vinings Spinal Diagnostic, P.C. v Liberty Mut. Ins. Co., 186 Misc 2d 287, 291 [Dist Ct, Nassau County 2000]). Indeed, to hold otherwise would undermine the clear legislative mandate to facilitate the prompt and efficient resolution of first-party no-fault claims, many of which involve small sums for medical supplies, by imposing on the provider the unwarranted burden to obtain the necessary affidavits or other proof extrinsic to the forms to establish medical necessity. Thus, we reaffirm our holding that a provider’s proof of a properly-completed claim makes out a prima facie case upon its motion for summary judgment (Sehgal v Royal Ins. Co. of Am., NYLJ, Apr. 15, 1999 [App Term, 9th & 10th Jud Dists]) thereby shifting the burden to the insurer who, if not precluded, may rebut the inference by proof in admissible form establishing that the health benefits were not medically necessary (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). If not refuted by the no-fault benefits claimant, such proof may entitle the insurer to summary judgment.

An examination of the record on appeal in a recent Appellate Division, Second Department case, St. Luke’s Roosevelt v American Transit Ins. Co., AD2d (2d Dept, Nov. 17, 2003), reveals that the plaintiff therein relied exclusively on proof of its properly-submitted claim [*3]forms to establish its case for summary judgment. In its papers in opposition to the motion and on appeal from the order granting the provider’s motion for summary judgment, the insurer contended, as in the instant case, that a claimant must prove that the medical services were “necessary” whether or not the insurer was precluded from asserting the defense: “[e]ven if the claims were not properly denied. . . [t]he Plaintiff must still prove a prima facie case that the hospital services were necessary.” On appeal, plaintiffs cited Dermatossian v New York City Tr. Auth. (67 NY2d 219) and Liberty Queens Med. P.C. v Liberty Mut. Ins. Co. (NYLJ, Nov. 4, 2002 [App Term, 2d & 11th Jud Dists]) for the proposition that the submission of the statutory forms setting forth the fact and amount of the loss establishes a prima facie case of entitlement to summary judgment. The Appellate Division affirmed the lower court’s order and held that “plaintiffs made a prima facie showing of entitlement to judgment as a matter law” (St. Luke’s-Roosevelt Hosp. v American Tr. Ins. Co., — AD2d — [2d Dept, Nov. 17, 2003]; cf. Wagner v Baird, 208 AD2d 1087, 1088 [3d Dept 1994]).

Where, as here, the insurer is precluded from raising the defense of lack of medical necessity, the logic of the result reached in St. Luke’s-Roosevelt Hosp. v American Tr. Ins. Co. (— AD2d — [2d Dept, Nov. 17, 2003]) is even more compelling. A contrary rule would require a claimant to prove the health benefits’ medical necessity by evidence additional to the proof necessary to establish a proper claim, even when the insurer has waived the defense, thereby rewarding an insurer’s dilatory response to the claim in the first instance by imposing a greater burden of proof after the action is commenced than was necessary at the claim stage to require that the insurer act on the claim or be precluded from most defenses. Moreover, the situation may be analogized to an account stated where, upon the insurer’s failure timely and properly to deny the bill as embodied in the claim form, the insurer is presumed to have acquiesced to its correctness, thereby rendering the insurer liable thereon. Thus, when an action is commenced, the prima facie case is the unchallenged claim form. Indeed, the Court of Appeals has expressed its impatience with insurers “who sit on their many procedural rights and requirements and then belatedly deny claims they should have acted upon earlier” (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d at 285).

In light of the foregoing, plaintiff has established its entitlement to summary judgment as a matter of law. Accordingly, plaintiff’s motion is granted and the matter is remanded to the court below for a calculation of the statutory interest and an assessment of attorney’s fees due on $879.73 (Insurance Law § 5106 [a]; 11 NYCRR 65-3.9 [a]; 65-3.10 [a]; see St. Clare’s Hosp. v Allstate Ins. Co., 215 AD2d 641 [1995]).
Decision Date: December 24, 2003

[*1]

Supreme Court, Appellate Term, Second Department, December 24, 2003

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellants. Samuel K. Rubin, Bethpage (Lawrence R. Miles of counsel), for respondent.

{**3 Misc 3d at 9} OPINION OF THE COURT

Memorandum.

Order unanimously modified by providing that plaintiffs’ motion for summary judgment is granted to the extent of awarding it partial summary judgment in the sum of $10,635.26, and matter remanded to the court below for the calculation of statutory interest and an assessment of attorney’s fees, and for all further proceedings on the remaining portion of the claim in accordance with the decision therein; as so modified, affirmed without costs.

Plaintiffs commenced this action to recover $10,805.26 in assigned first-party no-fault benefits, plus interest and attorney’s fees, pursuant to Insurance Law § 5101 for medical services rendered to their assignor for injuries she sustained in a motor vehicle accident. Thereafter, plaintiffs moved for summary judgment. Defendant opposed the motion which was denied by order of the court below entered September 26, 2002.

A review of the record indicates that with the exception of one of two $170 claims filed on behalf of Daniel Kim’s Acupuncture P.C., plaintiffs established their entitlement to summary judgment for the recovery of no-fault benefits prima facie by proof that they submitted to defendant the completed claim form (Damadian MRI in Elmhurst v Liberty Mut. Ins. Co., 2003 NY Slip Op 51700[U] [decided herewith]; Sehgal v Royal Ins. Co. of Am., NYLJ, Apr. 15, 1999, at 31, col 4 [App Term, 9th & 10th Jud Dists]; accord S & M Supply v GEICO Ins., 2003 NY Slip Op 51192[U] [App Term, 2d & 11th Jud Dists]; Choicenet Chiropractic v Allstate Ins. Co., 2003 NY Slip Op 50672[U] [App Term, 2d & 11th Jud Dists]; see Dermatossian v New York City Tr. Auth., 67 NY2d [*2]219, 225 [1986]). The burden then shifted to defendant to demonstrate a triable issue whether plaintiffs are entitled to all or any portion of the benefits sought (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]).

While we agree that the preclusion rule does not apply to a defense based on a claim that the incident was not an accident but a deliberate event staged in furtherance of a scheme to defraud the insurer (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 201 [1997]; Matter of Metro Med. Diagnostics v Eagle Ins. Co., 293 AD2d 751, 752 [2002]), defendant’s sole proof of the matter, in the form of an affidavit of its investigator, failed to raise a triable issue of fraud. Here, the report, which was unsworn, alleged, essentially, only that the “uncooperative”{**3 Misc 3d at 10} insured (but not the assignor) had been involved in prior accidents alleged to be “suspicious,” and as to the assignor, recommended merely that the payment of benefits be deferred pending further investigation. Such unsubstantiated hypotheses and suppositions are insufficient to raise a triable issue of the assignor’s fraud, and partial summary judgment should have been granted as to the properly proven claims (see Penny v Pembrook Mgt., 280 AD2d 590, 591 [2001]). However, the court properly denied summary judgment as to one claim for $170, proof of which was omitted from the motion papers.

We note, finally, that while plaintiff concededly failed to respond to defendant’s several requests for verification in the form of an examination of the assignor under oath, not only did defendant fail to prove that the requests were timely (11 NYCRR 65-3.5 [a]), but such requests would not have tolled the 30-day claim determination period because at the time plaintiffs filed the instant claims there was no provision in the insurance regulations for such a procedure (compare 11 NYCRR 65.12 [d], with 11 NYCRR 65-3.5 [e] [eff Apr. 5, 2002]; A.B. Med. Servs. v Lumbermens Mut. Cas. Co., 2003 NY Slip Op 51392[U] [App Term, 2d & 11th Jud Dists]; Bronx Med. Servs. v Lumbermans Mut. Cas. Co., 2003 NY Slip Op 51022[U] [App Term, 1st Dept]).

Accordingly, the matter is remanded to the court below for a calculation of the statutory interest and an assessment of attorney’s fees due on $10,635.26, the portion of the claims for which summary judgment is granted (Insurance Law § 5106 [a]; 11 NYCRR 65-3.9 [a]; 65-3.10 [a]; see St. Clare’s Hosp. v Allstate Ins. Co., 215 AD2d 641 [1995]) and for all further proceedings on the remaining claim.

Doyle, P.J., Winick and Skelos, JJ., concur.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by State Farm Mutual Automobile Insurance Company from an order of the Civil Court, Queens County (Agate, J.), entered January 31, 2003, denying its petition to vacate the arbitrator’s awards.

Order unanimously affirmed without costs.

Upon a review of the record, we find that, with regard to the compulsory arbitration of its no-fault claim, State Farm Mutual Automobile Insurance Company (State Farm) has failed to establish that the arbitrator’s award was not based on the evidence and was arbitrary and capricious (see Matter of Motor Vehicle Acc. Indem. Corp. v Aetna Cas. & Sur. Co., 89 NY2d 214 [19961). In regard to its uninsured motorist claim, State Farm also has not established that the arbitrator “exceeded his power or so imperfectly executed it that a final and definite award upon the subject matter submitted was not made” (CPLR 7511 [b] [1] [iii]). Consequently, State Farm’s petition to vacate the awards was properly denied. Furthermore, inasmuch as Travelers Insurance Company has not cross-appealed with respect to its cross petition to confirm the awards, this court will not address said issue on appeal.

SM-2

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by plaintiff from an order of the Civil Court, Queens County (P. O’Donoghue, J.), dated December 6, 2000, which denied its motion for summary judgment.

Order unanimously affirmed without costs.

The plaintiff instituted this action under the No-Fault Law to recover for medical services it provided to its assignor. In support of its motion for summary judgment, plaintiff submitted its claim forms and the defendant’s denial of the claims based upon an affirmed peer review report submitted by its doctor.

The order denying plaintiffs motion for summary judgment should be affirmed. The plaintiffs prima facie showing was opposed by an affirmed medical report raising a triable issue of fact. The defense of lack of medical necessity may be based either on a medical examination or a sufficiently detailed peer review report, as implicitly provided by Insurance Regulation 11 NYCRR 65-3.8 (b) (4). Here, defendant timely denied plaintiffs no-fault benefits claim following a file-based peer review which, in our view, set forth a factual basis and medical rationale sufficient to create a triable issue as to the treatment’s medical necessity (Rockawav Blvd. Medical P.C.. Park Health Ctr. v Allstate Ins. Co., NYLJ, Mar. 7, 2003 [App Term, 2d & 11th Jud Dists]).
Decision Date: December 22, 2003

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 9th and 10th JUDICIAL DISTRICTS

Appeal by plaintiff from an order of the District Court, Suffolk County (H. Bergson, J.), entered October 18, 2002, denying its motion for summary judgment.

Order unanimously reversed without costs, plaintiff’s motion for summary judgment granted and matter remanded to the court below for the calculation of statutory interest and an assessment of attorney’s fees.

In this action to recover assigned first-party no-fault insurance benefits, defendant insurer objected to plaintiffs claim for medical equipment on the ground that the supplier’s prices exceeded the prevailing rates for such equipment in its “geographic location” (cf. 11 NYCRR 68.5 [b], Reg. No. 83). The Insurance Department regulation permitting reference to “the prevailing fee in the geographic location of the provider” to determine appropriate no-fault compensation pertains only where “the superintendent has not adopted or established a fee schedule applicable to the provider” (id.; e.g. Tucciarone v Progressive Ins. Co., 204 AD2d 864 [1994]). The regulations, however, explicitly limit a provider’s medical equipment claims to 150 percent of cost (11 NYCRR App. 17-C, Part E [b] [1]) which clearly is an applicable fee schedule within the contemplation of 11 NYCRR 69.5 (b) (see King’s Med. Supply v Travelers Prop. Cas. Corp., 194 Misc 2d 667, 673 [2003]). As “[tjhe purpose of [Insurance Law § 51083 and the fee schedules promulgated thereunder [was] ‘to significantly reduce the amount paid by insurers for medical services, and thereby help contain the no-fault premium” (Goldberg v Corcoran, 153 AD2d 113, 118 [1989]), we must assume that the 150 percent rule represents a legislative determination that the net effect of this straightforward, categorical limitation on fees, coupled with suppliers’ marketplace competition to moderate prices (or at least to minimize price disparities), “help[s] contain the no-fault premium” (id.). If the premises underlying this [*2]determination are empirically unsound, the solution is remedial legislation.
Decision Date: December 22, 2003

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 9th and 10th JUDICIAL DISTRICTS

Appeal by plaintiff from an order of the District Court, Suffolk County (H. Bergson, J.), entered October 23, 2002, denying its motion for summary judgment.

Order unanimously reversed without costs, plaintiff’s motion for summary judgment granted, and matter remanded to the court below for the calculation of statutory interest and an assessment of attorney’s fees.

In this action to recover assigned first-party no-fault insurance benefits, defendant insurer objected to plaintiffs claim for medical equipment on the ground that the supplier’s prices exceeded the prevailing rates for such equipment in its “geographic location” (cf. 11 NYCRR 68.5 [b], Reg. No. 83). As defendant preserved no other proper defense to the action, plaintiff’s motion for summary judgment should have been granted for the reasons set forth in King’s Med. Supply Inc. v Allstate Ins. Co., (No. 2003-50 S C [decided herewith]).
Decision Date: December 22, 2003

[*1]

Supreme Court, Appellate Term, Second Department, December 9, 2003

APPEARANCES OF COUNSEL

Amos Weinberg, Great Neck, for appellants. Teresa M. Spina, Woodbury (Emilio A. Cacace of counsel), for respondent.

{**2 Misc 3d at 26} OPINION OF THE COURT

Memorandum.

Order unanimously reversed without costs, motion for summary judgment on their claims granted and matter remanded to the court below for a calculation of statutory interest and an assessment of attorney’s fees.{**2 Misc 3d at 27}

In this action to recover $4,643.74 in first-party no-fault benefits, two of the plaintiffs moved for summary judgment, Royalton Chiropractic P.C. on two claims, one for $1,730.58 for tests rendered April 13, 2001, and one for $1,757.62 for tests rendered April 16, 2001, and A.B. Medical Services, PLLC on its two claims, each for $302.12. Defendant opposed, citing said plaintiffs’ failure to prove the treatments’ medical necessity and otherwise to allege a prima facie case for summary judgment. Summary judgment should have been granted as to the four claims.

We have rejected arguments that a no-fault benefits claimant is obligated to prove the treatment’s medical necessity, at the claim stage or in support of its motion for a summary judgment in a subsequent action on the claim (see Amaze Med. Supply v Eagle Ins. Co., 2003 NY Slip Op 51701[U] [decided herewith]; Choicenet Chiropractic v Allstate Ins. Co., 2003 NY Slip Op 50672[U]; Park Health Ctr. v Prudential Prop. & [*2]Cas. Ins. Co., 2001 NY Slip Op 40650[U]; see also Sehgal v Royal Ins. Co. of Am., NYLJ, Apr. 15, 1999, at 31, col 4 [App Term, 9th & 10th Jud Dists]). Having failed to timely mail or otherwise deliver its determination form with respect to Royalton’s $1,730.58 claim, that is, to “pay or deny the claim in whole or in part” (11 NYCRR 65-3.8 [c]) within 30 days of receipt as required by Insurance Law § 5106 (a) (see Nyack Hosp. v Progressive Cas. Ins. Co., 296 AD2d 482, 483 [2002]; Damadian MRI in Canarsie v Countrywide Ins. Co., 194 Misc 2d 708 [2003]), defendant waived nearly all objections and defenses thereto, relating to the adequacy of the proof of claim (New York & Presbyt. Hosp. v American Tr. Ins. Co., 287 AD2d 699, 701 [2001]) or to its propriety (Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 199 [1997]; New York & Presbyt. Hosp. v Empire Ins. Co., 295 AD2d 325 [2002]). We also agree that defendant failed to demonstrate that it took any action on Royalton’s $1,757.62 claim after Royalton timely responded to its request for medical verification, thereby waiving any defenses to said claim. Finally, given A.B. Medical Services’ unrebutted proof that it mailed Kaufman’s claims on September 24, 2001, defendant’s March 2002 verification requests were clearly untimely (11 NYCRR 65-3.5 [a]; 65-3.6 [b]) and thus summary judgment should also be granted as to this claim.

The matter is remanded to the court below for a calculation of the statutory interest and an assessment of attorney’s fees due on $4,092.44, the portion of the claim for which summary judgment {**2 Misc 3d at 28}was sought (Insurance Law § 5106 [a]; 11 NYCRR 65-3.9 [a]; 65-3.10 [a]; see St. Clare’s Hosp. v Allstate Ins. Co., 215 AD2d 641 [1995]), and for all further proceedings on the remainder of the claim.

Aronin, J.P., Golia and Rios, JJ., concur.

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE TERM : 2nd and 11th JUDICIAL DISTRICTS

Appeal by plaintiff from an order of the Civil Court, Kings County (J. Sullivan, J.), entered September 18, 2002, denying its motion for summary judgment.

Order unanimously affirmed without costs.

Plaintiff commenced this action, pursuant to Insurance Law § 5101 et seq. to recover first-party no-fault benefits for health services it provided to its assignors Martha DeJean and Jean Samuel Emmanuel for injuries they sustained in an automobile accident, and for statutory interest and attorneys fees. Thereafter, plaintiff moved for summary judgment on the ground that defendant did not pay or deny its claim within the 30-day period as provided by Insurance Law § 5106 (a). By order entered September 18, 2002, the court below denied plaintiff’s motion, from which this appeal ensues.

It is uncontroverted that defendant received plaintiff’s complete claim for $1,671.66 on July 18, 2000 ($759.33 for DeJean and $912.33 for Emmanuel). Defendant denied the part of the claim as to Emmanuel on December 13, 2000 and denied the part of the claim as to DeJean on December 15, 2000. Considering plaintiff’s failure to respond to defendant’s valid and timely requests for verification, defendant has rebutted plaintiff’s prima facie case, established through submission of its claim forms, by showing that plaintiff did not submit a completed proof of claim and that therefore plaintiff was no longer entitled to summary judgment by virtue of the fact that defendant did not timely pay or deny said claim (see Insurance Law Ы 5106 [a]; 11 NYCRR 65.15 [d], [g]; New York & Presbyt. Hosp. v American Tr. Ins. Co., 287 AD2d 699). To hold otherwise would allow plaintiff to obtain the benefits of the insurance regulations without having to abide by them. Consequently, defendant has shown a triable issue of fact, thereby [*2]defeating plaintiff’s motion for summary judgment (see Alvarez v Prospect Hosp., 68 NY2d 320, 324). Defendant’s papers in opposition raised an additional issue of fact by showing that fraud was committed as to the part of the claim concerning Emmanuel (see Metro Medical Diag. v Eagle Ins. Co., 293 AD2d 751; see also Central Gen. Hosp. v Chubb Group Ins. Cos., 90 NY2d 195).

Accordingly, we find that the court below properly denied plaintiff’s motion for summary judgment.
Decision Date: October 21, 2003