21 Fla. L. Weekly Supp. 1053b
Online Reference: FLWSUPP 2110VAZQInsurance — Personal injury protection — Coverage — Medical expenses — Policy that clearly subjects all payments to any limitations of PIP statute, including all fee schedules, unambiguously elects to limit reimbursement to permissive statutory fee schedule — Failure to reference Medicare and inclusion of language regarding payment of reasonable charges does not render policy ambiguous
EXECUTIVE DIAGNOSTIC CENTER, INC., a/a/o TIFFANY VAZQUEZ, Plaintiff, vs. UNITED AUTOMOBILE INSURANCE COMPANY, a Florida corporation, Defendant. County Court, 11th Judicial Circuit in and for Miami-Dade County, Civil Division. Case No. 12-2467 SP 24 (01). June 4, 2014. Rodolfo Ruiz, Judge. Counsel: Ryan Peterson, for Plaintiff. Thomas L. Hunker, Office of the General Counsel, United Automobile Insurance Co., Miami Gardens, for Defendant.
ORDER GRANTING DEFENDANT’S MOTION FOR PARTIAL SUMMARY JUDGMENT ON PAYMENT OF MEDICAL EXPENSES PURSUANT TO FEE SCHEDULES
THIS CAUSE having come before the Court on March 17, 2014, on Defendant’s, UNITED AUTOMOBILE INSURANCE COMPANY (“United”), Motion for Partial Summary Judgment regarding Limiting Reimbursement of Provider Charges in Accordance with Fee Schedules, and the Court having considered the Motion and Supplemental Memorandum of Law, arguments of counsel, and the Court file, it is,
ORDERED and ADJUDGED that Defendant’s Motion for Partial Summary Judgment is hereby GRANTED for reasons set forth herein.BACKGROUND
This matter involves a suit for personal injury protection (“PIP”) benefits under UAIC 200 (07/11), a personal automobile insurance contract issued by United. On May 28, 2012, Tiffany Vazquez was allegedly involved in an automobile accident and made a claim for PIP benefits under Yovani Crosniel’s insurance contract with United. On October 26, 2012, United received a demand letter submitted by Plaintiff’s counsel seeking payment of Plaintiff’s bills for dates of service from August 1, 2012 through August 23, 2012 — a total amount of $3,121.00. United received another demand letter on or about November 14, 2012 from Plaintiff’s counsel, seeking payment for a single date of service, September 17, 2012, in the amount of $1,345.00. United provided a demand response on or about December 13, 2012, limiting reimbursement of Plaintiff’s charges to 80% of 200% of the Medicare Part B fee schedule pursuant to the language of its policy and section 627.736(5)(a)(2) of the Florida Statutes. See Fla. Stat. § 627.736(5)(a)(2) (2008). Consequently, payment was issued by United in the amount of $3,385.30 for benefits, $47.74 for interest, and $5.75 for demand penalty and postage.
United posits that it correctly availed itself of the reimbursement limitations permissible under section 627.736(5)(a)(2) because the language of UAIC 200 (07/11) provides sufficient notice of an election to use the fee schedules as the basis for calculating reimbursements. Plaintiff argues, however, that the policy at issue fails to clearly and unambiguously elect the permissive Medicare fee schedule method for calculating reimbursements, and therefore alleges that United breached its personal automobile insurance contract by failing to pay 80% of reasonable and necessary medical expenses.
STANDARD OF REVIEW
A party is entitled to summary judgment in their favor if the “pleadings, depositions, answers to interrogatories, and admissions on file together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Fla. R. Civ. P. 1.510(c). The moving party bears the burden of demonstrating the non-existence of any genuine issue of material fact, Volusia County v. Aberdeen at Ormond Beach, L.P., 760 So. 2d 126, 130 (Fla. 2000) [25 Fla. L. Weekly S390a]; Holl v. Talcott, 191 So. 2d 40, 43 (Fla. 1966); Calarese v. Weissfisch, 87 So. 3d 1225, 1227 (Fla. 3d DCA 2012) [37 Fla. L. Weekly D1238c]. However, once the moving party has met its burden, the burden then shifts to the party opposing the motion to come forward with counter-evidence sufficient to reveal a genuine and material disputed issue of fact. Tropical Glass & Const. Co. v. Gitlin, 13 So. 3d 156, 158 (Fla. 3d DCA 2009) [34 Fla. L. Weekly D1163a].
ANALYSIS
As explained by the Florida Supreme Court in Geico Gen. Ins. Co. v. Virtual Imaging Servs., Inc., fee schedule provisions of the No-Fault Law cannot be applied absent a specific policy provision implementing said fee schedules. No. SC12-905, 2013 WL 3332385, at *1 (Fla. Jul. 3, 2013) [38 Fla. L. Weekly S517a] (“Virtual Imaging”). In Virtual Imaging, the Court analyzed whether Geico Insurance Company could avail itself of the permissive payment option of section 627.736(5)(a)(2) without placing its insured on notice that it was opting to pay only the 200% Medicare Part B fee schedule amount. Id. The Court concluded that because the Geico policy failed to clearly and unambiguously elect the aforementioned permissive payment option, Geico was not permitted to limit reimbursements in accordance with the Medicare fee schedules. Id. at *9; see also Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So. 3d 63, 68 (Fla. 4th DCA 2011) [36 Fla. L. Weekly D1062a] (holding that the choice of reimbursement methodology must be done in a manner that places policyholders on notice of the insurer’s intention to cap benefits pursuant to section 627.736(5)(a)(2)).
Thus, pursuant to Virtual and Kingsway, this Court must analyze whether the policy language of UAIC 200 (07/11) provided sufficient notice to the insured that United would limit reimbursements pursuant to the fee schedules found under section 627.736(5)(a)(2). See State Farm Mut. Auto. Ins. Co. v. Menendez, 70 So. 3d 566, 569 (Fla. 2011) [36 Fla. L. Weekly S469a] (holding that when “interpreting an insurance contract,” a Court is “bound by the plain meaning of the contract’s text.”). In construing the policy at issue, “[i]f the language used . . . is plain and unambiguous, a court must interpret the policy in accordance with the plain meaning of the language used so as to give effect to the policy as it was written.” Id. at 569-70 (quoting Travelers Indem. Co. v. PCR, Inc., 889 So. 2d 779, 785 (Fla. 2004) [29 Fla. L. Weekly S774a]); see also U.S. Fire Ins. Co. v. J.S.U.B., Inc., 979 So. 2d 871, 877 (Fla. 2007) [32 Fla. L. Weekly S811a] (stating that insurance contracts are construed according to their plain meaning).
Further, in order for an exclusion or limitation in a policy to be enforceable, the insurer must clearly and unambiguously draft a policy provision to achieve that result. See Auto-Owners Ins. Co. v. Anderson, 756 So.2d 29, 36 (Fla. 2000) [25 Fla. L. Weekly S211a]. However, courts should not “put a strained and unnatural construction on the terms of a policy in order to create an uncertainty or ambiguity.” Lindheimer v. St. Paul Fire & Marine Ins. Co., 643 So. 2d 636, 638 (Fla. 3d DCA 1994); Health Options, Inc. v. Kabeller, 932 So. 2d 416, 420 (Fla. 2d DCA 2006) [31 Fla. L. Weekly D1122a]. Instead, “the terms of the contract must be given their everyday meaning and read in light of the skill and experience of ordinary people.” Id.; see also The Doctors Co. v. Health Management Associates, Inc., 943 So. 2d 807, 809 (Fla. 2d DCA 2006) [31 Fla. L. Weekly D2350a] (explaining that “[i]nsurance contracts, just like any other contract, ‘should receive a construction that is reasonable, practicable, sensible, and just.’ ”) (quoting Gen. Star. Indem. Co. v. W. Fla. Village Inn, Inc., 874 So. 2d 26, 29 (Fla. 2d DCA 2004) [29 Fla. L. Weekly D1070b]).
I. UAIC 200 (7/11) clearly and unambiguously elects the fee schedule methodology
In this case, Section I, Part E of the UAIC 200 (7/11) policy states as follows:
The Company will pay, in accordance with the No-Fault Act in effect on the day the policy was issued, to and for the benefit of the injured person —
(a) medical benefits — eighty percent of all reasonable charges for medically necessary expenses. Any amounts payable under this coverage shall be subject to any and all limitations authorized by section 627.736, or any other provisions of the No-Fault Act, including but not limited to, all fee schedules . . .
(emphasis added).
There are several significant distinctions between the aforementioned language and the policy provisions assailed in Virtual and Kingsway. First and foremost, UAIC 200 (7/11) uses the word “shall,” which constitutes an affirmative, unequivocal election informing the insured that United will apply the limitations and fee schedules contained in the No-Fault Act. See Virtual Imaging, 2013 WL 3332385, at *6.
Second, the policy states that the statutory “limitations” will apply to the “amounts payable” under PIP coverage. There is only one reimbursement limitation section within 627.736 — subsection 5(a)(2). Subsection (5)(a)(2) constitutes a “limitation” because it states that an insurer may “limit reimbursement” to 80% of the schedule of maximum charges, and there is no ambiguity within the statute as to which specific limitation listed in parts (a) through (f) will apply to a given medical service. See Fla. Stat. § 627.736(5)(a)(2)(a)-(f) (2008). Each limitation applies to its own category of medical procedure, and a medical service can fit into only one of the subsections listed in parts (a) through (f). Id. Thus, unlike the policies in Virtual and Kingsway, which make no mention of any statutory payment limitations, UAIC 200 (7/11) clearly and unambiguously places the insured on notice that United will avail itself of the various reimbursement limitations contained within subsection (5)(a)(2). See Virtual Imaging, 2013 WL 3332385, at *8 (“[I]n order to an exclusion or limitation in a policy to be enforceable, the insurer must clearly and unambiguously draft a policy provision to achieve that result.”) (citing Anderson, 756 So. 2d at 36).
Third, United’s policy specifically states that it will apply the payment limitations contained in “section 627.736” and “the No-Fault Act,” including “all fee schedules.” Given that the No-Fault Act does not provide any other fee schedules apart from those contained in subsection (5)(a)(2), said language is devoid of ambiguity. See Weldon v. All Am. Life Ins. Co., 605 So. 2d 911, 914 (Fla. 2d DCA 1992) (“Where a contract of insurance is entered into on a matter surrounded by statutory limitations and requirements, the parties are presumed to have entered into such agreement with the reference to the statute . . .”). Instead, UAIC 200 (7/11) places the insured on notice that the multiple payment methodologies contained in subsection (5)(a)(2) will be used to limit reimbursement. See Doctors Co., 943 So. 2d at 809 (“A single policy provision should not be considered in isolation, but rather, the ‘contract shall be construed according to the entirety of its terms . . . as set forth in the policy and as amplified’ by the policy application, endorsements, or riders.”), (quoting Swire Pac. Holdings, Inc. v. Zurich Ins. Co., 845 So. 2d 161, 166 (Fla. 2003) [28 Fla. L. Weekly S307d]).
II. Failure to specifically reference Medicare, as well as the inclusion of language regarding reasonable charges, does not render UAIC 200 (7/11) ambiguous
Plaintiff posits that the language contained within UAIC 200 (7/11) is insufficient because it fails to specifically state that United will limit its reimbursements pursuant to “Medicare.” However, the language proposed by Plaintiff is overly narrow, and is not mandated by Virtual Imaging. Subsection (5)(a)(2) contains a system of permissive reimbursement methodologies applicable to various forms of medical services, not just Medicare fee schedules. Accordingly, United’s limitation of liability provision is designed to encompass each and every one of the limitations found under subsection (5)(a)(2), not merely Medicare under (5)(a)(2)(f). Simply limiting reimbursements under UAIC 200 (7/11) to “Medicare” would be an incomplete, imprecise, inaccurate, and insufficient reference to the system of reimbursement methodologies contained in subsection (5)(a)(2). Moreover, Virtual Imaging does not require insurers to specifically state the word “Medicare.” It simply requires the policy language to give “notice to the insured — and to the provider who renders service based on an assignment of benefits in the insured’s policy — regarding the amount of coverage the insurer will provide.” Virtual Imaging, 2013 WL 3332385, at *9.
Plaintiff also counters that UAIC 200 (7/11) is ambiguous because it promises to pay both “reasonable” charges while seeking to limit reimbursement to the “fee schedules.” However, this argument is contrary to the holding in Virtual Imaging, which explains that section 627.736(1)(a) requires all PIP policies to pay “reasonable” charges and subsection (5)(a)(2) “fee schedules are one possible method of calculating reimbursements to satisfy the PIP statute’s reasonable medical expenses coverage mandate . . .” Virtual Imaging, 2013 WL 3332385, at *1 (emphasis added). Thus, subsection (5)(a)(2) does not conflict with the PIP statute’s goal of providing coverage for reasonable medical expenses; it simply provides “the Medicare fee schedules as a method for calculating the ‘reasonable medical expenses’ coverage the insurer is required by section 627.736 to provide . . .”. Id. at *1 n.3; see also id. at *8 n.8 (“Although we agree that there are two payment methodologies for satisfying the PIP statute’s coverage mandate, we emphasize that we do not conclude that limiting reimbursement pursuant to section 627.736(5)(a)(2) would never satisfy this reasonable expenses coverage mandate.”).
Consequently, United’s promise to pay “reasonable” charges does not signify an election of the (5)(a)(1) factored methodology in lieu of (5)(a)(2). Indeed, UAIC 200 (7/11) does not contain any reference to the analysis of determining reasonableness under (5)(a)(1); instead, the policy elects subsection (5)(a)(2) by indicating that it “shall” limit reimbursements as authorized by “section 627.736” and the “No-Fault Act,” including “fee schedules.” Accordingly, UAIC 200 (7/11) complies with Virtual Imaging by clearly and unambiguously electing the permissive payment methodology, and the mere fact the policy could be worded differently (whether by including the term “Medicare” or specifically citing subsection (5)(a)(2) in lieu of using the phrase “all fee schedules”) is of no consequence. See First Specialty Ins. Co. v. Caliber One Indemnity Co., 988 So. 2d 708, 713 (Fla. 2d DCA 2008) [33 Fla. L. Weekly D1996a] (“[T]he mere fact that a provision in an insurance policy could be more clearly drafted does not necessarily mean that the provision is otherwise inconsistent, uncertain or ambiguous.”) (quoting State Farm Mut. Auto. Ins. Co. v. Pridgen, 498 So. 2d 1245, 1248 (Fla. 1986)).
III. Policy language strikingly similar to UAIC 200 (7/11) has been found to clearly and unambiguously elect the fee schedule methodology
The Eleventh Judicial Circuit, sitting in its appellate capacity, recently addressed whether language contained in an Allstate insurance policy nearly identical to UAIC 200 (7/11) clearly and unambiguously notified the insured of Allstate’s intent to utilize the fee schedule reimbursement limitations authorized by section 627.736(5)(a)(2)(0. See Allstate Property & Casualty Ins. Co. and Allstate Fire & Casualty Ins. Co. v. Royal Diagnostic Center, Inc. a/a/o Dania Mondy, Case No.13-073 AP (Fla. 11th Cir. Ct. App., Apr. 3, 2014) [21 Fla. L. Weekly Supp. 627a] (“Royal”). The Allstate policy at issue in Royal provided, in pertinent part, as follows:
Any amounts payable under this coverage shall be subject to any and all limitations authorized by Fla. Stat. § 627.736, or any other provision of the Florida Motor Vehicle No-Fault Law, as enacted, amended or otherwise continued in the law including, but not limited to, all fee schedules.
(emphasis added).
Upon reviewing the aforementioned language, the Court in Royal determined that the policy provided sufficient notice to its insureds pursuant to Virtual Imaging that Allstate had elected to limit reimbursements under the fee schedules: “[I]t is our view that Allstate’s policy language clearly and unambiguously subjects payments to all fee schedules authorized by the PIP statute. In fact, it states that payments ‘shall be subject to’ the fee schedules. (Emphasis added.) This leaves no room for ambiguity.” Royal, at 3.
In this case, the language contained within UAIC 200 (7/11) is strikingly similar to the policy language analyzed in Royal. Both policies state that payments “shall be subject to . . . all fee schedules” while referencing the No-Fault Law in general; moreover, neither policy specifically references Medicare or cites subsection (5)(a)(2). Given that UAIC 200 (7/11) contains essentially the same language approved by the Eleventh Judicial Circuit in Royal, United was entitled to limit reimbursement under the statutory fee schedules in this case.
It is also worth noting, as discussed in Royal, that the Court in Virtual Imaging appears to have conceded, albeit in dicta, that the language of GEICO’s 2011 amended policy (the “GEICO Amended Policy”) properly elected the fee schedules. Virtual Imaging, 2013 WL 3332385, at *1 (finding that “the GEICO policy has since been amended to include an election of the Medicare fee schedules as the method of calculating reimbursements . . .”). The GEICO Amended Policy states as follows:
The Company will pay in accordance with the Florida Motor Vehicle No Fault Law (as enacted, amended, or newly enacted), and where applicable in accordance with the fee schedules contained in the Florida Motor Vehicle No Fault Law, to or for the benefit of the injured person:
(a) 80% of medical expenses . . .
Like the language in UAIC 200 (7/11) (as well as the Allstate policy in Royal), the GEICO Amended Policy does not specifically state the term “Medicare,” nor does it cite to subsection (5)(a)(2). More importantly, the GEICO Amended Policy and UAIC 200 (7/11) both invoke the No-Fault Law in general while specifically referencing “all fee schedules.” Consequently, given the Florida Supreme Court’s approval of the GEICO Amended Policy in Virtual Imaging and its similarities to UAIC 200 (7/11), United properly availed itself of the fee schedule reimbursement limitations authorized by section 627.736(5)(a)(2)(f).CONCLUSION
Based upon the foregoing, it is hereby ORDERED and ADJUDGED that Defendant’s Motion for Partial Summary Judgment is GRANTED.
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