Opinion
CV-006644-11
04-26-2013
Jersey Rehab PA, P.C. Assignee Of OWEN G. WEBB, Plaintiff(s), v. IDS Property Casualty Insurance Company, Defendant(s).
Friedman, Harfenist, Kraut & Perlstein, Attorneys for Plaintiff Bruno, Gerbino & Soriano, LLP, Attorneys for Defendant
Friedman, Harfenist, Kraut & Perlstein, Attorneys for Plaintiff
Bruno, Gerbino & Soriano, LLP, Attorneys for Defendant
Michael A. Ciaffa, J.
The following papers have been considered by the Court on this motion: submitted April 22, 2013
Papers Numbered
Notice of Motion, Affirmation & Exhibits Annexed...........................1 - 2
Affirmation in Opposition....................................................................3
Reply Affirmation................................................................................4
Defendant moves for an order granting it summary judgment, dismissing claims for no-fault benefits that had been timely filed by the plaintiff, Jersey Rehab PA, P.C. Three bills are at issue. Each sought payment for health services rendered by plaintiff to its assignor, claimant Owen G. Webb, after an auto accident.
The second and third bills in dispute (plaintiff's fourth, fifth, sixth and seventh causes of action) were timely denied by defendant based upon Mr. Webb's failure to attend an IME. In the absence of a challenge by plaintiff to defendant's proof, the Court assumes that defendant's evidence is sufficient to establish timely mailing of the IME notices to Mr. Webb. Compare St.Vincent's Hosp. v GEICO, 50 AD3d 1123 (2d Dept 2008), with ARCO Med. NY, PC v NY Cent. Mut. Fire Ins. Co., 2011 NY Slip Op 50184 (App Term 2d Dept). Likewise, defendant's proof by affidavit sufficiently establishes that Mr. Webb failed to appear for an IME, as requested.
Under well settled legal principles, a claimant's attendance at a properly noticed and scheduled IME is a condition precedent to an insurer's obligation to cover no-fault claims. See Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 (2d Dept 2006). Nevertheless, under the peculiar facts presented in this case, the Court holds that the defendant cannot properly claim that Mr. Webb breached a "condition precedent" to coverage when defendant, itself, breached a regulatory "condition precedent" to its right to obtain an IME of Mr. Webb.
Critically, the no-fault regulations include mandatory notice requirements governing insurer requests for both EUOs and IMEs (11 NYCRR 65-3.5[e]). The regulations expressly provide that the insurer "shall inform the applicant at the time the examination is scheduled that the applicant will be reimbursed for any loss of earnings and reasonable transportation expenses incurred in complying with the request" (id.).
In interpreting the provision in issue, the Insurance Department's General Counsel has opined that every EUO notice "must include requisite language advising the person required to appear ... of that person's right to reimbursement for lost earnings and transportation costs ... in order for such notice to be deemed effective under the regulation." General Counsel Opinion 12-22-2006 (No.1) (emphasis added). Since the regulation draws no distinction between EUOs and IMEs (see 11 NYCRR 65-3.5[e]), the conclusion is inescapable: IME notices are subject to the very same requirements.
As plaintiff's counsel cogently argues in her opposing papers, defendant's IME request letters fail to comply with this mandatory directive. Although the letters include a sentence stating that "[a]ll fees relating to this appointment will be paid by your insurance carrier," that language merely implies that the IME doctor's fees will be paid by the insurer. By no means does this language give notice to Mr. Webb that he would be reimbursed for lost earnings and transportation expenses as required by the literal terms of the regulation.
Accordingly, the Court concludes that defendant's IME notices cannot be deemed to have substantially complied with the notice requirements of 11 NYCRR 65-3.5(e). Furthermore, under the logic of the General Counsel's opinion, which is entitled to deference unless "irrational or unreasonable," see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., supra, the IME letters were ineffective and insufficient to give proper notice to Mr. Webb of his right to reimbursement.
Consequently, defendant's papers fail to establish, as a matter of law, that Mr. Webb breached a condition precedent to coverage by failing to appear for an IME. Simply stated, compliance with the above-quoted notice requirement of 11 NYCRR 65-3.5(e) is a "condition precedent" to the insurer's right to demand an IME. If the insurer fails to give the applicant proper notice of his right to reimbursement for lost wages and transportation costs, the IME demand is defective, per se, and may not form the basis for defeating an otherwise timely and proper no fault claim by a provider.
For these reasons, plaintiff's fourth, fifth, sixth and seventh causes of action are not subject to summary dismissal on grounds of IME default.
Finally, defendant requests summary judgment dismissing the causes of action relating to the first bill (plaintiff's second and third causes of action) on the ground that it paid the first bill, in full. Plaintiff does not oppose this branch of the motion.
Accordingly, defendant's motion for summary judgment is GRANTED only to the extent of dismissing plaintiff's second and third causes of action. The motion is otherwise DENIED.
So Ordered:
District Court Judge
Dated: April 26, 2013
cc:Bruno, Gerbino & Soriano, LLP
Friedman, Harfenist, Kraut & Perlstein, LLP