Opinion
5444/07.
Decided on January 18, 2008.
Attorneys for plaintiff: Friedman, Harfenist, Langer Kraut.
Attorneys for defendant: Law Offices of Teresa M. Spina.
The Plaintiff commenced this action to recover no-fault first party benefits in the total sum of $879.73, for medical services allegedly provided to its assignor following a motor vehicle accident of February 2, 2005. The action was commenced on February 6, 2007. Issue was joined on April 10, 2007. The Plaintiff now moves for summary judgment. The Defendant opposes that motion and cross-moves for summary judgment as well. The Plaintiff opposes the Defendant's cross-motion.
Summary judgment is a drastic remedy, Sillman v. Twentieth Century-Fox Film Corporation, 3 NY2d 395, 165 NYS2d 498 (1957), which should not be granted where there is any doubt as to the existence of a triable issue of fact. Rotuba Extruders, Inc. v. Ceppos, 46 NY2d 223, 413 NYS2d 141 (1978) To prevail, the movant must first make a showing of entitlement to judgment, as a matter of law, Bank of New York v. Granat, 197 AD2d 653, 602 NYS2d 942 (2nd Dept. 1993), tendering evidentiary proof in admissible form. Friends of Animals, Inc. v. Associate Fur Manufacturers, Inc., 46 NY2d 1065, 416 NYS2d 790 (1979). It is only thereafter incumbent upon the party opposing summary judgment to "demonstrate by admissible evidence the existence of a factual issue requiring a trial of the action or tender an acceptable excuse for his failure so to do." Zuckerman v. City of New York, 49 NY2d 557, 427 NYS2d 595 (1980). The movant's failure to make such a showing, regardless of the sufficiency of opposing papers, mandates the denial of a summary judgment motion. Winegrad v. New York University Medical Center, 64 NY2d 851, 487 NYS2d 316 (1985)
PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
The Plaintiff alleges that it performed an MRI of its assignor's cervical spine on February 26, 2005. The bills for this alleged service was dated March 30, 2005. According to the Plaintiff, this bill was received by the Defendant on April 1, 2005; and, the Plaintiff submits a copy of the denial ("N-F 10") received, dated April 14, 2005, confirming this fact. The Defendant's admission of having received the Plaintiff's claims cures any defect 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)
The Plaintiff does not allege that the Defendant's N-F 10 was untimely. The Plaintiff does allege that the Defendant's N-F 10 is improper as to form and must be disregarded. Specifically, the Plaintiff suggests that the N-F 10 was not issued on the forms prescribed by the Insurance Department Regulation 68, having omitted therefrom items 2A through 2F, relating to categories of payments which have been denied in part, and items 3 through 17, relating to all policy issues, loss of earnings benefits and other reasonable and necessary expenses. The redaction of item number 5 also resulted in the omission of advice to the assignor and/or assignee that they may qualify for special expedited arbitration.
To establish its prima facie right to a judgment as a matter of law, the Plaintiff must demonstrate its timely and proper submission of the claims in question and the Defendant's failure to either pay or issue a valid denial within thirty (30) days of receipt of those claims. 11 N.Y.C.R.R. § 65-3.(c); Presbyterian Hospital in the City of New York v. Maryland Casualty Company, 90 NY2d 274, 660 NYS2d 536 (1997); Nyack Hospital v. State Farm Mutual Automobile Insurance Company, 11 AD3d 664, 784 NYS2d 136 (2nd Dept. 2004); Westchester Medical Center v. AIG, Inc., 36 AD3d 900, 829 NYS2d 180 (2nd Dept. 2007) If the Plaintiff fails to demonstrate each of these elements, by the submission of evidence in admissible form, the Plaintiff's motion will be denied. Such is the case before this court.
The Plaintiff has failed to lay a proper evidentiary foundation for the introduction of its claim forms into evidence. The Defendant's admission of receipt of the Plaintiff's claim forms "did not concede the facts asserted in the claim forms and it remained plaintiff's burden to proffer such evidence in admissible form, which it failed to do ( see, Midborough Acupuncture, P.C. v. New York Cent. Mut. Fire Ins. Co., 13 Misc 3d 132 (A), 2006 N.Y.Slip Op. 51879(U), supra)." 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); See also: Fortune Medical, P.C. v. Allstate Insurance Co., 14 Misc 3d 136, 836 NYS2d 492 (App. Term 9th 10 Jud. Dists. 2007) "Indeed, absent a foundation to establish the admissibility of the provider's claim forms as business records, said claim forms do not constitute proof of the act, transaction, occurrence or event' set forth therein for which plaintiff seeks to recover (CPLR 4518)." Bajaj v. General Assurance, __ Misc 3d __, __ {18 Misc 3d 25} NYS2d __ 2007 WL 4165268 (App. Term 2nd 11th Jud. Dists. 2007); See also: Ontario Medical, P.C. v. Sea Side Medical, P.C., 15 Misc 3d 129, 839 NYS2d 435 (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)
In recognition of this significant defect in its motion papers, the Plaintiff attempts, for the first time in reply, to lay a business record foundation for its claim forms. The use of reply papers for this purpose, however, is improper. The purpose of reply papers is to address arguments raised in opposition to the motion, not to permit the introduction of new arguments, issues, grounds or evidence in support of the motion. Merchants Bank of New York v. Gold Lane Corp ., 28 AD3d 266 , 814 NYS2d 99 (1st Dept. 2006); Litvinov v. Hodson , 34 AD3d 1332 , 826 NYS2d 536 (4th Dept. 2006)
Contrary to the Plaintiff's argument, CPLR § 2001, which provides the court with the discretion to "permit a mistake, omission, defect or irregularity, . . ., to be corrected" at any stage of an action, cannot be used to correct the Plaintiff's failure to make out a prima facie case with proof in admissible form in the first instance. The cases relied upon by the Plaintiff are inapposite. In Moccia v. Carrier Car Rental, Inc ., 40 AD3d 504 , 837 NYS2d 67 (1st Dept. 2007) the court permitted a reply to provide a certificate of conformity for a previously submitted out of state affidavit to provide compliance with CPLR § 2309(c), nunc pro tunc. The court specifically noted that this did nothing more than correct a defect in form. Ramos v. Dekhtyar, 301 AD2d 428, 753 NYS2d 489 (1st Dept. 2003) involved papers submitted on a motion to renew, not in reply. Moreover, the only correction made was the affixing of a jurat to a previously affirmed chiropractor's report; again correcting form, not substance. Farkas v. Tarrytown Lumber, Inc. 133 AD2d 251, 519 NYS2d 49 (2nd Dept. 1987) and Holy Spirit Association for Unification of World Christianity v. Harper Row Publishers, Inc., 101 Misc 2d 30, 420 NYS2d 56 (S.C. NY Co. 1979) allowed replies to specify the sections under which the motions had been brought, which were either omitted or misstated in the original motion papers. Once again, the courts noted that the substance of the papers submitted were unchanged and that the replies were permitted to correct technical defects as to form. Krug v. Offerman, Fallon, Mahoney Cassano, 245 AD2d 603, 664 NYS2d 882 (3rd Dept. 1997) is to the same effect, allowing a reply to correct the misidentification of a signature on an original affidavit, without making any substantive change.
In the matter sub judice, it is only after the Defendant had already served and submitted its opposition to the Plaintiff's motion that the Plaintiff submitted the reply Affidavit of Brijkumar Yamraj, sworn to on October 22, 2007, which alleges, for the first time, that it is the Plaintiff's regular office policy and procedure to record the information contained in the Plaintiff's claim forms in its billing program upon completion of the tests performed; that the billing program automatically generates a bill for the services and that the bill is stored in the patient's file. This affidavit does much more than correct a technical defect as to form; rather, it is testimonial and substantive in nature, attempting to set forth factual elements of the Plaintiff's prima facie case. The Plaintiff may not, however, rely upon evidence submitted for the first time in reply to meet its prima facie burden. Rengifo v. City of New York , 7 AD3d 773 , 776 NYS2d 865 (2nd Dept. 2004); Branham v. Loews Orpheum Cinemas, Inc ., 31 AD3d 319 , 819 NYS2d 250 (1st Dept. 2006); Migdol v. City of New York, 291 AD2d 201, 737 NYS2d 78 (1st Dept. 2002)
Accordingly, having failed to demonstrate all necessary elements to its entitlement to a judgment as a matter of law in the first instance, with evidentiary proof in admissible form, the Plaintiff's motion for summary judgment is denied.
DEFENDANT'S CROSS-MOTION FOR SUMMARY JUDGMENT
The Defendant alleges that it timely served its N-F 10 in response to the Plaintiff's claim. The Defendant further alleges that its N-F 10 was proper, having been issued on a form allegedly approved by the New York State Insurance Department. Relying on an affirmed peer review report, the Defendant also alleges that it has demonstrated a lack of medical necessity for the services in question, as set forth in its N-F 10.
Before the defense of lack of medical necessity will be considered, the Defendant must demonstrate, through the submission of evidentiary proof in admissible form, that it timely issued a proper N-F 10 asserting that defense in response to the Plaintiff's claim. The Defendant will be precluded from raising its medical necessity defense where it fails to make such a demonstration. 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)
Addressing the timely service of the Defendant's N-F 10, although the court does not find the affidavit of Kathleen McClernon to properly demonstrate "either proof of actual mailing or proof of a standard office practice or procedure designed to ensure that items are properly addressed and mailed (citations omitted)[,]" Residential Holding Corp. v. Scottsdale Insurance 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), or one "geared so as to ensure the likelihood that a notice . . . is always properly addressed and mailed[,]" Nassau Insurance Company v. Murray, 46 NY2d 828, 414 NYS2d 117 (1978), this issue need not be determined by the court. The Plaintiff acknowledges that its claim was timely denied and that it received the Defendant's N-F 10. Plaintiff states, "On April 14, 2005, GEICO denied the bills for the elctrodiagnostic [ sic] and/or other diagnostic services[,]" ( Armao Affirmation 9/7/07, ¶ 7), and annexes a copy of the N-F 10 to its motion papers, confirming this fact. This admission cures the defect in the Defendant's proof concerning the timeliness of its denial.
In an effort to demonstrate the propriety of its modified N-F 10 the Defendant relies upon the affidavits of Mark Pressler and Aurora de la Torre. In November 2006 Mr. Pressler was an Assistant Deputy Superintendent and Chief of the Property Bureau of the New York State Insurance Department, whose duties included oversight of the no-fault reparations system. Aurora de la Torre, is a Senior Vice President of Operations of Nadent-Health Data Services ("HDS") and has held a management position with that company since 1980. In January and February of 1992 she was the Director of Operations. Her duties included providing assistance in no-fault claims procedure, systems and fee schedule coding.
Ms. de la Torre alleges that in January 1992 HDS contacted the Insurance Department of behalf of the Defendant, "to see if GEICO could use a form for denial of health service benefits which would not include boxes for defenses that had no application to the health provider's claims." ( de la Torre Affidavit 2/5/07, ¶ 2) Ms. de la Torre submits a copy of the Insurance Department's reply letter dated January 23, 1992 which states that the proposed form may not be used, indicating, inter alia, "Your page two as presently constituted does not meet the prescribed standards. . . . Your modification of page two of the NF-10 form is not acceptable and can not be used in its present format." ( Smeragliuolo Letter 1/23/92, ¶ 2) Ms. de la Torre alleges that HDS then amended its proposed form, in accordance with Mr. Smeragliuolo's recommendations, and faxed a copy to the Insurance Department on January 31, 1992. Ms. de la Torre further alleges that HDS then received a letter from Mr. Smeragliuolo dated February 3, 1992 allowing the proposed amended N-F 10 to be used. HDS then so notified GEICO.
The affidavit of Mark Pressler confirms that on January 31, 1992 HDS submitted for approval a proposed N-F 10 to be used in denying health service claims, altering the form prescribed by Regulation 68. Quoting Mr. Smeragliuolo's letter of February 3, 1992, Mr. Pressler alleges that the Insurance Department advised HDS that they "may use this form for all No-Fault denials of benefits on or after February 1, 1992.'" ( Pressler Affidavit 11/29/06, ¶ 3) Mr. Pressler explains that "[t]he letter was intended to convey the Department's assent to the use of the form in conformity with the provisions of the regulation." ( Pressler Affidavit 11/29/06, ¶ 3)
Based upon the foregoing, the Defendant argues that the N-F 10 it used to deny the Plaintiff's claim was issued on the same form approved by the Insurance Department and was, therefore, not only timely, but proper as to its form. For the reasons to be detailed below, this court does not agree.
It is initially noted that the Defendant has failed to submit a complete copy of the N-F 10 in question. As indicated hereinabove, according to the Defendant, the Insurance Department initially rejected its proposed altered N-F 10 due to problems with the form's second page. While the Defendant alleges that it corrected these problems and obtained permission to use the corrected form, the Defendant fails to provide this court with the second page of the N-F 10 allegedly used. Without this page 2, it is impossible for this court to determine if the N-F 10 used was in conformity with the permission allegedly given by the Insurance Department and/or in compliance with Insurance Department Regulation 68 and the forms prescribed therein as of the date of denial. Given the absence of this page, the Defendant has failed to demonstrate that its N-F 10 was proper, as a matter of law. For this reason alone, the Defendant's motion must be denied.
Additionally, it is not clear from the evidence submitted by the Defendant that the Defendant ever actually obtained approval to use the N-F 10 it submitted to the Insurance Department. Mr. Smeragliuolo's letter of February 3, 1992, upon which the Defendant relies as proof of the Department's approval, explicitly states, in referring to the Defendant's proposed altered N-F 10, "Nonpolicy forms of this type are not approved by the Department." ( Smeragliuolo Letter 2/3/92, ¶ 2) Mr. Smeragliuolo's opinion, that the Defendant's proposed form "appears to comply with the standards set in Appendix 13-A" and that the Defendant "may use this form for all No-Fault denials of benefits on or after February 1, 1992[,]" ( Smeragliuolo Letter 2/3/92, ¶ 2) not only contradicts his own statement regarding the Insurance Department's refusal to approve this form, but is beyond the scope of his authority.
11 N.Y.C.R.R. § 2.5 clearly identifies which officials and employees of the Insurance Department may give written opinions. This regulation specifically limits those individuals to "[t]he superintendent, all deputy superintendents, the department counsel and bureau heads[.]" Moreover, 11 N.Y.C.R.R. § 2.5(e) advises that opinions issued by the Insurance Department "should not be broader than the scope of the powers and duties of the official or employee giving the same." Mr. Smeragliuolo, is an Associate Insurance Examiner; he is not an official or employee who is empowered to issue an opinion on behalf of the Insurance Department. Additionally, as will be discussed at length hereinafter, the Insurance Department does not have any authorization to approve the use a modified N-F 10 "for all No-Fault denials of benefits on or after February 1, 1992." ( Smeragliuolo Letter 2/3/92, ¶ 2)
Even if Mr. Smeragliuolo's opinion was considered to be approval of the Defendant's proposed N-F 10, the N-F 10 which the Defendant served upon the Plaintiff was not the same as the one allegedly approved. Moreover, the Defendant has not submitted any proof that it obtained approval for the N-F 10 form it used, following the revision of Insurance Department Regulation 68.
Insurance Department Regulation 68, implementing the no-fault law, was first promulgated in 1974. These regulations were repealed on September 1, 2001 and a revised Regulation 68 was issued at that time. Implementation of the new Regulations was stayed on August 31, 2001; and, the old Regulations remained in effect until April 5, 1992, when the stay on implementation of the new Regulations was lifted and they became effective. See: In re Medical Society of the State of New York v. Serio, 298 AD2d 255, 749 NYS2d 227 (1st Dept. 2002), aff'd 100 NY2d 854, 800 NE2d 728, 768 NYS2d 423 (2003)
At the time the Defendant sought approval of its modified N-F 10 form, the old Regulations were in effect. The N-F 10 in the matter before this court was issued more than thirteen (13) years later. The new Regulations had been in effect for approximately three (3) years; and, the prescribed form itself had been changed by the Insurance Department at least twice, once in March 2002 and again in January 2004. In fact, at the time of the March 2002 amendment of the prescribed form, Appendix 13 of the new Regulations explicitly provided, "Other than NYS form NF-AOB, no deviations may be made to the prescribed forms unless expressly acknowledged by the Department. . . . Insurers may continue to use currently existing stocks of prescribed No-Fault forms until May 1, 2003 at which time the revised prescribed forms must be utilized." Despite these changes to the prescribed form, and the clear mandate that the new prescribed forms must be used, unless proper approval is given for their modification, the Defendant continued to use the modified N-F 10 it created in 1992. The Defendant's suggestion, during oral argument on this motion, that it took it upon itself to further modify its N-F 10 form in an attempt to keep up with the amendments to the Regulations and the prescribed form, while continuing the alterations it began in 1992, is unavailing.
It is undisputed that the N-F 10 issued by the Defendant in this matter was neither on the prescribed form, as it existed in 2005, nor on the form allegedly approved by the Insurance Department in 1992. Neither the old Regulations nor the new Regulations permit an insurer to adjust or amend its forms of its own accord. Both the old and new Insurance Department Regulations only allow for the modification of an N-F 10 upon approval of the Insurance Department. See: 11 N.Y.C.R.R. § 65-3.4(c)(11); 11 N.Y.C.R.R. § 65-3.8(c)(1); and former 11 NYCRR § 65.15(c)(3)(x); 11 NYCRR § 65.15 (g)(3)(c); See also: New York University Hospital Rusk Institute v. Hartford Accident Indemnity, 32 AD3d 458, 820 NYS2d 309 (2nd Dept. 2006) Even if the Defendant had received approval for the form it submitted to the Insurance Department in 1992, the evidence submitted at this time demonstrates that the N-F 10 used by the Defendant herein was neither on the allegedly approved form nor on a form which had ever been submitted to the Insurance Department for approval.
The above notwithstanding, whether the Defendant obtained approval for the N-F 10 form it served upon the Plaintiff or not, it appears that the Defendant improperly used that form in an effort to effectuate a complete denial of the Plaintiff's claims in this matter. The Defendant's use of this form to deny the Plaintiff's claims violated the Insurance Department Regulations as they existed in 1992 and as they existed at the time the Defendant's N-F 10 was issued.
At the time the Defendant's N-F 10 was served upon the Plaintiff, the revised Regulation 68, at 11 N.Y.C.R.R. § 65-4.4(c) provided, in pertinent part: "Attached is an appendix (13, infra) which includes the following prescribed claim forms that must be used by all insurers, and shall not be altered unless approved by the superintendent: (11) Denial of Claim Form (NYS N-F 10)[.]" Using virtually the same language quoted by Mr. Pressler in his affidavit, 11 N.Y.C.R.R. § 65-3.8(c)(1) provides:
If the insurer denies a claim in whole or in part involving elements of basic economic loss or extended economic loss, the insurer shall notify the applicant or the authorized representative on the prescribed denial of claim form, in duplicate, and shall furnish, if requested by the applicant, one copy of all prescribed claim forms submitted by or on behalf of the applicant thereto. However, where a denial involves a portion of a health provider's bill, the insurer may make such denial on a form or letter approved by the department which is issued in duplicate. No form or letter shall be approved unless it contains substantially the same information as the prescribed form which is relevant to the claim denied. Assuming, for the sake of argument, proper approval of the Defendant's N-F 10, the propriety of the Defendant's use of this N-F 10 in this matter must rise or fall on the intent and application of these regulations, which are in derogation of the common law and must be strictly construed. Presbyterian Hospital in the City of New York v. Maryland Casualty Co., 226 AD2d 613, 641 NYS2d 395 (2nd Dept.1996) aff'd 90 NY2d 274, 683 NE2d 1 (1997); Presbyterian Hospital in the City of New York v. Aetna Casualty Surety Company, 233 AD2d 431, 650 NYS2d 255 (2nd Dept.1996); Bennett v. State Farm Insurance Co., 147 AD2d 779, 537 NYS2d 650 (3rd Dept.1989)
"The intention of the Legislature is first to be sought from a literal reading of the act itself[.]" Statutes § 92; See also: DaimlerChrysler Corp. v. Spitzer , 7 NY3d 653 , 627 NYS2d 88 (2006); State v. Patricia II, 6 NY3d 160, 811 NYS2d 289 (2006); In re M.B., 6 NY3d 437, 813 NYS2d 349 (2006). "[W]here the statutory language is clear and unambiguous, the court should construe it so as to give effect to the plain meaning of the words used (citations omitted)." Patrolmen's Benevolent Association of City of New York v. City of New York, 41 NY2d 205, 391 NYS2d 544 (1976); See also: Tall Trees Construction Corporation v. Zoning Board of Appeals of Town of Huntington, 97 NY2d 86, 735 NYS2d 873 (2001) People v. Garson , 6 NY3d 604 , 815 NYS2d 887 (2006) A statute must be construed as a whole; and, its various provisions must be considered together, with reference to each other. Statutes § 97; Friedman v. Connecticut General Life Insurance Company, 9 NY3d 105, __ NYS2d __ (2007); Charter Development Co., L.L.C. v. City of Buffalo , 6 NY3d 578 , 815 NYS2d 13 (2006); In Matter of Notre Dame Leasing, LLC v. Rosario , 2 NY3d 459 , 779 NYS2d 801 (2004) Every part of a statute is to be given meaning and effect; Statutes § 98; Heard v. Cuomo, 80 NY2d 684, 594 NYS2d 675 (1993); Matter of Yolanda D., 88 NY2d 790, 651 NYS2d 1 (1996) and any interpretation of one part which deprives meaning and effect to another is to be avoided. People v. Mobil Oil Corporation, 48 NY2d 192, 422 NYS2d 33 (1979) Roballo v. Smith, 63 NY2d 485, 483 NYS2d 178 (1984); People v. Jeanty, 94 NY2d 507, 706 NYS2d 683 (2000) "Words are not to be rejected as superfluous where it is practicable to give each a distinct and separate meaning (citations omitted)." Cohen v. Lord, Day Lord, 75 NY2d 95, 551 NYS2d 157 (1989); Rosner v. Metropolitan Property and Liability Insurance Company, 96 NY2d 475, 729 NYS2d 658 (2001); Leader v. Maroney, Ponzini Spencer, 97 NY2d 95, 736 NYS2d 291 (2001) These well established rules of statutory construction are equally applicable to the construction of regulations. ATM One, LLC v. Landaverde , 2 NY3d 472, 779 NYS2d 808 (2004); East Acupuncture, P.C. v. Allstate Insurance Co. , 15 Misc 3d 104 , 832 NYS2d 737 (App.Term 2nd 11th Dists.2007)
Applying these rules to the effect to be given to 11 N.Y.C.R.R. § 65-4.4(c)(11) and 11 N.Y.C.R.R. § 65-3.8(c)(1), it is clear that modified N-F 10 forms or letters of denial which have been approved by the Insurance Department may only be used "where a denial involves a portion of a health provider's bill[.]" 11 N.Y.C.R.R. § 65-3.8(c)(1) If a health service benefits claim is being denied in full, the prescribed N-F 10 must be used.
As previously indicated, 11 N.Y.C.R.R. § 65-4.4(c) explicitly "prescribed [the] claim forms that must be used by all insurers, [which] shall not be altered unless approved by the superintendent[.]" Consistent with the first part of that subsection, the first sentence of 11 N.Y.C.R.R. § 65-3.8(c)(1) reiterates that any denial issued for all elements of basic economic loss must be made "on the prescribed denial of claim form[.]" This provision clearly does not allow for the use of any form other than the "prescribed form." The natural significance of the words used have a definite meaning; and, the court may not add or subtract words to this sentence. People v. Zimmerman, __ NY2d, __ NYS2d __ (2007); Majewski v. Broadalbin-Perth Central School District, 91 NY2d 577, 673 NYS2d 966 (1998); Matter of Greenberg, 70 NY2d 573, 523 NYS2d 67 (1987) This latter provision clearly does not contain any authorization for use of a modified N-F 10 or letter of denial where a claim is to be denied in full. Nor does this provision authorize the Insurance Department to approve such use. To read this sentence otherwise would render the very next sentence of 11 N.Y.C.R.R. § 65-3.8(c)(1) meaningless.
The next sentence of 11 N.Y.C.R.R. § 65-3.8(c)(1), beginning with the word "However," clearly designates that what follows is an exception to the language which preceded it, and gives effect to that portion of 11 N.Y.C.R.R. § 65-4.4(c) which authorizes the superintendent to approve changes to the prescribed forms. That exception, which would permit the use of a modified N-F 10 or letter of denial approved by the Insurance Department, is specifically limited to situations "where a denial involves a portion of a health provider's bill." 11 N.Y.C.R.R. § 65-3.8(c)(1) This limited exception leaves in tact the sentence which precedes it, mandating the use of the "prescribed denial of claim form" for all other elements of basic economic loss and extended economic loss, including health service benefits which are denied in full. Clearly, if the Regulations intended to allow the use of an approved modified N-F 10 or a letter of denial to deny a health service benefits claim in full, the sentence beginning with "However" would have included such claims within the exception's ambit. Having failed to do so, the only interpretation of the controlling Regulation that can be gleaned from the clear and unequivocal language is that approved modified N-F 10s or letters of denial may only be used for partial denials of health service benefits; and, the Insurance Department does not have any authority to approve the use of modified N-F 10s or letters of denial for any other elements of basic economic loss.
A comparison of cases determining the validity of modified N-F 10 forms or letters of denial confirms this obvious interpretation of the controlling Regulations. In Nyack Hospital v. Metropolitan Property Casualty Insurance Company, 16 AD3d 564, 791 NYS2d 658 (2nd Dept. 2005) the issue before the court was the validity of a modified N-F 10 form which the defendant had used to deny the plaintiff's entire bill for medical services. In finding the use of the modified N-F 10 improper, and in granting the plaintiff summary judgment, the court held, "A proper denial of claim must include the information called for in the prescribed denial of claim form (citations omitted). The denial of claim form issued by the defendant in the case at bar, even if timely, was fatally defective in that it omitted numerous items of requested information, and thus was incomplete (citations omitted)." Nyack Hospital v. State Farm Mutual Automobile Insurance Company, 11 AD3d 664, 784 NYS2d 136 (2nd Dept. 2004) Summit Psychological, P.C. v. General Assurance Company , 9 Misc 3d 8 , 801 NYS2d 117 (App.Term 9th 10th Jud. Dists. 2005) and Spineamericare Medical, P.C. v. U.S. Fidelity Guaranty Company, 12 Misc 3d 138 (A), 824 NYS2d 766 (App.Term 9th 10th Jud. Dists. 2006) are to the same effect. On the other hand, in New York University Hospital Rusk Institute v. Hartford Accident Indemnity, supra . the court was confronted with a partial denial of the plaintiff's claim for medical expenses. The court therein recognized that in such a situation a letter of disclaimer could be used, in lieu of the prescribed form, provided it had been approved by the Insurance Department and issued in duplicate. Summary judgment was nevertheless granted to the plaintiff due to the defendant's failure to satisfy the latter requirements.
As can be seen from the affidavit of Mark Pressler, submitted by the Defendant, the Insurance Department is apparently in agreement with this court's application of the controlling regulations. As previously indicated, Mr. Pressler specifically states that the Mr. Smiragliuolo's letter of February 3, 1992, upon which the Defendant relies, was only "intended to convey the Department's assent to the use of the form in conformity with the provisions of the regulation." ( Pressler Affidavit 11/29/06, ¶ 3) Moreover, Mr. Pressler makes very clear what he means by "conformity with the provisions of the regulation," when he sets forth the Regulation, as it existed at that time, as follows: If the insurer denies a claim in whole or in part involving elements of basic economic loss, or for accidents occurring on and after January 1, 1982 involving elements of extended economic loss, the insurer shall notify the applicant or the authorized representative on the prescribed denial of claim form, in duplicate, and shall furnish, if requested by the applicant, one copy of all prescribed claim forms submitted by or on behalf of the applicant thereto. However, where a denial involves a portion of a health provider's bill, the insurer may make such denial on a form or letter approved by the department which is issued in duplicate. No form or letter shall be approved unless it contains substantially the same information as the prescribed form which is relevant to the claim denied.' (emphasis in original) ( Pressler Affidavit 11/29/06, ¶ 2) As can be seen, the old Regulation, in pertinent part, was identical to the revised Regulation. By underlining the above section, Mr. Pressler, an Assistant Deputy Superintendent and Chief of the
Property Bureau of the New York State Insurance Department, emphasizes that modified N-F 10 forms and letters of denial may only be approved by the Insurance Department and used by an insurer where the "denial involves a portion of a health provider's bill." To employ Mr. Pressler's words, the use of a modified N-F 10 in any other circumstance would not be "in conformity with the provisions of the regulation." ( Pressler Affidavit 11/29/06, ¶ 3)
While the N-F 10 used in the matter before this court bears an "X" mark at item number 2, indicating that "A PORTION OF YOUR CLAIM FOR HEALTH SERVICES IS DENIED AS FOLLOWS[,]" it is clear from the remainder of the Defendant's N-F 10 that this was not a denial of a portion of the Plaintiff's bill, but a complete denial. The Defendant's N-F 10 indicates that the amount of the bill in question was "$879.73," that the amount paid by the Defendant was "$0.00," and that the amount is dispute is "$879.73." While it appears fairly clear that the Defendant's N-F 10 was issued as a complete denial of the Plaintiff's claim, at best, the conflicting entries raise a question of fact.
For each of the reasons stated above, having failed to properly demonstrate the timely service of a proper denial of claim, the Defendant's motion for summary judgment is denied. Under these circumstances, the court need not pass on the validity of the Defendant's defense of lack of medical necessity at this time.
This constitutes the decision and order of this court.
Andrew M. Engel, J.D.C.