Opinion
No. CV–020834–13.
11-10-2014
GREATER FOREST HILLS PHYSICAL THERAPY, PC Assignee of Jacinto Sanchez, Plaintiff(s) v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Defendant(s).
Russell Friedman & Associates, LLP, Lake Success, for Plaintiff. Abrams, Cohen & Associates, New York, for Defendant.
Russell Friedman & Associates, LLP, Lake Success, for Plaintiff.
Abrams, Cohen & Associates, New York, for Defendant.
Opinion
SCOTT FAIRGRIEVE, J.
This is a case of first impression. Should this court follow the holding of the Second Department that claimants are excused from filing claims for no-fault benefits when an insurance company disclaims coverage for no-fault benefits based upon a medical review? In the alternative, should this court follow the opinion of the Office of the General Counsel of the State of New York Insurance Department, which came after the holding of the Second Department, that claimants submitting for no-fault benefits must timely submit claims in order to be eligible for the payments of benefits even after receiving a denial of all future benefits by the insurance carrier?
Motion by State Farm
Defendant State Farm moves for summary judgment on the grounds that since plaintiff Greater Forest Hills did not submit proof of claim for $3,576.83 pursuant to NYCRR 65–1.1, plaintiff cannot recover for physical therapy rendered to its assignor Jacinto Sanchez.
Facts
Plaintiff seeks to recover the sum of $3,576.83 for physical therapy rendered to its assignor Jacinto Sanchez for the period of August 1, 2011 through February 1, 2012. Mr. Sanchez allegedly sustained personal injuries in an automobile accident on November 22, 2010. Plaintiff claims that it properly billed defendant for said service.
Defendant submits the affidavit of Carol Anne Slack, dated March 6, 2014, who is presently a claim representative and has been employed by defendant for over 21 years. Ms. Slack states that defendant never received the bill for $3,576.83 for services rendered August 1, 2011 through February 1, 2012.
Plaintiff submits no proof that it ever sent the bill to State Farm.
Defendant issued the Denial of Claim form dated June 9, 2011, which denied all New York No–Fault benefits effective June 10, 2011, because:
In accordance with the independent medical examination performed by Jacquelin Emmanuel MD on 5/23/11, the injured party is no longer in need of additional Orthopedic treatment; in addition, the cervical and lumbar injuries are resolved and the right shoulder impingement injuries are unrelated to the accident. Therefore, all New York No–Fault benefits pertaining to treatment to the above injuries are denied effective 6/10/11. A copy of this examination is enclosed for your review and a copy of the report is being sent to each party that is carbon copied on the NF10.
Decision
Defendant contends that since plaintiff never submitted the necessary claim form for the services rendered pursuant to NYCRR 65–1.1, plaintiff is barred from pursuing this action.
Plaintiff contends that once defendant repudiated any further responsibility to pay no-fault claims, plaintiff was no longer obligated to submit proof of claim forms to the defendant. Plaintiff cites Matter of State Farm Ins. Co. v. Domotor, 266 A.D.2d 219, 697 N.Y.S.2d 348 (2nd Dept 1999) to support its position. In Matter of State Farm Ins. Co. v. Domotor, State Farm terminated all further no-fault benefits after its medical experts determined that treatment was no longer necessary. The Second Department held that an insurance carrier can no longer insist that no-fault claims for services rendered be timely submitted once its disclaimed coverage:
An insured's failure to provide timely written proof of loss is generally an absolute defense to an action to recover on the policy (see, Igbara Realty Corp. v. New York Prop. Ins. Underwriting Assn ., 63 N.Y.2d 201 ). However, this absolute defense may be waived (see, Igbara Realty Corp. v. New York Prop. Ins. Underwriting Assn ., supra; Treptow v. Exchange Mut. Ins. Co., 106 A.D.2d 767 ). An insurance carrier may not insist upon adherence to the terms of its policy after it has repudiated liability on the claim by sending a letter disclaiming coverage (see, Rajchandra Corp. v. Title Guar. Co., 163 A.D.2d 765, 769 ) for “[o]nce an insurer repudiates liability ... the [in]sured is excused from any of its obligations under the policy” (Ocean–Clear, Inc. v. Continental Cas. Co., 94 A.D.2d 717, 718 ).
Matter of State Farm v. Domotor, supra, was recently cited with approval by the court in State Farm Mut. Auto. Ins. Co. v. Urban, 78 AD3d 1064, 912 N.Y.S.2d 586 (2nd Dept 2010).
In NY Medical Health, P.C. v. New York City Transit Authority, 24 Misc.3d 1219(A), 897 N.Y.S.2d 671, 2009 WL 2058664 (N.Y. City Civ Ct, 2009) the Court followed the rationale of Matter of State Farm v. Domotor, supra, to a situation involving the New York City Transit Authority (self-insurer) which denied liability for no-fault benefits. The Transit Authority denied liability because the accident was caused by the injured party driving a bike into a disabled bus that was standing still, i.e.; in other words, the accident did not arise out of the use or operation of the Transit Authority motor vehicle. The Court upheld the arbitration award to the plaintiff because plaintiff no longer had a duty to submit timely claims to defendant once defendant denied coverage and all liability for no-fault benefits.
Defendant cites the opinion dated September 2, 2004, from the Office of the General Counsel of the State of New York Insurance Department. The opinion disagrees with the holding of Matter of State Farm v. Domotor, supra. The opinion states that the plaintiff must timely submit claims for no-fault benefits even when the insurance carrier has denied all future benefits based upon a medical exam. The opinion states:
Question Presented
After a No–Fault insurer has denied all future benefits for continued treatment by a health provider of an eligible injured person based upon the negative findings of an insurer's medical examination of that person, must the insurer continue to issue denials for claims for continued treatment which are submitted subsequent to the issuance of the denial for all future benefits?
Conclusion
Yes. Pursuant to Section 5106(a) of the Insurance Law and Sections 65–3.8(a)(1) and 65–3.8(c) of Department No–Fault Regulation 68, whenever a No–Fault provider submits a claim for reimbursement to an insurer, the insurer must pay or deny the claim within 30 calendar days after receipt of proof of claim. There is no provision in either the No–Fault statue or regulation which relieves an insurer of the obligation to pay or issue a denial on all claims for benefits submitted. Neither does the statute or regulation relieve an applicant for benefits of their responsibility to submit claims in order to be eligible for the payment of benefits, even after receiving a denial of all future benefits.
Defendant urges this court to follow the said opinion from the State Insurance Department because the Court of Appeals generally gives deference to the opinions of the State Insurance Department; see paragraph 8 of the defendant's reply affirmation, dated October 9, 2014, which states:
The Court of Appeals has generally given deference to the opinions of the regulatory agencies. See State Farm Mutual Automobile Insurance Co. v. Robert Mallela, 4 NY3d 313 (2005) (giving deference to the Insurance Department which had recently promulgated revised No–Fault regulations); New York State Assn. of Life Underwriters, 83 N.Y.2d 353 (1994) ; Gaines v. New York State Division of Housing and Community Renewal, 90 N.Y.2d 545 (1997) ; Rodriguez v. Perales, 86 N.Y.2d 361 (1995) ; Elcor Health Services v. Novello, 100 N.Y.2d 273 (2003) ; Morris v. County Bd. of Assessors, 35 N.Y.2d 624 (1974). This has been true of the Insurance Department specifically. See John Paterno, Inv. v. Curiale, 88 N.Y.2d 328 (1996). Such interpretations are generally accorded great weight by the Courts. See Udall v. Tallman, 380 U.S. 1 (1965) ; Lyng v. Secretary of Agriculture, 476 U.S. 926 (1976) ; Immigration and Naturalization Service v. Stanisic, 395 U.S. 62 (1969) ; State Farm Mutual Automobile Ins. Co v. Levin, 263 A.D.2d 233 (3rd Dept.2000), appeal denied, 95 N.Y.2d 754 ; Allstate Ins. Co. v. Libow, 106 A.D.2d 110 (2nd Dept., 1984).
Although this court is somewhat sympathetic to the position of defendant presented herein, this court is constrained to follow the Second Department that plaintiffs are not obligated to timely submit claims for no-fault benefits once an insurance carrier denies coverage.
Conclusion
This court urges defendant to appeal this decision to have the Second Department review this matter in light of the position of the State Insurance Department.
Thus, the motion for summary judgment is denied. Plaintiff can proceed to press its no-fault claim for services rendered even though it did not timely submit the necessary claim form because this requirement became unnecessary when defendant denied all further coverage for no-fault benefits based upon the independent medical examination of Dr. Jacquelin Emmanuel.
So Ordered.