IN THE FLORIDA SUPREME COURT
GEICO GENERAL INSURANCE COMPANY,
Petitioner,
vs. Case No. SC12-905
VIRTUAL IMAGING SERVICES,
INC., as assignee of Maria Tirado,
Respondent.
_________________________________/
____________________________________________________________________
APPEAL ON CERTIFIED QUESTION
____________________________________________________________________
____________________________________________________________________
ST PETE MRI'S AMICUS CURIAE BRIEF
IN SUPPORT OF RESPONDENT
____________________________________________________________________
David M. Caldevilla and Michael R. Bray, de la Parte & Gilbert, P.A.,
Post Office Box 2350, Tampa, FL 33601-2350, Telephone: (813) 229-2775
Craig E. Rothburd, Craig E. Rothburd, P.A.,
800 W. De Leon Street, Tampa, FL 33606-2722, Telephone: (813) 251-8800
Scott R. Jeeves, The Jeeves Law Group, P.A.,
954 First Avenue North, St. Petersburg, FL 33705, Telephone: (727) 894-2929
Lorca J. Divale, The Divale Law Group, P.A.,
P.O. Box 22347 St. Petersburg, FL 33742, Telephone: (727) 321-5646
COUNSEL FOR ST. PETE MRI
ii
TABLE OF CONTENTS
Page
TABLE OF AUTHORITIES ................................................................................. iii
STATEMENT OF AMICUS CURIAE'S IDENTITY AND INTEREST ................. 1
SUMMARY OF THE ARGUMENT ..................................................................... 7
I. STANDARD OF REVIEW .......................................................................... 7
II. GEICO'S PIP INSURANCE POLICY EXPRESSLY PROMISES TO
PAY THE "REASONABLE" AMOUNT AND NEVER MENTIONS THE
NEW FEE SCHEDULE METHOD OF §627.736(5)(A)2-5 ............................... 7
III. THE 2012 AMENDMENTS CONFIRM THAT GEICO IS
UNLAWFULLY RELYING ON THE FEE SCHEDULE METHOD ...............17
IV. THE FEE SCHEDULE CASES ARE CORRECT AND GEICO IS
BLATANTLY BREACHING THE EXPRESS PROVISIONS OF ITS OWN
PIP INSURANCE POLICY ..............................................................................19
CONCLUSION ....................................................................................................20
CERTIFICATE OF SERVICE ..............................................................................21
CERTIFICATE OF COMPLIANCE ....................................................................22
iii
TABLE OF AUTHORITIES
Page
Cases
Advanced 3-D Diagnostics, a.a.o. Francois v. Liberty Mutual Ins. Co.,
18 Fla.L. Weekly 522a (Orange County Ct. 2011) ............................................ 2
AFO Imaging Inc. v. Peak Prop.& Cas. Ins. Corp.,
17 FLW Supp. 368a, ¶18 (Fla.13th Cir. Ct. Jan. 25, 2010) ...............................12
All Family Clinic of Daytona Beach, Inc. v. State Farm Mutual Auto. Ins. Co.,
685 F.Supp.2d 1297 (S.D. Fla.2010)................................................................12
Allstate Ins. Co v. Holy Cross Hosp., Inc.,
961 So.2d 328 (Fla.2007) .................................................................................20
American Independent Ins. Co. v. Gables Ins. Recovery, a.a.o. Lima,
19 Fla.L. Weekly Supp. 14b (Fla.11th Cir. Ct. App. Div. 2011) ....................... 2
American Risk Assur. Co. v. Benrube,
407 So.2d 993 (Fla.3d DCA 1981) .................................................................... 9
Atkins v. Allstate Ins. Co.,
382 So.2d 1276 (Fla.3d DCA 1980) .................................................................. 9
Bayfront Medical Center, a.a.o. Compas v. Esurance Ins. Co.,
17 Fla.L. Weekly Supp. 1228a (Pinellas County Ct. 2010) ............................... 2
City of Hollywood v. Lombardi,
770 So.2d 1196 (Fla.2000) ...............................................................................19
DCI MRI, Inc v. Geico Indem. Co.,
79 So.3d 840 (Fla.4th DCA 2012) ................................................................ 2, 15
Dorsal Rehab, Inc., a.a.o. Lopez v. State Farm Fire & Cas. Co.,
17 Fla.L. Weekly Supp. 1259b (Broward County Ct. 2010) ............................. 2
Explorer Ins. Co. v. Physicians Group, LLC,
iv
16 Fla.L. Weekly Supp. 317a (Fla.13th Jud. Cir. Ct., 2009) ........................... 2, 9
Gables Ins. Recovery, Inc., a.a.o. Gonzalez v. Mercury Ins. Co. of Florida,
18 Fla.L. Weekly Supp. 1038a (Broward County Ct. 2011) .............................. 2
Gary H. DiBlasio, M.D., P.A., v. Progressive American Ins. Co.,
13 Fla.L. Weekly Supp. 625a (Fla.15th Cir. Cty. Ct. 2006) .............................. 9
Geico Gen. Ins. Co. v. Virtual Imaging Services, Inc.,
90 So.3d 321 (Fla.3rd DCA 2012) ................................................................ 2, 15
Geico Indem. Co. v. Physicians Group, LLC,
47 So.3d 354 (Fla.2d DCA 2010) ...................................................................... 3
Geico Indem. Co. v. Virtual Imaging Services, Inc.,
79 So.3d 55 (Fla.3d DCA 2011) ................................................................... 2, 15
Health Diagnostics of Miami, LLC, a.a.o. Gelpi v. United Auto. Ins. Co.,
18 Fla.L. Weekly 1055a (Broward County Ct. 2011) ........................................ 2
High Definition Mobile MRI, Inc. v. State Farm Mut. Auto. Ins. Co.,
18 Fla.Law Weekly Supp. 102b (Broward County Ct. 2010) ............................ 2
Imaging Center of West Palm Beach, LLC, a.a.o. Guerrero v. Government
Employees Ins. Co.,
18 Fla.L. Weekly Supp. 907a (Palm Beach County Ct. 2011)........................... 2
Ivey v. Allstate Ins. Co.,
774 So.2d 679, 683-684 (Fla.2000) ................................................................... 6
Kingsway Amigo Ins. Co. v. Ocean Health, Inc.,
63 So.3d 63 (Fla.4th DCA 2011) ............................................................ 2, 15, 17
Lake Worth Therapy Center, Inc., a.a.o. Spann v. Security National Ins. Co.,
19 Fla.L. Weekly Supp. 373b (Broward County Ct. 2011) ............................... 2
McGowan Spinal Rehab. Center, P.A. a/a/o Cannon v. Progressive Express Ins.
Co.,
v
15 Fla.L. Weekly Supp. 713a (Fla.4th Jud. Cir. Cnty. Ct. 2008) ....................... 9
Millennium Diagnostic Imaging Center, Inc. v. Security National Ins. Co.,
882 So.2d 1027 (Fla.3d DCA 2004) .................................................................12
Millennium Radiology, LLC v. U.S. Security Ins. Co.,
17 Fla.L. Weekly Supp. 1037a (Broward County Ct. 2010) ............................... 2
Mitchell R. Pollack, M.D., a/a/o Holland v. Progressive American Ins. Co.,
13 Fla.L. Weekly Supp. 381 (Broward County, Cnty. Ct. 2006) ....................... 9
MRI Assoc. of St. Pete, Inc. v. State Farm Mut. Auto. Ins. Co.,
755 F.Supp.2d 1205 (M.D. Fla.2010) ..............................................................15
MRI Associates of St. Pete, a.a.o. Volpe v. Safeco Ins.Co. of Illinois,
17 Fla.L. Weekly Supp. 686a (Hillsborough County Ct. 2010) .................. 2, 7, 9
MRI Associates of St. Pete, Inc. v. Dairyland Ins. Co.,
U.S. Dist. Ct., M.D. Fla. Case No. 8:11-cv-665-EAK-MAP ........................ 1, 15
MRI Associates of St. Pete, Inc. v. Direct General Ins. Co.,
U.S. Dist. Ct., M.D. Fla.Case No. 8:12-cv-02408-MSS-AEP ........................... 1
MRI Associates of St. Pete, Inc. v. Esurance Ins. Co.,
Hillsborough County Cir. Ct. Case No. 10-CA-003923 ..................................... 1
MRI Associates of St. Pete, Inc. v. First Acceptance Ins. Co.,
Hillsborough County Circuit Court Case No. 10-CA-003919 ............................ 1
MRI Associates of St. Pete, Inc. v. First Floridian Auto & Home Ins. Co.,
Hillsborough County Cir. Ct. Case No. 10-CA-013131 ..................................... 1
MRI Associates of St. Pete, Inc. v. Geico Indem. Co.,
Hillsborough County Cir. Ct. Case No. 10-CA-003935 ..................................... 1
MRI Associates of St. Pete, Inc. v. Mercury Ins. Co. of Florida,
Hillsborough County Cir. Ct. Case No. 08-CA-027873 ..................................... 1
vi
MRI Associates of St. Pete, Inc. v. Metropolitan Casualty Ins. Co.,
Hillsborough County Cir. Ct. Case No. 10-CA-003921 ..................................... 1
MRI Associates of St. Pete, Inc. v. Nationwide Mut. Fire Ins. Co.,
Hillsborough County Cir. Ct. Case No. 09-CA-025723 ..................................... 1
MRI Associates of St. Pete, Inc. v. USAA Cas. Ins. Co.,
Hillsborough County Cir. Ct. Case No. 10-CA-016785 ..................................... 1
MRI Assocs. of Am., LLC v. State Farm Fire & Cas. Co.,
61 So.3d 462 (Fla.4th DCA 2011) ....................................................................17
MRI Services I, LLC v. State Farm Fire & Cas. Co.,
17 Fla.L. Weekly Supp. 1039a (Broward County Ct. 2010) .............................. 2
National Nuclear Center, Inc., a.a.o. Lamothe v. State Farm Mut. Auto. Ins. Co.,
17 Fla.L. Weekly Supp. 1124b (Broward County Ct. 2010) ............................. 2
Nationwide Mut. Fire Ins. Co. v. AFO Imaging, Inc.,
71 So.3d 134 (Fla.2d DCA 2011) ................................................................. 4, 15
Personal Injury Clinic a.a.o. Montero v. Mercury Ins. Co. of Fla.,
17 Fla.L. Weekly Supp. 470a (Miami-Dade County Ct., 2010) ......................... 2
Personal Injury Clinic a/a/o Simo v. United Auto. Ins. Co.,
Slip. Op. Case No. 10-3946-SP-21 (Miami-Dade County, Cnty. Ct. Feb. 10,
2011) .................................................................................................................. 9
Physicians Group a/a/o Buckner v. Progressive Select Ins. Co.,
16 Fla.L. Weekly Supp. 961a (Fla.12th Jud. Cir. Cty. Ct. 2009) ....................... 9
Professional Consulting Services, Inc. v. Hartford Life & Accident Ins. Co.,
849 So.2d 446 (Fla. 2d DCA 2003) ..................................................................14
Progressive Auto Pro Ins. Co. v. Doctor's Pain Management Assoc.,
14 Fla.L. Weekly Supp. 1010a (Fla.9th Jud. Cir. Appellate Div. 2007) ............ 9
Ronald J. Trapana, M.D., P.A., a.a.o. Saint Rose v. United Auto. Ins. Co.,
vii
18 Fla.L. Weekly 551a (Miami-Dade County Ct. March 16, 2011) .................. 2
SOCC, PL v. State Farm Mut. Auto. Ins. Co.,
95 So.3d 903 (Fla. 5th DCA 2012) ...................................................................15
State Farm Florida Ins. Co. v. Nichols,
21 So.3d 904 (Fla.5th DCA 2009) ....................................................................20
Sturgis v. Fortune Ins. Co.,
475 So.2d 1272 (Fla.2d DCA 1985) .................................................................20
Universal Underwriters Ins. Co. v. Morrison,
574 So.2d 1063 (Fla.1990) ...............................................................................20
USAA Casualty Ins. Co. v. DPI of North Broward, LLC, a.a.o. Negrette,
19 Fla.L. Weekly Supp. 925a (Fla.17th Jud. Cir. Ct. App. Div. 2012) .............. 2
USAA Casualty Ins. Co. v. Millenium Radiology, LLC, a.a.o. Keiter,
19 Fla.L. Weekly Supp. 928a (Fla.17th Jud. Cir. Ct. App. Div. 2012) .............. 2
Wright v. Auto-Owners Ins. Co.,
739 So.2d 180 (Fla.2d DCA 1999) ...................................................................20
Statutes
§ 627.733, Fla. Stat. ............................................................................................... 8
§ 627.736(1)(a), Fla. Stat. ............................................................................... 13, 15
§ 627.736(5)(a), Fla. Stat. ............................................................................. 2, 9, 14
§ 627.736(5)(a)1, Fla. Stat. ..................................................................... 4, 9, 13, 15
§ 627.736(5)(a)2, Fla. Stat. ............................................................................ passim
§ 627.736(5)(a)3, Fla. Stat. ............................................................................. 12, 15
§ 627.736(5)(a)4, Fla. Stat. ...................................................................................15
viii
§ 627.736(5)(a)5, Fla. Stat. ................................................................. 15, 16, 18, 19
§ 627.736(5)(b)1, Fla. Stat. .................................................................................... 6
§ 627.736(5)(c)1, Fla. Stat. .................................................................................... 6
§ 627.736, Fla. Stat. ....................................................................................... passim
Ch. 2001-271, Laws of Fla. .................................................................................... 6
Ch. 2001-63, Laws of Fla. ...................................................................................... 6
Ch. 2002-387, Laws of Fla. .................................................................................... 6
Ch. 2003-2, Laws of Fla......................................................................................... 6
Ch. 2003-261, Laws of Fla. .................................................................................... 6
Ch. 2003-411, Laws of Fla. ............................................................................... 6, 10
Ch. 2004-5, Laws of Fla......................................................................................... 6
Ch. 2005-2, Laws of Fla......................................................................................... 6
Ch. 2005-3, Laws of Fla......................................................................................... 6
Ch. 2006-197, Laws of Fla. .................................................................................... 6
Ch. 2006-290, Laws of Fla. .................................................................................... 6
Ch. 2006-305, Laws of Fla. .................................................................................... 6
Ch. 2007-150, Laws of Fla. .................................................................................... 6
Ch. 2007-324, Laws of Fla. ............................................................................... 6, 10
Ch. 2008-220, Laws of Fla. ............................................................................... 6, 12
ix
Ch. 2008-4, Laws of Fla......................................................................................... 6
Ch. 2009-21, Laws of Fla. ...................................................................................... 6
Ch. 2012-197, Laws of Fla. ............................................................................... 6, 18
Ch. 76-168, Laws of Fla......................................................................................... 6
Ch. 76-266, Laws of Fla......................................................................................... 6
Ch. 77-457, Laws of Fla......................................................................................... 6
Ch. 77-468, Laws of Fla......................................................................................... 6
Ch. 78-374, Laws of Fla......................................................................................... 6
Ch. 79-164, Laws of Fla......................................................................................... 6
Ch. 79-40, Laws of Fla. ......................................................................................... 6
Ch. 79-400, Laws of Fla......................................................................................... 6
Ch. 80-206, Laws of Fla......................................................................................... 6
Ch. 81-259, Laws of Fla......................................................................................... 6
Ch. 81-318, Laws of Fla......................................................................................... 6
Ch. 82-243, Laws of Fla......................................................................................... 6
Ch. 82-386, Laws of Fla......................................................................................... 6
Ch. 85-320, Laws of Fla......................................................................................... 6
Ch. 86-182, Laws of Fla......................................................................................... 6
Ch. 87-226, Laws of Fla......................................................................................... 6
x
Ch. 87-282, Laws of Fla......................................................................................... 6
Ch. 88-370, Laws of Fla......................................................................................... 6
Ch. 89-243, Laws of Fla......................................................................................... 6
Ch. 89-282, Laws of Fla......................................................................................... 6
Ch. 89-313, Laws of Fla......................................................................................... 6
Ch. 90-119, Laws of Fla......................................................................................... 6
Ch. 90-232, Laws of Fla......................................................................................... 6
Ch. 90-248, Laws of Fla......................................................................................... 6
Ch. 90-295, Laws of Fla......................................................................................... 6
Ch. 91-106, Laws of Fla......................................................................................... 6
Ch. 91-110, Laws of Fla......................................................................................... 6
Ch. 91-128, Laws of Fla......................................................................................... 6
Ch. 91-224, Laws of Fla......................................................................................... 6
Ch. 92-318, Laws of Fla......................................................................................... 6
Ch. 93-120, Laws of Fla......................................................................................... 6
Ch. 93-289, Laws of Fla......................................................................................... 6
Ch. 94-123, Laws of Fla......................................................................................... 6
Ch. 95-202, Laws of Fla......................................................................................... 6
Ch. 95-211, Laws of Fla......................................................................................... 6
xi
Ch. 96-406, Laws of Fla......................................................................................... 6
Ch. 97-102, Laws of Fla......................................................................................... 6
Ch. 97-84, Laws of Fla. ......................................................................................... 6
Ch. 98-223, Laws of Fla......................................................................................... 6
Ch. 98-270, Laws of Fla......................................................................................... 6
Ch. 99-248, Laws of Fla......................................................................................... 6
Ch. 99-3, Laws of Fla. ........................................................................................... 6
Ch. 99-381, Laws of Fla......................................................................................... 6
Ch. 99-8, Laws of Fla. ........................................................................................... 6
Other Authorities
"Injuries in Auto Crashes," available at www.dmvflorida.org/2004-crash-
data.shtml. .......................................................................................................... 4
David Dietz and Darrell Preston, "Home Insurers' Secret Tactics Cheat Fire
Victims, Hike Profits,"
Bloomberg (August 3, 2007), available at
www.bloomberg.com/apps/news?pid=newsarchive &sid=aIOpZROwhvNI ....... 5
Matthew Morriset, "Private Auto Insurance is the Biggest Source of Industry
Profits,"
Online Auto Insurance News (Dec. 7, 2011), available at
http://news.onlineautoinsurance.com/ companies/private-car-insurance-profits-
report-95713 ....................................................................................................... 5
Mollie Reilly and Max J. Rosenthal, "Insurance Claim Delays Deliver Massive
Profits to Industry by Shorting Customers,"
Huffington Post (Dec. 13, 2011), available at
www.huffingtonpost.com/2011/12/13/insurance-claim-delays-industry-profits-
xii
allstate-mckinsey-company_n_1139102.html ..................................................... 5
Stephen Gandel, "Geico's Profits Plunged in 2011,"
CNN Money (Feb. 25, 2012), available at http://finance.
fortune.cnn.com/2012/02/25/geico-berkshire-hathaway/ .................................... 5
1
STATEMENT OF AMICUS CURIAE'S IDENTITY AND INTEREST
Amicus Curiae MRI Associates of St. Pete, Inc. ("St. Pete MRI") provides
health care to Floridians injured in auto accidents. St. Pete MRI has filed numerous
class action lawsuits1 on behalf of thousands of Florida health care providers,
against Geico and other insurance companies that provide personal injury
protection ("PIP") coverage in Florida, concerning the same legal issue in this
appeal (i.e., whether an insurer can expressly promise in its insurance policy to pay
PIP claims based on the "reasonable" amount of a health care provider's charges,
but then pay a much lower amount based exclusively on a fee schedule method not
mentioned in the policy).
There are many published cases showing that since 2008, Geico and some
(but not all) other PIP insurers have routinely underpaid PIP claims using the new
1 St. Pete MRI's pending class action lawsuits include: MRI Assoc. of St. Pete, Inc.
v. Dairyland Ins. Co., U.S. Dist. Ct., M.D. Fla. Case No. 8:11-cv-665-EAK-MAP;
MRI Assoc. of St. Pete, Inc. v. Mercury Ins. Co. of Florida, Hillsborough County
Cir. Ct. Case No. 08-CA-027873; MRI Assoc. of St. Pete, Inc. v. Nationwide Mut.
Fire Ins. Co., Hillsborough County Cir. Ct. Case No. 09-CA-025723; MRI Assoc.
of St. Pete, Inc. v. First Acceptance Ins. Co., Hillsborough County Circuit Court
Case No. 10-CA-003919; MRI Assoc. of St. Pete, Inc. v. Metropolitan Cas. Ins.
Co., Hillsborough County Cir. Ct. Case No. 10-CA-003921; MRI Assoc. of St.
Pete, Inc. v. Esurance Ins. Co., Hillsborough County Cir. Ct. Case No. 10-CA-
003923; MRI Assoc. of St. Pete, Inc. v. Geico Indem. Co., Hillsborough County
Cir. Ct. Case No. 10-CA-003935; MRI Assoc. of St. Pete, Inc. v. First Floridian
Auto & Home Ins. Co., Hillsborough County Cir. Ct. Case No. 10-CA-013131;
MRI Assoc. of St. Pete, Inc. v. USAA Cas. Ins. Co., Hillsborough County Cir. Ct.
Case No. 10-CA-016785; and MRI Assoc. of St. Pete, Inc. v. Direct General Ins.
Co., U.S. Dist. Ct., M.D. Fla.Case No. 8:12-cv-02408-MSS-AEP.
2
fee schedule method of Section 627.736(5)(a)2-5, Florida Statutes (2008-2011),
without mentioning it in their policies.2 In these cases, the defendant PIP insurers
2 See, e.g., Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So.3d 63 (Fla.4th
DCA 2011), rev. den., 86 So.3d 1113 (Fla. 2012); DCI MRI, Inc v. Geico Indem.
Co., 79 So.3d 840 (Fla.4th DCA 2012); Geico Indem. Co. v. Virtual Imaging
Services, Inc., 79 So.3d 55 (Fla.3d DCA 2011) ("Virtual I"); Geico Gen. Ins. Co.
v. Virtual Imaging Services, Inc., 90 So.3d 321 (Fla.3rd DCA 2012) ("Virtual II");
USAA Cas. Ins. Co. v. Millenium Radiology, LLC, a.a.o. Keiter, 19 Fla.L. Weekly
Supp. 928a (Fla.17th Jud. Cir. Ct. App. Div. 2012); USAA Cas. Ins. Co. v. DPI of
North Broward, LLC, a.a.o. Negrette, 19 Fla.L. Weekly Supp. 925a (Fla.17th Jud.
Cir. Ct. App. Div. 2012); American Ind. Ins. Co. v. Gables Ins. Recovery, a.a.o.
Lima, 19 Fla.L. Weekly Supp. 14b (Fla.11th Cir. Ct. App. Div. 2011); Explorer
Ins. Co. v. Physicians Group, LLC, 16 Fla.L. Weekly Supp. 317a (Fla.13th Jud.
Cir. Ct., 2009); Personal Injury Clinic a.a.o. Montero v. Mercury Ins. Co. of Fla.,
17 Fla.L. Weekly Supp. 470a (Miami-Dade County Ct., 2010); MRI Assoc. of St.
Pete, a.a.o. Volpe v. Safeco Ins.Co. of Illinois, 17 Fla.L. Weekly Supp. 686a
(Hillsborough County Ct. 2010); Natl. Nuclear Center, Inc., a.a.o. Lamothe v.
State Farm Mut. Auto. Ins. Co., 17 Fla.L. Weekly Supp. 1124b (Broward County
Ct. 2010); Millennium Radiology, LLC v. U.S. Sec. Ins. Co., 17 Fla.L. Weekly
Supp. 1037a (Broward County Ct. 2010); MRI Services I, LLC v. State Farm Fire
& Cas. Co., 17 Fla.L. Weekly Supp. 1039a (Broward County Ct. 2010); Bayfront
Medical Center, a.a.o. Compas v. Esurance Ins. Co., 17 Fla.L. Weekly Supp.
1228a (Pinellas County Ct. 2010); Dorsal Rehab, Inc., a.a.o. Lopez v. State Farm
Fire & Cas. Co., 17 Fla.L. Weekly Supp. 1259b (Broward County Ct. 2010); High
Def. Mobile MRI, Inc. v. State Farm Mut. Auto. Ins. Co., 18 Fla.Law Weekly
Supp. 102b (Broward County Ct. 2010); Advanced 3-D Diagnostics, a.a.o.
Francois v. Liberty Mut. Ins. Co., 18 Fla.L. Weekly 522a (Orange County Ct.
2011); Ronald J. Trapana, M.D., P.A., a.a.o. Saint Rose v. United Auto. Ins. Co.,
18 Fla.L. Weekly 551a (Miami-Dade County Ct. March 16, 2011); Health
Diagnostics of Miami, LLC, a.a.o. Gelpi v. United Auto. Ins. Co., 18 Fla.L.
Weekly 1055a (Broward County Ct. 2011); Gables Ins. Recovery, Inc., a.a.o.
Gonzalez v. Mercury Ins. Co. of Florida, 18 Fla.L. Weekly Supp. 1038a (Broward
County Ct. 2011); Imaging Center of West Palm Beach, LLC, a.a.o. Guerrero v.
Government Employees Ins. Co., 18 Fla.L. Weekly Supp. 907a (Palm Beach
County Ct. 2011); Lake Worth Therapy Center, Inc., a.a.o. Spann v. Security
National Ins. Co., 19 Fla.L. Weekly Supp. 373b (Broward County Ct. 2011).
3
typically stipulate that the plaintiff health care provider's charges are "reasonable"
and that the only remaining issue is whether the PIP insurer was authorized to rely
on the new fee schedule method, without mentioning that in its insurance policy.
Likewise, in the case at bar, Geico did not dispute that the plaintiff health care
provider's $3,600 charge is reasonable, but instead of paying that reasonable charge
as promised in the insured patient's PIP policy, Geico unilaterally relied on the new
fee schedule method (which is not mentioned in that policy) to pay merely
$1,989.57. In Geico Indem. Co. v. Physicians Group, LLC, 47 So.3d 354 (Fla.2d
DCA 2010), Geico relied on the fee schedule method to pay merely $1,122.86 for a
surgical procedure, where the physician's usual and customary charge was $13,500,
and Geico agreed to pay based on that $13,500 charge if the court ruled that the fee
schedule method could not be used. In other words, fraud and billing abuses by the
plaintiff health care providers are not involved in any of these cases.3
Nonetheless, the gross disparity between the reasonable amount charged and
the much lower amount that Geico paid demonstrates that the legal issue in this
case means millions (if not billions) of dollars to the insurance industry, Florida
health care providers, and Florida drivers. About 200,000 Floridians are injured
3 If insurers would simply pay the level of benefits expressly promised in their PIP
policies and required by statutes, there would be little, if any, PIP litigation.
Instead, they throw stones from glass houses, by arguing (without evidence) they
are being defrauded by doctors, when in reality, the insurance industry is probably
one of the most significant perpetrators of fraud and bad faith ever known.
4
each year in auto accidents. See, "Injuries in Auto Crashes," www.dmvflorida.org/
2004-crash-data.shtml. When the above-described underpayments are multiplied
by the number of people injured since the January 1, 2008 effective date of the new
fee schedule method and the number of different medical treatments involved, it is
apparent that PIP insurers are reaping windfall profits to the detriment Florida
health care providers, who in good faith render medical services to insured patients
with the reasonable expectation of receiving payment without unlawful reductions,
and to the determent of Florida drivers, who pay insurance premiums for the
maximum level of PIP benefits based on the reasonable amount method expressly
described in their insurance policies, instead of the "minimum amount" of PIP
benefits provided under the fee schedule method4 relied upon, sub silentio, by
Geico and other insurers, who promise one thing but deliver another.
Among all businesses in our country, the insurance industry stands out as
one which appears to have a "business model" of systematically breaching its own
contracts. Charging premiums for seemingly high benefits, while denying or
underpaying legitimate claims, is highly profitable.5 Not surprisingly, auto
4 Under the PIP statute, the "reasonable" amount is the maximum amount payable.
See, §627.736(5)(a)1, Fla. Stat. In sharp contrast, in Nationwide Mut. Fire Ins. Co.
v. AFO Imaging, Inc., 71 So.3d 134, 137 (Fla.2d DCA 2011), the court explained
that the fee schedule method is "utilized in computing the minimum amount"
payable by PIP insurance. (Emph. added).
5 See, e.g., David Dietz and Darrell Preston, "Home Insurers' Secret Tactics Cheat
5
insurance provides the largest source of profits to insurers.6 In 2011, even after
dropping 48% from the previous year, Geico still reported huge profits of $587
million.7 Because of the huge dollars at stake, this case and others like it illustrate
that PIP insurers will continue denying and underpaying legitimate claims.8
While PIP insurers are reaping windfall profits by breaching their own
insurance policies, health care providers are being whipsawed. With the
proliferation of unbridled regulation, managed care, governmental payers, and the
ever-growing number of uninsured patients, health care providers have seen their
operating expenses grow while their payment for services shrink. The situation is
worse when health care services are rendered to a PIP insured. When Florida's no-
Fire Victims, Hike Profits," Bloomberg (August 3, 2007), www.bloomberg.com/
apps/news?pid=newsarchive &sid=aIOpZROwhvNI; Mollie Reilly and Max J.
Rosenthal, "Insurance Claim Delays Deliver Massive Profits to Industry by
Shorting Customers," Huffington Post (Dec. 13, 2011),
www.huffingtonpost.com/2011/12/13/insurance-claim-delays-industry-profits-
allstate-mckinsey-company_n_1139102.html.
6 See, Matthew Morriset, "Private Auto Insurance is the Biggest Source of Industry
Profits," Online Auto Insurance News (Dec. 7, 2011), http://news.
onlineautoinsurance.com/ companies/private-car-insurance-profits-report-95713.
7 Stephen Gandel, "Geico's Profits Plunged in 2011," CNN Money (Feb. 25, 2012),
http://finance. fortune.cnn.com/2012/02/25/geico-berkshire-hathaway/.
8 In Florida alone, a simple Westlaw search reveals over 450 published appellate
decisions since 2008 involving lawsuits concerning alleged breaches of insurance
policies, and a similar search of the Florida Law Weekly Supplement yields over
135 more published cases for the same timeframe. Of course, only a small
percentage of the overall number of lawsuits filed result in published decisions.
6
fault scheme was first adopted in 1971, its purpose was to provide swift and
virtually automatic payment for health care provided to an insured patient. See,
e.g., Ivey v. Allstate Ins. Co., 774 So.2d 679, 683-684 (Fla.2000). However, since
1971, the PIP statutes have been amended by 62 different session laws9 and have
evolved into a complex quagmire of traps, hurdles, and loopholes that PIP insurers
manipulate to their benefit and to the detriment of health care providers who
simply want to get paid for services rendered in good faith to insured patients.
When health care providers do not comply with some of the PIP statute's hyper-
technical requirements, their right to payment can be completely forfeited. See,
e.g., §627.736 (5)(b)1.d & (5)(c)1, Fla.Stat. Now, under the new fee schedule
method, when health care providers do receive payment, the amount is a small
portion of that payable under the reasonable amount method.
PIP insureds are also being whipsawed. First, they are being charged
premiums calculated based on the maximum level of PIP benefits available under
the reasonable amount method promised in their PIP policies, but the PIP insurers
are actually paying out much lower benefits under the fee schedule method not
9 See, Chs. 76-168, 76-266, 77-457, 77-468, 78-374, 79-40, 79-164, 79-400, 80-
206, 81-259, 81-318, 82-243, 82-386, 85-320, 86-182, 87-226, 87-282, 88-370, 89-
243, 89-282, 89-313, 90-119, 90-232, 90-248, 90-295, 91-106, 91-110, 91-128, 91-
224, 92-318, 93-120, 93-289, 94-123, 95-202, 95-211, 96-406, 97-84, 97-102, 98-
223, 98-270, 99-3, 99-8, 99-248, 99-381, 2001-63, 2001-271, 2002-387, 2003-2,
2003-261, 2003-411, 2004-5, 2005-2, 2005-3, 2006-197, 2006-290, 2006-305,
2007-150, 2007-324, 2008-4, 2008-220, 2009-21, 2012-197, Laws of Florida.
7
mentioned in the policies. Second, the PIP insurers' practice of expressly promising
to use the reasonable amount method in their policies, while they sub silentio apply
the fee schedule method, leaves PIP insureds potentially liable for the unpaid
balance of medical bills not covered by their PIP insurers. In the end, the PIP
insurers' much lower payments under the fee schedule method will ultimately
diminish the array and quality of health care providers who will agree to treat
patients with PIP coverage. See, Volpe, 17 Fla.L. Weekly Supp. 686a at ¶10.
SUMMARY OF THE ARGUMENT
PIP insurers must abide by the promises made in their own PIP policies, and
cannot unilaterally change the maximum level of PIP benefits for which policy
holders bargained when they initially purchased and/or renewed their PIP policies
and paid the premiums based on that maximum level of benefits.
I. STANDARD OF REVIEW
St. Pete MRI agrees that the Third District's interpretation of the PIP statute
and Geico's insurance policy must be reviewed on a de novo basis.
II. GEICO'S PIP INSURANCE POLICY EXPRESSLY PROMISES TO
PAY THE "REASONABLE" AMOUNT AND NEVER MENTIONS
THE NEW FEE SCHEDULE METHOD OF §627.736(5)(A)2-5
Geico is asking this Court to construe the unambiguous provisions of the
insured patient's PIP insurance policy and the 2008-2011 versions of the PIP
statute. However, Geico's brief fails to quote them. Accordingly, before this Court
8
attempts to answer the question certified below, it should compare and contrast the
applicable versions of the PIP statutes and Geico's own PIP policy. In pertinent
part, the pre-October 1, 2007 version of Section 627.736 (the "Former PIP
Statute") provided the following reasonable amount method for calculating PIP
benefits for medical expenses:
627.736 Required personal injury protection benefits...—
(1) REQUIRED BENEFITS.—Every insurance policy complying
with the security requirements of s. 627.733 shall provide personal injury
protection to the named insured, relatives residing in the same household,
persons operating the insured motor vehicle, passengers in such motor
vehicle, and other persons struck by such motor vehicle and suffering bodily
injury while not an occupant of a self-propelled vehicle, subject to the
provisions of subsection (2) and paragraph (4)(d), to a limit of $10,000 for
loss sustained by any such person as a result of bodily injury, sickness,
disease, or death arising out of the ownership, maintenance, or use of a
motor vehicle as follows:
(a) Medical benefits.—Eighty percent of all reasonable expenses for
medically necessary medical, surgical, X-ray, dental, and rehabilitative
services, including prosthetic devices, and medically necessary ambulance,
hospital, and nursing services. Such benefits shall also include necessary
remedial treatment and services recognized and permitted under the laws of
the state for an injured person who relies upon spiritual means through
prayer alone for healing, in accordance with his or her religious beliefs;
however, this sentence does not affect the determination of what other
services or procedures are medically necessary.
. . . . .
(5) CHARGES FOR TREATMENT OF INJURED PERSONS.—
(a) Any physician, hospital, clinic, or other person or institution lawfully
rendering treatment to an injured person for a bodily injury covered by
personal injury protection insurance may charge the insurer and injured
party only a reasonable amount pursuant to this section for the services and
supplies rendered, and the insurer providing such coverage may pay for such
9
charges directly to such person or institution lawfully rendering such
treatment, if the insured receiving such treatment or his or her guardian has
countersigned the properly completed invoice, bill, or claim form approved
by the office upon which such charges are to be paid for as having actually
been rendered, to the best knowledge of the insured or his or her guardian. In
no event, however, may such a charge be in excess of the amount the person
or institution customarily charges for like services or supplies. With
respect to a determination of whether a charge for a particular service,
treatment, or otherwise is reasonable, consideration may be given to
evidence of usual and customary charges and payments accepted by the
provider involved in the dispute, and reimbursement levels in the
community and various federal and state medical fee schedules applicable to
automobile and other insurance coverages,[10
] and other information relevant
10
Medicare is welfare, and not the type of "federal and state medical fee schedules
applicable to automobile and other insurance coverages" contemplated by former
subsection (5)(a) (presently, (5)(a)1) of the PIP statute. Thus, Florida courts have
repeatedly held as a matter of law that Medicare fee schedules cannot be relied
upon by PIP insurers to determine the "reasonable" amount payable under the PIP
statute. See, Atkins v. Allstate Ins. Co., 382 So.2d 1276 (Fla.3d DCA 1980);
American Risk Assur. Co. v. Benrube, 407 So.2d 993 (Fla.3d DCA 1981); Gary H.
DiBlasio, M.D., P.A., v. Progressive American Ins. Co., 13 Fla.L. Weekly Supp.
625a (Fla.15th Cir. Cty. Ct. 2006); Progressive Auto Pro Ins. Co. v. Doctor's Pain
Management Assoc., 14 Fla.L. Weekly Supp. 1010a (Fla.9th Jud. Cir. Appellate
Div. 2007); McGowan Spinal Rehab. Center, P.A. a/a/o Cannon v. Progressive
Express Ins. Co., 15 Fla.L. Weekly Supp. 713a (Fla.4th Jud. Cir. Cnty. Ct. 2008);
Physicians Group a/a/o Buckner v. Progressive Select Ins. Co., 16 Fla.L. Weekly
Supp. 961a (Fla.12th Jud. Cir. Cty. Ct. 2009); Mitchell R. Pollack, M.D., a/a/o
Holland v. Progressive American Ins. Co., 13 Fla.L. Weekly Supp. 381 (Broward
County, Cnty. Ct. 2006); Personal Injury Clinic a/a/o Simo v. United Auto. Ins.
Co., Slip. Op. Case No. 10-3946-SP-21 (Miami-Dade County, Cnty. Ct. Feb. 10,
2011). Thus, PIP insurers cannot rely on the fee schedule method under the guise
of the reasonable amount method. See, e.g., Explorer, 16 Fla.L. Weekly Supp.
317a ("reasonable" amount may be proved through the elements described in
§627.736(5)(a)1, and insurer's position that fee schedule method clarified
reasonable amount to be charged by medical provider was erroneous); Montero, 17
Fla.L. Weekly Supp. 470a (fee schedule in §627.736(5)(a)2 "leave[s] no room for
interpretation, and sets forth fixed payment schedules for services provided. It does
not take into account the 'reasonableness' of the fee"); Volpe, 17 Fla.L. Weekly
Supp. 686a at ¶19 (reasonable amount test of former Section 627.736(5)(a) is not
10
to the reasonableness of the reimbursement for the service....
(Emph. added). In other words, before October 1, 2007, the Former PIP Statute
"required" that PIP insurers "shall" pay 80% of the "reasonable amount."
Effective on October 1, 2007, the "Florida Motor Vehicle No-Fault Law"
(including the Former PIP Statute) was repealed by a "sunset" provision. See Ch.
2003-411, §19, Laws of Fla.(2003). Three months later, as of January 1, 2008, the
Legislature enacted a new PIP statute. See, Ch. 2007-324, §§ 8-21, Laws of
Fla.(2007); Physicians Group, 47 So.3d at 356 ("On January 1, 2008, the new
Florida Motor Vehicle No-Fault Law, including a new PIP statute, went into
effect") (emph. added). That new PIP statute identified two separate and distinct
methods to calculate PIP benefits and states:
627.736 Required personal injury protection benefits; exclusions;
priority; claims.—
(1) REQUIRED BENEFITS.—Every insurance policy complying
with the security requirements of s. 627.733 shall provide personal
injury protection to the named insured, relatives residing in the same
household, persons operating the insured motor vehicle, passengers in
such motor vehicle, and other persons struck by such motor vehicle and
suffering bodily injury while not an occupant of a self-propelled vehicle,
subject to the provisions of subsection (2) and paragraph (4)(e), to a limit
of $10,000 for loss sustained by any such person as a result of bodily
injury, sickness, disease, or death arising out of the ownership,
maintenance, or use of a motor vehicle as follows:
(a) Medical benefits.—Eighty percent of all reasonable expenses
replaced, substituted, clarified, or defined by the fee schedule method of the new
version of Section 627.736(5)(a)2-5).
11
for medically necessary medical, surgical, X-ray, dental, and
rehabilitative services, including prosthetic devices, and medically
necessary ambulance, hospital, and nursing services. However, the
medical benefits shall provide reimbursement only for such services and
care that are lawfully provided, supervised, ordered, or prescribed by a
physician licensed under chapter 458 or chapter 459, a dentist licensed
under chapter 466, or a chiropractic physician licensed under chapter
460 or that are provided by any of the … persons or entities [listed in
new subparts 1 through 5]….
. . . . .
(5) CHARGES FOR TREATMENT OF INJURED PERSONS.—
(a)1. Any physician, hospital, clinic, or other person or institution
lawfully rendering treatment to an injured person for a bodily injury
covered by personal injury protection insurance may charge the insurer
and injured party only a reasonable amount pursuant to this section for
the services and supplies rendered, and the insurer providing such
coverage may pay for such charges directly to such person or institution
lawfully rendering such treatment, if the insured receiving such
treatment or his or her guardian has countersigned the properly
completed invoice, bill, or claim form approved by the office upon
which such charges are to be paid for as having actually been rendered,
to the best knowledge of the insured or his or her guardian. In no event,
however, may such a charge be in excess of the amount the person or
institution customarily charges for like services or supplies. With
respect to a determination of whether a charge for a particular
service, treatment, or otherwise is reasonable, consideration may be
given to evidence of usual and customary charges and payments
accepted by the provider involved in the dispute, and reimbursement
levels in the community and various federal and state medical fee
schedules applicable to automobile and other insurance coverages,[11
]
and other information relevant to the reasonableness of the
reimbursement for the service, treatment, or supply.
2. The insurer may limit reimbursement to 80 percent of the
following schedule of maximum charges: a. For emergency transport and treatment by providers licensed
11
See, footnote 10 above.
12
under chapter 401, 200 percent of Medicare.
b. For emergency services and care provided by a hospital licensed
under chapter 395, 75 percent of the hospital's usual and customary
charges.
c. For emergency services and care as defined by s. 395.002(9)
provided in a facility licensed under chapter 395 rendered by a physician
or dentist, and related hospital inpatient services rendered by a physician
or dentist, the usual and customary charges in the community.
d. For hospital inpatient services, other than emergency services and
care, 200 percent of the Medicare Part A prospective payment applicable
to the specific hospital providing the inpatient services.
e. For hospital outpatient services, other than emergency services and
care, 200 percent of the Medicare Part A Ambulatory Payment
Classification for the specific hospital providing the outpatient services.
f. For all other medical services, supplies, and care, 200 percent of
the applicable Medicare Part B fee schedule.[12
] However, if such
services, supplies, or care is not reimbursable under Medicare Part B, the
insurer may limit reimbursement to 80 percent of the maximum
reimbursable allowance under workers' compensation, as determined
under s. 440.13 and rules adopted thereunder which are in effect at the
time such services, supplies, or care is provided. Services, supplies, or
care that is not reimbursable under Medicare or workers' compensation
is not required to be reimbursed by the insurer.[13
]
12
Because subsections (5)(a)2.f and (5)(a)3 of the 2007 session law did not clearly
identify "the applicable Medicare Part B fee schedule," the Legislature amended
the new PIP statute in June 2008 to clarify that "the participating physicians
schedule of Medicare Part B" is the "applicable" fee schedule. All Family Clinic of
Daytona Beach, Inc. v. State Farm Mutual Auto. Ins. Co., 685 F.Supp.2d 1297,
1298 (S.D. Fla.2010); AFO Imaging Inc. v. Peak Prop.& Cas. Ins. Corp., 17 FLW
Supp. 368a, ¶18 (Fla.13th Cir. Ct. Jan. 25, 2010), affirmed, 71 So.3d 134 (Fla.2d
DCA 2011); Ch. 2008-220, §22, Laws of Fla.(2008). The 2008 clarifying
legislation was not a substantive change to the 2007 law and both versions must be
construed to mean the same thing. Id. See also, Millennium Diagnostic Imaging
Center, Inc. v. Security National Ins. Co., 882 So.2d 1027 (Fla.3d DCA 2004).
13
Notably, under subsection (5)(a)2.f of the fee schedule method, "Services,
supplies, or care that is not reimbursable under Medicare or workers' compensation
is not required to be reimbursed by the insurer." So, if the PIP insurer relies on the
fee schedule method for such services, the insured patient must bear 100% of
13
3. For purposes of subparagraph [(5)(a)]2., the applicable fee
schedule or payment limitation under Medicare is the fee schedule or
payment limitation in effect at the time the services, supplies, or care
was rendered and for the area in which such services were rendered,
except that it may not be less than the applicable 2007 Medicare Part B
fee schedule for medical services, supplies, and care subject to Medicare
Part B.
4. Subparagraph [(5)(a)]2. does not allow the insurer to apply any
limitation on the number of treatments or other utilization limits that
apply under Medicare or workers' compensation. An insurer that
applies the allowable payment limitations of subparagraph [(5)(a)]2. must reimburse a provider who lawfully provided care or treatment
under the scope of his or her license, regardless of whether such provider
would be entitled to reimbursement under Medicare due to restrictions or
limitations on the types or discipline of health care providers who may
be reimbursed for particular procedures or procedure codes.
5. If an insurer limits payment as authorized by subparagraph
[(5)(a)]2., the person providing such services, supplies, or care may
not bill or attempt to collect from the insured any amount in excess
of such limits, except for amounts that are not covered by the
insured's personal injury protection coverage due to the coinsurance
amount or maximum policy limits.
(Emph. added). Thus, under the 2008-2011 PIP statute, the Legislature allowed PIP
insurers to calculate PIP benefits under either: (1) the pre-existing method of
paying 80% of the reasonable charges under Section 627.736(1)(a) and (5)(a)1 (the
"reasonable amount method"); or (2) a new alternative method of paying 80% of
the fee schedules listed in Section 627.736(5)(a)2-5 (the "fee schedule method").
In the subject PIP policy that Geico issued to the plaintiff health care
the charges. Under the reasonable amount method, the PIP insurer would be
responsible for 80% of the reasonable amount of those charges.
14
provider's insured patient,14
Geico unambiguously promised to pay for medical
expenses under the pre-existing reasonable amount method:
The Company will pay, in accordance with the Florida Motor
Vehicle No-Fault Law, as amended, to or for the benefit of the injured
person:
(a) 80% of medical expenses....
. . . . .
"Medical expenses" means reasonable expenses for necessary
medical, surgical, x-ray, dental, ambulance, hospital, professional
nursing and rehabilitative services for prosthetic devices and for
necessary remedial treatment and services recognized and permitted
under the laws of the state for an injured person.
. . . . .
3. CHANGES
The terms and provisions of this policy cannot be waived or
changed, except by an endorsement issued to form a part of this
policy. We may revise this policy during its terms to provide more
coverage without an increase in premium. If we do so, your policy
will automatically include the broader coverage when effective in
your state.
(A 7-8, 23-24, 32; bold and underline added; all other emph. omitted).15
Nowhere
in the policy (including the "Limit of Liability" section) does it mention or suggest
that Geico would rely on any fee schedules, much less the fee schedule method of
Section 627.736(5)(a)2-5. Thus, after the new PIP statute took effect on January 1,
14
Before providing services, health care providers typically obtain an assignment
of insurance benefits from patients insured by PIP. Accordingly, in most PIP suits
(including this case), the plaintiff health care provider stands in the shoes of the
assignor insured patient. See, e.g., Professional Consulting Services, Inc. v.
Hartford Life & Accident Ins. Co., 849 So.2d 446, 447 (Fla. 2d DCA 2003).
15
Citations herein to "A" refer to the Respondent's appendix.
15
2008, the insured patient's PIP policy continued to describe the same pre-existing
higher level of PIP benefits required by the Former PIP Statute, which was carried
forward in subsections (1)(a) and (5)(a)1 of the 2008-2011 PIP statute.
Although the new PIP statute also authorizes PIP insurers to pay lower
benefits based on the new fee schedule method, that new method is an alternative
which is separate and distinct from the reasonable amount method.16
First,
subsection (5)(a)2 states the insurer "may" (not "shall") "limit reimbursement" by
using the various Medicare and workers' compensation fee schedules enumerated
therein. Next, (5)(a)3 states that Medicare fee schedules only apply "[f]or purposes
of subparagraph [(5)(a)]2...." Next, (5)(a)4 provides that the fee schedule method
does not allow PIP insurers to rely on limitations that otherwise apply under the
Medicare and workers' compensation systems. See, Nationwide, 71 So.3d at 137-
138; SOCC, PL v. State Farm Mut. Auto. Ins. Co., 95 So.3d 903, 909-910 (Fla. 5th
DCA 2012). Lastly, (5)(a)5 provides that "If" the insurer limits payment as
authorized by the fee schedule method, then the health care provider is not allowed
16
Geico's reliance on MRI Assoc. of St. Pete, Inc. v. State Farm Mut. Auto. Ins.
Co., 755 F.Supp.2d 1205 (M.D. Fla.2010) is misplaced. First, that federal trial
court decision was issued before, and directly conflicts with, Kingsway, DCI MRI,
Virtual I, and Virtual II. Second, the federal trial judge did not address any of the
prior published Florida cases cited in fn. 2 herein. Third, after Kingsway was
entered, the same federal trial judge recently certified a class action in an identical
case. See, MRI Associates of St. Pete, Inc. v. Dairyland Ins. Co., U.S. Dist. Ct.,
M.D. Fla.Case No. 8:11-cv-665-EAK-MAP, Online Docket, Doc. #32.
(www.flmd.uscourts.gov).
16
to balance-bill the insured patient for any portion of the bill not paid by the PIP
insurer "except for amounts that are not covered by the insured's [PIP] coverage
due to the coinsurance amount or maximum policy limits."
Subsection (5)(a)5 is the most important for illustrating the separate and
distinct nature of the reasonable amount method and the fee schedule method.
First, (5)(a)5 states that it only applies "If" the insurer uses the fee schedules in
(5)(a)2, and thereby recognizes that the insurer is not required to use those fee
schedules. Second, it prohibits the health care provider from balance-billing the
patient when the fee schedule method is used, "except" for charges that are not
covered by PIP due to coinsurance or exhaustion of PIP benefits. Third, by
implication, it maintains the health care provider's right to balance-bill the insured
patient whenever the PIP insurer uses the reasonable amount method, or whenever
there is no PIP coverage due to coinsurance, or exhaustion of PIP coverage. If, as
Geico and its amici suggest, the reasonable amount method and the fee schedule
method are one and the same method, why would the Legislature allow the health
care provider to balance-bill insured patients when the PIP insurer does not rely on
the fee schedules listed in (5)(a)2, or when there is no PIP coverage due to
coinsurance or exhaustion? Indeed, to adopt Geico's argument, this Court must
adopt a judicial construction that completely ignores or rewrites (5)(a)5.
The foregoing ramifications of (5)(a)5 are also important because
17
subsections (5)(d) and (10)(b)3 of the PIP statute require the health care provider's
initial claim form and pre-suit demand letter specify the "exact amount" owed.
MRI Assocs. of Am., LLC v. State Farm Fire & Cas. Co., 61 So.3d 462 (Fla.4th
DCA 2011). "Such precision is not possible" where the policy does not specify
which payment calculation method will be used. Kingsway, 63 So.3d at 68. It is
doubtful that the Legislature intended to create a trap that would prevent doctors
from properly filling out their claim forms and demand letters whenever a PIP
insurance policy does not expressly adopt the fee schedule method.
As in the cases cited in fn. 2, Geico's PIP policy here describes only the
reasonable amount method, and not the fee schedule method. Geico's policy also
expressly prohibits unilateral unwritten changes to the policy. Consequently, the
health care provider's lawful authority to balance-bill the patient, the patient's legal
obligation to pay any balance-billed charge, and the health care provider's ability to
properly complete its initial claim form and demand letter, are established by
Geico's election to describe only the reasonable amount method in its PIP policy.
III. THE 2012 AMENDMENTS CONFIRM THAT GEICO IS
UNLAWFULLY RELYING ON THE FEE SCHEDULE METHOD
A PIP insurer's inability to rely on the fee schedule method when its
insurance policy only describes the reasonable amount method has been hotly
litigated since 2008. See, e.g., Cases cited in fn. 2 herein.
The Third District issued its decision and certified question below on April
18
25, 2012. Several days later, on May 4, 2012, the Legislature promptly answered
the Third District's question by codifying the holdings in the cases cited in fn. 2
herein. Specifically, the Legislature inserted a new subsection (5)(a)5 into the
current 2012 version of Section 627.736, which reads as follows:
5. Effective July 1, 2012, an insurer may limit payment as
authorized by this paragraph only if the insurance policy includes a
notice at the time of issuance or renewal that the insurer may limit
payment pursuant to the schedule of charges specified in this paragraph.
Ch. 2012-197, § 10, Laws of Fla. (2012).
Not only does the 2012 version of subsection (5)(a)5 codify the published
cases cited in fn. 2 herein, but it also imposes additional requirements not
expressed in those cases. Although those published cases uniformly required PIP
insurers to clearly adopt the fee schedule method in their PIP policies before
relying on that method, such an adoption could have been buried anywhere in the
policy or done at any time with an amendatory endorsement. However, as of July
1, 2012, the 2012 version of (5)(a)5 now imposes the additional requirements that
the fee schedule method can "only" be adopted by a "notice" in the policy at the
time of "issuance or renewal." So, the fee schedule method can no longer be
adopted by a provision buried in the fine print of a lengthy policy, or by an
amendatory endorsement during the policy term period after the premium is paid.
The Legislature is presumed to know about the prior litigation and published
judicial constructions of the PIP statute when amending it, and is also presumed to
19
have adopted those constructions when amending the PIP statute, unless a contrary
intention is expressed when amending it. See, e.g., City of Hollywood v. Lombardi,
770 So.2d 1196, 1202 (Fla.2000). Nothing in the 2012 adoption of the new (5)(a)5
expresses any intent to overturn Kingsway and the other cases cited in fn. 2.
To the contrary, we must presume that when the Legislature adopted the new
(5)(a)5, it was aware that many cases had decided the fee schedule method had to
be expressly adopted in the PIP policy. When inserting the new (5)(a)5 and
codifying those prior published decisions, and also placing additional requirements
on how and when the fee schedule method could be adopted, it is obvious that the
Legislature did so to end to the debate. Indeed, what other purpose could the
Legislature have intended by inserting the new (5)(a)5 but to clarify and confirm
that PIP insurers must abide by the promises made in their own PIP policies, and
cannot unilaterally and silently change the maximum level of PIP benefits for
which policy holders bargained when they initially purchased and/or renewed their
PIP policies and paid the premiums based on that maximum level of benefits?
IV. THE FEE SCHEDULE CASES ARE CORRECT AND GEICO IS
BLATANTLY BREACHING THE EXPRESS PROVISIONS OF ITS
OWN PIP INSURANCE POLICY
The sound rationale expressed in the many published cases cited in fn. 2
herein speaks for itself, as does the plain language of Geico's own PIP policy—
which is conspicuously absent from Geico's brief. Also, as explained in many of
20
those cases, nothing prevents PIP insurers from agreeing in their policies to
provide a higher level of PIP benefits than the minimum amount afforded by the
statutory fee schedule method. See also, State Farm Florida Ins. Co. v. Nichols, 21
So.3d 904 (Fla.5th DCA 2009); Universal Underwriters Ins. Co. v. Morrison, 574
So.2d 1063 (Fla.1990); Sturgis v. Fortune Ins. Co., 475 So.2d 1272 (Fla.2d DCA
1985); Wright v. Auto-Owners Ins. Co., 739 So.2d 180 (Fla.2d DCA 1999). This
Court should not decide this appeal without reading all the cases cited in fn. 2.
Geico's reliance upon Allstate Ins. Co v. Holy Cross Hosp., Inc., 961 So.2d
328 (Fla.2007) is misplaced. In that case, this Court's analysis "assumes the
existence of enforceable contracts by which [the plaintiff hospital] agreed to accept
PPO rates from [the PIP insurer] for any of its insureds that received treatment
covered by their PIP policies." Id. at 331, n. 2. There is no such contract in this
case. To the contrary, in this case, the only contract is the one that Geico has failed
to quote in its brief, which expressly promises to pay the "reasonable" amount and
says nothing about the fee schedule method.
Simply stated, Geico is crying crocodile tears. Geico manifests unmitigated
temerity by claiming to be the victim, when in reality it is the wrongdoer.
CONCLUSION
WHEREFORE, St. Pete MRI requests this Honorable Court to answer the
certified question in the negative, and affirm the Third District's decision below.
21
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that a true and correct copy hereof was served by
Email on the following persons, on this _____ day of ____________, 20______:
Counsel for Petitioner, Geico General Insurance Company: Frank A.
Zacherl, Esquire, Email - [email protected]; Suzanne Labrit, Esquire, Email
- [email protected]; and Jerel C. Dawsen, Esquire, Email –
Counsel for Respondent, Virtual Imaging Services, Inc.: John Beranek,
Esquire, Email - [email protected]; Harley N. Kane, Esquire, Email -
[email protected]; and Joseph P. Littman, Esquire, Email –
Counsel for Florida Personal Injury Federation of Florida and National
Association of Mutual Insurance Companies: Mary L. Aldrich, Esquire,
Email - [email protected]; Nancy A. Copperthwaite, Esquire, Email
- [email protected]; and Nancy M. Wallace, Esquire, Email -
Counsel for American Insurance Association and Property Casualty Insurers Association of America: Raoul G. Cantero, Esquire, Email -
[email protected]; T. Neal McAliley, Esquire, Email -
[email protected]; and Jesse L. Green, Esquire, Email -
Counsel for Florida Justice Reform Institute: Cynthia S. Tunnicliff, Equire,
Email - [email protected]; and Gerald D. Nelson Bryant, IV,
Esquire, Email - [email protected];
Counsel for the Travelers Companies, Inc.: Mark D. Tinker, Esquire, Email -
Counsel for Floridians for Fair Insurance, Inc.: Lawrence M. Kopelman,
Esquire, Email - [email protected]; and
22
Counsel for Gables Insurance Recovery, Inc.: Robert N. Pelier, Esquire,
Email - [email protected], and Bart Billbrough, Esquire, Primary Email -
[email protected]; Secondary Email - [email protected].
CERTIFICATE OF COMPLIANCE
I HEREBY CERTIFY that the text herein is printed in Times New Roman
14-point font, and that this brief complies with the font requirements of Florida
Rule of Appellate Procedure 9.210.
Respectfully Submitted,
____________________________________
de la PARTE & GILBERT, P.A.
David M. Caldevilla, FBN 654248
Primary Email: [email protected]
Secondary Email: [email protected]
Michael R. Bray, FBN 58263
Primary Email: [email protected]
Secondary Email: [email protected]
Post Office Box 2350
Tampa, FL 33601-2350
Telephone: (813) 229-2775
and
CRAIG E. ROTHBURD, P.A.
Craig E. Rothburd, FBN 49182
Email: [email protected]
800 W. De Leon Street
Tampa, FL 33606-2722
Telephone: (813) 251-8800
and
23
THE JEEVES LAW GROUP, P.A.
Scott R. Jeeves, FBN 0905630
Primary Email: [email protected]
Secondary Email: [email protected]
954 First Avenue North
St. Petersburg, FL 33705
Telephone: (727) 894-2929
and
THE DIVALE LAW GROUP, P.A.
Lorca J. Divale, FBN 0173622
Email: [email protected]
P.O. Box 22347
St. Petersburg, FL 33742
Telephone: (727) 321-5646
Counsel for Amicus Curiae,
MRI Associates of St. Pete, Inc.,
d/b/a St. Pete MRI
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