Opinion
60762/03.
Decided June 21, 2004.
The instant action was brought by Plaintiff medical provider for first party benefits pursuant to New York Insurance Law Article 51.
The facts of the case are not in dispute. Plaintiff's claim for no fault benefits was received by Defendant insurer on July 17, 2002, for services rendered to Plaintiff's assignor between June 3, 2002 and July 2, 2002. On August 13, 2002, Defendant issued Plaintiff a denial of claim based on Plaintiff's assignor failing to attend Independent Medical Examinations (IMEs).
On June 24, 2002, prior to Plaintiff submitting its claim, Defendant issued an IME scheduling letter to Plaintiff's assignor and Plaintiff's attorney. Plaintiff's assignor requested a rescheduling of the IME, and on June 28, 2002, Defendant issued a rescheduling letter to Plaintiff's assignor and attorney. Plaintiff's assignor failed to attend any of the IMEs. On July 24, 2002, Defendant sent Plaintiff's assignor a denial of benefits form.
It is undisputed that the basis of Defendant's denial of Plaintiff's first party benefit claims is Plaintiff's assignor's failure to attend IMEs that were requested and scheduled before Plaintiff's claim was submitted. It is further agreed that Defendant never requested a verification or additional verification of claim from Plaintiff directly.
Section 65-3.5 of 11 N.Y.C.C.R., the regulations promulgated pursuant to New York's No Fault Law, states:
(A) Within 10 business days after receipt of the completed application for motor vehicle no-fault benefits, the insurer shall forward to the parties required to complete them, those prescribed verification forms it will require prior to payment of the initial claim.
(B) Subsequent to the receipt of one or more of the completed verification forms, any additional verification shall be requested within 15 business days of receipt of the prescribed verification forms.
A claim verification may take the form of requiring an independent medical examination of the patient to verify the injuries allegedly sustained in a motor vehicle accident. 11 N.Y.C.C.R. sec. 65.15(d)(2). Recently, it has been held that a request for an independent medical examination is a request for additional verification rather than an initial verification request. Choicenet Chiropractic, P.C. v. Elco Administrative Services Co., 2002 N.Y. Slip Op 40382U.
The purpose of the No-Fault law is to ensure prompt payment of claims by accident victims. Presbyterian v. Maryland, 90 N.Y. 2d 274, 660 N.Y.S. 2d 536 (1997). An important aspect of this is to allow insurance companies to conduct investigations in order to determine the veracity and propriety of submitted claims, which may be furthered by requests for verification. However, so as not to undermine the goals of prompt payment, insurance companies must issue these verification requests in accordance with the strict time requirements of the No-Fault regulations. All Health Medical Care, P.C. a/a/o Eliyahu Malaev v. Government Employees Insurance Co., 2 Misc. 3d 907, 771 N.Y.S. 2d 832 (2004).
In the instant case Defendant did not forward any request for verification or additional verification within the statutorily prescribed time period. Defendant is basing its denial of benefits on IME requests made prior to the submission of Plaintiff's claim, a request not even made to Plaintiff directly.
An insurance carrier's defense must stand or fall upon the reason appearing in its denial of claim. State Farm Insurance Co. V. Demotor, 226 A.D. 2d 219, 697 N.Y.S. 2d 348 (2d Dept. 1999). Consequently, if the grounds for denial stated by Defendant in its denial letter are insufficient as a matter of law, Plaintiff would be entitled to a summary judgment because the 30-day time period mandated by the No-Fault law for insurers to pay or deny claims has already expired. 11 N.Y.C.C.R. sec. 65-3.5; 65-3.8(a).
A legally valid basis for denying a first party benefit claim would be the provider's failing to comply with the insurer's verification requests. All Health Medical Care, P.C.a/a/o Eliyahu Malaev v. Government Employees Insurance Co., op cit. Such failures would also include a plaintiff's assignor failing to appear at an independent medical examination. Urban Medical Diagnostics, P.C. v. Liberty Mutual Insurance Co. 2001 N.Y. Misc. Lexis 1125 (2d Dept. 2001). However, the court has been unable to locate any precedent that would permit an insurer to deny a first party claim based on a failure of the plaintiff's assignor to comply with a request predating the submission of the first party claim.
Recent decisions have held that a plaintiff's assignor's failure to appear at medical examinations raises triable issues of fact as to said claims by the medical provider. Adam's Medical Supplies, Inc. a/a/o Yrvel Orelien v. Windsor Group Insurance Company, 2004 N.Y. Misc. Lexis 447 (2d Dept. 2004); Millennium Medical Diagnostics, P.C. a/a/o Brain Bernard v. Liberty Mutual Insurance Co., 2001 N.Y. Misc. Lexis 1296 (2d Dept. 2001). This, or course would defeat a motion for summary judgment which may only be granted if no triable issues of fact exist. CPLR 3212. However, the above-cited cases all involve situations in which the verification request for the IME was made to the provider after its claim was submitted within the statutorily prescribed time frame. In no instance has such a result been found when no such request was made to the provider itself.
The court believes that it would go against the purpose and intent of the No-Fault law if it would permit an insurer to deny a claim based on a failure to respond to a verification request made to someone other than the claimant at hand, even if such request were made to the claimant's assignor. This is especially true if the request was made before any claim was filed, in contradiction of the precise wording of the regulations.
Therefore, based on the foregoing, the court grants Plaintiff's motion for summary judgment. Plaintiff is awarded $453.30, plus statutory interest from August 16, 2002 (30 days from receipt of the claim by the insurer), plus statutory attorneys fees and costs and disbursements.