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The Topsy-Turvy World of No-Fault Litigation
By: Diane C. Petillo, Esq.

FOR THE DEFENSE

The Topsy-Turvy World of No-Fault Litigation

By: Diane C. Petillo, Esq.
Bruno, Gerbino & Soriano, LLP
Melville, New York




Once upon a time, before no-fault litigation became prevalent, the rules of evidence applied equally to all. Now, with the onset of a multitude of no-fault claims clogging our court system, it would seem that this is no longer the case.

Specifically, under the no-fault regulations currently in existence, a provider must mail its bill for services rendered to the insurance carrier within 45 days of treatment in order to receive payment. The carrier then has thirty days to either pay or deny the claim. (11 NYCRR §65-3.8 (2005)). If payment is not received within the prescribed time limits, providers then become plaintiffs in a plethora of lawsuits to collect their unpaid bills.

As an attorney representing insurance carriers, it is extremely frustrating to see that all the plaintiffs need to do in order to satisfy their burden is appear in court with their purported bill. Only in the realm of no-fault litigation is the plaintiff’s burden so low that it is almost non-existent. There is no need for the plaintiff to produce a witness to either authenticate the bill or provide proof of mailing. On the other hand, the carrier is required to produce an expert witness to testify regarding the medical necessity (or lack thereof) of the treatment provided or the services rendered. More often than not, the case is adjourned for any number of reasons, and the carrier must then bring its expert witness back on the adjourn date. This is not only burdensome to the carrier, but expensive as well.

Similarly, the assignment of benefits does not have to be authenticated by the patient. This is mind-boggling. Under basic contract law, standing must be proven in order for the provider to step into the shoes of the patient for the purposes of collecting insurance benefits. Standing is a jurisdictional issue; this issue cannot be waived. Despite this fact, the courts routinely decide that the carrier’s NF-10 denial, which is not in evidence during the presentation of the plaintiff’s case, somehow serves to not only acknowledge that the provider is the assignor of the injured party, but also serves to authenticate the assignment. This is especially troubling in that the assignors/patients are never present in court to authenticate the assignment and the treatments allegedly provided.

Additionally, some courts have now precluded the Peer Reviewer from testifying, thereby curtailing the right of the carrier to defend on the basis of medical necessity, a right which the legislature clearly intends them to have. As per 11 NYCRR § 65-3.8 (4), an insurer is entitled to have a Peer Review conducted by another doctor, other than the treating doctor, to determine the medical necessity of the treatment provided or the services rendered. The Peer Reviewer would then prepare a report containing the evaluation, conclusion, and opinion regarding same. In the event that payment is not recommended, then an NF-10 Denial of Claim form would be sent to the provider. It is evident that the legislature intended the carriers to have this right as the regulations dictate to whom and when the report must be provided.

It is important to note that the records reviewed by the Peer Reviewer are those provided by the plaintiff to the carrier (along with the billing) in order to receive payment. These documents consist of reports for initial evaluations, letters of medical necessity, treatment records, prescriptions for diagnostic testing, and records of diagnostic testing. If the billing for the services rendered is received within 45 days of the treatment date, and if the submitted records demonstrate medical necessity, then the carrier remits payment. If however, there is a question regarding the necessity of these services, then the documents are provided to the Peer Reviewer for analysis.

The Plaintiff would now like to have it both ways. The records that are generated by their providers are to be accepted by the carrier as justification for remittance of payment. However, these same records are now not reliable as a basis for a Peer Review. The Peer Reviewers assigned to each claim are doctors whose training and expertise is commensurate with that of the providers who are submitting bills for services rendered.

For example, a chiropractor’s treatment of a patient would be referred to another chiropractor for evaluation, and not to an orthopedist. This is essential because the Peer Reviewer, who practices in the same area of expertise, therefore relies on these very same documents in his/her own practice. In this instance, the Peer Reviewer is not wearing a “doctor hat” but rather that of a document examiner.

The purpose of this review is not to recommend a course of treatment for the patient; rather, the purposes is to determine whether the treatment rendered was justified based on the information maintained in the providers very own records. Plaintiffs routinely argue that the Peer Reviewer should be precluded from testifying because the Peer Reviewer cannot prove the reliability of the records they reviewed. It is ironic that the plaintiff is, in essence, calling into question the veracity of his very own records.

The courts have consistently held that a Peer Review must set forth a sufficient factual basis and medical rationale for the rejection of the claim. (Triboro Chiropractic and Acupuncture P.L.L.C v. Electric Insurance Company, 2 Misc3rd 135(A) App Term, 2nd & 11th Jud Dists, 2004]). The factual basis would be the entries made by the plaintiff provider to justify the treatment provided or services rendered. Since the information relied on by the Peer Reviewer comes from the plaintiff’s own records, it’s unfathomable that the plaintiff would argue that he is prejudiced because his own records are being used against him. Further, at trial, a Peer Reviewer would be subject to cross-examination by the plaintiff regarding the opinion and the basis therefore.

Some courts have attempted to circumvent the legislature by constructively denying the carriers a right afforded to them under 11NYCRR§ 65-3.8. The end result is that the carriers are unable to effectively investigate claims. The courts have lowered the standard of proof for the plaintiffs while placing an undue burden on the carriers in these cases. As per the current climate in some courts, the carriers should not even attempt to refute a claim because once the matter reaches the court; the carrier’s hands are tied. It would seem, in this day and age of questionable claims, that it would be to everyone’s benefit that claims be investigated.

Editor’s Note: Diane C. Petillo is a graduate of St. John’s University School of Law and an associate at the law firm of Bruno, Gerbino & Soriano, LLP, located in Melville, New York

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