The recent case of State Farm v. Delray Medical Center Inc., weighed by Florida’s Fourth District Court of Appeal, stemmed from an auto accident in which the insurance company providing Personal Injury Protection (PIP) benefits challenged the health care provider on the reasonableness of medical bills.
Although the accident victim was not a party to the case, the interplay of medical bills and assessment of damages in personal injury lawsuits comes up all the time.
In order to be compensated for medical expenses, plaintiffs usually must:
- Authenticate the medical bills;
- Present competent medical testimony that the treatment received was necessary as a result of defendant’s negligence;
- The cost of these expenses is reasonable in amount.
A new law that took effect in Florida in 2013 had a significant impact on the ability to collect PIP benefits. Florida is a no-fault state, and each driver is mandated to carry at least $10,000 in PIP benefits to cover his or her own injuries in a crash. Only if the cost of care to treat injuries exceeds that amount may car accident victims pursue litigation against the other at-fault driver. The new law requires those injured in a crash to seek treatment within two weeks of the crash (where there were previously no limits) and also allows a maximum $2,500 in coverage, unless the injuries are deemed less serious. Proving the higher rate applies usually involves presentation of expert witness testimony corroborating the severity of injuries, the necessity of medical treatment and the reasonableness of the cost.
In the aforementioned case, the insurance company sought discovery from the health care provider under state PIP statutes asking for information that would allow analysis of the reasonableness of medical expenses incurred by two of the insurance company’s policyholders.
After health care services were provided, the medical center billed the insurance company. The insurer filed a petition questioning the reasonableness of those medical expenses, arguing the charges were far higher than what is allowed under Medicare billing rates. In its petition to the court, insurer attached nearly two dozen discovery requests. Among those requests were information for what the medical center had billed to other patients who had received the same or similar treatment. The medical center refused this request and filed for an order of protection, asking the court to shield this information from the insurer.
Trial court denied the insurer’s request to compel medical center to produce this information, citing failure to show good cause. Insurer then filed an amended petition, which the trial court also denied, calling it “extremely far-reaching” and “overbroad.”
The pertinent statute cited by the insurer was F.S. 627.736(6), which requires health care providers to offer information regarding the history, condition, treatment dates and costs of such treatment and why items in question are medically necessary and reasonable in amount. However, as the appeals court pointed out, this pertains only to the treatment of the injured person. Here, the insurance company sought information regarding the amounts paid by others who had no involvement whatsoever in the case.
Therefore, the appeals court ruled, trial court was right to find the request by the insurance company exceeded the scope of the statute.
If you have been a victim of a traffic accident, call Chalik & Chalik at (954) 476-1000 or 1 (800) 873-9040.
State Farm v. Delray Medical Center Inc., Nov. 4, 2015, Florida’s Fourth District Court of Appeal
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