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Excluding Information the Insurance Company Needs to Defeat Your PIP Case

The Miami Heat are currently facing the possibility of losing their best player (Chris Bosh) for an extended period of time. Josh McRoberts, a key free-agent acquisition, has been ruled out for the season due to a meniscus injury. The flu bug has spread throughout the locker room, and the Heat are facing the prospect of a losing record, i.e. under .500 for the season, for the first time since 2007-2008. Medical providers who bill Florida Personal Injury Protection (PIP) insurance have felt this so-called “losing feeling” due to the decision in Northwoods, and the amendments to the PIP Statute in 2012. Well, fear not medical providers and Miami Heat Fans, seems as if Chris Bosh won’t be out too long, and it seems as if the judges are reversing course on key aspects of the PIP law.

Motion by Medical Providers to Exclude Rate Information

Quantum Imaging Holdings LLC a/a/o Gerome Baptelmy v. United Automobile Insurance Company was decided on June 17, 2014.  A motion was filed by the medical provider to completely exclude any mention, reference, or disclosure of rates they accepted or contracted for with health insurance companies, Medicare, and pursuant to Section 440.13 (Workers Compensation Fee Schedule). The argument was that the insurer, State Farm is not a party to the contracts that they agree to with health insurance companies, Medicare, and pursuant to Section 440.13 (Workers Compensation Fee Schedule) and that they ultimately aren’t relevant in PIP. The defendant, United, argued that because Quantum accepted less from health insurers, their charges aren’t reasonable. Thus, United argued that these rates are relevant to prove the unreasonableness of the charges.

The defendant isn’t a party to health insurance contracts.

The court in the Quantum case sided with the medical provider! The court reasoned that any health insurance contracts that Quantum had with other health insurers aren’t relevant to a PIP case because United was not a party to those contracts. The court further stated that the terms of the contracts with these providers are confidential and not applicable to United, in that United cannot reap the benefits without actually entering into the health insurance agreements. Likewise, Florida law holds that evidence that medical providers entered into these health insurance agreements is insufficient to “prove that the provider’s charge is unreasonable.”

This evidence is confusing, prejudicial, and misleading.

Medical providers in South Florida can rejoice in that the court in the Quantum case held that any probative value of the health insurance negotiated rates was called unfairly prejudicial, it was held to lead to confusion of the issues and to mislead the jury. Ultimately, the court threw out any reference to health insurance contracts and negotiated rates. The court did indicate that the insurance contracts were not a major portion of Quantum’s business model. Quantum argued that evidence of these contracts, the rates, the time periods for entering, the language, benefits, etc., and evidence that United chose not to enter into the same contracts, would cause confusion to the jury. The jury would have to consider these negotiated rate contracts versus the PIP policy and contract. The jury would have to compare “apples to pudding” as the court stated, which would cause unfair prejudice and confusion.

Medicare fee schedules aren’t relevant in PIP.

The court held that Medicare fee schedules (MFS) are relevant in PIP when discussing the reasonableness of a medical provider’s charges. The court indicated that “Medicare is a social welfare program and not an insurance or reimbursement plan. Once again, the court stated that the MFS was like comparing apples to pudding, in that PIP differs in all aspects. This comparison would once again lead to confusion of the jury and unfair prejudice to interpreting the MFS rates.

This decision is predicated on certain key facts:

  1. The medical provider did not enter into many insurance contracts prior to the new law changes in 2012.
  2. The medical provider’s business model did not encompass many Medicare patients or health insurance patients/contracts. Even so, this case provides hope to the medical providers of Florida. Negotiated rate contracts should be protected by basic fundamental contract law. Two parties enter into a contract. They bargain, haggle and eventually agree on terms. Basic contract principles protect the terms, obligations, duties, risks of the contract as confidential, proprietary, and trade secrets. The same protection given to basic contract principles should be given to negotiated rate health insurance contracts. Without a barrier to these terms, confusion will prejudice any jury. How can you compare a negotiated contract term/payment amount to a PIP policy/contract that is set in stone based on statutory principles? PIP amounts are statutory creatures, which DO NOT allow for bargained for payments/terms/obligations/rights/etc. This decision truly frames the issue and provides a common-sense approach for dealing with negotiated health insurance contract rates, Medicare Fee Schedules, and other such health insurance contracts. These contracts should not be compared with PIP rates/amounts under any circumstances. WHY create confusion and mislead a jury?

It is important to discuss these issues with an experienced PIP litigation attorney. We will discuss your case free of charge, evaluate your contracts with other insurances and strategize the best plan of attack for any PIP suits. Remember, proper planning will breed proper execution. Like the Miami Heat, all of our medical providers have contingency plans and well-crafted arguments to ensure the proper information is divulged and to equally ensure that protected information remains confidential and protected!

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