When a delay letter is not good enoughAugust 6, 2014
Hillside OpenMRI, P.C. v Allstate Ins. Co., 2014 NY Slip Op 51143(U)(App. Term 2d Dept. 2014)
With respect to the second cause of action, seeking to recover upon a claim for $878.66, and the third cause of action, seeking attorney’s fees with respect thereto, defendant’s claim representative stated that defendant had received plaintiff’s claim for the sum of $878.66 on July 8, 2010 and that it had denied the claim on October 4, 2010. She also stated that defendant had [*2]sent delay letters, dated July 30, 2010 and September 9, 2010 to plaintiff after the receipt of the claim. The letters informed plaintiff that payment of the claim would be delayed pending an EUO of the injured party. However, an insurer’s delay letters, which request no verification, are insufficient to toll the 30-day statutory time period within which a claim must be paid or denied (see Nyack Hosp. v Encompass Ins. Co., 23 AD3d 535 ). Since defendant did not establish that it had otherwise tolled its time to pay or deny the claims, defendant failed to demonstrate that the claim underlying these causes of action had been timely denied. Thus, the branches of defendant’s motion seeking dismissal of the second and third causes of action were properly denied.”
The question that is present is this: What does a delay letter have to say to preserve an EUO no-show defense? Does the date of the EUO have to be set forth on the delay letters to the provider? It is a bit disconcerting because this is not the all purpose “we are delaying your bill, check in with us one day.” It told the provider why the bill was on hold. “prejudice” is “surprise.” No surprise here. The provider knew what the good hands people were doing. A senseless decision.