Does not need to be mailed in duplicate (again)

Performance Plus Med., P.C. v Utica Mut. Ins. Co., 2015 NY Slip Op 50399(U)(App. Term 2d Dept. 2015)

“We note that, contrary to plaintiff’s argument on appeal, the mailing affidavit submitted by defendant alleged that two copies of each denial of claim form were mailed to plaintiff. In any event, the failure to send a denial in duplicate is not, on its own, a fatal error (Mollo Chiropractic, PLLC v American Commerce Ins. Co., 42 Misc 3d 66, 69 [App Term, 2d, 11th & 13th Jud Dists 2013]).”

EUO denial not vague or conclusory for not stating dates

Quality Psychological Servs., P.C. v Avis Rent-A-Car Sys., LLC, 2015 NY Slip Op 50378(U)(App. Term 2d Dept. 2015)

“Here, plaintiff has not alleged that it did not receive a denial of claim from defendant. Moreover, the denial of claim form attached to defendant’s motion papers, which plaintiff argues is fatally defective, states that the claim was being denied because plaintiff’s assignor had failed to appear for two properly scheduled examinations under oath. Contrary to plaintiff’s argument, the failure to set forth the dates of the scheduled examinations in the denial of claim form did not render the denial conclusory, vague, or without merit as a matter of law

The denial was valid despite not setting forth the date on the denials.

A timely denial with errors

NYU-Hospital for Joint Diseases v Allstate Ins. Co., 2014 NY Slip Op 08613 (2d Dept. 2014)

On October 18, 2012, the plaintiff mailed a copy of the NF-5 claim form to the defendant, Lopez’s automobile insurance carrier. The defendant received it on or about October 20, 2012, and thereafter issued an NF-10 denial of claim form dated November 14, 2012. The plaintiff, while not disputing that the defendant had issued a denial of claim within 30 days after its receipt of the NF-5 claim form, asserted in its motion for summary judgment that the NF-10 form was “defective” because it “contain[ed] the wrong amount of the bill and the wrong amount in dispute.” Upon an order entered September 10, 2013, granting that branch of the plaintiffs’ motion which was for summary judgment on the first cause of action, the Supreme Court entered a judgment in favor of the plaintiff and against the defendant in the principal sum of $19,095.62.

Among the ways in which a no-fault insurer may comply with the “30 day rule” (see Insurance Law § 5106[a]; 11 NYCRR 65-3.8[a][1]; [c]) is by issuing a “timely and sufficient” NF-10 denial of claim form within 30 days after its receipt of an NF-5 claim form (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 114 AD3d 33, 46). Nonprejudicial mistakes or omissions in [*2]an otherwise timely and proper “NF-10” denial of claim form are not necessarily fatal (see Wyckoff Hgts. Med. Ctr. v Government Empls. Ins. Co., 114 AD3d 855; NYU-Hospital for Joint Diseases v Esurance Ins. Co., 84 AD3d 1190, 1191-1192; St. Barnabas Hosp. v Penrac, Inc., 79 AD3d 733, 734; see also Westchester Med. Ctr. v Government Empls. Ins. Co., 77 AD3d 737, 738; cf. St. Vincent’s Hosp. & Med. Ctr. v New Jersey Mfrs. Ins. Co., 82 AD3d 871; Nyack Hosp. v State Farm Mut. Auto. Ins. Co., 11 AD3d 664). Here, the papers submitted in support of the plaintiffs’ motion for summary judgment included a copy of the defendant’s NF-10 denial of claim form. Contrary to the plaintiff’s contention, the NF-10 form was timely and sufficient. Under the circumstances of this case, the plaintiffs did not meet their prima facie burden of establishing their entitlement to judgment as a matter of law (see Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 114 AD3d at 46).

An NF-10 can have mistakes, but the question is whether they are prejudicial.  Here, the NF-10 had the UB-05 amount and not the DRG value.  The Court allowed the claim to be handled on its merits, and rightfully so.

Mailing and denial issues

Urban Well Acupuncture, P.C. v American Commerce Ins. Co., 2014 NY Slip Op 51520(U)

“The action, seeking recovery of first-party no-fault benefits, is not ripe for summary dismissal since defendant “failed to . . . establish that the denial of claim form was in fact mailed to the plaintiff” (Nyack Hosp. v Metropolitan Prop. & Cas. Ins. Co., 16 AD3d 564, 564-565 [2005]; see Mercury Cas. Co. v Encare, Inc., 90 AD3d 475 [2011]). The affidavit submitted by the defendant insurer to establish proof of mailing – identifying the affiant as a “mailroom representative” of a nonparty to this action, State-Wide Insurance Company (“State-Wide”) – neither stated that the affiant actually mailed the claim denial to plaintiff nor, so far as appears, described defendant’s mailing office practice and procedures (see New York and Presbyterian Hospital v Allstate Ins. Co., 29 AD3d 547 [2006]), as opposed to those generally followed by State-Wide. Conspicuously absent from defendant’s moving submission was any allegation or showing that a jural relationship existed between defendant and State-Wide. Given these shortcomings in defendant’s proof, we have no occasion to consider whether defendant’s purported mailing of the claim denial to the individual treating acupuncturist rather than the employing professional corporation was proper (see 11 NYCRR 65-3.8[c])”

Nyack v. Metropolitan is best known as one of the first defective denial cases.  There is a line in this case (nobody paid attention to it) stating that an affidavit of mailing to the plaintiff was not presented.  I guess somebody forgot to link “state wide” and “american commerce” in the mailing affidavit.  It happens, and I am sure this mistake will not happen again.

I like how the court ducked the main issue here: Can a denial be sent to the treating acupuncturist as opposed to the P.C.  If the court follows Judge Ciaffa’s agency theory case and pertinent precedent regarding the duty to communicate, then the answer to the question should be an unconditional “yes”.

Summary judgment is limited to what is pleaded upon the moving papers

 

“Here, in light of the limited basis of the plaintiff’s motion for summary judgment on the complaint, which was premised solely on the defendant’s alleged failure to timely pay or deny the no-fault claim within 30 days of receipt of proof of the claim (see Insurance Law § 5106[a]; 11 NYCRR 65-3.8[a][1], [c]), “the defendant’s only burden in opposition . . . was to raise a triable issue of fact regarding its timely . . . denial of the [plaintiff’s] claim” (Lenox Hill Hosp. v Government Empls. Ins. Co., 89 AD3d 905, 905; see Viviane Etienne Med. Care, P.C., v Country-Wide Ins. Co., _____ AD3d _____, 2013 NY Slip Op 08430 [2d Dept 2013]; Westchester Med. Ctr. v Progressive Cas. Ins. Co., 89 AD3d 1081, 1082-1083). In opposition to the plaintiff’s prima facie showing of entitlement to judgment as a matter of law, the defendant satisfied its burden by raising a triable issue of fact as to whether it did in fact mail a proper NF-10 denial of claim form to the plaintiff only 22 days after its receipt of the claim verification that it had previously requested”

This shift has been years in the making, based upon the Westchester-Liberty case that came out a few years ago.  To reach the merits of the defense, the plaintiff needs to show the defense lacks merit.  Thus on medical necessity case, plaintiff must affirmatively show that the service is medially appropriate; On a DWI case (which this case was), Plaintiff must show that Defendant was not drunk or that the intoxication was not a proximate cause of the loss.  It is an interesting standard and, in practice, the only reason a plaintiff moves for summary judgment is to establish its prima facie case.  CPLR 3212(g).  I wonder when the Appellate Division will (if ever) reach this discrete issue.

The faiure to issue a denial in duplicate is no necessarily fatal to preserving a defense

 Mollo Chiropractic, PLLC v American Commerce Ins. Co., 2013 NY Slip Op 23419 (App. Term 2d Dept. 2013)

“The Civil Court therefore found, in effect, that defendant’s defense of lack of medical necessity was precluded because it was not preserved in proper duplicate copies of the denial of claim form submitted to plaintiff.”

“It is noted that, subsequent to Rusk, the Appellate Division has found that other errors in denials should not be considered fatal, when such errors do not pose the possibility of any prejudice to the claimant (see e.g. NYU-Hospital for Joint Diseases v Esurance Ins. Co., 84 AD3d 1190, 1191 [2011] [finding that a denial was not “rendered a nullity” by possible errors, when such errors “were not significant by themselves, and did not pose any possibility of confusion or prejudice to the [plaintiff] under the circumstances”]; Westchester Med. Ctr. v Nationwide Mut. Ins. Co., 78 AD3d 1168, 1169 [2010] [“minor factual discrepancy” did not invalidate a denial which “was not conclusory or vague, and did not otherwise involve a defense which had no merit as a matter of law”]). Upon reviewing the language in Rusk, we note that the Appellate Division did not base its decision therein solely on the defendants’ failure to serve the denial in duplicate….  However, in light of the Appellate Division cases decided after Rusk, we are no longer of the opinion that the failure to send a denial in duplicate should, on its own, be considered a fatal error that would prevent a defendant from being able to raise any otherwise meritorious, but precludable, defenses.

 

Brutal loss on a coverage case

Matter of Matter of AIU Ins. Co. v Veras, 2012 NY Slip Op 03116 (1st Dept. 2012)

“On June 4, 2005, respondent Veras and additional respondent Richard, who was driving a vehicle owned by additional respondent Wynder-Ortiz and insured by State Farm, were involved in an automobile accident. State Farm was not notified and did not learn of the accident from its insured. Nearly four years later, it learned of the accident from Veras, who served it with the judgment entered in his favor in the action he had commenced against Richard and Wynder-Ortiz. Although it completed its internal investigation and prepared letters of disclaimer within two weeks, State Farm waited another 15 days before sending out the letters. It was not error for the court to find this largely unexplained delay unreasonable (see Insurance Law § 3420[d]; First Fin. Ins. Co. v Jetco Contr. Corp., 1 NY3d 64, 66 [2003]; Travelers Ins. Co. v Volmar Constr. Co., 300 AD2d 40, 42-43 [2002]; see also George Campbell Painting v National Union Fire Ins. Co. of Pittsburgh, PA, 92 AD3d 104 [2012]).”

So, notice of the accident is received after 4 years.  A judgment is entered and served upon State Farm.  Then, a decision is made to deny within 2 weeks.  Then 15 days were not explained.  After this, a disclaimer was sent, and this was insufficient?

“We reject State Farm’s argument that the delay was due to its investigation of other possible grounds for disclaiming. State Farm’s witness testified that the investigation was completed in two weeks. In any event, however, “just as we would not permit the insured to delay giving the insurer notice of claim while investigating other possible sources of coverage, [*2]we should not permit the insurer to delay issuing a disclaimer on a known ground while investigating other possible grounds for avoiding liability” (George Campbell Painting, 92 AD3d at 115).”

A very impressive win.

NYU-Hospital for Joint Diseases v Esurance Ins. Co., 2011 NY Slip Op 04436 (2d Dept. 2011)

“Esurance issued a denial of claim, which incorrectly stated the amount of the claim and the amount in dispute. Esurance denied the claim, inter alia, because Cancian allegedly was intoxicated at the time of the accident.

The hospital then commenced this action seeking payment of its bill, and moved for summary judgment on the complaint arguing, among other things, that the denial of claim was untimely, fatally defective for the above-mentioned mistakes, and that Esurance’s defense that Cancian was intoxicated was unsupported by the evidence.

“A proper denial of [a] claim [for no-fault benefits] must include the information called for in the prescribed denial of claim form (see 11 NYCRR 65-3.4[c][11]) and must promptly apprise the claimant with a high degree of specificity of the ground or grounds on which the disclaimer is predicated'” (St. Barnabas Hosp. v Allstate Ins. Co., 66 AD3d 996, 996, quoting Nyack Hosp. v State Farm Mut. Auto. Ins. Co., 11 AD3d 664, 664). A timely denial of a no-fault insurance medical claim alone does not, however, avoid preclusion where the “denial is factually insufficient, conclusory, vague or otherwise involves a defense which has no merit as a matter of law” (Nyack Hosp. v State Farm Mut. Auto. Ins. Co., 11 AD3d at 665).

Here, the hospital established its prima facie entitlement to judgment as a matter of law based on the untimeliness of the denial of claim….

In opposition to the motion, however, Esurance raised a triable issue of fact as to whether the denial of claim was timely issued by submitting the affidavit of an employee with knowledge of its “standard office practices or procedures designed to ensure that items were properly addressed and mailed” (St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d at 1124), wherein he attested that a denial of claim was timely issued to the hospital. We note that while the denial of claim contained errors, they were not significant by themselves, and did not pose any possibility of confusion or prejudice to the hospital under the circumstances; thus, the denial was not rendered a nullity

Further, Esurance raised a triable issue of fact as to whether Cancian was “injured as a result of operating a motor vehicle while in an intoxicated condition” (Insurance Law § 5103[b][2]). Contrary to the hospital’s contention, the personal observations of the police officer present at the scene of the accident as recorded in the police accident report were properly considered by the Supreme Court under the business record exception to the hearsay rule (see CPLR 4518[a]; Westchester Med. Ctr. v State Farm Mut. Auto. Ins. Co., 44 AD3d at 753).”

Very good work on the part of defense counsel.  Defense counsel tore apart the ridiculous “how was I supposed to know what was denied, I only spend my life doing medical collections work.”  He also tore apart “the police report was uncertified” even though the whole world knows it says what it says.  Lastly, defense counsel beat back the untimely denial argument, but I am not sure how or what the facts were regarding this argument.  I have an email into defense counsel to find out what actually happened.

Another denial that was fatally flawed

NYU Hosp. for Joint Diseases v Country Wide Ins. Co., 2011 NY Slip Op 04219 (2d Dept. 2011)

“Here, even assuming that the denial of claim form issued by the defendant was timely and was properly mailed to the plaintiff, the form “was fatally defective in that it omitted numerous items of requested information, and thus was incomplete” (Nyack Hosp. v Metropolitan Prop. & Cas. Ins. Co., 16 AD3d at 565; see Westchester Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 81 AD3d 929; compare St. Barnabas Hosp. v Penrac, Inc., 79 AD3d 733). The denial also incorrectly listed Raquel Uviles as the applicant for benefits instead of the plaintiff”

This is just plain ridiculous already.  I understand the “specificity rule”, but is there prejudice?  Did Henig really not know what was being disclaimed and why?  In my mind, enough with these games already.  Yes, I know the hospitals in this state are hurting, and the latest budget severely curtailed the medicaid reimbursement rate.  But, should the courts impose upon auto insurance policy holders an additional tax because Albany is trying to plug serious budget holes?

Three strikes and you owe it

St. Vincent’s Hosp. & Med. Ctr. v New Jersey Mfrs. Ins. Co., 2011 NY Slip Op 01828 (2d Dept. 2011)

“The plaintiff, St. Vincent’s Hospital & Medical Center, as assignee of Tula Huillca, demonstrated its prima facie entitlement to judgment as a matter of law. While the defendant insurer timely issued two denials of claim within 30 days of its receipt of the completed hospital facility forms (NYS Form N-F 5), those denials of claim, which incorrectly stated the amount of the bill (STRIKE ONE) and the amount in dispute (STRIKE TWO), and incorrectly listed Tula Huillca as the applicant for benefits (STRIKE THREE) instead of the plaintiff, were fatally defective (see St. Barnabas Hosp. v Allstate Ins. Co., 66 AD3d 996, 996-997; Nyack Hosp. v Metro. Prop. & Cas. Ins. Co., 16 AD3d at 565). In opposition, the defendant failed to raise a triable issue of fact.”

According to the Penal Law, three strikes will net you 25-life.  Here, well, you succumb to whatever the Plaintiff felt like suing you for.  The comments on this topic are worth a read.  There are some interesting viewpoints on this issue, all of them quite intelligible.