DJ based upon EUO no-shows granted over vigorous opposition

American Transit v. Chedister , Index #:  301921/12 (Sup. Ct. Bronx Co. 2013)

Supreme Court could not be anymore emphatic that it is not impressed with the Alrof v. Safeco argument that provider attorneys throw around when trying to get around an EUO no-show case.  Personal knowledge is not as personal as some want it to mean.

Mr. Five Boro took another dive – this time with the sharks

Mr. Five Boro took at dive in the IME no-show DJ matter of American Transit Ins. Co. v. Beltre, under Bronx Co. Index #: 310468/11 (Sup. Ct. Bronx Co. 2012 [Suarez, J.S.C.])

A lesson on why the failure to attempt a DJ on an EUO no-show can spell doom

Superior Oxygen & Ortho Supplies, Ltd. v Auto One Ins. Co., 2012 NY Slip Op 50348(U)(App. Term 2d Dept. 2012)

“defendant failed to establish that the examination under oath (EUO) scheduling letters had been timely mailed (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]) and that the 30-day claim determination period (see Insurance Department Regulations [11 NYCRR] § 65-3.8) had been tolled. As a result, defendant failed to establish that its denial of claim forms were timely and, thus, that it is not precluded from raising the failure of plaintiff’s assignors to appear at the EUOs as a defense”

The case speaks for itself and the result should validate a more proactive method to handling these cases.  Otherwise, why are you paying your attorneys to do these EUO’s?


I took on the runners and won

I liked that title, but it is not necessarily true.  It is an embellishment at best, and if you clicked on it, then it did the trick.  In actuality, here is an interesting DJ victory that was obtained in Nassau.  I think it discusses various issues involving (1) the use of DJ’s; (2) timing issues; and (3) objective criteria used to demand EUO’s.  It is a thoughtful order, and should give the bar pause when pursuing EUO’s.  Read here.

EUO letters were mailed and the Claimant failed to attend the EUO: summary judgment granted

Points of Health Acupuncture, P.C. v Lancer Ins. Co., 2010 NY Slip Op 51455(U)(App.Term 2d Dept. 2010)

You have seem this before.

“Contrary to the Civil Court’s findings, defendant established the timely mailing of the EUO scheduling letters. Defendant submitted the affirmation of a partner in the law firm retained by defendant to conduct plaintiff’s EUO in which he set forth in detail his firm’s standard office practice and procedure for the mailing of EUO scheduling letters (see New York & Presbyt. Hosp. v Allstate Ins. Co., 29 AD3d 547 [2006]; Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]; Top Choice Med., P.C. v New York Cent. Mut. Fire Ins. Co., 22 Misc 3d 133[A], 2009 NY Slip Op 50230 [U] [App Term, 2d, 11th & 13th Jud Dists 2009]). In addition, counsel alleged facts sufficient to establish that plaintiff had failed to appear at counsel’s law office for the duly scheduled EUOs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]; W & Z Acupuncture, P.C. v Amex Assur. Co., 24 [*2]Misc 3d 142[A], 2009 NY Slip Op 51732[U] [App Term, 2d, 11th & 13th Jud Dists 2009]). Since the appearance of the plaintiff at an EUO is a condition precedent to the insurer’s liability on the policy (see Insurance Department Regulations [11 NYCRR] § 65-1.1; Stephen Fogel Psychological, P.C., 35 AD3d at 722), the Civil Court should have granted defendant’s motion for summary judgment dismissing the complaint. We note that, contrary to the Civil Court’s finding, the affidavit submitted by defendant’s no-fault specialist established that defendant timely mailed its denial of claim forms.”

EUO no-show (case #3)

Points of Health Acupuncture, P.C. v Lancer Ins. Co., 2010 NY Slip Op 51338(U)(App. Term 2d Dept. 2010)

Part I:

“[c]ontrary to the finding of the Civil Court, defendant established the timely mailing of the EUO scheduling letters with respect to plaintiff’s claims for the sums of $222.76 (dates of service: October 23, 2006 and October 30, 2006), $501.21 and $167.07. Defendant submitted the affirmation of a partner in the law firm retained by defendant to conduct plaintiff’s EUO in which he set forth in detail his firm’s standard office practice and procedure for the mailing of EUO scheduling letters.  In addition, counsel alleged facts sufficient to establish that plaintiff had failed to appear at counsel’s law office for the duly scheduled EUOs,”

Part II:

“The first set of letters sent by defendant to plaintiff after defendant received plaintiff’s $334.14 claim (dates of service: July 24, 2006-July 31, 2006) and plaintiff’s $222.76 claim (dates of service: August 14, 2006 and August 15, 2006) merely stated that defendant was waiting for the results of an investigation by its special investigation unit as well as the scheduling of an EUO. Since it is well settled that an insurer’s delay letters, which request no verification, do not toll the statutory time period within which a claim must be paid or denied (see Nyack Hosp. v Encompass Ins. Co., 23 AD3d 535 [2005]; Careplus Med. Supply, Inc. v Selective Ins. Co. of Am., 25 Misc 3d 48 [App Term, 9th & 10th Jud Dists 2009]; Ocean Diagnostic Imaging P.C. v Citiwide Auto Leasing Inc., 8 Misc 3d 138[A], 2005 NY Slip Op 51314[U] [App Term, 2d & 11th Jud Dists 2005]), defendant did not toll the statutory period within which defendant had to pay or deny said claims. While the rest of the letters sent by defendant in response to the remaining claims sent by plaintiff were in fact verification requests, the affidavit submitted by defendant’s no-fault specialist failed to establish that they were timely mailed (see New York & Presbyt. Hosp., 29 AD3d 547; Residential Holding Corp., 286 AD2d 679; Top Choice Med., P.C. v New York Cent. Mut. Fire Ins. Co., 22 Misc 3d 133[A], 2009 NY Slip Op 50230[U] [App Term, 2d, 11th & 13th Jud Dists 2009]).”

Part III:

“Notwithstanding the foregoing, defendant correctly asserts that plaintiff’s cross motion for summary judgment was premature under CPLR 3212 (f). Defendant established that while facts may exist that are essential to justify the denial of plaintiff’s summary judgment motion, defendant was unable to set forth such facts with respect to its non-precluded defense that plaintiff was fraudulently incorporated.”

As to Part I: These bills were probably received after the EUO defaults.

As to Part II: These bills were probably received prior to the EUO defaults and the EUOs were probably not scheduled within 15-30 days after receipt of the bills, so this makes sense.  It appears that the the carrier said that the bills would be delayed until its counsel felt like setting up EUO’s.

As to Part III: “You can have it both ways”???

Now, here is something interesting.  If you are conducting EUO’s to get information from providers based upon corporate structure issues, then aren’t you admitting that you do not have sufficient material to mount a meaningful defense?  Yet in this case, the court held that even though the carrier admitted (through its actions of scheduling provider EUO’s) that it had insufficient evidence to mount a meaningful defense on the issue of corporate structure, the carrier’s papers were still sufficient to: (a) raise an issue of fact in answering a summary judgment motion; and (b) allow for broad discovery.

I think the carrier should have to elect its remedy.  The carrier must: (a) seek an EUO and either deny for a provider’s default or conduct a more in depth investigation including denying for corporate fraud issues should the provider attend; or (b) deny based upon the information the carrier has and hopes it has enough information to survive summary judgment, trial or arbitration.

But, is it fair that an insurance carrier should deny for an EUO, which was improperly scheduled, and then get to defend on the basis for which the EUO was scheduled, i.e., corporate fraud?

I think summary judgment should have been granted to the provider on the second set of bills.  Sorry for not towing the company line on this one – but fair is fair.

Lastly, this is why the District Court was wrong in Dynamic v. State Farm.  The carrier, should it believe something is amiss, must schedule EUO’s, and the provider should attend or detail why the EUO’s are improper.  These issues need to be developed pre-litigation.

Notwithstanding the above, if the carrier’s EUO demands are untimely, then all defenses including those that the EUO was supposed to expound upon should be precluded, as a matter of equity.  Sloppy work on either the defense or the plaintiff side should not be tolerated.

EUO no-show (case #2)

Infinity Health Prods., Ltd. v Progressive Ins. Co., 2010 NY Slip Op 51334(U)(App. Term 2d Dept. 2010)

“To raise a triable issue of fact based on the assignor’s failure to appear at scheduled EUOs, defendant was required to demonstrate that its initial and follow-up requests for verification were timely (see Insurance Department Regulations [11 NYCRR] §§ 65-3.5 [b]; 65-3.6 [b]) and establish, by an affidavit of one with personal knowledge, that the assignor had failed to appear for the EUOs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 [2006]). Since defendant failed to establish that the EUO scheduling letters were timely mailed (see Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679 [2001]), defendant failed to demonstrate that the 30-day claim determination period (Insurance Department Regulations [11 NYCRR] § 65-3.8) was tolled. As a result, defendant failed to establish that its denial of claim forms were timely and, thus, that it is not precluded from raising as a defense the failure of plaintiff’s assignor to appear for an EUO.”

I previously published a blog entry where I discussed the EUO time frames in great detail.  At least, the court seems to finally be consistent here on what is necessary to prove the EUO no-show defense.

And then there is the dissent, with which I completely agree.

EUO scheduling letters must be sent within the same time frame that exists for verifying bills

St. Vincent Med. Care, P.C. v Travelers Ins. Co., 2010 NY Slip Op 50446(U)(App. Term 2d Dept. 2010)

“While defendant properly argues that an EUO need not be scheduled to be held within 30 days of the receipt of the claim form (see Eagle Surgical Supply, Inc. v Progressive Cas. Ins. Co., 21 Misc 3d 49 [App Term, 2d & 11th Jud Dists 2008]), defendant nevertheless failed to demonstrate that the EUO scheduling letters were timely mailed. Defendant admits that it received the three subject bills on October 27, 2006. As the EUO scheduling letters were mailed on December 18, 2006, 52 days after receipt of the bills, they were untimely and did not toll defendant’s time to pay or deny those bills (see Insurance Department Regulations [11 NYCRR] § 65-3.5 [b]; § 65-3.6 [b]; § 65-3.8 [j]; see also Eagle Surgical Supply, Inc., 21 Misc 3d at 51).”

Keep in mind the following.  When you delay a bill for an EUO, the provider must receive a delay letter specifying that the claim is being delayed pending the EUO of the EIP or assignee.  A follow-up delay with respect to that bill must be sent within 31-40 days after that first delay letter is sent.  This must be done for each bill!

Now, the EUO scheduling letters that the carrier’s attorney sends or the carrier itself  sends must also be sent within 15-30 days of receipt of the first bill.  After the first no-show, a follow-up EUO scheduling letter must be sent within 10 days of the said no-show.

In putting the above two rules together, it should be observed that if a bill is timely delayed for an EUO, yet the EUO scheduling letter is not sent within 15-30 days after receipt of the bill, then the EUO delay will be invalid.  This is very confusing, and I think the proposed new regulations actually clarify this very discreet issue, and perhaps this issue only as it relates to EUOs.

Validity of EUO, Appellate Term, 2d Dept: Take two

The Appellate Term, Second Department seems to be all over the place with the “EUO” cases. The analysis is really needlessly strained and hard to follow. The latest case demonstrates this… Two parts of the opinion are set forth herein.

Great Wall Acupuncture, P.C. v New York Cent. Mut. Fire Ins. Co.

2009 NYSlipOp 50294(U)(App. Term 2d Dept. 2009)

Plaintiff asserts that the EUO scheduling letters were ineffective since they were not sent to plaintiff but rather to an attorney. However, since defendant’s counsel received a letter from said attorney a short time before the initial EUO scheduling letter was mailed advising counsel that the attorney represented plaintiff with respect to EUO requests which were already pending, such a contention lacks merit

A review of the record indicates that defendant established that the insurance policy in effect when the EUOs were sought contained an endorsement authorizing verification by EUO. Inasmuch as the accident in which plaintiff’s assignor was allegedly injured occurred after the April 5, 2003 effective date of the emergency first amendment to revised Department of Insurance Regulation 68, contrary to plaintiff’s contention, defendant was not required to schedule the EUO within 30 days of receiving plaintiff’s claims but only within a reasonable time thereafter. Since the date selected for the EUO was reasonable and plaintiff did not appear for the scheduled EUO, defendant’s motion for summary judgment should have been granted since the action was premature

First, while I agree that in principle an EUO scheduling letter, or any other correspondence, should only be sent to an attorney representing the Party to be deposed, when one is on notice of the same, the regulations do not agree with that proposition of law. The regulations require that the notices be mailed to the injured person and his or her authorized representatives. I am not sure solely sending it to the attorney complies with the regs. But that part of the opinion does not necesarily trouble me.

It is the second part. Why does the App. Term, 2nd Dept keep saying that the failure to attend EUO’s makes the action premature? The failure to attend an EUO is a policy violation – albeit shceduled as additional verification requests – and the claim must be denied. The denial must be within the latter of 30 days of the last EUO appointment or date of receipt of the bill. This is the law. I also do not understand why the App. Term is saying that upon one failure to attend an EUO, the claim is still premature? We shall see how the Court fixes this, or if the App. Div is going to have straighten this out, similar to Fogel and AB Liberty…