Peer Hearsay in No-Fault Trials: Experts May Testify From the Medical Records They Reviewed

Key Takeaways

• The Civil Court barred State Farm’s peer review doctors from testifying because they would discuss medical records they had reviewed — a classic “peer hearsay” objection.
• The Appellate Term reversed: the doctors should have been permitted to testify, and a new trial was required.
• The ruling follows Park Slope Med., Alrof, and Urban Radiology — the line of cases dismantling the peer hearsay objection in no-fault trials.
• Peer reviewers may rely on, and testify about, the assignor’s own medical records when explaining a lack-of-medical-necessity opinion.

Expert Testimony and Medical Records: A Critical Evidence Ruling

Medical peer reviews are fundamental to no-fault insurance litigation, where insurance companies routinely challenge the necessity and reasonableness of medical treatments. When trial courts improperly exclude expert testimony based on peer reviews, it can derail an entire case and force costly retrials.

The Appellate Term’s decision in Kew Garden Imaging addresses a common but problematic trial court ruling that excluded medical expert testimony on questionable hearsay grounds. This case highlights the importance of understanding the proper foundation requirements for expert testimony based on medical records and the ongoing challenges healthcare providers face when insurance companies deploy peer review experts.

The Decision

Kew Garden Imaging v State Farm Mut. Auto. Ins. Co., 2013 NY Slip Op 50748(U)(App. Term 2d Dept. 2013)

“The Civil Court precluded defendant’s medical witnesses from testifying on the ground that those doctors could not testify as to the contents of the medical records they had reviewed in preparing their peer reviews.

As defendant’s doctors should have been permitted to testify (see Park Slope Med. & Surgical Supply, Inc. v Travelers Ins. Co., 37 Misc 3d 19 ; Alrof, Inc. v Progressive Ins. Co., 34 Misc 3d 29 ; Urban Radiology, P.C. v Tri-State Consumer Ins. Co., 27 Misc 3d 140, 2010 NY Slip Op 50987 ), a new trial is required.”

Peer hearsay. The party that made the frivolous objection at trial should pay the cost for Defendant’s expert.

The Legal Framework: What “Peer Hearsay” Actually Means

A medical-necessity trial in no-fault court almost always turns on a peer review — a doctor’s paper opinion, built from the treating providers’ own records, that the disputed services were not medically necessary. The “peer hearsay” objection is the plaintiff bar’s counterattack: the reviewing doctor never examined the patient, so any testimony about what the medical records say is hearsay, and without the records themselves in evidence the opinion supposedly collapses.

The objection has a surface appeal, but the case law cited in Kew Garden Imaging rejected it for a structural reason. The records the peer reviewer relied upon were generated by the plaintiff’s assignor’s own treating providers — frequently the very records the plaintiff submitted to the carrier to get the bills paid in the first place. A plaintiff is in a poor position to cry hearsay about documents its own side created and exchanged. Urban Radiology, Alrof, and Park Slope Medical built that principle into a settled rule in the Appellate Term, Second Department, and Kew Garden Imaging applied it to reverse a preclusion order.

This sits comfortably within the broader New York rule that an expert may ground an opinion on out-of-court material if it is of a kind accepted in the profession as reliable. Few categories of material are more professionally reliable to a physician than the patient’s own treatment records.

Why This Matters for Carriers, Providers, and Trial Strategy

For carriers, preclusion of the peer doctor is functionally a directed verdict — without the expert, there is no lack-of-necessity defense. Kew Garden Imaging confirms that a properly framed peer opinion survives the hearsay objection, but the remedy for an erroneous preclusion is a new trial, which means paying the expert twice. That is the sting in the original note: the frivolous objection cost the defendant a second expert fee with no compensating sanction.

For plaintiffs, the lesson is to stop relying on the blanket objection and instead attack the opinion on its real weak points: whether the peer reviewer’s factual recitation matches the records, whether the records relied on were actually the ones in the claim file, and whether the opinion stays within the expert’s scope and foundation. Those targeted challenges still work; the categorical hearsay objection does not.

For trial judges, the trilogy of Appellate Term authority makes preclusion on pure peer-hearsay grounds reversible error in this context — and a guaranteed retrial in a court system that can ill afford them. The medical necessity battleground, including the burden-shifting framework at trial, is mapped in the firm’s medical necessity and peer review resources.

Practice Pointers

• Defendants: Make sure the peer reviewer’s testimony tracks the records identified in the peer report, and have the claim file documents organized for the foundation questions. The right to testify from reviewed records is not a license for an unmoored narrative.
• Defendants: When the objection is raised, cite Kew Garden Imaging, Park Slope Medical, Alrof, and Urban Radiology by name; trial courts respond to the unbroken line of authority.
• Plaintiffs: Cross-examine on discrepancies between the records and the peer report rather than seeking wholesale preclusion — it is both permissible and more effective.
• Both sides: Preserve the evidentiary ruling clearly on the record. As this case shows, an erroneous preclusion is appealable and will be reversed.

Related Resources

• Peer review — the firm’s cluster hub on peer review practice
• Medical necessity and peer review requirements in NY no-fault
• The firm’s Legal Encyclopedia
• No-Fault Defense practice
• Understanding Article 10 evidentiary issues and expert witness testimony rules
• How peer hearsay challenges continue to evolve in Article 10 cases
• The landmark destruction of peer hearsay doctrine
• New York Civil Court evidence rules for peer review reports
• New York No-Fault Insurance Law

Frequently Asked Questions

What is “peer hearsay” in New York no-fault litigation?

It is the shorthand for the objection that a peer review doctor — who never examined the patient — cannot testify about the contents of the medical records reviewed in preparing the peer report, because those records are out-of-court statements. Appellate Term case law, including Kew Garden Imaging v State Farm, has rejected the objection as a basis for precluding the expert.

Can a peer review doctor testify without the underlying medical records being in evidence?

Under the Urban Radiology line of cases, a defendant’s peer reviewer may testify about the assignor’s treating records relied upon in forming the opinion — particularly records generated by the plaintiff’s side and submitted in support of the claim. The opinion’s weight can still be attacked on cross-examination.

What happens if a trial court wrongly precludes a peer review expert?

The preclusion typically guts the insurer’s medical necessity defense, and on appeal the remedy is a new trial — exactly what the Appellate Term ordered in Kew Garden Imaging. The erroneous ruling costs both sides a retrial rather than producing a final judgment.