New Jersey fee schedule is proper as a matter of law

The provider could not recover more than the New Jersey schedule allowed on this record. That was the result in Surgicare Surgical v National Interstate, later affirmed on appeal. But the 2014 decision applied an earlier version of New York’s out-of-state reimbursement rule; for services from January 23, 2018, a reader must also account for the amended payment comparison.

Legal Update (September 2026): Surgicare was affirmed in 2015, but DFS’s 2018 amendment changed the out-of-state reimbursement comparison for later services; the fee-schedule hub keeps those periods distinct.

Last reviewed: September 2026.

The 2014 dispute was about the applicable payment rule

Surgicare Surgical v National Interstate Insurance Co., 46 Misc 3d 736, was decided November 17, 2014, in Bronx County Civil Court. Surgicare sought assigned no-fault benefits for arthroscopic surgery performed in New Jersey after a motor-vehicle accident.

The insurer made a partial payment and denied the balance using New Jersey’s no-fault ambulatory surgery fee schedule. The provider maintained that 11 NYCRR 68.6 required the local prevailing fee, not necessarily the amount prescribed by that schedule.

The parties disagreed about whether the schedule applied. They did not dispute that, if it applied, the insurer had paid the proper scheduled amount. That agreement narrowed the case substantially. It was not a trial in which competing coders disputed each line of a current bill.

The court granted the insurer’s motion to dismiss and denied the provider’s cross motion. The provider’s allegation that nothing had been paid was contradicted by the payment evidence and its own acknowledgment. The live claim concerned the unpaid difference, not a second recovery of the amount already received.

What “prevailing fee” meant in the earlier rule

The former version of 11 NYCRR 68.6 used the prevailing fee in the geographic location of an out-of-state provider. Surgicare argued that the omission of the words “fee schedule” excluded an automatic resort to New Jersey’s schedule.

The court disagreed. It read the regulation alongside the no-fault cost-control framework and the regulator’s interpretation of reimbursement for services outside New York. Where the treatment jurisdiction had an applicable medical fee schedule, the court treated the permissible scheduled amount as the prevailing fee.

That was a ruling about the services and schedule before the court. It should not be restated as a rule that every foreign jurisdiction has a no-fault schedule, that every medical service appears in one, or that a provider’s own charge establishes the amount the insurer must pay.

The opinion also discussed 11 NYCRR 68.5(b), the provision addressing certain reimbursable services not set forth in a schedule. Jason focused on the relationship between the two provisions in his original reaction.

Why the court discussed a regulator’s Guatemala opinion

The court’s reasoning drew on an Insurance Department opinion concerning services provided in Guatemala. Surgicare did not involve treatment there. The reference mattered because the regulator described reimbursement under section 68.6 in terms of the permissible cost in the foreign location.

The trial court read that terminology as supporting use of the legally permitted New Jersey charge. The later Appellate Term opinion also relied on the regulator’s interpretation and explained why it was entitled to deference in the case before it.

That chain of reasoning is narrower than treating the foreign opinion as a New Jersey fee schedule. The regulatory interpretation supplied context for the phrase “prevailing fee”; the applicable New Jersey schedule and the payment evidence supplied the amount. Each source had a different role.

It also explains why the absence of the words “fee schedule” in the former regulation did not persuade the court. The rule covered jurisdictions with different reimbursement systems, not only jurisdictions that had enacted a no-fault schedule. The court did not assume that every treatment location had the same kind of schedule or that the provider could choose whichever system produced the largest payment.

Jason’s original synopsis

The following is the November 2014 commentary, including the original wording. Its approval of the court’s approach predates the later amendment to section 68.6.

The quick synopsis of this case is that were the services are performed in a state where there is a fee schedule for these types of service, the state’s fee schedule will control.  It makes sense, and the Court goes on to note that not applying this rule will turn every “simple” no-fault matter into a battle of coding and billing experts.  This is antithetical to the realm of no-fault.  I personally like how the Court uses 68.5(b) to create a rule that a reasonable and customary amount will only be permissible upon there being no way to harmonize the fee schedule with the service provided.

The later rule did not simply erase the role of a local schedule. It retained a way to identify the prevailing-fee amount while changing the comparison used to determine reimbursement for many services. That distinction is why the historical note remains useful but needs the update below.

The reply affidavit was considered in a specific procedural setting

The trial opinion considered a certified coder’s affidavit submitted with the insurer’s reply. The provider objected that the insurer had not included a qualifying affidavit in its initial papers.

The court explained that the provider had an opportunity to respond through its cross motion and did not do so. It therefore considered the submission without the prejudice that would arise from genuinely unanswered new material. The opinion cited authority dealing with that opportunity to respond.

This is not a general license to save essential evidence for reply. The case turned on the procedural opportunity described in the record. A reader examining a different motion needs to identify what was first submitted, when the opponent could answer it, and what relief the court was considering.

The decision is particularly useful beside MIA Acupuncture v Integon and Healing Art v Amica. Those notes identify proof supporting payment and denial mailing. Surgicare adds a separate question about when the particular proof was presented and whether the opposing party had a fair chance to address it.

Partial payment did not concede the balance

The provider also argued that payment of part of the bill showed satisfaction with the whole claim. The court rejected that argument, referring to 11 NYCRR 65-3.8(d), which permits payment of undisputed elements without prejudice to either party.

That part of the opinion prevents another overreading of the result. Paying an undisputed portion is not necessarily an agreement that every remaining charge is owed. Conversely, a partial payment is not proof that every proposed reduction is correct. The remaining dispute still needs an identified legal and factual basis.

Here, the parties’ agreement about the arithmetic under the New Jersey schedule made the legal question decisive. In Tyorkin v Garrison, by contrast, the unexplained calculation left a fee issue for trial. The library preserves both results because “fee schedule applies” does not answer every payment dispute.

The 2015 appellate decision

In Surgicare Surgical Associates v National Interstate Insurance Co., 50 Misc 3d 85, decided October 8, 2015, the Appellate Term, First Department, affirmed the dismissal. It agreed that an insurer could use the treatment jurisdiction’s applicable medical fee schedule to establish the prevailing fee under the former rule.

The appellate court also noted that the services were rendered after April 1, 2013, so the excessive-fee defense was not subject to preclusion under the amended 11 NYCRR 65-3.8(g). That timing point connects Surgicare with the Saddle Brook amendment decision, rather than making it a case solely about geography.

This was the appeal from the 2014 Surgicare order. It was not an appeal from Saddle Brook, which involved a different provider, insurer and motion record. The two decisions support a related historical line but should not be described as stages of the same lawsuit.

For services from January 23, 2018, use the amended comparison

The adopted 33rd Amendment to Regulation 83 changed 11 NYCRR 68.6. For covered out-of-state services to a New York resident, subdivision (b) generally uses the lowest of the highest applicable New York regional fee, the provider’s charge and the prevailing fee in the provider’s location.

Subdivision (a) uses the lower of the provider’s charge and the prevailing fee for emergency care, services to a nonresident, or services to a New York resident who is living in the treatment jurisdiction for reasons unrelated to treatment. Those are the specified exceptions, not a general exemption whenever a provider is outside New York.

Subdivision (c) provides that an applicable motor-vehicle medical fee schedule in the treatment jurisdiction supplies the prevailing-fee amount. That schedule therefore remains relevant. It does not displace the other components of the applicable comparison.

DFS’s explanation of the amendment makes the service date the dividing line, regardless of accident date or when the insurer received the bill. The 2016 proposal note, updated with the adopted rule supplies that later part of the history.

Geography does not decide whether a separate fee is reimbursable

Avanguard addressed the obligation to pay a separate facility fee for surgery in a New York office-based setting. The Court of Appeals affirmed that the applicable framework did not mandate that fee.

Surgicare addressed the amount for reimbursable services under the earlier out-of-state rule. The distinction matters before using either decision: a calculation based on treatment location is not itself authority to bill an otherwise disputed category of charge.

A useful claim review therefore begins with the bill’s service date, treatment location, provider status and type of charge. The payment record and any denial then show what amount and reason are actually disputed. Those records allow the historical cases to answer the right question without treating a 2014 title as a complete statement of today’s regulation.

Connect to the Encyclopedia

Start with the fee-schedule defense hub. Follow the closest case comparisons:

• Saddle Brook: the related 2015 New Jersey and late-denial decision.
• Avanguard: separate office-based facility fees and reimbursement authority.
• Tyorkin: New Jersey calculation defects left an issue for trial.
• The out-of-state proposal and the different rule adopted for 2018.
• Healing Art: accepted evidence from a fee-schedule vendor.

For review of a particular no-fault billing dispute, contact the Law Office of Jason Tenenbaum. Bring the service dates, bills, payment records, denials and the insurer’s fee calculation. A review can identify the disputed issue; these historical decisions do not guarantee a recovery.