Fee schedule vendor properly substituted for a claims rep. affidavit

Understanding who can provide testimony in no-fault insurance disputes is crucial for healthcare providers seeking reimbursement. A recent appellate decision clarifies an important procedural point: insurance companies can use affidavits from their fee schedule vendors’ employees instead of their own claims representatives when defending fee schedule determinations. This ruling has significant implications for acupuncture providers and other healthcare professionals navigating reimbursement disputes under New York’s no-fault insurance system.

The case involved an acupuncture practice challenging an insurer’s fee schedule application, specifically regarding acupuncture services performed by chiropractors. The court’s decision demonstrates how insurers can effectively defend their reimbursement calculations through third-party vendor testimony.

The issue of who possesses sufficient personal knowledge to establish fee schedule defenses has generated substantial litigation in New York no-fault practice. Traditionally, courts required insurers to present testimony from their own employees who processed claims and applied fee schedule reductions. This case represents a significant departure from that practice, recognizing the modern reality of outsourced claims administration where specialized vendors perform technical fee schedule determinations on behalf of insurance carriers. The decision acknowledges that third-party fee schedule adjusters, despite lacking formal employment relationships with insurers, possess the requisite expertise and familiarity with rate calculations to provide competent testimony regarding reimbursement methodology.

Case Background

Healing Art Acupuncture, P.C. submitted claims to Amica Mutual Insurance Company for acupuncture services rendered by chiropractors employed by the practice. Amica denied the claims on grounds that the billed amounts exceeded the workers’ compensation fee schedule applicable to acupuncture services performed by chiropractors, and that Amica had already paid the maximum allowable amounts under that schedule. Healing Art Acupuncture challenged the denial, arguing that acupuncture services should be reimbursed at higher rates regardless of the treating provider’s professional licensure. When Amica moved for summary judgment, it submitted an affidavit from a fee schedule adjuster employed by Managed Care Network, a third-party vendor contracted to perform fee schedule determinations for Amica. Healing Art Acupuncture objected, arguing that only Amica’s own claims representatives possessed sufficient personal knowledge to establish the fee schedule defense. The lower court rejected this argument and granted summary judgment to Amica.

Jason Tenenbaum’s Analysis:

Healing Art Acupuncture, P.C. v Amica Mut. Ins. Co., 2015 NY Slip Op 50078(U)(App. Term 2d Dept. 2015)

“Defendant denied plaintiff’s claims on the grounds that they exceeded the amount permitted by the workers’ compensation fee schedule, and that defendant had fully paid for the billed-for services in accordance with the fee schedule for acupuncture services performed by chiropractors. Contrary to plaintiff’s assertion, the affidavit executed by a fee schedule adjuster [*2]for defendant’s vendor, Managed Care Network, established that defendant had properly used the workers’ compensation fee schedule for acupuncture services performed by chiropractors to determine the amount which plaintiff was entitled to receive for the services at issue”

So here, you have a vendor’s affidavit establishing the merits of the fee schedule defense. Generally, this type of issue can be handled through claims representative affidavit.

Legal Significance

This decision resolves an important evidentiary question regarding the admissibility of third-party vendor testimony in no-fault fee schedule disputes. The personal knowledge requirement for affidavits under CPLR 3212 typically demands that affiants possess direct familiarity with the facts they attest to, leading some providers to argue that only insurance company employees who maintain ultimate responsibility for claim payments can properly testify about fee schedule applications. The Appellate Term’s rejection of this argument reflects pragmatic recognition that modern insurance operations routinely delegate specialized functions to contractors possessing technical expertise beyond that of generalist claims adjusters.

The holding aligns with broader principles governing corporate testimony and business records authentication. Just as corporations may produce witnesses with knowledge of their operations regardless of formal title or department, insurers may rely on the specialized knowledge of fee schedule vendors who perform the actual work of analyzing CPT codes, cross-referencing applicable schedules, and calculating maximum allowable reimbursements. This principle extends beyond acupuncture billing disputes to encompass any scenario where insurers utilize third-party administrators, repricing companies, or other vendors to perform claims functions. The decision effectively establishes that contractual delegation of claims processing responsibilities carries with it the authority to provide sworn testimony regarding those delegated functions.

Practical Implications for Litigants

For healthcare providers challenging fee schedule reductions, this decision underscores the importance of attacking the substance of fee schedule determinations rather than relying on formalistic objections to affiant qualifications. When insurers produce vendor testimony, providers should focus discovery on the accuracy of CPT code assignments, the proper identification of applicable fee schedules, and the mathematical calculations underlying reimbursement. Arguments that vendor employees lack standing to testify face significant hurdles after this decision.

Insurance carriers benefit from clarification that their utilization of specialized fee schedule vendors does not create evidentiary obstacles to defending reimbursement disputes. However, insurers must ensure that vendor affidavits contain sufficient detail regarding the methodology employed, the specific fee schedules consulted, and the basis for any professional licensure distinctions affecting reimbursement rates. Conclusory statements from vendors, even if technically competent to testify, may still fail to establish prima facie entitlement to summary judgment absent detailed explanation of the analytical process. Carriers should also maintain clear contractual documentation of their relationships with fee schedule vendors to rebut challenges to the vendors’ authority to act on the insurers’ behalf.

Key Takeaway

This decision establishes that insurance companies can rely on affidavits from their fee schedule vendors’ adjusters to defend reimbursement determinations, rather than requiring testimony from their own claims representatives. This procedural flexibility strengthens insurers’ ability to justify their New York no-fault insurance payment decisions in court proceedings.

Legal Update (February 2026): Since this 2015 post, New York’s no-fault fee schedules and reimbursement procedures have been subject to multiple regulatory amendments and updates. Practitioners should verify current fee schedule provisions, procedural requirements for vendor testimony, and any changes to evidentiary standards that may affect reimbursement dispute proceedings.

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