It came and I am surprised – but if everything is now done in New Jersey, what’s the long term impact?

The Court of Appeals affirmed this decision in 2016: the governing no-fault framework did not require GEICO to pay Avanguard’s separate office-based surgery facility fees. The doctor’s professional services and the additional facility charge were different items. The question in the original title about New Jersey was a forecast, not the holding of a New York case.

Still current (September 2026): The Court of Appeals affirmed Avanguard in 2016, holding that the applicable framework did not mandate office-based surgery facility fees; the fee-schedule hub distinguishes that entitlement issue from the later out-of-state payment calculation.

Last reviewed: September 2026.

What the Second Department decided

Government Employees Insurance Co. v Avanguard Medical Group, PLLC, 127 AD3d 60, was decided February 18, 2015. The dispute concerned office-based surgery performed in an accredited Brooklyn practice and setting under Public Health Law § 230-d.

The physician billed for professional services through a separate professional corporation. Avanguard also sought facility fees covering use of the location, staff and equipment. GEICO challenged the obligation to pay those separate charges.

The Appellate Division reversed the denial of GEICO’s summary-judgment motion. It held that, without express statutory or regulatory authorization, the insurer was not required to pay the separate facility fee for surgery in the office-based setting at issue. The court did not decide that the physician’s surgical work was uncompensated or medically unnecessary.

Accreditation and Article 28 status were not interchangeable

The decision distinguished an accredited office-based surgery practice from a hospital or ambulatory surgery center regulated under Public Health Law article 28. The statutory and regulatory frameworks provided facility-fee treatment for the latter settings, with a different level of licensing and oversight.

Avanguard argued that its accreditation should permit it to collect a comparable facility fee. The court rejected that argument. A fee schedule available to another type of facility did not become applicable to Avanguard simply because surgery occurred at both locations.

This is an entitlement issue, not just a dispute over the rate assigned to a code. Before comparing fee amounts, the reader needs to identify the type of provider, the setting and the authority allowing the separate charge. A schedule cannot be used to skip those questions.

Why the fallback regulation did not supply a fee

Avanguard relied on 11 NYCRR 68.5, which addresses certain reimbursable professional health services not set forth in the schedules. It argued that the regulation filled the absence of an office-based facility-fee entry.

The Second Department rejected using that provision to create an entire category of compensable fees. Its analysis distinguished a gap for a particular professional service from a recurring charge for use of the premises, personnel and equipment.

The Court of Appeals made that distinction explicit in Government Employees v Avanguard, 27 NY3d 22, decided March 31, 2016. It affirmed, explaining that the regulation addressed reimbursable professional services and did not authorize recovery of the office-based facility expenses at issue.

A missing schedule entry therefore did not, by itself, establish a right to bill a prevailing fee. The reimbursement authority had to exist before the fallback valuation method could apply. That is why Avanguard differs from a disagreement over whether an otherwise payable service received the correct amount.

The procedural history matters too

GEICO had sought to stop related actions and arbitrations while the declaratory-judgment dispute was pending. Its unsuccessful request for a stay or preliminary injunction was not the same question as its later request for a declaration on the merits.

The 2015 merits appeal resulted in summary judgment for GEICO. The Court of Appeals’ 2016 opinion recounts that the separate appeal concerning the preliminary injunction was then dismissed as academic. A reader following the case through multiple entries should not treat the earlier denial of interim relief as a final ruling requiring payment.

The archive’s earlier Article 28 and surgical-center note belongs before Avanguard in that history. Its earlier discussion should be read with the later appellate holding, not substituted for it.

What the New Jersey question did not decide

The original title asks about the longer-term impact if services moved to New Jersey. Avanguard concerned a New York office-based practice. It did not establish that relocation guarantees payment of an otherwise disputed facility charge.

The 2014 Surgicare case addressed the applicable amount for reimbursable New Jersey services under the then-current out-of-state rule. Saddle Brook combined a New Jersey schedule issue with the new excessive-fee preclusion provision. Those are useful comparisons, but neither should be collapsed into a promise that all facility fees outside New York are recoverable.

DFS subsequently adopted a different out-of-state calculation. Under the final 33rd Amendment to Regulation 83, the usual comparison for covered services to a New York resident includes the highest applicable New York regional fee, the provider’s charge and the local prevailing fee, subject to stated exceptions. The proposal-to-adoption note explains that change.

The practical point is limited: the treatment location can affect valuation, but a geographic comparison is not itself authority to collect a separate category of fee. Identify whether the charge is reimbursable before deciding how a permissible amount would be calculated.

Reading a bill that cites Avanguard

Separate the professional-service bill from any facility component. Identify which entity billed each item and the legal status of the setting. Then ask what statutory, regulatory or schedule provision the party invokes for that particular charge.

If the dispute is only arithmetic, a case about the existence of reimbursement authority may not resolve it. The Tyorkin note describes a fee defense that survived but still needed a trial because its calculations were insufficiently explained. The Healing Art note describes accepted vendor proof of scheduled payment.

Conversely, a persuasive calculation does not cure the absence of authority for the charge itself. That sequence—entitlement, applicable rule, then amount—is the reason Avanguard belongs in the fee-schedule library beside, but not merged with, the out-of-state and coding cases.

This note records the appellate decisions and the later geographic-rule change. It does not certify the licensing status of a current facility, price a present-day surgical bill or predict the outcome of an individual reimbursement dispute.

Connect to the Encyclopedia

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

• Surgicare: the earlier New Jersey prevailing-fee calculation.
• Saddle Brook: New Jersey fees and the post-2013 preclusion issue.
• The 2018 adopted rule differed from the out-of-state proposal.
• Tyorkin: proving the amount after a fee defense survives.
• Healing Art: a supported fee-schedule vendor affidavit.

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.