EUO letter to Assignor did toll time to pay or deny

Under New York’s no-fault insurance regulations, insurers must pay or deny claims within 30 days of receiving proper proof of claim. However, this timeline can be tolled when insurers request examinations under oath or independent medical examinations. The case of Doctor Goldshteyn Chiropractic, P.C. v ELRAC, Inc. clarifies the specific documentation required to establish that an EUO request to an assignor properly tolled the insurer’s time to pay or deny medical provider claims.

This decision provides crucial guidance on a frequently litigated issue: what proof must insurers present to demonstrate they timely tolled their payment obligations through EUO requests? The answer requires more than simply sending a delay letter to the medical provider—insurers must also prove they timely requested the underlying EUO from the assignor.

Case Background

Doctor Goldshteyn Chiropractic brought an action to recover no-fault benefits from ELRAC, Inc. The medical provider argued that defendant failed to establish proper tolling of its time to pay or deny claims seeking $241.30, $1,310.94, and $1,019.62. Specifically, the plaintiff contended that the defendant had not timely mailed EUO scheduling letters to the assignor, meaning the subsequent delay notice to the provider was ineffective.

The insurer’s defense hinged on proving a two-step process: first, that it timely sent an EUO scheduling letter to the insured assignor; and second, that it sent a corresponding delay notice to the medical provider informing them that payment was being held pending completion of the EUO. The case turned on whether defendant adequately documented both steps.

Jason Tenenbaum’s Analysis

Doctor Goldshteyn Chiropractic, P.C. v ELRAC, Inc., 2017 NY Slip Op 50923(U)(App. Term 2d Dept. 2017)

“Plaintiff’s contention that defendant failed to establish that its time to pay or deny claims seeking to recover the sums of $241.30, $1,310.94, and $1,019.62 was tolled because defendant had not timely mailed EUO scheduling letters to plaintiff’s assignor lacks merit. While plaintiff correctly asserts that the letter from defendant dated January 27, 2011 is a delay letter, defendant established that the first EUO scheduling letter had been timely and properly mailed to plaintiff’s assignor on January 4, 2011 (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 ; Great Health Care Chiropractic, P.C. v Nationwide Ins., 46 Misc 3d 130, 2014 NY Slip Op 51812 )”

This is an interesting case because (I think) it lays out what is necessary to timely delay a bill for pending EUOs/IMEs and, afterwards, denying the same. Most of the caselaw that has discussed the issue has not been favorable to the carriers.

Here, the carrier presented (1) EUO letter to Assignor; and (2) Timely delay letter to medical provider stating that bill is delayed pending EUO.

I would note that if the EIP attended and the bill was denied on other grounds, you would still need the same proof to show the time to pay or deny is tolled. Oftentimes (and I have seen it accidentally out of here), the motion-writer thinks that you only need to present the delay to the provider to prove a toll. This is not the case – do not fall into that trap.

You always need (1) the underlying EUO/IME letter with proof of mailing and (2) proof of attendance to prove the toll.

Legal Significance

This decision clarifies a critical but often misunderstood aspect of no-fault claims administration: the procedural requirements for properly tolling the 30-day payment period through EUO requests. New York’s no-fault regulations establish strict timeframes within which insurers must pay or deny claims. When insurers fail to meet these deadlines without proper tolling, they may be deemed to have waived their defenses and owe payment plus statutory interest.

The court’s ruling establishes that effective tolling requires dual documentation. First, the insurer must prove it timely mailed an EUO scheduling letter to the insured assignor. This typically requires proof of mailing (such as an affidavit from the mail room, certified mail receipt, or other competent evidence) and proper addressing. The timing is crucial—the EUO request must be sent within the initial 30-day period or any previously tolled period.

Second, the insurer must send a delay notice to the medical provider informing them that payment is being held pending completion of the EUO or IME. This second step serves an important notice function, alerting the provider that their claim is not being ignored but rather pending completion of necessary examinations.

Practical Implications

For insurance companies, this decision underscores the importance of maintaining meticulous records when tolling claim payment timelines. Insurers should implement systems ensuring that: (1) EUO and IME scheduling letters are sent timely with proper proof of mailing; (2) corresponding delay notices are sent to medical providers; and (3) all documentation is preserved for potential litigation.

A common mistake highlighted by Jason Tenenbaum’s analysis is assuming that the delay letter to the provider alone suffices to establish tolling. Motion writers and claims adjusters must understand that both the underlying examination request to the assignor and the delay notice to the provider are necessary components of proper tolling.

For medical providers and their attorneys, this case provides a roadmap for challenging inadequate toll notices. When insurers assert they timely tolled payment obligations through EUO or IME requests, providers should demand proof of both the examination scheduling letter to the assignor and the delay notice. If the insurer cannot produce both documents with adequate proof of mailing and timely dispatch, the tolling may be ineffective, potentially entitling the provider to payment.

Related Articles

• EUO scheduling requirements and untimely medical provider examinations
• Additional verification timing and EUO procedure requirements
• Follow-up verification timing requirements in no-fault claims
• EUO non-appearance issues and triable facts
• New York No-Fault Insurance Law