It is the bill, not the NF-2

In New York no-fault insurance cases, timing requirements for Independent Medical Examinations (IMEs) can be a source of confusion for both healthcare providers and insurance companies. The regulatory framework governing no-fault insurance establishes specific timeframes within which insurers must take action on claims, but these timeframes vary depending on what document the insurer receives and what action is required. Understanding these distinctions is essential for both providers seeking payment and carriers defending denial of coverage.

A common misconception among healthcare providers is that insurers must schedule IMEs within 30 days of receiving an NF-2 form from the healthcare provider. This belief appears to stem from a misreading of 11 NYCRR 65-3.5 and its Appendix 13, which establish timing requirements for IME scheduling. However, these regulations tie IME scheduling obligations to receipt of actual claims for payment, not to preliminary documentation such as NF-2 forms that merely provide notice of treatment without making a demand for payment.

The distinction between NF-2 forms and actual bills is fundamental to understanding insurers’ obligations under the no-fault regulatory scheme. NF-2 forms serve as preliminary notifications of treatment provided, alerting carriers that claims may be forthcoming. Bills, in contrast, are formal demands for payment that trigger carriers’ obligations to either pay or deny claims within 30 days, subject to tolling for verification requests, IME scheduling, and other permissible delays. Conflating these documents can lead providers to incorrectly conclude that IME scheduling was untimely when in fact it complied fully with regulatory requirements.

The case of City Anesthesia Healthcare, P.C. v Erie Insurance Co. demonstrates how courts analyze IME scheduling requirements and the consequences when patients fail to appear for properly scheduled examinations. This decision is particularly relevant for providers who may have misunderstood the regulatory framework governing New York No-Fault Insurance Law and IME procedures. The Appellate Term’s analysis provides definitive guidance on when IME scheduling obligations begin.

Case Background

City Anesthesia Healthcare, P.C. submitted a claim to Erie Insurance Company of New York seeking payment for anesthesia services provided to a patient injured in a motor vehicle accident. Prior to submitting the actual claim for payment, the provider had sent an NF-2 form to the carrier. The carrier scheduled IMEs for the patient before receiving the formal claim, and the patient failed to appear for these examinations. Based on the patient’s failure to appear, the carrier denied the claim.

In Civil Court, City Anesthesia challenged the denial, arguing that the carrier’s pre-claim IME scheduling violated regulatory requirements. Specifically, the provider contended that 11 NYCRR 65-3.5 and Appendix 13 required the carrier to schedule the IMEs within 30 days of receiving the NF-2 form, and because the carrier had not done so, the IME scheduling letters were defective. Civil Court agreed with this argument and ruled in favor of the provider. The carrier appealed to the Appellate Term.

Jason Tenenbaum’s Analysis:

City Anesthesia Healthcare, P.C. v Erie Ins. Co. of N.Y., 2021 NY Slip Op 50135(U)(App. Term 2d Dept. 2020)

“Contrary to the determination of the Civil Court, defendant demonstrated that, before it had received the claim at issue, it properly scheduled independent medical examinations (IMEs) of plaintiff’s assignor, and that the assignor failed to appear for the duly scheduled IMEs (see Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720 ). Defendant also demonstrated that it timely denied the claim (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 ), based upon the assignor’s failure to appear for the IMEs. An assignor’s appearance at an IME “is a condition precedent to the insurer’s liability on the policy” (Stephen Fogel Psychological, P.C., 35 AD3d at 722). Plaintiff’s contention that the pre-claim IME scheduling letter was required to be mailed within 30 days of defendant’s receipt of the NF-2 lacks merit (see 11 NYCRR 65-3.5 , ; Appendix 13).”

It is the bill, not the NF-2

Legal Significance

The City Anesthesia decision clarifies a fundamental principle of no-fault insurance regulation: the 30-day IME scheduling requirement applies to receipt of actual claims (bills), not to receipt of preliminary paperwork such as NF-2 forms. This holding prevents providers from exploiting a misreading of regulatory language to invalidate properly scheduled IMEs. The decision recognizes that NF-2 forms serve an informational function distinct from bills’ payment demand function, and regulatory timing requirements attach to the latter rather than the former.

The Appellate Term’s reliance on Stephen Fogel Psychological, P.C. v Progressive Casualty Insurance Co. demonstrates the consistency of New York appellate authority on this issue. Courts have repeatedly held that appearance at an IME is a condition precedent to insurer liability, and that properly scheduled IMEs trigger this condition precedent regardless of when they occur relative to NF-2 form submission. This principle protects insurers’ fundamental right to verify claims through medical examination before payment obligations arise.

The decision also reinforces the established principle that pre-claim IME scheduling is permissible and effective. Insurers need not wait for formal bill submission before scheduling examinations when they have notice through NF-2 forms or other sources that treatment has been provided and claims are anticipated. This allows carriers to manage their examination processes efficiently and avoid the administrative burden of scheduling examinations under compressed timeframes after bill receipt. The ability to schedule pre-claim IMEs benefits all parties by providing earlier assessment of medical necessity and injury causation.

Practical Implications

For healthcare providers, City Anesthesia establishes that challenging IME scheduling based on NF-2 timing is a losing argument. Providers should not rely on receipt dates of preliminary forms when evaluating whether IME scheduling letters were timely. The relevant date for assessing IME scheduling timeliness is when the carrier received the actual bill demanding payment, not when it received notification that treatment had been provided. Providers who fail to appreciate this distinction may pursue meritless defenses that waste litigation resources.

The decision also underscores the critical importance of ensuring that patients appear for properly scheduled IMEs. When an insurer schedules an IME, whether before or after receiving a claim, patient non-appearance will defeat the provider’s right to payment regardless of the timing of the scheduling letter relative to NF-2 submission. Providers must implement robust systems for notifying patients of IME appointments, confirming their understanding of the appointment details, and ensuring attendance. The consequences of patient non-appearance are severe and typically cannot be overcome through procedural challenges to IME scheduling.

For insurance carriers, this decision validates the practice of scheduling IMEs upon receiving NF-2 forms or other preliminary notice of treatment, before formal bills are submitted. This proactive approach allows carriers to conduct necessary medical assessments without the time pressure that would result from waiting for bill submission. However, carriers must still ensure that IME scheduling letters contain all required information and comply with regulatory formatting requirements. The fact that pre-claim scheduling is permissible does not excuse deficiencies in the scheduling letters themselves.

Key Takeaway

The court definitively rejected the healthcare provider’s argument that IME scheduling letters must be sent within 30 days of receiving an NF-2 form. Instead, the regulatory framework and established case law make clear that IME scheduling requirements are triggered by receipt of actual claims (bills), not preliminary paperwork. This distinction is crucial for understanding when insurers’ obligations begin and how IME no-show cases are evaluated by courts.

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