STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY v. M R I ASSOCIATES OF TAMPA, INC. D/ B/ A PARK PLACE M R I ( 2018 )


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  •                NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING
    MOTION AND, IF FILED, DETERMINED
    IN THE DISTRICT COURT OF APPEAL
    OF FLORIDA
    SECOND DISTRICT
    STATE FARM MUTUAL AUTOMOBILE                    )
    INSURANCE COMPANY,                              )
    )
    Appellant,                        )
    )
    v.                                              )      Case No. 2D16-4036
    )
    MRI ASSOCIATES OF TAMPA, INC.,                  )
    d/b/a PARK PLACE MRI,                           )
    )
    Appellee.                         )
    )
    Opinion filed May 18, 2018.
    Appeal from the Circuit Court for
    Hillsborough County; Claudia Isom, Judge.
    D. Matthew Allen of Carlton Fields Jorden
    Burt, P.A.; Chris W. Altenbernd of Banker
    Lopez Gassler P.A., Tampa; and Marcy
    Levine Aldrich and Nancy A. Copperthwaite
    of Akerman LLP, Miami, for Appellant.
    David M. Caldevilla of de la Parte & Gilbert,
    P.A.; Kristin A. Norse and Stuart C.
    Markman of Kynes, Markman, Felman,
    P.A.; Craig E. Rothburd of Craig E.
    Rothburd, P.A., John V. Orrick, Jr., of the
    Law Offices of John V. Orrick, P.L., Tampa,
    and Scott R. Jeeves of Jeeves Law Group,
    P.A., St. Petersburg, for Appellee.
    SLEET, Judge.
    State Farm Mutual Automobile Insurance Company appeals the final
    declaratory judgment denying its motion for summary judgment and entering final
    judgment in favor of MRI Associates of Tampa, Inc., d/b/a Park Place MRI (Park Place).
    The circuit court ruled that State Farm's Personal Injury Protection (PIP) policy failed to
    clearly and unambiguously elect to limit reimbursement payments to the schedule of
    maximum charges described in section 627.736(5)(a)(1)–(5), Florida Statutes (2013).
    Because the express language of State Farm's PIP policy does clearly and
    unambiguously elect to limit reimbursement payments for medical expenses to the
    schedule of maximum charges, we reverse.
    The facts are undisputed in this case. This action arises from nineteen
    individual PIP claims involving State Farm insureds who were injured in automobile
    accidents in 2013, received MRIs from Park Place, and subsequently executed
    assignments of benefits to Park Place. Park Place submitted the bills to State Farm
    under the insureds' PIP policies, and State Farm paid portions of each of the nineteen
    bills in accordance with its interpretation of its policy. Park Place disputed the amounts
    paid by State Farm, and State Farm filed an action seeking a declaration of its rights
    and obligations under its policy and the PIP statute, section 627.736. Park Place
    countersued, seeking a declaration of its rights and obligations under the State Farm
    policy and the PIP statute and an injunction to prevent State Farm from limiting its
    payments for charges to the schedule of maximum charges.1
    1In their appellate briefs and at oral argument, the parties also disputed
    whether the actual payments made by State Farm were in compliance with the schedule
    of maximum charges limitation. However, by stipulation of the parties, the trial court's
    summary judgment order was limited to the issue of whether State Farm's policy
    "lawfully invokes the schedule of maximum charges . . . set forth in section
    -2-
    To calculate the amount payable to Park Place for the MRI charges at
    issue, State Farm relied on the following language from its policy:
    We will pay in accordance with the No-Fault Act properly
    billed and documented reasonable charges for bodily injury
    to an insured caused by an accident resulting from the
    ownership, maintenance, or use of a motor vehicle as
    follows:
    ....
    We will limit payment of Medical Expenses described in the
    Insuring Agreement of this policy's No-Fault Coverage to
    80% of a properly billed and documented reasonable
    charge, but in no event will we pay more than 80% of the
    following No-Fault Act "schedule of maximum charges"
    including the use of Medicare coding policies and payment
    methodologies of the federal Centers for Medicare and
    Medicaid Services, including applicable modifiers.
    The policy defines a reasonable charge as follows:
    Reasonable Charge, which includes reasonable expense,
    means an amount determined by us to be reasonable in
    accordance with the No-Fault Act, considering one or more
    of the following:
    1. usual and customary charges;
    2. payments accepted by the provider;
    3. reimbursement levels in the community;
    4. various federal and state medical fee schedules
    applicable to motor vehicle and other insurance
    coverages;
    5. the schedule of maximum charges in the No-Fault Act[;]
    6. other information relevant to the reasonableness of the
    charge for the service, treatment, or supply; or
    7. Medicare coding policies and payment methodologies of
    the federal Centers for Medicare and Medicaid Services,
    including applicable modifiers, if the coding policy or
    payment methodology does not constitute a utilization
    limit.
    627.736(5)(a)(1)"; therefore, whether the amount actually paid by State Farm complies
    with the schedule of maximum charges was not before the trial court and is thus outside
    the scope of our appellate review.
    -3-
    The State Farm policy tracks the method of reimbursement calculation outlined in
    section 627.736(5)(a)2 and the limitation set forth in section 627.736(5)(a)(1).3 State
    Farm contends that it is authorized under the 2013 PIP statute to limit its maximum
    payment to eighty percent of the schedule of maximum charges under section
    627.736(5)(a)(1). Park Place disagrees, arguing that State Farm must elect either the
    reasonable charge method of calculation under section 627.736(5)(a) or the schedule of
    maximum charges method of calculation under section 627.736(5)(a)(1) and that
    because its policy includes both, State Farm relies on an "unlawful hybrid method" of
    reimbursement calculation. Park Place contends that because State Farm cannot elect
    both calculation methods, it must use the reasonable charge method as outlined in the
    definitions section of its policy and section 627.736(5)(a). We disagree.
    2Section  627.736(5)(a) provides:
    (5) Charges for treatment of injured persons.--
    (a) A physician, hospital, clinic, or other person or institution
    lawfully rendering treatment to an injured person for a bodily
    injury covered by personal injury protection insurance may
    charge the insurer and injured party only a reasonable
    amount pursuant to this section for the services and supplies
    rendered . . . . In determining whether a charge for a
    particular service, treatment, or otherwise is reasonable,
    consideration may be given to evidence of usual and
    customary charges and payments accepted by the provider
    involved in the dispute, reimbursement levels in the
    community and various federal and state medical fee
    schedules applicable to motor vehicle and other insurance
    coverages, and other information relevant to the
    reasonableness of the reimbursement for the service,
    treatment, or supply.
    3Section
    627.736(5)(a)(1) provides that "[t]he insurer may limit
    reimbursement to 80 percent of the . . . schedule of maximum charges."
    -4-
    This court reviews a final summary judgment de novo. Motzenbecker v.
    State Farm Mut. Auto. Ins. Co., 
    123 So. 3d 600
    , 602 (Fla. 2d DCA 2013) (reviewing a
    ruling on cross-motions for summary judgment where both parties sought declaratory
    relief); see also Allstate Ins. Co. v. Orthopedic Specialists, 
    212 So. 3d 973
    , 975 (Fla.
    2017) ("Because the question presented requires this Court to interpret provisions of the
    Florida Motor Vehicle No-Fault Law—specifically, the PIP statute—as well as to
    interpret the insurance policy, our standard of review is de novo." (quoting Geico Gen.
    Ins. Co. v. Virtual Imaging Servs., Inc., 
    141 So. 3d 147
    , 152 (Fla. 2013))).
    " '[L]egislative intent is the polestar that guides a court's inquiry under the No-Fault Law,'
    including the PIP statute. 'Such intent is derived primarily from the language of the
    statute.' " Virtual 
    Imaging, 141 So. 3d at 154
    (citation omitted) (quoting Allstate Ins. Co.
    v. Holy Cross Hosp., Inc., 
    961 So. 2d 328
    , 334 (Fla. 2007)).
    In 1971 the Florida Legislature enacted the Florida Motor Vehicle No-Fault
    Law4 "to provide for medical, surgical, funeral, and disability insurance benefits without
    regard to fault[] and to require motor vehicle insurance securing such benefits." 
    Id. at 152
    (quoting § 627.731, Fla. Stat. (2008)). The mandate that an insurer reimburse a
    percentage of the reasonable expenses for medically necessary services "is the heart of
    the PIP statute's coverage requirements." 
    Id. at 155.
    Under the 2013 version of the
    PIP statute, an insurer is required to pay the reasonable charges for medically
    necessary services under section 627.736(5)(a); however, it may elect to limit its
    payment using the schedule of maximum charges under section 627.736(5)(a)(1). See
    Virtual 
    Imaging, 141 So. 3d at 150
    ("[T]he PIP statute, section 627.736, requires the
    4See   §§ 627.730–.7405.
    -5-
    insurer to pay for 'reasonable expenses . . . for medically necessary . . . services' but
    merely permits the insurer to use the Medicare fee schedules as a basis for limiting
    reimbursements." (citation omitted)). To make this election, the insurer must provide
    notice to the insured in the policy. § 627.736(5)(a)(5); see also Orthopedic 
    Specialists, 212 So. 3d at 976
    –77.
    In Virtual Imaging, the Florida Supreme Court considered "the effect of the
    2008 amendments [to the PIP statute] on an insurer's ability to limit reimbursements"
    before the legislature enacted the notice requirement in 
    2012. 141 So. 3d at 154
    . The
    2008 PIP statute contained language similar to the 2013 PIP statute regarding the
    reasonable charge calculation method and the schedule of maximum charges limitation
    in subsections (5)(a)(1) and (5)(a)(2), respectively. By placing the reasonable charge
    method and the fee schedules limitation in two separate but coequal subsections of
    627.736(5)(a), the legislature created two distinct reimbursement calculation
    methodologies. 
    Id. at 156
    ("[T]here are two different methodologies for calculating
    reimbursements to satisfy the PIP statute's reasonable medical expenses coverage
    mandate."). The supreme court held that the statute thus "offered insurers a choice . . .
    to limit reimbursements based on the Medicare fee schedules or . . . based on the
    [reasonable charge] factors enumerated in section 627.736(5)(a)(1)." 
    Id. at 157.
    Relying on the permissive language of section 627.736(5)(a)(2), the supreme court
    explained that an "insurer must clearly and unambiguously elect the [schedule of
    maximum charges] payment methodology in order to rely on it." 
    Id. at 158
    (citing
    Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 
    63 So. 3d 63
    , 67–68 (Fla. 4th DCA
    2011)). Because the insurer's policy made no specific reference to the schedule of
    -6-
    maximum charges, the supreme court ultimately concluded that it could not limit its
    reimbursement based on those fee schedules. 
    Id. at 160.
    In Orthopedic Specialists, the supreme court considered the 2009 version
    of the PIP statute, which included language identical to the 2008 statute defining the
    reasonable charge and schedule of maximum charges calculation methodologies in
    subsections (5)(a)(1) and (5)(a)(2), respectively. Relying on Virtual Imaging, the
    supreme court reaffirmed that the reasonable charge calculation methodology and the
    schedule of maximum charges limitation were separate and distinct and that each
    individually "satisf[ied] the PIP statute's reasonable medical expenses coverage
    mandate." Orthopedic 
    Specialists, 212 So. 3d at 976
    . But the supreme court went on
    to explain that the insurer's "PIP policy cannot contain a statement that the insurer will
    not pay eighty percent of reasonable charges because no insurer can disclaim the PIP
    statute's reasonable medical expenses coverage mandate" and that the policy cannot
    "state that the insurer will calculate benefits solely under the Medicare fee schedules
    contained within section 627.736(5)(a)(2) because the Medicare fee schedules are not
    the only applicable mechanism for calculating reimbursements under the permissive
    payment methodology." 
    Id. at 977
    (noting that the schedule of maximum charges
    outlined in section 627.736(5)(a)(2) contained both Medicare fee schedules and non-
    Medicare fee schedules). Accordingly, the supreme court expressly rejected the
    argument urged by Park Place in this appeal, that an insurer's policy must completely
    disclaim the reasonable charge methodology to elect the schedule of maximum charges
    limitation. 
    Id. at 975
    (rejecting the Fourth District's holding that a "policy must make it
    inescapably discernable that it will not pay the 'basic' statutorily required coverage
    -7-
    [mandate of eighty percent of reasonable expenses for medically necessary services]
    and will instead substitute the Medicare fee schedules as the exclusive form of
    reimbursement" (alteration in original) (quoting Orthopedic Specialists v. Allstate Ins.
    Co., 
    177 So. 3d 19
    , 26 (Fla. 4th DCA 2015))). Because the insurer's policy "clearly and
    unambiguously state[d] that '[a]ny amounts payable' for medical expense
    reimbursements 'shall be subject to any and all limitations, authorized by section
    627.736, . . . including . . . all fee schedules,' " the supreme court concluded that the
    policy adequately placed the insured and service providers on notice of the insurer's
    election of the schedule of maximum charges limitation. 
    Id. at 977
    –78 (second
    alteration in original).
    Significantly, neither Virtual Imaging nor Orthopedic Specialists applies to
    policies created after the 2012 amendment to the PIP statute, which the State Farm
    policy at issue in this case was. See Orthopedic 
    Specialists, 212 So. 3d at 974
    ; Virtual
    
    Imaging, 141 So. 3d at 150
    ("[O]ur holding applies only to policies that were in effect
    from the effective date of the 2008 amendments to the PIP statute that first provided for
    the Medicare fee schedule methodology, which was January 1, 2008, through the
    effective date of the 2012 amendment, which was July 1, 2012.").
    In 2012 the legislature substantially amended section 627.736(5), setting
    forth the schedule of maximum charges limitation as a subsection of the reasonable
    charge calculation methodology. Ch. 2012-197, § 10, at 2743–44, Laws of Fla. As a
    result of this amendment, the reasonable charge and schedule of maximum charges
    methodologies are no longer coequal subsections of 627.736(5)(a); instead the
    reasonable charge method is set forth in subsection (5)(a), and the schedule of
    -8-
    maximum charges limitation is provided in subsection (5)(a)(1). Based on the current
    construction of the PIP statute, we conclude that there are no longer two mutually
    exclusive methodologies for calculating the reimbursement payment owed by the
    insurer. See Bd. of Trs., Jacksonville Police & Fire Pension Fund v. Lee, 
    189 So. 3d 120
    , 126 (Fla. 2016) ("When a statute is amended to change a key term or to delete a
    provision, 'it is presumed that the Legislature intended it to have a meaning different
    from that accorded to it before the amendment.' " (quoting Carlile v. Game & Fresh
    Water Fish Comm'n, 
    354 So. 2d 362
    , 364 (Fla.1977))). The 2013 PIP statute includes
    the fact-dependent calculation of reasonable charges as a part of the definition of
    "[c]harges for treatment of injured persons" under section 627.736(5)(a). And an insurer
    may not disclaim the fact-dependent calculation; however, it may elect to limit its
    payment in accordance with the schedule of maximum charges under subsection
    (5)(a)(1)(a)–(f). Accordingly, we reject Park Place's argument that State Farm's policy
    contains an "unlawful hybrid method" of reimbursement calculation and is therefore
    impermissibly vague. State Farm's inclusion of the statutory factors in its definition of
    reasonable charges tracks the PIP statute and is not inconsistent with the policy
    language limiting reimbursement to the schedule of maximum charges.
    "Where the language in an insurance contract is plain and unambiguous, a
    court must interpret the policy in accordance with the plain meaning so as to give effect
    to the policy as written." Orthopedic 
    Specialists, 212 So. 3d at 975
    –76 (quoting
    Washington Nat'l Ins. Corp. v. Ruderman, 
    117 So. 3d 943
    , 948 (Fla. 2013)). State
    Farm's policy clearly and unambiguously states that "in no event will we pay more than
    80% of the . . . No-Fault Act 'schedule of maximum charges.' " The policy also includes
    -9-
    language virtually identical to that of section 627.736(5)(a)(1)(a)–(f), listing verbatim all
    of the applicable fee schedules that it will use to limit reimbursement. State Farm's
    policy language is even more clear and unambiguous than that at issue in Orthopedic
    Specialists, which "state[d] that '[a]ny amounts payable' for medical expense
    reimbursements 'shall be subject to any and all limitations, authorized by section
    627.736, . . . including . . . all fee schedules.' 
    " 212 So. 3d at 977
    ; see also Allstate
    Indem. Co. v. Markley Chiropractic & Acupuncture, LLC, 
    226 So. 3d 262
    , 266 (Fla. 2d
    DCA 2016), review denied, no. SC16-1100 (Fla. Aug. 4, 2017). Because the State
    Farm policy includes mandatory language expressly limiting reimbursement for
    reasonable medical expenses to the schedule of maximum charges set forth in section
    627.736(5)(a)(1)(a)–(f), we conclude that it is sufficient to place insureds and service
    providers on notice as required by section 627.736(5)(a)(5). Accordingly, we reverse
    the trial court's order granting summary judgment in favor of Park Place, and we certify
    the following question of great public importance:
    DOES THE 2013 PIP STATUTE AS AMENDED PERMIT AN
    INSURER TO CONDUCT A FACT-DEPENDENT
    CALCULATION OF REASONABLE CHARGES UNDER
    SECTION 627.736(5)(a) WHILE ALLOWING THE INSURER
    TO LIMIT ITS PAYMENT IN ACCORDANCE WITH THE
    SCHEDULE OF MAXIMUM CHARGES UNDER SECTION
    627.736(5)(a)(1)?
    Reversed and remanded for further proceedings consistent with this
    opinion; question certified.
    CASANUEVA and CRENSHAW, JJ., Concur.
    - 10 -