ENDO SURGI CENTER A/S/O BERNADETTE HARPER VS. NJM INSURANCE GROUP (L-2518-17, ESSEX COUNTY AND STATEWIDE) ( 2019 )


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  •                                  NOT FOR PUBLICATION WITHOUT THE
    APPROVAL OF THE APPELLATE DIVISION
    This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
    internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.
    SUPERIOR COURT OF NEW JERSEY
    APPELLATE DIVISION
    DOCKET NO. A-1934-17T3
    ENDO SURGI CENTER a/s/o
    BERNADETTE HARPER,
    Plaintiff-Respondent,
    v.
    NJM INSURANCE GROUP,
    Defendant-Appellant.
    _____________________________
    Argued December 11, 2018 – Decided February 7, 2019
    Before Judges Hoffman, Suter and Geiger.
    On appeal from Superior Court of New Jersey, Law
    Division, Essex County, Docket No. L-2518-17.
    Robert A. Cappuzzo argued the cause for appellant
    (Chasan Lamparello Mallon & Cappuzzo, PC,
    attorneys; Robert A. Cappuzzo, of counsel and on the
    brief; Richard W. Fogarty, on the briefs).
    Carl A. Salisbury argued the cause for respondent
    (Bramnick, Rodriguez, Grabas, Arnold & Mangan,
    LLC, attorneys; Carl A. Salisbury, on the brief).
    PER CURIAM
    In New Jersey Mfrs. Ins. Co. v. Specialty Surgical Center, ___ N.J. Super.
    ___, ___ (App. Div. January 29, 2019) (slip op. at 2), we affirmed trial court
    orders that "held the PIP 1 medical fee schedule [did] not provide payment to an
    ambulatory surgical center (ASC) for procedures not listed as reimbursable
    when performed at an ASC." That precedent resolves this case. We reverse the
    trial court's summary judgment order that granted reimbursement to the ASC
    because the medical procedure involved in this case was not reimbursable when
    performed separately at an ASC.
    Bernadette Harper, a New Jersey Manufacturers Insurance Company
    (NJM) insured, sustained injury to her lower back in a February 2012 car
    accident. In April 2014, she received a lumbar discography at an ASC operated
    by defendant Endo Surgi Center in Union (Endo Surgi). Endo Surgi sought
    $10,000.02 in reimbursement from NJM for the discography.2 NJM denied
    payment.
    1
    "PIP" means personal injury protection as provided for in N.J.S.A. 39:6A-4.
    2
    Endo Surgi's claim requested reimbursement for services on three different
    dates. The discography was performed on April 22, 2014. Endo Surgi's total
    claim, for all three dates of service, was $13,582.82 in medical benefits. NJM
    challenged the discography portion; it did not challenge the remaining $3582.62.
    A-1934-17T3
    2
    The ASC filed a demand for PIP arbitration with Forthright, Inc., an entity
    that was contracted with the State to provide dispute resolution professionals
    (DRPs) to hear PIP disputes. See Kimba Med. Supply v. Allstate, Ins. Co., 
    431 N.J. Super. 463
    , 467 (App. Div. 2013). In November 2016, the DRP ruled in
    favor of Endo Surgi that the claim was reimbursable.           NJM appealed that
    decision to a three-DRP panel, which reversed the DRP's decision in March 2017
    as "contrary to the [l]aw, specifically N.J.A.C. 11:3-29.5."
    Endo Surgi filed a Law Division complaint under N.J.S.A. 2A:23A-13 of
    the Alternative Procedure for Dispute Resolution Act (APDRA) seeking to
    vacate the three-DRP panel's decision. Endo Surgi contended it was entitled to
    reimbursement under N.J.A.C. 11:3-29.4(g) because the procedure was
    reimbursable under Medicare rules. Both parties filed motions for summary
    judgment. On November 17, 2017, the trial court granted Endo Surgi's cross-
    motion for summary judgment, ordering reinstatement of the DRP's award that
    allowed reimbursement, and denying NJM's motion.
    Endo Surgi's claim is for reimbursement under the PIP medical fee
    schedule, N.J.A.C. 11:3-29.1 to -.6 and 11:3-29 (Appendix 1 to 7) (Fee
    Schedule), for Harper's lumbar discography. The Department of Banking and
    Insurance (Department) promulgated the Fee Schedule "'on a regional basis for
    A-1934-17T3
    3
    the reimbursement of healthcare providers . . . for medical expense benefits . . .
    under [PIP] coverage . . . .'" Specialty Surgical, ____ N.J. Super. at ____ (slip
    op. at 3) (quoting N.J.S.A. 39:6A-4.6(a)). "'ASC facility fees are listed in
    Appendix, Exhibit 1 [(the Fee Schedule)] by CPT [3] Code.'" 
    Ibid. (alterations in original).
    This lumbar discography claim was billed under CPT Code 62290. In
    April 2014, when this claim was submitted, this CPT Code 62290 was listed on
    the Fee Schedule but the column listing reimbursement for an ASC, did not list
    any dollar amount for reimbursement, instead it had the notation "N1."
    N.J.A.C. 11:3-29.5(a) provides that "[c]odes that do not have an amount
    in the ASC facility column are not reimbursable if performed in an ASC." In
    the Department's Frequently Asked Questions (FAQ), the Department
    explained:
    Question: There is no fee in the ASC facility fee column
    of Appendix, Exhibit 1 for the service I want to provide
    in an ASC.
    Answer: N.J.A.C. 11:3-29.5(a) and 29.4(e)3 state that
    when there is no fee in the ASC facility fee column of
    Appendix, Exhibit 1 for a service, the facility fee for
    that service is not reimbursable if performed in an ASC.
    3
    A "CPT Code" means "Current Procedural Terminology" Code.
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    4
    Stated another way, the only facility fees that are
    reimbursable for services performed in an ASC are
    those CPT and HCPCS codes that have facility fees
    listed in the ASC Facility Fee Column of Appendix,
    Exhibit 1. The fact that, subsequent to the promulgation
    of the fee schedule rule, [Medicare] may have
    authorized additional procedures to be performed in an
    ASC does not permit an ASC to be reimbursed for those
    services unless there is an amount listed in the ASC Fee
    Column of Appendix, Exhibit 1 for the corresponding
    CPT code. However, certain codes that do not have
    fees in the ASC facility fee column have "N1" in the
    payment indicator column.          The "N1" payment
    indicator means that the service can be performed in an
    ASC but a facility fee is not separately reimbursable
    because the service is included in another procedure.
    N.J.A.C. 11:3-29.5(a) and 29.4(e)3 apply only to
    facility fees and do not apply to physician services.
    [(Emphasis added).]
    The Law Division judge granted reimbursement because after January 1, 2014,
    Medicare allowed reimbursement to ASCs that performed this CPT Code. The
    court did not consider it fair that the Department's PIP medical fee schedule did
    not allow reimbursement to an ASC "once Medicare indicated that this particular
    discography performed at a [ASC] facility is reimbursable."            The court
    referenced another regulation, N.J.A.C. 11:3-29.4(g), which provided:
    [e]xcept as specifically stated to the contrary in this
    subchapter [that is, Subchapter 29], the fee schedules
    shall be interpreted in accordance with the following,
    incorporated herein by reference, as amended and
    supplemented: the relevant chapters of the Medicare
    A-1934-17T3
    5
    Claims Processing Manual, updated periodically by
    CMS, that were in effect at the time the service was
    provided.
    [N.J.A.C. 11:3-29.4(g).]
    The court stated that the ... whole point of ... the language contained in 11:3-
    29.4(g) and the spirit of that, [is] that the ... fee should be ... reimbursable."
    On appeal, NJM argues the trial court's order should be vacated because
    CPT Code 62290 is not reimbursable to ASC's under the Department's PIP
    Medical Fee Schedule when performed separately.4 It contends the trial court
    did not have the legal authority to amend the Fee Schedule to conform it with
    Medicare's reimbursement rules. In doing so, the trial court to improperly
    substituted its judgment for that of the Department. NJM asks that we exercise
    "supervisory authority" to correct this significant concern of public policy.
    "We exercise de novo review of legal questions." Specialty Surgical, __
    N.J. Super. at __ (slip op. at 9) (citing State v. Gandhi, 
    201 N.J. 161
    , 176 (2010);
    Manalapan Realty, LP v. Twp. Comm. of Manalapan, 
    140 N.J. 366
    , 378 (1995)).
    4
    As NJM explains in its brief, the "ASC may host a procedure utilizing this
    code but as a packaged procedure, it is not separately reimbursable by a No -
    Fault insurer. This is because the cost of hosting procedures marked with an
    'N1' modifier, such as CPT 62290, is included in other charges." Endo Surgi
    does not dispute the lumbar discography was the only procedure performed on
    Ms. Harper on April 22, 2014 and was not "bundled" with another procedure.
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    6
    In Specialty Surgical, we addressed the same legal issue. In that case, the CPT
    codes being considered for reimbursement when performed at an ASC were not
    listed in the Department's medical fee schedule at all. Id. at __ (slip op. at 4-5).
    The   defendants    cited   N.J.A.C.      11:3-29.4(g)   as   authority   to   permit
    reimbursement of those CPT Codes because they were reimbursable by
    Medicare even though they were not included in the Fee Schedule. Id. at __
    (slip op. at 9-10). In discussing the Fee Schedule, we observed in Specialty
    Surgical that it listed various CPT codes.
    For many, there was an amount listed that could be
    reimbursed to an ASC if it performed the service listed.
    For some other listed CPT Codes, there was no
    reimbursement figure for an ASC. Clearly, if the CPT
    Code is listed and no amount is set forth for an ASC,
    the ASC cannot receive payment for that service.
    [Id. at __ (slip op. at 13) (emphasis added).]
    We also rejected the argument in Specialty Surgical that Endo Surgi
    makes here that the Fee Schedule is amended when Medicare permits
    reimbursement to an ASC of a CPT Code. "The fact that Medicare now includes
    the CPT Code does not result in the automatic amendment of the Fee Schedule;
    instead we conclude it is the Department, not Medicare, that amends the Fee
    Schedule." Id. at ___ (slip op. at 15).
    A-1934-17T3
    7
    In this case, CPT Code 62290 was listed in the Fee Schedule but that
    schedule did not include a reimbursement amount for an ASC because it did not
    permit reimbursement when performed separately at an ASC. The trial court
    erred in ordering reimbursement.       This case presents one of those "rare
    circumstances" where our review of a trial court order is necessary because of
    our "nondelegable special supervisory function." Riverside Chiropractic Grp.
    v. Mercury Ins. Co., 
    404 N.J. Super. 228
    , 239 (App. Div. 2008) (citing Mt. Hope
    Dev. Assocs. v. Mt. Hope Waterpower Project, LP, 
    154 N.J. 141
    , 152 (1998));
    see Specialty Surgical, __ N.J. Super. at __ (slip op. at 7). We are constrained
    to reverse in light of our decision in Specialty Surgical.5
    Reversed.
    5
    Endo Surgi claims the trial court erred by not awarding it attorney's fees when
    it granted the cross-motion for summary judgment. Endo Surgi did not file a
    cross-appeal of the trial court's order. Because of this, the issue is not properly
    before us. See State v. Chavies, 
    345 N.J. Super. 254
    , 265 (App. Div. 2001).
    "Appellate courts ordinarily decline to consider issues not presented to the trial
    court unless they 'go to the jurisdiction of the trial court or concern matters of
    great public interest.'" Kvaerner Process, Inc. v. Barham-McBride Joint
    Venture, 
    368 N.J. Super. 190
    , 196 (App. Div. 2004) (quoting Nieder v. Royal
    Indem. Ins. Co., 
    62 N.J. 229
    , 234 (1973)); see also U.S. Bank Nat'l Ass'n v.
    Guillaume, 
    209 N.J. 449
    , 483 (2012) (declining to consider argument raised for
    the first time on appeal).
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    8