SAINT BARNABAS MEDICAL CENTER A/S/O SEAN HOLEY VS. Â MERCURY INDEMNITY COMPANY OF AMERICA(L-6590-15, ESSEX COUNTY AND STATEWIDE) ( 2017 )

NOT FOR PUBLICATION WITHOUT THE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-2311-15T2
SAINT BARNABAS MEDICAL CENTER
A/S/O SEAN HOLEY,
Plaintiff-Appellant,
v.
MERCURY INDEMNITY COMPANY OF AMERICA,
Defendant-Respondent.
Argued telephonically July 10, 2017 –
Decided July 31, 2017
Before Judges Simonelli and Carroll.
On appeal from the Superior Court of New
Jersey, Law Division, Essex County, Docket No.
L-6590-15.
Steven Stadtmauer argued the cause for
appellant (Celentano, Stadtmauer &
Walentowicz, LLP, attorneys; Mr. Stadtmauer,
on the briefs).
David C. Harper argued the cause for
respondent.
PER CURIAM
This appeal arises out of a dispute between plaintiff Saint
Barnabas Medical Center (SBMC) and an automobile insurer,
defendant Mercury Indemnity Company of America (MICA), over
personal injury protection (PIP) benefits. After being injured
in a June 2013 motor vehicle accident, the insured motorist, Sean
Holey, received treatment for his burn injuries at SBMC's
outpatient facility on June 24, 2013. Holey assigned his rights
to receive PIP benefits for those services under his automobile
policy with MICA to SBMC, as his subrogee.
SBMC submitted a bill for $10,404 for surgical and ancillary
services it provided to Holey. MICA processed the bill pursuant
to Exhibit 7 of the Hospital Outpatient Surgical Facility (HOSF)
fee schedule and SBMC's Magnacare Preferred Provider Organization
(PPO) contract, and allowed a total payment of $3,234.31, which
related solely to surgical codes 15002 and 15100. MICA denied
eleven additional line items totaling $3894, finding that, under
N.J.A.C. 11:3-29.5(a), they constituted "ancillary service[s] that
[are] integral to the surgical procedure and [therefore] not
permitted to be reimbursed separately in a HOSF."
SBMC contended that under the HOSF fee schedule it could
charge a maximum of $6,681.02 for the procedures performed on
Holey. It disputed MICA's decision to disallow the eleven line
items as well as the reduction of the reasonable fee allowed by
MICA for surgical code 15100. Accordingly, SBMC claimed it was
owed the difference between $6,681.02 and $3,234.31, or $3,446.71.
2 A-2311-15T2
The dispute over SBMC's unpaid balance was presented to a
Dispute Resolution Professional (DRP) who was assigned by the
arbitration tribunal, Forthright, to hear the case. The DRP
entered an award in favor of MICA. In a thorough written opinion,
the DRP wrote:
After considering all documentation
submitted, as the finder of fact I conclude
by the preponderance of the evidence that
[MICA] properly issued payment for services
rendered at 80% of the billable amount and
further find that the billable amount is in
fact the HOSF fee schedule. I further find
by the same preponderance that [SBMC] has
failed to submit sufficient rationale to
support their position that payment should be
issued at 80% of their [usual, customary, and
reasonable].
Next[,] [MICA] denied spate payment for
several [revenue] codes which they contend
were unbundled from the primary skin graft and
facility fee. These services included
pharmaceutical[] supplies, anesthetic agents,
injections[,] and recovery room fees.
After considering all documentation
submitted, as the finder of fact I conclude
by the preponderance of the evidence submitted
that [SBMC] has failed to submit sufficient
documentation to support their position that
these services are separately reimbursable as
they [were] intrinsic to the skin graft and
facility fee billed under CPT codes 15002 and
15100.
As permitted by the DRP rules, SBMC pursued an internal
administrative appeal to a three-member DRP Panel within
Forthright. After considering the parties' arguments and
3 A-2311-15T2
reviewing the record, the DRP Panel affirmed the DRP's arbitration
award in a comprehensive seven-page written opinion.
SBMC then filed a complaint in the Law Division seeking to
vacate the arbitration award pursuant to N.J.S.A. 2A:23-13(c)(4)
and (5). SBMC alleged that the DRP and DRP Panel "commit[ted]
prejudicial errors when they imperfectly executed their powers and
erroneously applied [the] law to the issues and facts presented
in this action." In an order and letter opinion dated January 8,
2016, Judge Robert H. Gardner disagreed and affirmed the award.
On appeal, SBMC argues that the trial court erred in
interpreting the law and in failing to address all of SBMC's
claims. It further argues that this court has jurisdiction to
review the Law Division order because the method by which hospitals
bill for their services, and the proper interpretation of N.J.A.C.
11:3-29.5 relative to how a hospital is paid for its services, are
issues of "general public importance." MICA responds that the
Alternative Procedure for Dispute Resolution Act (APDRA), N.J.S.A.
2A:23A-1 to -30, prohibits appellate review absent circumstances
in which the judge failed to provide an appropriate review or an
issue of strong public policy requires review. MICA argues this
case does not fall within either exception. We agree.
APDRA was enacted in 1987 to create a new procedure for
dispute resolution. Mt. Hope Dev. Assocs. v. Mt. Hope Waterpower
4 A-2311-15T2
Project, L.P., 154 N.J. 141, 145 (1998). The express intention
of the procedure is "to provide a speedier and less expensive
process" for the resolution of disputes. Governor's
Reconsideration and Recommendation Statement to Assembly Bill No.
296, at 1 (Jan. 7, 1987), reprinted at N.J.S.A. 2A:23A-1. A
critical element of the procedure is a summary application in the
Superior Court to vacate, modify, or correct an award within forty-
five days after delivery of the award. N.J.S.A. 2A:23A-13a. Any
such action in the Superior Court shall be conducted in a summary
manner and on an expedited basis. N.J.S.A. 2A:23A-19. In
addition, the APDRA severely limits the grounds on which an award
may be vacated, modified, or corrected. N.J.S.A. 2A:23A-13c
provides that a decision on the facts by the DRP is final unless
the party seeking review demonstrates that his or her rights were
prejudiced by
(1) Corruption, fraud or misconduct in
procuring the award;
(2) Partiality of an umpire appointed as a
neutral;
(3) In making the award, the umpire's
exceeding their power or so imperfectly
executing that power that a final and definite
award was not made;
(4) Failure to follow the procedures set forth
in this act, . . .; or
5 A-2311-15T2
(5) The umpire's committing prejudicial error
by erroneously applying law to the issues and
facts presented for alternative resolution.
[N.J.S.A. 2A:23A-13c.]
Pursuant to APDRA's statutory framework, judicial scrutiny
by the trial court is designed to be the final level of appellate
review. N.J.S.A. 2A:23A-18(b) provides that "[u]pon the granting
of an order confirming, modifying or correcting an award, a
judgment or decree shall be entered by the [trial] court in
conformity therewith and be enforced as any other judgment or
decree. There shall be no further appeal or review of the judgment
or decree." (Emphasis added).
Adhering to this explicit language in the statute, the general
rule then is that a plaintiff has no right to appeal from a trial
judge's order issued in cases arising under the APDRA. Morel v.
State Farm Ins. Co., 396 N.J. Super. 472, 475 (App. Div. 2007).
Courts have adhered to this general rule, reserving, for policy
matters, the exercise of their supervisory jurisdiction over the
trial court. See Mt. Hope, supra, 154 N.J. at 152 (noting that
only "'rare circumstances' grounded in public policy [] might
compel this Court to grant limited appellate review"). The "rare
circumstances" enabling further review beyond the trial court in
APDRA matters arise only in situations where such appellate review
is needed to effectuate a "nondelegable, special supervisory
6 A-2311-15T2
function," of the appellate court. Riverside Chiropractic Grp.
v. Mercury Ins. Co., 404 N.J. Super. 228, 239 (App. Div. 2008).
In only a few exceptional instances has this court elected
to perform such appellate review in an APDRA matter. See, e.g.,
Selective Ins. Co. of Am. v. Rothman, 414 N.J. Super. 331, 341-42
(App. Div. 2010) (reversing a trial court's order erroneously
upholding a decision of a DRP, who failed to enforce a clear
statutory mandate involving a "matter of significant public
concern"), aff'd, 208 N.J. 580 (2012); Allstate Ins. Co. v. Sabato,
380 N.J. Super. 463, 473 (App. Div. 2005) (conducting appellate
review over a DRP's ruling on attorney's fees because the
reasonableness of counsel fees "comes within [the court's]
exclusive supervisory powers"); Faherty v. Faherty, 97 N.J. 99,
109 (1984) (exercising appellate review over a child support award
made by an arbitrator designated by the parties' divorce judgment);
see also Kimba Med. Supply v. Allstate Ins. Co., 431 N.J. Super.
463, 482 (App. Div. 2013) (invoking the jurisdictional exception
to undertake appellate review of unresolved and recurring legal
questions concerning the proper interpretation of APDRA, and to
clarify the trial court's ability to remand certain open issues
back to the dispute professional).
In the event that such further judicial review is appropriate,
however, the appellate court's "role is to determine whether the
7 A-2311-15T2
trial judge acted within APDRA's bounds. If so, [the appellate
tribunal is] bound by N.J.S.A. 2A:23A-18(b) to dismiss the appeal."
Fort Lee Surgery Ctr., Inc. v. Proformance Ins. Co., 412 N.J.
Super. 99, 103 (App. Div. 2010). Fort Lee Surgery is an
instructive example of the general rule disfavoring this court's
involvement in APDRA matters. In Fort Lee Surgery we were asked
to determine whether the trial judge erred in modifying an
arbitrator's award issued under APDRA. We found that our appellate
review of the trial court in that matter was inappropriate and
declined to exercise jurisdiction. Id. at 104.
We reasoned that because the Law Division judge had rested
her decision upon one of the enumerated statutory grounds set
forth in APDRA for vacating, modifying or correcting an arbitration
award, the Appellate Division had no cause to invoke its
supervisory function. Ibid.; see also Riverside Chiropractic,
supra, 404 N.J. Super. at 240 (declining appellate jurisdiction
because it was not shown that the trial judge "commit[ted] any
glaring errors that would frustrate the Legislature's purpose in
enacting the APDRA"); N.J. Citizens Underwriting Reciprocal Exch.
v. Kieran Collins, D.C., LLC, 399 N.J. Super. 40, 50 (App. Div.)
(likewise dismissing an appeal in an APDRA matter because the
trial judge "steered a course well within" the trial court's
limited scope of review), certif. denied, 196 N.J. 344 (2008).
8 A-2311-15T2
While we are mindful that "[t]he exercise of our supervisory
function cannot be talismanically eliminated by the mere
invocation of the words of the [APDRA] statute," Fort Lee Surgery,
supra, 412 N.J. Super. at 104, we decline to exercise our
supervisory function to review the merits of this billing dispute
over PIP benefits. There is nothing momentous, legally or
factually, about this case. The amount in dispute here is
relatively small. No significant issues of public policy are
implicated. We do not discern that Judge Gardner approached the
merits of this dispute outside the proper boundaries of the APDRA.
Therefore, finding no basis to invoke our supervisory function and
no rare circumstance grounded in public policy to invoke our
appellate jurisdiction, we dismiss SBMC's appeal of the January
8, 2016 order.
Dismissed.
9 A-2311-15T2