March 29, 2017

Alleviation Med. Servs., P.C. v Allstate Ins. Co. (2017 NY Slip Op 27097)

Headnote

The facts in the case of Alleviation Medical Services, P.C. v Allstate Insurance Company involve a lawsuit by a medical provider seeking to recover assigned first-party no-fault benefits that were denied by the insurance company. The insurance company had denied the claim on the ground of lack of medical necessity. The main issue decided by the court was whether the insurance company's denial of the claim on the grounds of lack of medical necessity precluded the provider from recovering the benefits. The court held that the insurance company's argument that it need not pay the claim because it had paid other claims after denying the instant claim, which subsequent payments exhausted the available coverage, lacked merit. Therefore, the court affirmed the order denying the insurance company's motion for summary judgment dismissing the complaint.

Reported in New York Official Reports at Alleviation Med. Servs., P.C. v Allstate Ins. Co. (2017 NY Slip Op 27097)

Alleviation Med. Servs., P.C. v Allstate Ins. Co.

2017 NY Slip Op 27097 [55 Misc 3d 44]

Accepted for Miscellaneous Reports Publication

Supreme Court, Appellate Term, Second Department, 2d, 11th and 13th Judicial Districts

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

As corrected through Wednesday, May 17, 2017

[*1]

Alleviation Medical Services, P.C., as Assignee of Ali Al Rahabi, Respondent,
v
Allstate Insurance Company, Appellant.

Supreme Court, Appellate Term, Second Department, 2d, 11th and 13th Judicial Districts, March 29, 2017

APPEARANCES OF COUNSEL

Peter C. Merani, P.C. (Brian Kratenstein of counsel) for appellant.

Gary Tsirelman, P.C. (Irena Golodkeyer of counsel) for respondent.

{**55 Misc 3d at 45} OPINION OF THE COURT

Memorandum.

Ordered that the order is affirmed, with $25 costs.

In this action by a provider to recover assigned first-party no-fault benefits, it is undisputed that defendant denied plaintiff’s claim on May 10, 2011 on the ground of lack of medical necessity. In May 2014, defendant moved for summary judgment dismissing the complaint on the ground that the amount of available coverage had been exhausted. By order entered April 1, 2015, the Civil Court denied defendant’s motion.

At the outset, we note that, although defendant did not deny the claim on the ground that the coverage limits of the insurance policy at issue had been exhausted, this defense is not precluded (New York & Presbyt. Hosp. v Allstate Ins. Co., 12 AD3d 579 [2004]; Flushing Traditional Acupuncture, P.C. v Infinity Group, 38 Misc 3d 21 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2012]).

In Nyack Hosp. v General Motors Acceptance Corp. (8 NY3d 294 [2007]), the Court of Appeals, noting that no-fault benefits are overdue if not paid within 30 calendar days after receipt of a fully complete claim, held that the word “claims,” as used in 11 NYCRR 65-3.15, the priority-of-payment regulation, does not encompass claims that are not yet complete because they have not been fully verified in accordance with 11 NYCRR 65-3.5 (b). In contrast, in the instant case, by denying the claim on May 10, 2011, defendant implicitly declared that the claim at issue was fully verified. As we read Nyack Hosp. to hold that fully verified claims are payable in the order they are received (see 11 NYCRR 65-3.8 [b] [3]; 65-3.15; Nyack Hosp., 8 NY3d 294), defendant’s argument—that it need not pay the claim at issue because defendant paid other claims after it had denied the instant claim, which subsequent payments exhausted the available coverage—lacks merit (see 11 NYCRR 65-3.15; cf. Nyack Hosp., 8 NY3d 294; but see Harmonic Physical Therapy, P.C. v Praetorian Ins. Co., 47 Misc 3d 137[A], 2015 NY Slip Op 50525[U] [App Term, 1st Dept 2015]). Consequently, defendant{**55 Misc 3d at 46} has not established its entitlement to summary judgment dismissing the complaint.

Accordingly, the order is affirmed.

Solomon, J.P., Pesce and Elliot, JJ., concur.