Lenox Hill Radiology & MIA, P.C. v Hereford Ins. Co.

2021 NY Slip Op 21157 [72 Misc 3d 702]

June 1, 2021

Tsai, J.

Civil Court of the City of New York, New York County

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

As corrected through Wednesday, August 25, 2021

[*1]

Lenox Hill Radiology and MIA, P.C., as Assignee of Shahrooz Sabzehroo, Plaintiff, v Hereford Ins. Co., Defendant.

Civil Court of the City of New York, New York County, June 1, 2021

APPEARANCES OF COUNSEL

Law Offices of Rubin & Nazarian, New York City (Joseph Kuroly of counsel), for defendant.

Sanders Barshay Grossman, PLLC, New York City (Edward A. Cespedes of counsel), for plaintiff.

Richard Tsai, J.

In this action seeking to recover assigned first-party no-fault benefits, defendant moves for summary judgment dismissing the complaint on the ground that the action is premature, because plaintiff did not provide MRI films demanded pursuant to a verification request (mot seq No. 001). Plaintiff opposes the motion, arguing that it had responded that it would send the films after it received payment from defendant for the reasonable costs of the films. It is undisputed that no payment for the films was ever sent.

The issue presented is whether the toll upon the insurer’s time to pay or otherwise deny a claim, which was triggered by a verification request for the provider to provide MRI films, ends when the provider responds that the films will be sent only after the insurer reimburses the provider for the reproduction costs of those films.

Background

On October 31, 2017, plaintiff’s assignor, Shahrooz Sabzehroo, was allegedly injured in [*2]an automobile accident (see defendant’s exhibit C in support of mot, police accident rep; see also defendant’s exhibit A in support of mot, complaint ¶ 3).

On December 5, 2017, plaintiff allegedly took MRIs of Sabzehroo’s right knee and left knee, billed separately in the amount of $878.67 for each knee (see defendant’s exhibit E in support of mot, NF-3 forms). On December 6, 2017, plaintiff allegedly took MRIs of Sabzehroo’s cervical and lumbar spine, billed in the amount of $879.73 and $912, respectively (see id., NF-3 forms). Plaintiff allegedly submitted these bills to defendant, and defendant allegedly neither paid nor denied the bills within 30 days of receipt (complaint ¶¶ 16-17, 20, 40-41, 44, 64-65, 68, 88-89, 92).

Verification Requests and Responses

On January 11, 2018, defendant allegedly mailed a verification request to plaintiff to submit, among other things, “copies of the MRI/CD Film for dates of services 12/5/17 & 12/6/17, lumbar, cervical, right knee, and left knee” (see defendant’s exhibit {**72 Misc 3d at 704}E, first request).^[FN1] On February 14, 2018, defendant allegedly mailed a follow-up verification request to plaintiff for those MRI films (see id., second request).

On February 16, 2018, and March 8, 2018, plaintiff’s counsel allegedly mailed to defendant undated letters bearing the heading “VERIFICATION COMPLIANCE” for the MRIs taken of Sabzehroo’s cervical spine and one of Sabzehroo’s knees (see plaintiff’s exhibit 1 in opp to mot).^[FN2] The letters identically stated,

“Please see the attached responses to your request for verification dated 01/11/2018. This comprises full and complete compliance with the demand based on documents and information in control of the Provider. . . .

“Pursuant to Radiology Ground Rule 8, a copy of the MRI Film/CD/or Electronic Media will be provided upon receipt of $5.00, made payable to Lenox Hill Radiology, P.C.” (see plaintiff’s exhibit 1 in opp to mot).

On March 13, 14, and 21, 2018, plaintiff’s counsel allegedly mailed to defendant undated “VERIFICATION COMPLIANCE” letters in response to defendant’s follow-up verification {**72 Misc 3d at 705}request dated February 14, 2018, with respect to all four bills (see id.).

Meanwhile, by a letter dated March 14, 2018, defendant acknowledged receipt of an undated “Verification Compliance” letter, and responded, in relevant part:

“When a carrier or self insured employer requests x-rays, MRI’s or other recorded images and satisfactory reproductions including electronic media are furnished in lieu of the original films, a fee of $5.00 may be charged for the first sheet of duplicating film or electronic media and $3.00 for each additional film or electronic media; payment issued under separate cover

“Your claim remain [sic] in delay for the requested verification. . . .

“In order to properly evaluate your claim, we are still awaiting:

“Submit the MRI film/CD of the right knee, left knee, lumbar spine and cervical spine performed on 12/05/17 and 12/06/17.

“Regulation 68 65-3.5 (c) states the insurer is entitled to receive all items necessary to verify the Claim directly from the parties from which such verification was requested[.]

“Until all verification is received, your claim will remain in delay status” (defendant’s exhibit E in support of mot).

On April 18, 2018, defendant allegedly mailed to plaintiff a similar letter stating,

“Payment for MRI invoice will be paid under separate cover[.]

“Your claim remain [sic] in delay for the requested verification. . . .

“In order to properly evaluate your claim, we are still awaiting:

“Submit the MRI film/CD of the right knee, left knee, lumbar spine and cervical spine performed on 12/05/17 and 12/06/17[.] . . .

“Until all verification is received, your claim will remain in delay status” (defendant’s exhibit E in support of mot).

On May 1, 2018, plaintiff’s counsel allegedly mailed to defendant undated “VERIFICATION COMPLIANCE” letters in {**72 Misc 3d at 706}response to defendant’s follow-up verification request dated March 14, 2018, with respect to all four bills, which were nearly identical to the prior responses which plaintiff sent in February and March 2018 (plaintiff’s exhibit 1 in opp to mot). On May 29, 2018, plaintiff’s counsel allegedly mailed to defendant undated “VERIFICATION COMPLIANCE” letters in response to defendant’s April 18, 2018 follow-up request, and the responses were nearly identical to plaintiff’s prior responses (id.).

Meanwhile, on May 15, 2018, defendant allegedly mailed to plaintiff another follow-up verification request, which was almost identical to the follow-up request which defendant allegedly mailed on April 14, 2018, i.e., that defendant was still awaiting the MRI films and that the claims were in delay status until they were received (see defendant’s exhibit E in support of mot). This follow-up request indicated that the MRI invoice was paid under separate cover (see id.).

The Instant Action

On September 27, 2018, plaintiff commenced this action seeking to recover assigned first-party no-fault benefits, with interest plus attorneys’ fees (defendant’s exhibit A in support of mot, summons and complaint). On October 30, 2018, defendant allegedly [*3]answered the complaint (id., answer and aff of service).

On December 15, 2020, the court held oral argument on defendant’s motion. At argument, the parties agreed that the only items requested for verification which remained outstanding were the MRI films. Additionally, it was undisputed that no payment for the MRI films was ever sent. The court allowed the parties to submit supplemental papers on the issue of whether defendant may be allowed to assert that the verification was outstanding due to MRI films, when defendant had not paid for the cost of those films, after due demand from plaintiff in accordance with New York Workers’ Compensation Medical Fee Schedule radiology ground rule 8. Plaintiff submitted a supplemental affirmation in opposition; defendant apparently did not submit any supplemental papers.

Discussion

“On a motion for summary judgment, the moving party must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of{**72 Misc 3d at 707} any material issues of fact. If the moving party produces the required evidence, the burden shifts to the nonmoving party to establish the existence of material issues of fact which require a trial of the action” (Xiang Fu He v Troon Mgt., Inc., 34 NY3d 167, 175 [2019] [internal quotation marks and citations omitted]).

Defendant argues that the action must be dismissed as premature because defendant’s time to pay or deny the claims is currently tolled, pending receipt of the MRI films from plaintiff (affirmation of defendant’s counsel ¶¶ 10-16). To establish that verification requests and follow-up verification requests were timely mailed, defendant submitted an affidavit from Tony Singh, a no-fault supervisor employed by defendant (see defendant’s exhibit D in support of mot, aff of Tony Singh ¶ 2). According to Singh, defendant received the four bills at issue on December 18, 2017 (Singh aff ¶ 6 [a]). Verification requests were issued and mailed on January 11, 2018, and February 14, 2018 (id.), and defendant submitted copies of proofs of mailing for these requests (see defendant’s exhibit E in support of mot).

According to Singh, defendant received a letter from plaintiff on February 27, 2018, and defendant issued a “Missing/Incomplete Verification” acknowledging receipt on March 14, 2018 (Singh aff ¶ 6 [a]). On March 19, 2018, defendant received another letter from plaintiff, and defendant issued another “Missing/Incomplete Verification” acknowledging receipt on April 18, 2018 (id.). On May 8, 2018, defendant received several letters from plaintiff, and defendant issued another “Missing/Incomplete Verification” acknowledging receipt on May 15, 2018 (id.). According to Singh, defendant has still not received the verification requested (id.).

In opposition, plaintiff argues that defendant’s motion should be denied for issues of fact as to whether plaintiff’s response to the verification requests was sufficient. Alternatively, plaintiff argues that “plaintiff’s claims were fully verified ending the toll on defendant’s time to pay or deny,” because defendant “failed to respond to plaintiff’s response” (affirmation of plaintiff’s counsel at 4). Lastly, plaintiff argues that defendant failed to demonstrate a “good reason” to request a copy of the MRI films in its verification request (id. at 5).

“[A]n insurer must either pay or deny a claim for motor vehicle no-fault benefits, in whole or in part, within 30 days after{**72 Misc 3d at 708} an applicant’s proof of claim is received” (Infinity Health Prods., Ltd. v Eveready Ins. Co., 67 AD3d 862, 864 [2d Dept 2009]).

“Where there is a timely original request for verification, but no response to the request for verification is received within 30 calendar days thereafter, or the response to the original request for verification is incomplete, then the insurer, within 10 calendar days [*4]after the expiration of that 30-day period, must follow up with a second request for verification (see 11 NYCRR 65-3.6 [b]). If there is no response to the second, or follow-up, request for verification, the time in which the insurer must decide whether to pay or deny the claim is indefinitely tolled. . . . Accordingly, any claim for payment by the medical service provider after two timely requests for verification have been sent by the insurer subsequent to its receipt of [a claim] form from the medical service provider is premature, if the provider has not responded to the requests” (Sound Shore Med. Ctr. v New York Cent. Mut. Fire Ins. Co., 106 AD3d 157, 163 [2d Dept 2013] [citations omitted]).

Defendant met its prima facie burden of establishing that the action was premature based on the affidavit of the no-fault supervisor, who averred that defendant has not received any MRI films in response to its initial and follow-up verification requests. Plaintiff’s argument that a triable issue of fact arises as to the sufficiency of plaintiff’s responses to defendant’s verification requests for the MRI films is without merit. Plaintiff does not dispute that the initial and follow-up verification requests were timely mailed. It is also undisputed that plaintiff did not provide any MRI films to defendant. There is no circumstance under which it could be reasonably inferred that plaintiff sent the MRI films. Thus, there are no disputed issues of fact for the trier of fact to determine.

To the extent that plaintiff argues that the action is not premature because: (1) its demand for reimbursement for the MRI films was a response that complied with the verification request, or (2) defendant “failed to act upon receipt of plaintiff’s response to defendant’s verification requests,” i.e., that defendant did not pay plaintiff for the costs of the MRI films when defendant had indicated payment was forthcoming, the analysis is more complex.

On the one hand, it is undisputed that plaintiff never provided the MRI films requested for verification. On the other{**72 Misc 3d at 709} hand, it is equally undisputed that a provider may charge the insurer a fee for the costs for reproduction of MRI films. Although neither party submitted a copy of radiology ground rule 8 of the New York State Workers’ Compensation Medical Fee Schedule, both parties agreed that, pursuant to ground rule 8, when an insurance carrier (or self-insured employer) requests X rays, MRIs, or other recorded images, and the provider furnishes satisfactory reproductions (including electronic media) in lieu of the original films, the provider may charge the insurer, at most, a fee of $5 for the first sheet of duplicating film or electronic media and $3 for each additional sheet of film or electronic media (compare defendant’s exhibit E in support of mot, with supplemental affirmation of plaintiff’s counsel in opp to mot at 3; see also Ops Gen Counsel NY Ins Dept No. 08-04-08 [Apr. 2008], available at https://www.dfs.ny.gov/insurance/ogco2008/rg080408.htm [accessed May 28, 2021]).

The issue presented is how the provider’s right to reimbursement for the reproduction of films fits within the no-fault regulatory scheme. If the provider’s duty to provide the MRI films is contingent upon the insurer’s payment of the reproduction costs, then plaintiff complied with the verification request when plaintiff demanded payment of the reproduction costs. However, if the provider has no right to insist that the insurer reimburse the reproduction costs before sending the MRI films, then plaintiff’s responses to the insurer would not be adequate, and it would be irrelevant whether the insurer had, in fact, paid the reproduction costs—even if the insurer had promised payment.

The no-fault regulations do not expressly require defendant to reimburse plaintiff in advance of receiving the MRI films. The no-fault regulations are silent as to when the provider [*5]must receive payment of these reproduction costs. Thus, the insurer’s duty to pay the reproduction costs appears independent from the insurer’s right to demand verification. Conceivably, plaintiff could have submitted the reproductions to defendant, along with a bill for the reproduction costs. Alternatively, plaintiff could have also decided to submit the original MRI films to defendant for verification in lieu of sending reproductions of the films. In that scenario, the insurer would not incur any fee for reproductions, but it would have to return the original films to the provider within 20 days of receipt (see Ops Gen Counsel NY Ins Dept No. 08-04-08). Thus, the question of whether or not the insurer must pay a reproduction fee at all lies within the control of the provider.{**72 Misc 3d at 710}

As a practical matter, it seems unlikely that providers would send originals to an insurer for verification, given the risk that originals could be lost while in transit to the insurer. This court also understands why a provider would insist that the reproduction costs be paid before the MRI films are sent, because a $5 bill for reproduction costs may go ignored.

However, to accept plaintiff’s approach that a provider may insist upon reimbursement before it must comply with a verification request for films “runs counter to the no-fault regulatory scheme, which is designed to promote prompt payment of legitimate claims” (Nyack Hosp. v General Motors Acceptance Corp., 8 NY3d 294, 300 [2007]). A core and essential objective in the no-fault regulations is “to provide a tightly timed process of claim, disputation and payment” (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 281 [1997]). In this case, the back-and-forth disagreement over whether defendant was paying the reproduction costs of the films went on for four months, before ending in a stalemate.

Plaintiff’s approach also goes too far. First, plaintiff essentially advocates that a provider would be excused from complying with any verification requests to provide the MRI films until it was reimbursed the reproduction costs. Second, plaintiff appears to argue that, when it responded that defendant must pay the reproduction costs before receiving the MRI films, the toll on the insurer’s time to pay or otherwise deny a claim ended, even though the verification sought was never provided, and plaintiff had not objected to providing the MRI films. Those arguments find no support in either the no-fault regulations themselves, or in the regulatory scheme.^[FN3] As discussed above, the decision to charge a reproduction fee is within the control of the provider.

While plaintiff’s approach would incentivize insurers to pay reproduction fees, the approach is unworkable and would add another layer of complexity and litigation over a host of new issues{**72 Misc 3d at 711} regarding the toll: Does the toll end when the plaintiff responds with a demand for payment? Does the toll restart if defendant sends payment for the reproduction costs? At what point in time would the toll be restarted? What would happen to the toll if the payment were [*6]delayed, or if plaintiff denies that the payment was ever sent? In this case, defendant promised payment, but payment was never sent. The host of issues that would follow from adopting plaintiff’s approach would undermine the objectives of the No-Fault Law of “promoting prompt resolution of injury claims, limiting cost to consumers and alleviating unnecessary burdens on the courts” (Pommells v Perez, 4 NY3d 566, 570-571 [2005]).

Finally, as a policy matter, the downside of plaintiff’s approach is that the sanction against the insurer for failing to pay the reproduction fees would be the entire amount of the claim, which could be significantly disproportionate to reproduction cost, which is very modest. Here, defendant would be liable for $3,549.07 because defendant did not pay $5 in reproduction fees.

Although plaintiff submitted decisions from no-fault arbitrations where the arbitrators ruled that the provider’s responses to demand payment of reproduction costs complied with the insurer’s verification requests (see plaintiff’s supplemental affirmation in opp, arbitration awards), this court declines to follow those arbitration decisions. Those decisions rest on the premise that the toll triggered by the insurer’s verification request ended when the provider demanded payment of the reproduction costs. However, as discussed above, in this court’s view, the insurer’s right to demand and receive verification is not contingent upon the insurer’s payment of the reproduction costs. Thus, the provider is not excused from complying with any verification requests to provide the MRI films until it was reimbursed the reproduction costs. Consequently, the toll did not end either when plaintiff responded that defendant must pay the reproduction costs before receiving the MRI films, or when defendant had promised but failed to pay the reproduction costs. The toll should not end because plaintiff had not objected to providing the MRI films, and the verification sought was never provided.^[FN4]

{**72 Misc 3d at 712}In its supplemental opposition papers, plaintiff argues that defendant failed to “[c]learly inform the applicant of the insurer’s position regarding any disputed matter,” which is one of the principles of claim settlement practices (see 11 NYCRR 65-3.2 [e]), in that defendant promised to send payment but never did (see plaintiff’s supplemental affirmation in opp at 6). As discussed above, because a provider has no right to insist upon payment of reproduction costs before complying with a verification request for MRI films, the insurer’s response to such demands is irrelevant. “[T]o rule otherwise would sanction the parties’ sending countless letters to each other, which would violate the intent of the No-Fault Law which encourages the prompt resolution of no fault claims” (LK Health Care Prods. Inc v GEICO Gen. Ins. Co., 39 Misc 3d 1230[A], 2013 NY Slip Op 50810[U], *3 [Civ Ct, Kings County 2013]).

Because the toll has not ended due to the outstanding MRI films, the action is therefore premature.

[*7]

Plaintiff’s objection to the reasonableness of the request for the MRI films is unavailing. It is readily apparent that copies of any MRI films (or lack of such films) would substantiate whether the billed MRIs were, in fact, actually performed. Moreover, plaintiff never objected to the request for these films in its verification responses (see Compas Med., P.C. v Travelers Ins. Co., 53 Misc 3d 136[A], 2016 NY Slip Op 51441[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016] [“plaintiff did not allege, much less demonstrate, that it objected to such requests during claims processing”]).

Therefore, defendant’s motion for summary judgment dismissing the complaint is granted, and the complaint is dismissed without prejudice as premature.

Conclusion

Upon the foregoing cited papers, it is hereby ordered defendant’s motion for summary judgment dismissing the complaint is granted, and the complaint is dismissed without prejudice.

Footnotes

Footnote 1:Defendant’s verification request and follow-up requests each combined all four bills into a single letter.

Footnote 2:Plaintiff’s counsel apparently responded to the verification requests with separate letters with respect to each bill. In its exhibits to the court, plaintiff’s counsel arranged all the undated responses to the verification requests and follow-up requests, which were sent on different dates and involved different bills, under a single exhibit tab. For the sake of clarity, the court will refer to documents submitted under that single exhibit tab based on the page number assigned by the document viewer used to access the electronically filed opposition papers.

Pages 7 through 14, and pages 15 through 20, of plaintiff’s opposition papers apparently pertain to the MRIs taken of Sabzehroo’s left and right knees. These pages reference dates of service on December 5, 2017, billed in the amount of $876.67.

Pages 21 through 26 apparently pertain to the MRI taken of Sabzehroo’s lumbar spine, as these pages reference a date of service on December 6, 2017, billed in the amount of $912.

Pages 27 through 34 apparently pertain to the MRI taken of Sabzehroo’s cervical spine, as these pages reference a date of service on December 6, 2017, billed in the amount of $879.73.

Because the MRIs of plaintiff’s knees were taken on the same day, and were billed for the same amount, it cannot be determined from the “Verification Compliance” letter allegedly mailed on February 16, 2018, whether that response was meant for the request of the MRI taken of the left or right knee.

Footnote 3:The no-fault regulations also specify that when an insurer requests examination under oath or independent medical examination, the insurer must reimburse the person being examined for “any loss of earnings and reasonable transportation expenses incurred in complying with the request” (11 NYCRR 65-3.5 [e]). The no-fault regulations are similarly silent as to when these costs must be paid.

Plaintiff’s approach that the insurer must reimburse costs in advance of the provider’s compliance because it is entitled to be reimbursed under the no-fault regulatory scheme could logically extend to these reimbursements as well.

Footnote 4:The court leaves open the question of whether the outcome might be different if an insurer had not paid the reproduction costs for the MRI films and yet sought dismissal of the claims, due to the provider’s failure to supply the requested verification within 120 days after the date of the initial verification request (see 11 NYCRR 65-3.5 [o]; see Psychology YME, P.C. v Travelers Ins., 65 Misc 3d 146[A], 2019 NY Slip Op 51798[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]). In that situation, the no-fault regulations allow a provider to provide written proof providing reasonable justification for the failure to comply (11 NYCRR 65-3.5 [o]), which does not apply here.

 

Advanced Recovery v Allstate Ins. Co.

2021 NY Slip Op 21148 [72 Misc 3d 671]

May 27, 2021

Li, J.

Civil Court of the City of New York, Queens County

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

As corrected through Wednesday, August 25, 2021

[*1]

Advanced Recovery, as Assignee of Loduca, Plaintiff, v Allstate Insurance Company, Defendant.

Civil Court of the City of New York, Queens County, May 27, 2021

APPEARANCES OF COUNSEL

Law Offices of Karen L. Lawrence, Garden City, for defendant.

Law Offices of Jonathan B. Seplowe, PC, Malverne, for plaintiff.

Wendy Changyong Li, J.

I. Background

In a summons and complaint filed on August 29, 2019, plaintiff commenced an action against defendant insurance company to recover a total of $5,119.50 in unpaid first-party no-fault benefits for medical services provided to plaintiff’s assignor Loduca from November to December 2016, plus attorneys’ fees and statutory interest (see mot, aff of Inguanti, exhibit A). Defendant moved for summary judgment dismissing the complaint (CPLR 3212 [b]) on the ground that defendant timely denied plaintiff’s claims based on Loduca’s failure to appear for two independent medical examinations (IME).

II. Discussion and Decision

CPLR 3212 provides that “a motion for summary judgment shall be supported by affidavit, by a copy of the pleadings and by other available proof, such as depositions and written admissions” (CPLR 3212 [b]). “[M]ere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient” (Zuckerman v City of New York, 49 NY2d 557, 562 [1980]). “A defendant moving for summary judgment [seeking an order dismissing plaintiff’s complaint] has the initial burden of coming forward with admissible evidence, such as affidavits by persons having knowledge of the facts, reciting the material facts and showing that the cause of action has no merit” (GTF Mktg. v Colonial Aluminum Sales, 66 NY2d 965, 967 [1985]; Anghel v Ruskin Moscou Faltischek, P.C., 190 AD3d 906, 907 [2d Dept 2021]; see Jacobsen v New York City Health & Hosps. Corp., 22 NY3d 824, 833 [2014]). A motion for summary judgment “shall be granted if, upon all the papers and proof submitted, the cause of action or defense shall be established sufficiently to warrant the court as a matter of law in directing{**72 Misc 3d at 673} judgment in favor of any party” (CPLR 3212 [b]; Zuckerman v City of New York at 562; see GTF Mktg. v Colonial Aluminum Sales, 66 NY2d at 968).

Insurers must pay or deny no-fault benefit claims “within 30 calendar days after receipt of the proof of claim” (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 [*2]NY3d 498, 505 [2015]; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 563 [2008]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317 [2007]; see Insurance Law § 5106 [a]; 11 NYCRR 65-3.8 [c]; Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 278 [1997]). Failure to establish timely payment or denial of the claim precludes the insurer from offering evidence of its defense to nonpayment (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 506; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d at 563; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318; Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d at 281-286). An assignor’s appearance at an IME “is a condition precedent to the insurer’s liability on the policy” (Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d 720, 722 [2d Dept 2006]; Greenway Med. Supply Corp. v Hartford Ins. Co., 56 Misc 3d 135[A], 2017 NY Slip Op 50960[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]; Parisien v Citiwide Auto Leasing, 55 Misc 3d 146[A], 2017 NY Slip Op 50684[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]; Longevity Med. Supply, Inc. v Praetorian Ins. Co., 47 Misc 3d 128[A], 2015 NY Slip Op 50393[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2015]).

To sustain its burden, defendant must present evidence that it mailed the IME notices to Loduca and that Loduca failed to appear for the IMEs (Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 35 AD3d at 721). Defendant presented an affidavit sworn December 31, 2019 (see mot, Inguanti aff, exhibit F), in which Donovan, an employee of MES Solutions, the company retained by defendant to schedule IMEs, attested to the ordinary business practices of MES Solutions in mailing IME scheduling letters and recording the status of the IMEs scheduled. Defendant also presented the scheduling letters to establish that defendant timely scheduled the IMEs (Bronx Acupuncture Therapy, P.C. v A. Cent. Ins. Co., 58 Misc 3d 141[A], 2017 NY Slip Op 51870[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]; Brand Med. Supply, Inc. v {**72 Misc 3d at 674}Praetorian Ins. Co., 56 Misc 3d 133[A], 2017 NY Slip Op 50947[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]; Broadway Massage Therapy, P.C. v Citiwide Auto Leasing, 55 Misc 3d 132[A], 2017 NY Slip Op 50426[U], *2 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]; Longevity Med. Supply, Inc. v Praetorian Ins. Co., 2015 NY Slip Op 50393[U], *1). The affidavits of Perrie, D.C. sworn January 29, 2020, and Bogdan, D.C. sworn January 2, 2020, the two chiropractors who were to perform the IMEs, established that Loduca failed to appear for the IMEs (see mot, Inguanti aff, exhibit H; Brand Med. Supply, Inc. v Praetorian Ins. Co., 2017 NY Slip Op 50947[U], *1; Broadway Massage Therapy, P.C. v Citiwide Auto Leasing, 2017 NY Slip Op 50426[U], *2; Longevity Med. Supply, Inc. v Praetorian Ins. Co., 2015 NY Slip Op 50393[U], *1). The affidavits of defendant’s employees and an officer of the company defendant retained to provide mailing services establishing defendant’s regular mailing procedures adequately demonstrated defendant’s timely denial of plaintiff’s claims based on Loduca’s failure to attend the IMEs (see Bronx Acupuncture Therapy, P.C. v A. Cent. Ins. Co., 2017 NY Slip Op 51870[U], *1; Greenway Med. Supply Corp. v Hartford Ins. Co., 2017 NY Slip Op 50960[U], *1; Brand Med. Supply, Inc. v Praetorian Ins. Co., 2017 NY Slip Op 50947[U], *1; Broadway Massage Therapy, P.C. v Citiwide Auto Leasing, 2017 NY Slip Op 50426[U], *2).

In opposition, plaintiff argued that the affidavits of the examining chiropractors Perrie and Bogdan, which were sworn more than three years after Loduca’s purported nonappearances at the IMEs and failed to state the basis for their recollection, rendered their [*3]assertions as to Loduca’s nonappearances conclusory (Satya Drug Corp. v Global Liberty Ins. Co. of N.Y., 65 Misc 3d 127[A], 2019 NY Slip Op 51505[U], *1 [App Term, 1st Dept 2019]; Utica Acupuncture P.C. v Amica Mut. Ins. Co., 55 Misc 3d 126[A], 2017 NY Slip Op 50331[U], *1 [App Term, 1st Dept 2017]; Five Boro Med. Equip., Inc. v Praetorian Ins. Co., 53 Misc 3d 138[A], 2016 NY Slip Op 51481[U], *1 [App Term, 1st Dept 2016]; Village Med. Supply, Inc. v Travelers Prop. Cas. Co. of Am., 51 Misc 3d 126[A], 2016 NY Slip Op 50339[U], *1 [App Term, 1st Dept 2016]). Conclusory affidavits and affirmations are insufficient to establish an assignor’s nonappearance at an IME (Compas Med., P.C. v Geico Ins. Co., 49 Misc 3d 140[A], 2015 NY Slip Op 51590[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2015]). {**72 Misc 3d at 675}However, whether a failure to state a basis of recollection renders an affidavit regarding nonappearance at an IME conclusory has not been previously addressed by the Appellate Term, Second Department or any higher authority binding this court.^[FN*]

Here, this court finds that the affidavits of Perrie and Bogdan are not conclusory even though they did not specify a basis for their recollection of Loduca’s nonappearances as explained below.

Perrie and Bogdan both attested that they had personal knowledge of Loduca’s nonappearances because they were present in their offices on the dates of the scheduled IMEs and Loduca did not appear or contact them to cancel or reschedule the IMEs (see Quality Health Prods. v Hertz Claim Mgt. Corp., 36 Misc 3d 154[A], 2012 NY Slip Op 51722[U], *1-2 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2012]). Plaintiff presented no evidence to support its assertions casting doubt on the personal knowledge of Perrie and Bogdan regarding Loduca’s nonappearances (Quality Health Prods. v Hertz Claim Mgt. Corp., 2012 NY Slip Op 51722[U], *2; see MB Advanced Equip., Inc. v New York Cent. Mut. Fire Ins. Co., 51 Misc 3d 151[A], 2016 NY Slip Op 50863[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]). While a contemporaneously executed affidavit is more probative than an affidavit executed later (Williams v New York City Hous. Auth., 183 AD3d 523, 527 [1st Dept 2020]), plaintiff has not established that the Perrie and Bogdan affidavits were “inherently unworthy of belief” or otherwise “incredible as a matter of law” (Salako v Nassau Inter-County Express, 131 AD3d 687, 688 [2d Dept 2015]). Affidavits executed a significant time after the events to which the witness attested have only been rejected when other infirmities existed in them (see Cruz v Roman Catholic Church of St. Gerard Magella in Borough of Queens in the City of N.Y., 174 AD3d 782, 784 [2d Dept 2019] [conclusory]; Deutsche Bank Natl. Trust Co. v Cunningham, 142 AD3d 634, 635 [2d Dept 2016] [failed to attest plaintiff was note holder at time foreclosure action commenced]; Fredette v Town of Southampton, 95 AD3d 940, 943 [2d Dept 2012] [affidavit tailored to avoid consequences of earlier testimony]; Montanaro v Kandel, 288 AD2d {**72 Misc 3d at 676}275, 275 [2d Dept 2001] [examining physician failed to specify tests used to support conclusions]). In our instant matter, plaintiff has not shown that any of these infirmities existed. Further, Perrie and Bogdan generally confirmed that letters were sent to MES Solutions on the same date as Loduca’s nonappearances. Donovan attested that MES [*4]Solutions received letters from the examiners with whom IMEs were scheduled advising whether the claimant appeared. Defendant appended letters signed by Perrie and Bogdan to its motion (see mot, Inguanti aff, exhibit G). Considering that the Perrie and Bogdan affidavits sufficiently established Loduca’s nonappearance at the IMEs, plaintiff’s contentions that these witnesses’ letters did not indicate their presence in the office at the time of Loduca’s nonappearance were irrelevant and failed to raise factual issues regarding defendant’s defense of nonappearance at scheduled IMEs. As defendant noted in reply, plaintiff presented no evidence that Loduca attended or unsuccessfully attempted to attend the IMEs. This court finds that defendant has presented prima facie admissible evidence proving that there is no material issue of fact and that the controversy can be decided as a matter of law (CPLR 3212 [b]; Jacobsen v New York City Health & Hosps. Corp., 22 NY3d 824 [2014]; Brill v City of New York, 2 NY3d 648 [2004]), and that plaintiff has failed to raise factual issues requiring a trial (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d 755, 757 [2d Dept 2020]; Nova Chiropractic Servs., P.C. v Ameriprise Auto & Home, 58 Misc 3d 142[A], 2017 NY Slip Op 51882[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]; K.O. Med., P.C. v IDS Prop. Cas. Ins. Co., 57 Misc 3d 145[A], 2017 NY Slip Op 51454[U], *1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]).

III. Order

Accordingly, it is ordered that defendant’s motion for summary judgment is granted and plaintiff’s complaint is dismissed.

Footnotes

Footnote *:This court recognizes that case law from the Appellate Term, First Department held that examining professionals’ affidavits regarding an assignor’s nonappearance were conclusory for failing to state a basis for their recollection in the affidavits.

Apazidis, M.D., P.C., As Assignee Of Cortes, Plaintiff(s), against State Farm Mutual Automobile Ins. Co., Defendant(s).

CV-703358-19/QU

Plaintiff’s Counsel:

Law Offices of Gabriel & Shapiro, L.L.C.

3361 Park Avenue, Suite 1000

Wantagh, NY 11793

Defendant’s Counsel:

McDonnell Adels Klestzick, P.L.L.C.

401 Franklin Avenue

Garden City, NY 11530

 

Wendy Changyong Li, J.

I. Papers

The following papers were read on Defendant’s motion for summary judgment seeking dismissal of Plaintiff’s complaint and Plaintiff’s cross-motion for summary judgment seeking judgment on its claims against Defendant:

Papers Numbered

Defendant’s Notice of Motion and Affirmation in Support dated September 18, 2019 (“Motion“) and file stamped by the court on September 27, 2019. 1

Plaintiff’s Amended Notice of Cross-Motion seeking summary judgment and Amended Affirmation in Support and Opposition dated as of July 29, 2020 (“Cross-Motion”) and electronically filed with the court on November 18, 2020. 2

Defendant’s Affirmation in Opposition to Cross-Motion dated as of August 4, 2020 (“Opposition to Cross-Motion”) and electronically filed with the court on August 5, 2020. 3

II. Background

In a summons and complaint filed February 21, 2019, Plaintiff sued Defendant insurance company to recover a total of $5,477.97 in unpaid first party No-Fault benefits for medical services provided to Plaintiff’s assignor Cortes from July 2, 2018 to July 30, 2018 resulting from an automobile accident on May 23, 2018, plus attorneys’ fees and statutory interest (see Motion, Aff. of Schwarzenberg, Ex. F). The First cause of action was for recovery of a bill for services provided on July 30, 2018 (“First Bill“) in the amount of $10.00. The Third cause of action was for recovery of a $4,796.10 bill for services provided on July 13, 2018 (“Second Bill“). The Fifth cause of action was for recovery of a $513.18 bill for services provided on July 13, 2018 (“Third Bill“). The Seventh cause of action was for recovery of a $148.69 bill for services provided on July 2, 2018 (“Fourth Bill“). The Ninth cause of action was for recovery of a $10.00 bill for services provided on July 16, 2018 (“Fifth Bill“). The Second, Fourth, Sixth, Eighth, and Tenth causes of action sought recovery of attorneys’ fees for each of the separate bills.

Defendant moved for summary judgment dismissing the complaint on the ground that Plaintiff failed to provide additional documentary verification within one-hundred twenty (120) days (11 NYCRR § 65-3.8[b][3]). Plaintiff cross-moved for summary judgment on its claims against Defendant. Both parties orally argued the motions before this Court on April 19, 2021.

III. Discussion and Decision

CPLR 3212 provides that “a motion for summary judgment shall be supported by affidavit, by a copy of the pleadings and by other available proof, such as depositions and written admissions” (CPLR 3212[b]). “Mere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient” (Zuckerman v. City of New York, 49 NY2d 557, 562 [1980]). “A defendant moving for summary judgment [seeking an order dismissing plaintiff’s complaint] has the initial burden of coming forward with admissible evidence, such as affidavits by persons having knowledge of the facts, reciting the material facts and showing that the cause of action has no merit” (GTF Mktg. v Colonial Aluminum Sales, 66 NY2d 965, 967 [1985]; Anghel v Ruskin Moscou Faltischek, P.C., 190 AD3d 906, 907 [2d Dept 2021], see Jacobsen v. New York City Health & Hosps. Corp., 22 NY3d 824, 833 [2014]). A motion for summary judgment “shall be granted if, upon all the papers and proof submitted, the cause of action or defense shall be established sufficiently to warrant the court as a matter of law in directing judgment in favor of any party” (CPLR 3212[b]; Zuckerman v. City of New York, at 562, see GTF Mktg. v Colonial Aluminum Sales, 66 NY2d at 968).

Insurers must pay or deny No-Fault benefit claims “within thirty (30) calendar days after [*2]receipt of the proof of the claim” (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498, 501 [2015]; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 563 [2008]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317 [2007]; see Insurance Law § 5106[a]; 11 NYCRR § 65-3.8[c]; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 278 [1997]). “New York Law prohibits unlicensed individuals from organizing a professional service corporation for profit or exercising control over such entities” (Andrew Carothers, M.D., P.C. v Progressive Ins. Co., 33 NY3d 389, 404 [2019], see Business Corporation Law §§ 1507; 1508; Nationwide Affinity Ins. Co. of Am. v Acuhealth Acupuncture, P.C., 155 AD3d 885, 886 [2d Dept 2017]; Liberty Mut. Ins. Co. v Raia Med. Health, P.C., 140 AD3d 1029, 1031 [2d Dept 2016]; One Beacon Ins. Group, LLC v Midland Med. Care, P.C., 54 AD3d 738, 740 [2d Dept 2008]). “A provider of health care services is not eligible for reimbursement under section 5102(a)(1) of the Insurance Law if the provider fails to meet any applicable New York State or local licensing requirement necessary to perform such service in New York . . .” (11 NYCRR § 65-3.16[a][12]; Nationwide Affinity Ins. Co. of Am. v Acuhealth Acupuncture, P.C., 155 AD3d at 886; Liberty Mut. Ins. Co. v Raia Med. Health, P.C., 140 AD3d at 1031; One Beacon Ins. Group, LLC v Midland Med. Care, P.C., 54 AD3d at 740). In the No Fault context, corporate practices evincing a willful, material noncompliance with licensing and incorporation statutes may establish a medical provider’s ineligibility to receive reimbursement (Andrew Carothers, M.D., P.C. v Progressive Ins. Co., 33 NY3d at 405, see State Farm v Mallela, 4 NY3d 313, 321 [2005]; Radiology Today, P.C. v GEICO Gen. Ins. Co., 32 Misc 3d 4, 7 [App Term 2d Dept 2011]). The elements of common law fraud need not be shown (Andrew Carothers, M.D., P.C. v Progressive Ins. Co., 33 NY3d at 405) if noncompliance with the above described licensing requirement is established through admissible evidence.

Failure to establish timely payment or denial of the claim precludes the insurer from offering evidence of its defense to non-payment (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 506; Fair Price Med. Supply Corp. v. Travelers Indem. Co., 10 NY3d at 563; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d at 281-86). However, the defense that a health care provider is ineligible to receive No Fault insurance benefit payments is not subject to preclusion (All Boro Psychological Servs., P.C. v Auto One Ins. Co., 35 Misc 3d 136[A], 2012 NY Slip Op 50777[U] *2 [App Term 2d Dept 2012]; Radiology Today, P.C. v GEICO Gen. Ins. Co., 32 Misc 3d at 6; Midborough Acupuncture P.C. v State Farm Ins. Co., 13 Misc 3d 58, 59 [App Term 2d Dept 2006]; A.B. Med. Servs. PLLC v Utica Mut. Ins. Co., 11 Misc 3d 71 [App Term 2006]).

In the instant matter, Defendant received Plaintiff’s Second Bill, Third Bill, and Fourth Bill on August 20, 2018, and the Fifth Bill on August 27, 2018, and denied the claims based on these bills on January 16, 2019. (see Motion, Schwarzenberg Aff. Ex. E). Defendant received the First Bill on September 11, 2018 and denied the claim based on this bill on January 28, 2019 (Id.). Defendant denied the claims for Plaintiff’s failure to provide requested verification. While Defendant denied Plaintiff’s claims well after the thirty (30) days required for timely payment or denial, Defendant may delay payment pending an investigation of Plaintiff’s alleged noncompliance with licensing and incorporation statutes, but only upon showing good cause to [*3]pursue the investigation (Andrew Carothers, M.D., P.C. v Progressive Ins. Co., 33 NY3d at 405; State Farm v Mallela, 4 NY3d at 322).

A. Defendant’s Requests for Verification

“An applicant from whom verification is requested shall, within 120 calendar days from the date of the initial request for verification, submit all such verification under the applicant’s control or possession or written proof providing reasonable justification for the failure to comply” (11 NYCRR § 65-3.5[o]).

In the instant matter and in a letter dated September 6, 2018, Defendant acknowledged receiving the Second Bill, Third Bill, Fourth Bill, and Fifth Bill and mailed to Plaintiff a request (“August Verification Request“) for additional verification (see Motion, Schwarzenberg Aff. Ex. A). Here, Plaintiff had one-hundred twenty (120) days to provide Defendant with requested verification under Plaintiff’s control or possession or a written explanation supporting Plaintiff’s failure to comply. In the August Verification Request, Defendant requested leases for twenty-four (24) different “office and practice locations,” an employment contract between Plaintiff and Shamalov PA, contracts for billing agreements covering the dates of service in the claims, account records for Chase Bank checking, savings, debit card, and Visa card from January 1, 2017 to date, Dr. Apazidis’ and Mr. Shamalov’s intake sheets and patient notes for each claim, W-2 forms issued by Plaintiff to Dr. Apazidis and Mr. Shamalov, and Plaintiff’s 2017 corporate tax return (see id.). In a letter dated September 26, 2018, Defendant acknowledged receiving the First Bill and mailed to Plaintiff a request (“September Verification Request“) (collectively with the August Verification Request, the “Verification Request“) for additional verification requesting the same documents as in the August Verification Request (see Motion Schwarzenberg Aff. Ex. C). Plaintiff was required to provide the verification requested in the August Verification Request by January 4, 2019, and the verification requested in the September Verification Request by January 24, 2019. In two (2) letters dated October 11 and November 2, 2018, Defendant made follow up requests for the documents (see Motion, Schwarzenberg Aff. Ex. B and D). The parties did not dispute that Plaintiff subsequently provided all the documents Defendant requested except for Plaintiff’s corporate tax returns for 2017, and account records for Chase Bank checking, savings, debit card, and Visa card.

B. Good Cause for Requested Verification

Defendant argued that Plaintiff’s 2017 corporate tax returns and account records for Chase Bank checking, savings, debit card, and Visa card were necessary to verify the medical necessity of the billed services, and whether the ownership, control, and operation of Plaintiff complied with New York State licensing requirements. Plaintiff countered that Defendant failed to respond to Plaintiff’s objections to the Verification Request, show good cause for the remaining documents requested, or substantiate the necessity of the request. The Court notes that both Plaintiff’s and Defendant’s supporting documents indicate that Plaintiff in the instant matter had various claims resulting from different assignors, including Plaintiff assignor in the matter before this Court, pending with the Defendant.

Contrary to Plaintiff’s contention, tax returns and bank statements were probative on whether a medical service provider complied with licensing laws (see All Boro Psychological Servs., P.C. v Auto One Ins. Co., 2012 NY Slip Op 50777[U] *1-2; Q-B Jewish Med. Rehabilitation, P.C. v Allstate Ins. Co., 33 Misc 3d 64, 66 [App Term 2d Dept 2011], see Dore v Allstate Indem. Co., 264 AD2d 804, 804-05 [2d Dept 1999]). While mere allegations of fraud would be sufficient to sustain a motion to compel discovery of evidence of noncompliance with licensing laws (see Lexington Acupuncture, P.C. v General Assur. Co., 35 Misc 3d 42, 43 [App Term 2d Dept 2012]; Medical Polis, P.C. v Progressive Specialty Ins. Co., 34 Misc 3d 153[A], 2012 NY Slip Op 50342[U] *2 [App Term 2d Dept 2012]), here, Defendant sought summary judgment, which requires admissible evidence (see Nationwide Affinity Ins. Co. of Am. v Acuhealth Acupuncture, P.C., 155 AD3ed at 886; One Beacon Ins. Group, LLC v Midland Med. Care, P.C., 54 AD3d at 740; Vista Surgical Supplies, Inc. v Utica Mut. Ins. Co., 22 Misc 3d 142[A], 2009 NY Slip Op 50493[U] *2 [App Term 2d Dept 2009]; Oleg Barshay, P.C. v State Farm Ins. Co., 14 Misc 3d 74, 78 [App Term 2d Dept 2006]). In our instant matter, Defendant failed to support its good cause with admissible evidence for investigating Plaintiff’s alleged noncompliance with the licensing statutes as explained below.

Defendant presented an affidavit sworn July 24, 2019, in which Huddle, an investigator in Defendant’s Special Investigative Unit, detailed Defendant’s investigation of Plaintiff, as part of an alleged broader scheme of non-compliance with licensing laws, leading to the Verification Request at issue. In her affidavit, Huddle quoted Dr. Apazidis’ testimony at an examination under oath (“EUO“) to demonstrate Dr. Apazidis’ lack of knowledge of Plaintiff’s business operations, non-physician Shamalov’s unusually greater role in those operations, and inconsistencies with the documents Plaintiff provided in response to Defendant’s Verification Request regarding Shamalov’s bonus, the principal location of Plaintiff’s business, and the existence of a written contract between Plaintiff and the company retained to handle medical billing. Since Defendant failed to present the transcript of Dr. Apazidis’ EUO to support its motion, Huddle’s account of Dr. Apazidis’ EUO testimony is hearsay (see Alleviation Med. Servs., P.C. v Allstate Ins. Co., 191 AD3d 934, 935 [2d Dept 2021]; Wells Fargo Bank, N.A. v Sesey, 183 AD3d 780, 783 [2d Dept 2020]; Jamaica Dedicated Med. Care, P.C. v Praetorian Ins. Co., 47 Misc 3d 147[A], 2015 NY Slip Op 50756[U] *1 [App Term 2d Dept 2015]). Huddle also quoted an affirmation of Dr. Apazidis dated April 2, 2019, to illustrate an inconsistency between Dr. Apazidis’ claim that the business of Plaintiff was still growing so he could not pay himself his full salary and his testimony that Shamalov was paid $300,000.00 per year. Again, Defendant did not present Dr. Apazidis’ affirmation, which rendered Huddle’s assertion hearsay (Alleviation Med. Servs., P.C. v Allstate Ins. Co., 191 AD3d at 935, see United Specialty Ins. v Columbia Cas. Co., 186 AD3d 650, 651 [2d Dept 2020]; Wells Fargo Bank, N.A. v Sesey, 183 AD3d at 783).

In Defendant’s Opposition to Cross-Motion, Defendant noted that the EUO transcripts were “unimportant, since the claim which is the subject of the motion for summary judgment was not the subject of the EUO, and plaintiff [did] not dispute any of the statements made in the Huddle affidavit” (Opposition to Cross-Motion, Schwarzenberg Aff. at 12). Here, the fact remains, however, that Defendant relied on the truth of Dr. Apazidis’ EUO testimony and his affirmation to establish good cause for requesting verification from Plaintiff which in the context [*4]of a summary judgment motion requires admissible evidence. Since Defendant failed to demonstrate its prima facie entitlement to a judgment as a matter of law, the court must deny Defendant’s motion for summary judgment (Pullman v Silverman, 28 NY3d 1060, 1063 [2016]; United Specialty Ins. v Columbia Cas. Co., 186 AD3d at 651-52; Matter of Long Is. Power Auth. Hurricane Sandy Litig., 165 AD3d 1138, 1140 [2d Dept 2018]; Nationwide Affinity Ins. Co. of Am. v Acuhealth Acupuncture, P.C., 155 AD3d at 887). That Plaintiff did not dispute any of Huddle’s statements is irrelevant given that it is Defendant’s burden in the first instance to demonstrate its entitlement to a summary judgment.

C. Requirement that Insurer Advise Before Denial

“[A]n insurer may issue a denial if, more than 120 calendar days after the initial request for verification, the applicant has not submitted all such verification under the applicant’s control or possession or written proof providing reasonable justification for the failure to comply, provided that the verification request so advised the applicant as required in section 65-3.5(o) of this Subpart” (11 NYCRR §65-3.8[b][3]) (emphasis added). In pertinent part, 11 NYCRR §65-3.5[o] provides that the “insurer shall advise the applicant in the verification request that the insurer may deny the claim if the applicant does not provide within 120 calendar days from the date of the initial request either all such verification under the applicant’s control or possession or written proof providing reasonable justification for the failure to comply.” Thus Defendant’s denial of Plaintiff’s claims for failing to provide requested verification was contingent upon Defendant advising Plaintiff of the consequences for noncompliance.

Here, Defendant’s Verification Request and Defendant’s follow up request letters dated October 11 and November 2, 2018 all advised that:

pursuant to 11 NYCRR 65-3.5(o), State Farm may deny the claim if NY Chiro and Rehab, P.C. does not provide within 120 calendar days from the date of this initial verification request all of the documents identified above under NY Chiro and Rehab, P.C.’s control or possession or written proof providing reasonable justification for the failure to comply…

(Motion, Schwarzenberg Aff. Ex. A, B, C and D). The Court notes that Plaintiff in the instant matter is Apazidis, M.D., P.C., not NY Chiro and Rehab, P.C.. Since Defendant’s letters advised that Defendant would deny Plaintiff’s claims if “NY Chiro and Rehab, P.C.” failed to comply with the verification request for documents under the control or in possession of “NY Chiro and Rehab, P.C.,” Defendant failed to comply with the requirement in 11 NYCRR § 65-3.5[o] that notices requesting verification advise Plaintiff that failure to provide the requested verification under its control within 120 days would allow Defendant to deny the claims. Given that “NY Chiro and Rehab P.C.” appears in the advisory of all four (4) separate letters, reference to that entity is less likely to be a typographical error (see Galetta v Galetta, 21 NY3d 186, 196 [2013]). Alleged typographical errors in correspondence have been given legal effect (see Iannucci v 70 Washington Partners, LLC, 51 AD3d 869, 870-71 [2d Dept 2008]). It is noted that Plaintiff presented a letter dated October 31, 2018, in which Plaintiff’s counsel advised Defendant that it did not represent NY Chiro and Rehab, to which Defendant referred in its letters (see Cross-Motion, Aff. of Justin Rosenbaum Ex. A). Plaintiff’s counsel, however, did not suggest any [*5]confusion by Plaintiff from Defendant’s reference to NY Chiro and Rehab in Defendant’s verification request letters addressed to Plaintiff. Here, even if Defendant’s letters furnished Plaintiff with constructive notice that Plaintiff’s claims would be denied if Plaintiff failed to provide requested verification within 120 days, which Defendant did not argue, that would have not satisfied the requirement pursuant to 11 NYCRR ｧ65 that Defendant must advise Plaintiff of the consequences.

Defendant’s motion for summary judgment dismissing Plaintiff’s complaint is denied.

D. Plaintiff’s Cross-Motion

Regarding the Cross-Motion, Plaintiff bore the burden to show it submitted the statutory claim forms indicating the fact and amount of the loss sustained and “that payment of no-fault benefits was overdue” (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 501; New York Hosp. Med. Ctr. of Queens v QBE Ins. Corp., 114 AD3d 648, 648 [2d Dept 2014]; NYU-Hospital for Joint Diseases v Esurance Ins. Co., 84 AD3d 1190, 1191 [2d Dept 2011]; Fair Price Med. Supply Corp. v ELRAC Inc., 12 Misc 3d 119, 120 [App Term 2d Dept 2006]). Here, Defendant’s denial of claim forms dated January 16 and 28, 2019, acknowledging receipt of Plaintiff’s claims in August 2018 constituted prima facie evidence that Defendant received Plaintiff’s claims and that the denial was overdue (see Lopes v Liberty Mut. Ins. Co., 24 Misc 3d 127[A], 2009 NY Slip Op 51279[U] *2 [App Term 2d Dept 2009]). However, an ineligibility of receiving No Fault insurance benefit due to non-compliance with licensing statutes defeats such prima facie showing.

Based on foregoing discussion, Defendant had identified the existence of evidence in Plaintiff’s exclusive control which raised the issue of Plaintiff’ ineligibility to receive No Fault benefit payments. Because the remaining requested verification, i.e., Plaintiff’s 2017 corporate tax return and various financial statements, are still outstanding, factual issues exist as to Plaintiff’ eligibility to receive No Fault benefit payments. Since Defendant’s defense of Plaintiff’s ineligibility to receive No Fault benefit payments is not precluded by Defendant’s untimely denial of Plaintiff’s claims and Plaintiff still has not provided the requested verification, this Court also must deny Plaintiff’s Cross-Motion (CPLR 3212[f]; RLC Med., P.C. v Allstate Ins. Co., 29 Misc 3d 134[A], 2010 NY Slip Op 51962[U] *1 [App Term 2d Dept 2010]; Points of Health Acupuncture, P.C. v Lancer Ins. Co., 28 Misc 3d 133[A], 2010 NY Slip Op 51338[U] *3 [App Term 2d Dept 2010]; Five Boro Psychological Servs., P.C. v AutoOne Ins. Co., 27 Misc 3d 89, 90 [App Term 2d Dept 2010]).

IV. Order

Accordingly, it is

ORDERED that Defendant’s Motion for summary judgment is denied, and it is further

ORDERED that Plaintiff’s Cross-Motion for summary judgement is denied.

This constitutes the DECISION and ORDER of the Court.

Dated: May 26, 2021

Queens County Civil Court

_____________________________________

Honorable Wendy Changyong Li, J.C.C.

Jules Francois Parisien, M.D., a/a/o Gonzales, Nicanor, Plaintiff, against Travelers Insurance Company, Defendant.

CV-728829-17/KI

Law Offices of Aloy O. Ibuzor, Hartford, Connecticut (Duane Frankson of counsel), for Travelers Insurance Company, defendant.

The Rybak Firm, PLLC (Oleg Rybak of counsel), New York City, for Jules Francois Parisien, M.D., plaintiff

Richard Tsai, J.

In this action seeking to recover assigned first-party no-fault benefits, defendant moves for summary judgment dismissing the complaint on the ground that plaintiff failed to appear for an examination under oath (EUO) on January 11, 2017 and March 8, 2017, or in the alternative, [*2]to compel plaintiff to appear for an examination before trial (Motion Seq. No. 001). Defendant also seeks an order deeming certain documents as genuine and certain facts as admitted which were submitted in a notice to admit to plaintiff’s counsel.

Plaintiff opposes the motion and cross-moves for summary judgment in his favor (Motion Seq. No. 002). Defendant did not submit any opposition papers to plaintiff’s cross motion or any reply papers in further support of defendant’s motion.

The issue presented is whether plaintiff raised triable issues of fact as to whether plaintiff had failed to appear at the EUOs, where defendant refused plaintiff’s requests to reschedule the EUOs for lengthy adjournments of two to three months.

BACKGROUND

On September 27, 2016, plaintiff’s assignor, Nicanor Gonzalez, was allegedly injured in a motor vehicle accident (see defendant’s exhibit C in support of motion, complaint ¶ 3; see also plaintiff’s exhibit 1 in support of cross motion, NF-AOB form).

On March 9, 2017, plaintiff allegedly rendered medical services to its assignor (see defendant’s exhibit A3 in support of motion, NF-3 forms dated 03/20/2017). Plaintiff allegedly submitted two bills these services: one in the amount of $267.79, and another in the amount of $1,625, to a post office box for defendant located in Melville, New York (id.; see also plaintiff’s exhibit 4 in support of cross motion, aff of Julien Parisien, MD ¶¶ 34-39). Defendant allegedly received both bills on March 30, 2017 (see defendant’s exhibit A in support of motion, aff of Lorraine Couvaris ¶ 8 [e]-[f]).

Scheduling of the EUO on January 11, 2017

Prior to the receipt of the bills at issue, by a letter dated December 9, 2016, addressed to the Rybak Firm, PLLC, defendant’s counsel scheduled an EUO of plaintiff to be held on January 11, 2017 at 10:00 a.m. at a court reporting location in Brooklyn (see defendant’s exhibit B, scheduling letter). According to an affidavit of service, the scheduling letter was sent by regular mail to the Rybak Firm, PLLC on December 9, 2016 (see id.). Copies of the letter were allegedly sent to plaintiff, among others.

By a letter dated January 5, 2017, the Rybak Firm, PLLC replied to the December 9, 2016 letter, and it informed defendant’s counsel that plaintiff retained the Rybak Firm, PLLC to represent his interests in the EUO (see defendant’s exhibit B in support of motion). However, plaintiff’s counsel indicated that the chosen date was inconvenient for Dr. Parisien and should be rescheduled, stating,

“Please be advised that Dr. Parisien has fully booked his schedule till the end of February 2017. Accordingly as the law provides that an EUO be scheduled for a time and place that is convenient to the person being examined, please let our office know which other dates in March Travelers is available to conduct the EUO of Dr. Parisien so that we may arrange for a mutually convenient date, time and location”

* * *

Finally, please be advised that Dr. Parisien must be reimbursed in the amount of $5000.00 per claimant for his loss of income and business opportunities he would suffer while preparing for, traveling to, appearing at and traveling from the EUO you have requested.

* * *

Prior to the EUO, Dr. Parisien needs a firm reassurance by you or Travelers that Travelers has agreed to reimburse our client for his time in the amount listed above, and at the commencement of the EUO, Dr. Parisien must be presented with a check (of the entire amount for $5,000.00 per claimant) from Travelers compensating our client”

(see defendant’s exhibit B in support of motion [emphasis in original]).

On January 11, 2017, defendant’s counsel, by Duane Frankson, Esq., placed a statement on the record at 11:48 a.m. that he had been present at the EUO location since 9:46 a.m., that the time was 11:48 a.m., and no one has appeared on behalf of Dr. Jules Francois Parisien (see defendant’s exhibit B in support of motion, Jan 11, 2017 EUO tr. at 6).

Scheduling of the EUO on March 8, 2017

By a letter dated January 12, 2017 addressed to the Rybak Firm, PLLC, defendant’s counsel stated that the EUO scheduled for January 11, 2017 “will be recorded as a non-appearance” and scheduled a follow-up EUO of plaintiff to be held on March 8, 2017 at 10:00 a.m. at the same court reporting location in Brooklyn (see defendant’s exhibit B in support of motion, scheduling letter). The letter further stated, “We will require submission of detailed appoint [sic] logs before considering any further reschedule date for the EUO. . . . Please note your response fails to include documentation substantiating your demand for $5,000. . . Travelers will issue a disbursement for loss of earnings and travel expense claims for medical providers up to $500, immediately after EUO has been conducted. Compensation beyond $500 will be considered only after documentation substantiating the amount demanded has been received and examined. There is no requirement that compensation occur in advance of the scheduled examination” (id.). According to an affidavit of service, the scheduling letter was sent by regular mail to the Rybak Firm, PLLC on January 12, 2017 (see id.).

By a letter dated February 27, 2017, the Rybak Firm, PLLC replied to the January 12, 2017 letter, and plaintiff’s counsel again indicated that the chosen date was inconvenient for Dr. Parisien and should be rescheduled, stating,

“Please note that it is very common amongst medical providers to have their schedules fully booked for about the same period of 2-4 months depending on the circumstances, as well as to clear or extend them accordingly, which is usually the main reason/valid excuse of their unavailability to appear for a potential EUO.

As such is the case, please be advised that Dr. Parisien has extended his schedule for the next two (2) months, and will be unavailable to appear for the requested EUO currently scheduled for March 8, 2017. Accordingly, as the law provides that an EUO be scheduled for a time and place that is convenient to the person being examined, we reiterate our previous request for an adjournment. Please let our office know which other dates in May 2017 Travelers is available to conduct the EUO of Dr. Parisien so that we may arrange for a mutually convenient date, time and location”

(see defendant’s exhibit B in support of motion [emphasis in original]).

By a letter dated March 6, 2017, defendant’s counsel responded, “We will not reschedule the examination of your client, Jules Francois Parisien, MD, scheduled for March 8, 2017; your client’s appearance is required and should your client fail to appear the date will be recorded as the second non-appearance” (see defendant’s exhibit B in support of motion). According to an [*3]affidavit of service, the scheduling letter was sent by regular mail to the Rybak Firm, PLLC on March 8, 2017, and the documents were emailed and faxed to their office (see id.).

On March 8, 2017, defendant’s counsel, by Duane Frankson, Esq., placed a statement on the record at 10:58 a.m. that he had been present at the EUO location since 9:45 a.m., that the time was 11:05 a.m., no one has arrived, and no one had contacted him to indicate they were attending (see defendant’s exhibit B in support of motion, Mar 8, 2017 EUO tr. at 3-6).

By a letter dated March 10, 2017, plaintiff’s counsel replied to defendant’s counsel letter dated March 6, 2017, stating, in pertinent part:

“Moreover, you were advised in advance of the appearance that our client was unavailable for the first chosen EUO date. It is not unreasonable to request for an adjournment past that date, but considering that first date a “no show” is unreasonable by any standard. As you well know, it is common courtesy to extend adjournments between counsel in order to accommodate everyone’s busy schedule. Our office has extended many such courtesies to your firm.

Further, the fact that Travelers assigned a second, arbitrary date for the EUO of our client does not obfuscate the need to have a mutually convenient dated for the examination. It was again communicated previously that the chosen date was inconvenient for Dr. Parisien. And you will not be provided with patient logs to substantiate the level of inconvenience because it is simply a dilatory, red-tape delay tactic”

(see defendant’s exhibit B in support of motion).

By a letter dated April 6, 2017, defendant’s counsel responded, in relevant part, “Your representations concerning your client’s availability have been and continue to be vague. Despite our attempts to accommodate your client, you consistently seek to adjourn the matter” (see defendant’s exhibit B in support of motion).

Denial of Claim Forms

On April 10, 2017, defendant allegedly issued a denial of the bill in the amount of $267.79, for the date of service on March 9, 2017 (see defendant’s exhibit A4 in support of motion, NF-10 Forms). On April 11, 2017, defendant allegedly issued a denial of the bill in the amount of $1,625, for the date of service on March 9, 2017 (see id.). The Explanation of Benefits attached to each denial identically stated, in relevant part:

“JULES FRANCOIS PARISIEN HAS FAILED TO COMPLY WITH ITS OBLIGATION TO PRESENT A PROPER PROOF OF CLAIM . . . BY FAILING TO APPEAR FOR AN EXAMINATION UNDER OATH ON 1/11/17 AND 3/8/17. THEREFORE, YOU HAVE FAILED TO SATISFY A CONDITION OF COVERAGE — YOUR CLAIM IS DENIED. DUE TO THE FAILURE OF JULES FRANCOIS PARISIEN TO COMPLY WITH POLICY — NO-FAULT GUIDELINES — REQUIREMENTS, THE ENTIRE CLAIM FOR NO-FAULT BENEFITS IS DENIED”

(see defendant’s exhibit A4 in support of motion, NF-10 forms and Explanations of Benefits).

The Instant Action

On August 24, 2017, plaintiff commenced this action, asserting two causes of action to recover unpaid first-part no-fault benefits for the services rendered, plus interest, and a third [*4]cause of action seeking attorneys’ fees (see defendant’s exhibit C, summons and complaint). On September 29, 2017, defendant allegedly answered the complaint (see defendant’s exhibit C in support of motion, answer and affidavit of service).

DISCUSSION

I. Defendant’s Motion for Summary Judgment and other relief (Motion Seq. No. 001)

Defendant argues that it is entitled to summary judgment dismissing the complaint because plaintiff twice failed to appear for duly scheduled EUOs on January 11, 2017 and March 8, 2017. In the alternative, defendant moves to compel plaintiff to appear for an examination before trial. Defendant also seeks an order deeming certain documents as genuine and certain facts as admitted which were submitted in a notice to admit to plaintiff’s counsel.

A. The branch of defendant’s motion for summary judgment

“On a motion for summary judgment, the moving party must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to demonstrate the absence of any material issues of fact. If the moving party produces the required evidence, the burden shifts to the nonmoving party to establish the existence of material issues of fact which require a trial of the action”

(Xiang Fu He v Troon Mgt., Inc., 34 NY3d 167, 175 [2019] [internal citations and quotation marks omitted]).

“[A]n appearance at an EUO is a condition precedent to the insurer’s liability on the policy” (GLM Med., P.C. v State Farm Mut. Auto. Ins. Co., 30 Misc 3d 137 [A], 2011 NY Slip Op 50194 [U] [App Term, 2d Dept, 2nd, 11th & 13th Jud Dists 2011]).

“To establish its prima facie entitlement to summary judgment dismissing a complaint on the ground that a provider had failed to appear for an EUO, an insurer must demonstrate, as a matter of law, that it had twice duly demanded an EUO from the provider, that the provider had twice failed to appear, and that the insurer had issued a timely denial of the claims”

(Oleg’s Acupuncture, P.C. v State Farm Mut. Auto. Ins. Co., 63 Misc 3d 152[A], 2019 NY Slip Op 50760 [U], * 1 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019] [internal citations omitted]). Defendant must demonstrate “that its initial and follow-up requests for verification were timely mailed” (Urban Radiology, P.C. v Clarendon Natl. Ins. Co., 31 Misc 3d 132 [A], 2011 NY Slip Op 50601[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2011]).

1. Mailing of the EUO scheduling letters

Generally, “proof that an item was properly mailed gives rise to a rebuttable presumption that the item was received by the addressee” (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 114 AD3d 33, 46 [2d Dept 2013], affd 25 NY3d 498 [2015] [internal quotation marks and citations omitted]). A party can establish proof of mailing “through evidence of actual mailing (e.g., an affidavit of mailing or service) or—as relevant here—by proof of a sender’s routine business practice with respect to the creation, addressing, and mailing of documents of that nature” (CIT Bank N.A. v Schiffman, —NY3d&mdash, 2021 NY Slip Op 01933, *3 [2021]; New York & Presbyt. Hosp. v Allstate Ins. Co., 29 AD3d 547, 547 [2d Dept 2006], quoting Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679, 680 [2d Dept 2001]; accord American Tr. Ins. Co. v Lucas, 111 AD3d 423, 424 [1st Dept 2013]).

“Actual mailing may be established by a proper certificate of mailing or by an affidavit of one with personal knowledge” (J.M. Chiropractic Servs., PLLC v State Farm Mut. Ins. Co., 36 Misc 3d 135[A], 2012 NY Slip Op 51348[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2012] [internal citation, emendations and quotation marks omitted]). For proof by office practice, “the office practice must be geared so as to ensure the likelihood that the item is always properly addressed and mailed” (Progressive Cas. Ins. Co. v Metro Psychological Servs., P.C., 139 AD3d 693, 694 [2d Dept 2016], citing Nassau Ins. Co. v Murray, 46 NY2d 828, 830 [1978]).

Here, defendant established mailing of the EUO scheduling letters, by submitting affidavits of service, which stated that the EUO scheduling letter dated December 9, 2016 was sent by regular mail to the Rybak Firm, PLLC on December 9, 2016, and that the EUO scheduling letter dated January 12, 2017 was sent by regular mail to the Rybak Firm, PLLC on January 12, 2017 (see defendant’s exhibit B in support of motion).

Plaintiff fails to raise a triable issue of fact as to whether the EUO scheduling letters were mailed. “[A] properly executed affidavit of service raises a presumption that a proper mailing occurred, and a mere denial of receipt is not enough to rebut this presumption” (Kihl v Pfeffer, 94 NY2d 118, 122 [1999]). Contrary to plaintiff’s argument, these affidavits of service were from a person with personal knowledge of the actual mailing.

Plaintiff points out that the EUO scheduling letters did not include the floor number or suite number in the address, and therefore argues that the EUO scheduling letter was sent to the wrong address (affirmation of plaintiff’s counsel in support of cross motion and in opposition to motion ¶ 112). However, minor errors in the mailing address will not render service void where it is “virtually certain” that the mailing will arrive at its intended destination (see Brownell v Feingold, 82 AD2d 844, 845 [2d Dept 1981]). Here, defendant submitted copies of the letters from plaintiff’s counsel, who acknowledged receipt of the EUO scheduling letters.

2. Plaintiff’s failure to appear

Defendant established that plaintiff twice failed to appear for EUOs on January 11, 2017 and March 8, 2017, by submitting certified transcripts from the EUOs scheduled on January 11, 2017 and March 8, 2017. Although plaintiff argues that defendant must also submit an affidavit from someone with personal knowledge that plaintiff failed to appear at an EUO (see affirmation of plaintiff’s counsel in support of cross motion and in opposition to motion ¶¶ 62-63), a certified transcript memorializing the missed appearance is sufficient (Active Chiropractic, P.C. v Praetorian Ins. Co., 43 Misc 3d 134[A], 2014 NY Slip Op 50634[U] [App Term 2d Dept, 2d, 11th & 13th Jud Dists 2014]; see also Atlantic Radiology Imaging, P.C. v Metro. Prop. & Cas. Ins. Co., 50 Misc 3d 147[A], 2016 NY Slip Op 50321[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]).

In opposition, plaintiff extensively argues that defendant failed to establish that it had objective reasons for requesting plaintiff’s EUO (see affirmation of plaintiff’s counsel in support of cross motion and in opposition to motion ¶¶ 92-108, 123-147). However, the Appellate Term, Second Department has repeatedly ruled, “contrary to plaintiff’s contention, defendant was not required to set forth objective reasons for requesting EUOs in order to establish its prima facie entitlement to summary judgment” (21st Century Pharmacy, Inc. v Integon Natl. Ins. Co., 69 Misc 3d 142[A], 2020 NY Slip Op 51364[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2020], citing Interboro Ins. Co. v Clennon, 113 AD3d 596, 597 [2d Dept 2014]; see also [*5]Gentlecare Ambulatory Anesthesia Servs. v GEICO Ins. Co., 65 Misc 3d 138[A], 2019 NY Slip Op 51684[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]).

Contrary to plaintiff’s argument, “there is no requirement to establish willfulness” (Goldstar Equip., Inc. v Mercury Cas. Co., 59 Misc 3d 138[A], 2018 NY Slip Op 50576[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2018]). “The doctrine of willfulness . . . applies in the context of liability policies, and has no application in the no-fault context” (Unitrin Advantage Ins. Co. v Bayshore Physical Therapy, PLLC, 82 AD3d 559, 561 [1st Dept 2011]).

Plaintiff next argues that defendant cannot meet its burden that plaintiff failed to appear at the EUOs “because it repeatedly scheduled EUOs that were inconvenient to Plaintiff and made no effort to cooperate with Plaintiff to schedule the EUOs at a time and place that was reasonable for all parties” (affirmation of plaintiff’s counsel in support of cross motion and in opposition to motion ¶ 110). Plaintiff asserts that “Plaintiff, through counsel, made clear that because Plaintiff was a medical provider, his schedule was often booked 2-4 months in advance. Yet defendant never scheduled or tried to schedule an EUO outside of this time constraint. As a result, Plaintiff was not able to attend EUOs that defendant scheduled which conflicted with Plaintiff’s schedule” (id. [internal citations omitted]). In its moving papers, defendant contended, “Plaintiff’s communications only demonstrate an effort to frustrate the claim process and have no substantive value beyond confirming notice occurred and Plaintiff failed to attend” (affirmation of defendant’s counsel in support of motion ¶ 13).

As plaintiff points out, “All examinations under oath and medical examinations requested by the insurer shall be held at a place and time reasonably convenient to the applicant” (11 NYCRR 65-3.5 [e]). The regulations do not place a limit on the number of times an applicant for no-fault benefits can request to reschedule an EUO. Courts have ruled that an EUO that is mutually rescheduled prior to the appointed time would not be deemed to constitute a failure to appear (Avicenna Med. Arts, P.L.L.C. v. Ameriprise Auto & Home, 47 Misc 3d 145 [A], 2015 NY Slip Op 50701[U] [App Term 2d Dept, 2d, 11th & 13th Jud Dists 2015]; Metro Psychological Servs., P.C. v Mercury Cas. Co., 49 Misc 3d 143[A], 2015 NY Slip Op 51644[U] [App Term, 1st Dept 2015]).

However, one cannot assume that an EUO is mutually rescheduled merely because a request to reschedule an EUO was made (Alas Lifespan Wellness, PT, P.C. v Citywide Auto Leasing, Inc., 64 Misc 3d 131[A], 2019 NY Slip Op 51040[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019] [a phone call from the assignor on the day of the scheduled IME asking to adjourn the IME, without more, is insufficient to show that an issue of fact exists as to whether the IME was mutually rescheduled]).

However, if plaintiff requested to reschedule an EUO and received no response, then the insurer is not entitled to summary judgment dismissing the complaint as a matter of law (Island Life Chiropractic, P.C. v State Farm Mut. Auto. Ins. Co., 64 Misc 3d 130[A], 2019 NY Slip Op 51038[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019] [plaintiff’s owner submitted an affidavit in which he stated that he had called defendant to reschedule each EUO and that he left messages for defendant’s investigator, but that plaintiff was not contacted by defendant in response to the messages]).

If an insurer refuses a timely and proper request to reschedule, then an issue of fact arises as to whether the EUOs were scheduled to be held at a time or place which was “reasonably convenient” to plaintiff (Parisien v Metlife Auto & Home, 68 Misc 3d 126[A], 2020 NY Slip Op 50845[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2020]). One lower court has ruled [*6]that an insurer may not unreasonably refuse to adjourn the exams “where a good-faith request is made to re-schedule and the adjournment sought is not excessive” (Diagnostic Radiographic Imaging, P.C. v GEICO, 42 Misc 3d 1205[A], 2013 NY Slip Op 52247[U] [Civ Ct, Kings County 2013]; see also A.B. Med. Servs. PLLC v USAA Gen. Indem. Co., 9 Misc 3d 19, 22, 2005 NY Slip Op 25297 [App Term, 2d Dept 2005]).

Here, defendant’s submissions indicate that the requests of plaintiff’s counsel to reschedule were made days before the EUOs were to occur, even though defendant’s counsel had mailed the scheduling letters more than a month before the scheduled EUOs. Defendant’s counsel apparently received plaintiff’s letter dated January 5, 2007 on January 10, 2017, the day before plaintiff’s EUO, as indicated by a date stamp on the letter (see defendant’s exhibit B in support of motion). Similarly, defendant’s counsel apparently received plaintiff’s letter dated February 27, 2017 on March 2, 2017, six days before plaintiff’s scheduled EUO on March 8, 2017 (see id.).

Assuming, for the sake of argument, that the requests of plaintiff’s counsel were both timely, plaintiff did not raise a triable issue of fact as to whether these requests were proper, or that they were made in good faith. Plaintiff requested two lengthy adjournments of the EUO for two to three months, ostensibly for the reason that plaintiff is a doctor. If that reason, without more, constituted a good faith basis for an adjournment, then plaintiff could postpone an EUO indefinitely. As plaintiff’s counsel points out, when an insurer schedules an EUO, the insurer must inform the applicant seeking no-fault benefits that “the applicant will be reimbursed for any loss of earnings and reasonable transportation expenses incurred in complying with the request” (11 NYCRR 65-3.5 [e]), which occurred here. Thus, any concern for the loss of earnings would not be a valid reason to reschedule an EUO. Additionally, when requesting to reschedule, plaintiff offered no specific dates which would be convenient for plaintiff. On this motion, plaintiff did not come forward within any additional information to support the contention that such lengthy adjournments would be reasonable under the circumstances. Thus, plaintiff fails to raise a triable issue of fact as to whether his requests for adjournments for two to three months were either proper, or made in good faith.

Lastly, plaintiff contends that defendant “failed to agree to reimburse the provider” for loss of earnings (see affirmation of plaintiff’s counsel ¶ 111). Plaintiff demanded a flat, up-front reimbursement in the amount of “$5,000 per claimant”, which plaintiff insisted be tendered by check “at the commencement of the EUO” (see defendant’s exhibit B in support of motion, letter from plaintiff’s counsel dated January 5, 2017). However, plaintiff’s counsel cites no authority for the proposition that the insurer must reimburse the lost earnings before the EUO takes place, and that the lack of reimbursement prior to the EUO would excuse the person to be examined from having to appear. As a practical matter, the duration of an EUO may be an important factor in calculating the reimbursement of lost earnings. In this case, the request of plaintiff’s counsel for a flat, up-front fee of $5,000 per claimant was improper (Professional Health Imaging, P.C. v State Farm Mut. Auto. Ins. Co., 51 Misc 3d 143[A], 2016 NY Slip Op 50698[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016] [“plaintiff improperly demanded that defendant pay a flat, up-front fee of $4,500 for plaintiff to attend the EUO, as opposed to seeking reimbursement for any loss of earnings and reasonable transportation expenses as set forth in the regulations”]).

Finally, plaintiff’s reliance upon Meridian Psychological Services, P.C. v Allstate Insurance Company (51 Misc 3d 128[A], 2016 NY Slip Op 50375[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]) is misplaced. There, the attorney testified at a nonjury trial that, [*7]“for the second EUO, she checked at 11:30 a.m. to see whether the assignor had appeared and continued to check for another 15 minutes, but plaintiff’s assignor never appeared. However, the letter scheduling the second EUO scheduled the EUO for 11:00, not 11:30” (id.). Here, unlike Meridian Psychological Services, P.C., the certified EUO transcripts reflect that defendant’s counsel stated on the record that he had been present before the scheduled start time of the EUOs. Thus, no reasonable inference could be drawn that plaintiff had appeared at the EUOs and left before defendant’s counsel had checked for plaintiff’s appearance. Neither does plaintiff submit an affidavit stating that he had appeared for any of the EUOs.

Thus, plaintiff fails to raise a triable issue of fact as to whether plaintiff twice failed to appear for duly scheduled EUOs.

3. Timely Denial of the Claims

“[A]n insurer must either pay or deny a claim for motor vehicle no-fault benefits, in whole or in part, within 30 days after an applicant’s proof of claim is received. An insurer can extend the 30-day period within which to pay or deny a claim by making a timely demand for further verification of the claim”

(Infinity Health Prods., Ltd. V Eveready Ins. Co., 67 AD3d 862, 864 [2d Dept 2009] [internal citations omitted]).

Here, the bills at issue were dated March 20, 2017 (see defendant’s exhibit A3 in support motion, NF-3 Forms), and the denials were allegedly issued on April 10 and 11, 2017. Although defendant claims to have received the bills on March 30, 2017, the actual date of receipt is not a material issue of fact in this case. Even assuming, for the sake of argument, that the bills were received on March 20, 2017, the issuance of the denials on April 10 and April 11, 2017 would be within 30 days of receipt of the bills.

Because defendant requested plaintiff’s EUO prior to its receipt of the bills, the notification requirements for verification requests under 11 NYCRR 65-3.5 and 65-3.6 did not apply (Mapfre Ins. Co. of New York v Manoo, 140 AD3d 468, 469 [1st Dept 2016]; Stephen Fogel Psychological, P.C. v Progressive Cas. Ins. Co., 7 Misc 3d 18, 21 [App Term, 2d Dept, 2d & 11th Jud Dists 2004], affd 35 AD3d 720 [2d Dept 2006]).^[FN1]

Plaintiff argues that defendant must establish when the NF-2 form was mailed to establish timely scheduling of the EUO, because the EUO was a “pre-claim” EUO, citing Okslen Acupuncture, P.C. v Lancer Insurance Company (39 Misc 3d 144[A], 2013 NY Slip Op 50821[U] [App Term, 1st Dept 2013]). This argument is without merit. Proof of timely mailing of the NF-2 form “is not part of an insurer’s prima facie burden when seeking summary judgment on the ground that a provider or the provider’s assignor failed to appear for duly scheduled EUOs” (BNE Clinton Med., P.C. v State Farm Mut. Auto Ins. Co., 70 Misc 3d 138[A], 2021 NY Slip Op 50083[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2021]). Plaintiff’s reliance upon Okslen Acupuncture, P.C. is misplaced. In that case, the Appellate Term, First Department held that pre-claim requests for EUOs do not trigger tolling of the 30-day period for [*8]an insurer to pay or otherwise deny a claim. Here, tolling is not at issue because the denials were allegedly issued within 30 days after they were received.

To establish the mailing of the denials, defendant submitted an affidavit from Lorraine Couvaris, a Claim Litigation Representative employed by defendant (see defendant’s exhibit A in support of motion, Couvaris aff ¶¶ 1-2). Defendant also submitted an affidavit from Mary A. Googe, the manager of a Special Processing Unit of a centralized mailing facility located in Norcross, Georgia, referred to as the Norcross Data Service Center, which does mailing for The Travelers Indemnity Company and its affiliated underwriting companies (see defendant’s exhibit A1 in support of motion, Googe aff ¶¶ 1-3).

Couvaris has been employed in the Claim Department since May 2005, and she has training and experience in claim processing and mail processing procedures that were in effect for the claims at issue (Couvaris aff ¶¶ 3-4). Couvaris processed the bills and issued the denials in this case (id. ¶ 8).

According to Couvaris, claims and documents submitted in support of claims that Travelers received were directed to a Claim Representative for processing (id. ¶ 5 [d]). The Claim Representative noted receipt of the submission on an electronic record, reviewed, the submission, and determined if claims were eligible for coverage (id.). The Claim Representative would seek an EUO if an EUO was deemed appropriate to ascertain the validity of claims (id. ¶ 5 [o]). Once the Claim Representative received the results of an EUO, the Claim Representative would make a determination concerning coverage of related claims (id. ¶ 5 [p]). If the determination of a Claim Representative was a denial, two copies of an “explanation of benefits” or NF-10, and any relevant documents were prepared and directed to the claimant and/or any designated assignee (id. ¶ 5 [q] [iii]). Contemporaneously with the determination, the Claim Representative would note the process on an electronic log (id. ¶ 5 [r]). The claims and documents submitted in support of the claims were kept, maintained, and relied upon by the Claim Representative in processing of the claim, and copies of all documents and electronic logs related to a claim are maintained by defendant in the regular course of business (id. ¶ 7)

Couvaris described the customary practice of defendant’s Melville Claim Center for correspondence as follows: a Claim Representative prepared the documents and reviewed them to ensure the information noted was accurate, and then transmitted the documents electronically for mailing to Norcross Data Center, located in Norcross, Georgia (id. ¶ 6 [a]).

According to Googe, the Norcross Data Service Center is the centralized facility from which certain Travelers documents, including no-fault denials (form NF-10s), verification requests, and associated notices of claim processing delays, are printed, batched, and mailed (Googe aff ¶ 4). When a Travelers employee completes an NF-10 denial, verification request, or a delay letter from his or her desktop computer, and executes the “send and archive option,” the document will be electronically transmitted to the Norcross Data Service Center, where it is batched, printed, and then mailed (id. ¶ 6).

Once transmitted, documents are electronically batched; and, when the documents are printed, they contain encoded information, which identifies the particular batch they were processed in (id. ¶ 8). The documents are then placed into a machine which inserts them into a windowed envelope where the address of the recipient is shown (id.). The envelope is sealed, and the appropriate amount of postage is applied according to size and weight (id.). The machine counts the number of documents and envelopes processed to check that all mail in a particular batch has gone through the process, by comparing the actual number of envelopes with [*9]the expected number (id.). A visual inspection is also performed to ensure that the address of the recipient appears visible in the envelope window (id. ¶ 9). The reconciled mail is then placed into covered United States Postal Service trays, which are secured and placed into United States Postal Service designated containers, which are then delivered to a secure loading facility, where they are picked up by United States Postal employees (id. ¶ 10).

With respect to NF-10 denials, the denials are mailed in duplicate, and mailed to the identified recipient no later than the next business day after the date which appears on the denial (id. ¶¶ 6-7, 13).

In this case, Couvaris stated that defendant received two claims for services rendered to Nicanor Gonzalez on March 30, 2017 (Couvaris aff ¶ 8 [f]). After reviewing the claims, Couvaris denied them for the failure of plaintiff to appear at scheduled EUOs on January 11, 2017 and March 8, 2017 (id. ¶ 8 [g]). Couvaris issued denial of claim forms in duplicate for each of the claims, and sent them to plaintiff and Gonzalez (id. ¶ 8 [h]). Couvaris then documented the electronic record with an account of her review and denial (id. ¶ 8 [i]).

Based on the detailed affidavits of Couvaris and Googe, defendant established proof of mailing of the denials no later than the next business day after April 10 and 11, 2017, the date that appears on the denials, in accordance with a standard office practice and procedure (Residential Holding Corp. v Scottsdale Ins. Co., 286 AD2d 679, 680 [2d Dept 2001]; Crystal Acupuncture, P.C. v Travelers Ins., 66 Misc 3d 130[A], 2019 NY Slip Op 52055[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2019]).

“[T]o rebut the presumption, there must be proof of a material deviation from an aspect of the office procedure that would call into doubt whether the notice was properly mailed, impacting the likelihood of delivery to the intended recipient. Put another way, the crux of the inquiry is whether the evidence of a defect casts doubt on the reliability of a key aspect of the process such that the inference that the notice was properly prepared and mailed is significantly undermined. Minor deviations of little consequence are insufficient”

(CIT Bank N.A, —NY3d—, 2021 NY Slip Op 01933, *3).

Contrary to plaintiff’s argument, defendant did submit an affidavit from someone with personal knowledge of the denials, because Couvaris stated that she was the Claims Litigation Representative who issued the denials, and Couvaris also had personal knowledge of the claims procedures and mailing procedures (Couvaris aff ¶¶ 4, 8 [g]).

As plaintiff points out, Couvaris indicated that she had reviewed electronic logs related to this claim, but defendant did not submit copies or printouts of the electronic logs. “Evidence of the contents of business records is admissible only where the records themselves are introduced. Without their introduction, a witness’s testimony as to the contents of the records is inadmissible” (Bank of New York Mellon v Gordon, 171 AD3d 197, 205-06 [2d Dept 2019] [internal citations and internal quotation marks omitted]). Thus, any information that Couvaris could only have obtained from the electronic log would not be admissible. However, in this case, Couvaris had personally issued the denials, and had submitted copies of the denials themselves. Plaintiff does not point to any information in Couvaris’s affidavit relevant to proof of mailing that could only have been derived from a review of the electronic log.

Contrary to plaintiff’s argument, the failure to send a denial of claim form in duplicate as required under 11 NYCRR 65-3.8 (c) (1) is not, on its own, a fatal error (Performance Plus Med., P.C. v Utica Mut. Ins. Co., 47 Misc 3d 129[A], 2015 NY Slip Op 50399[U] [App Term, [*10]2d Dept 2d, 11th & 13th Jud Dists 2015]; Mollo Chiropractic, PLLC v American Commerce Ins. Co., 42 Misc 3d 66, 69 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2013]). In any event, Couvaris and Googe averred that denial of claim forms are sent in duplicate (Couvaris aff ¶ 8 [h]; Googe aff ¶ 6).

Acupuncture Prima Care, P.C. v State Farm Mutual Auto Insurance Company (17 Misc 3d 1135[A], 2007 NY Slip Op 52273[U] [Dist Ct, Nassau County 2007]), which plaintiff cites, is distinguishable.

There, to establish proof of mailing, the defendant submitted two affidavits—an affidavit from a claims representative from the defendant’s office in Ballston Spa, New York and an affidavit from a claims support supervisor from the defendant’s office in Melville, New York. The claims representative described the procedure for generating the denial of claim forms, which were then sent to Claims Support Services personnel for processing (id. at *2). The affidavit from the Claims Support Services Supervisor stated, in essence, that the generated denial of claim forms are retrieved from a printer, placed in an envelope, and picked up by a courier who delivers the envelope to the United States Postal Service (id. at *2-3).

The court in Acupuncture Prima Care, P.C. ruled, “while this may describe a ‘standard office practice and procedure,’ it does not describe one “used to ensure that items were properly addressed and mailed” (id. at *3 [internal citation omitted]). The court reasoned that the procedure described did not contain enough safeguards to “take into account the possibility that an item of mail might get misplaced or lost anywhere between the CSA pool and the United States Post Office” (id.) The court also faulted the affiants for not indicating the basis for their knowledge that the office practice and procedure was followed, and the affiants failed to indicate that they were familiar with the defendant’s office practices and procedures when the first of the denials were allegedly mailed (id. at *3-4). Finally, the court indicated that neither of the affiants (who were in Ballston Spa and Melville) indicated from which office the denials were allegedly mailed, when the denials bore an address from Parsippany, New Jersey (id.).

Here, unlike the affiants in Acupuncture Prima Care, P.C., Googe established personal knowledge of the standard mailing procedures, based on training and experience that Googe received (Googe aff ¶¶ 2-3). In any event, the same court which decided Acupuncture Prima Care, P.C. acknowledged that its prior cases were no longer good law in light of St. Vincent’s Hospital of Richmond v Government Employees Insurance Company (50 AD3d 1123 [2d Dept 2008]) (see Uniondale Chiropractic Off. v State Farm Mut. Auto. Ins. Co., 20 Misc 3d 1130[A], 2008 NY Slip Op 51687[U] [Dist Ct, Nassau County 2008]).

In sum, plaintiff failed to raise a triable issue of fact as to whether the denials were mailed to plaintiff no later than one business day after April 10 and April 11, 2017.

Given all the above, the court grants the branch of defendant’s motion for summary judgment dismissing the complaint, on the ground that plaintiff twice failed to appear for duly scheduled EUOs on January 11, 2017 and March 8, 2017.

B. The branch of defendant’s motion to compel plaintiff to appear for an examination before trial

In light of dismissal of the complaint, the branch of defendant’s motion which sought, in the alternative, an order compelling plaintiff to appear for an examination before trial, is denied as academic.

C. The branch of defendant’s motion seeking an order deeming documents as admitted pursuant [*11]to CPLR 3123

The branch of defendant’s motion seeking an order to “deemed the documents described in Defendant’s Notice to Admit as genuine and the matters of fact set forth in Defendant’s Notice to Admit as true” is denied as academic, because defendant was granted summary judgment dismissing the complaint. In any event, “[t]he question as to whether a party has rightly or wrongly declined for reasons set forth to admit or to deny an item tendered in a notice to admit is for the trial court” (Belfer v Dictograph Products, 275 App Div 824 [1st Dept 1949]).

II. Plaintiff’s Cross Motion for Summary Judgment (Motion Seq. No. 002)

“A no-fault provider establishes its prima facie entitlement to summary judgment by proof of the submission to the defendant of a claim form, proof of the fact and the amount of the loss sustained, and proof either that the defendant had failed to pay or deny the claim within the requisite 30-day period, or that the defendant had issued a timely denial of claim that was conclusory, vague or without merit as a matter of law”

(Ave T MPC Corp. v Auto One Ins. Co., 32 Misc 3d 12[A]; 2011 NY Slip Op 51292[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2011]).

Here, any deficiencies in plaintiff’s proof of mailing were cured by defendant’s submission of the denial of claim form in defendant’s motion papers, which admitted receipt of the bill (Bob Acupuncture, P.C. v New York Cent. Mut. Fire Ins. Co., 53 Misc 3d 135[A], 2016 NY Slip Op 51434[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]; see Oleg Barshay, DC, P.C. v State Farm Ins. Co., 14 Misc 3d 74, 75 [App Term, 2d Dept, 2d & 11th Jud Dists 2006]).

However, plaintiff’s cross motion for summary judgment in its favor against defendant is denied. As discussed above, defendant timely denied the bills on the grounds that plaintiff twice failed to appear for duly scheduled EUOs.

CONCLUSION

Upon the foregoing cited papers, it is hereby ORDERED that defendant’s motion for summary judgment dismissing the complaint, or in the alternative, to compel plaintiff to appear for an examination before trial and other relief (Motion Seq. No. 001) is GRANTED TO THE EXTENT that the branch of defendant’s motion seeking summary judgment dismissing the complaint is granted, and the complaint is dismissed, with costs and disbursements to defendant as taxed by the Clerk upon submission of an appropriate bill of costs; and it is further

ORDERED that the remainder of defendant’s motion is denied; and it is further

ORDERED that plaintiff’s cross motion for summary judgment in its favor (Motion Seq. No. 002) is DENIED; and it is further

ORDERED that the Clerk is directed to enter judgment in defendant’s favor accordingly.

This constitutes the decision and order of the court.

Dated: April 30, 2021
New York, New York
ENTER:
________________________________
RICHARD TSAI, J.
Judge of the Civil Court

Footnotes

Footnote 1:However, once the bills are received, defendant is required to comply with the follow-up provisions of 11 NYCRR 65.36 (b) (Mapfre Ins. Co. of NY, 140 AD3d at 470). In this case, the follow-up EUO scheduling letter was sent before the bills at issue were received.

Ultimate Massage Therapy, P.C., As Assignee Of Brodie, Plaintiff(s), against Utica Mutual Insurance Company, Defendant(s).

CV-704628-19/QU

Plaintiff’s Counsel:

Law Offices of Gabriel & Shapiro LLC

3361 Park Avenue, Suite 1000

Wantagh, NY 11793

Defendant’s Counsel:

Michael Seth Nightingale

100 Garden City Plaza, Suite 414

Garden City, NY 11530

Wendy Changyong Li, J.

I. Papers

The following papers were read on Defendant’s motion for summary judgment seeking dismissal of Plaintiff’s complaint:

Papers Numbered

Defendant’s Notice of Motion and Affirmation in Support dated August 21, 2019 (“Motion“) and file stamped by the court on August 26, 2019. 1

Plaintiff’s Affirmation in Opposition dated and electronically filed with the court on November 23, 2020 (“Opposition“). 2

Defendant’s Reply Affirmation dated and electronically filed with the court on December 4, [*2]2020 (“Reply“). 3

II. Discussion and Decision

Defendant moved for summary judgment dismissing Plaintiff’s complaint on the ground that Workers Compensation insurance was primary and thus barred Plaintiff’s claim for No-Fault benefits. Plaintiff opposed Defendant’s motion for summary judgment.

“[P]rimary jurisdiction with respect to the determination as to the applicability of the Workers’ Compensation Law has been vested in the Workers’ Compensation Board and . . . it is therefore inappropriate for the courts to express views with respect thereto pending determination by the board” (Botwinick v Ogden, 59 NY2d 909, 911 [1983]; Dunn v American Tr. Ins. Co., 71 AD3d 629, 629-30 [2d Dept 2010], see LMK Psychological Serv., P.C. v American Tr. Ins. Co., 64 AD3d 752, 754 [2d Dept 2009]). By moving for summary judgment dismissing Plaintiff’s complaint, Defendant asked this Court to determine the applicability of the Workers’ Compensation Law. In our instant matter, Defendant failed to support its contention regarding the applicability of the Workers’ Compensation Law with admissible evidence. Here, Defendant laid no foundation for the transcript of a recording of assignor’s unsworn statement, in which he admitted he was operating his employer’s vehicle for business purposes prior to the accident (see Motion, Aff. of Michael S. Nightingale, Ex. 2). The police accident report was also inadmissible because it was neither certified (Progressive Advanced Ins. Co. v McAdam, 139 AD3d 691, 692 [2d Dept 2016]; Nationwide Gen. Ins. Co. v Bates, 130 AD3d 795, 796 [2d Dept 2015]), nor sworn or supported with the affidavit of a witness with personal knowledge of the facts (LMS Med. Care v American Tr. Ins. Co., 30 Misc 3d 137[A], 2011 NY Slip Op 50195[U] *1 [App Term 2d Dept 2011]).

Even had Defendant presented admissible evidence, the applicability of the Workers’ Compensation Law to this case must be resolved by the Workers’ Compensation Board (Compas Med., P.C. v American Tr. Ins. Co., 49 Misc 3d 146[A], 2015 NY Slip Op 51675[U] *1 [App Term 2d Dept 2015]; Jamaica Med. Supply, Inc. v American Tr. Ins. Co., 34 Misc 3d 133[A], 2011 NY Slip Op 523761[U] *2 [App Term 2d Dept 2011]; D.A.V. Chiropractic, P.C. v American Tr. Ins. Co., 29 Misc 3d 128[A], 2010 NY Slip Op 51738[U] *2 [App Term 2d Dept 2010]; AR Med. Rehabilitation, P.C. v American Tr. Ins. Co., 27 Misc 3d 133[A], 2010 NY Slip Op 50708[U] *2 [App Term 2d Dept 2010]). While Defendant cited Great Health Care Chiropractic, P.C. v Lancer Ins. Co. (42 Misc 3d 145[A], 2014 NY Slip Op 50340[U] *1 [App Term 2d Dept 2014]) to support its motion, that case further supports the Court’s conclusion. Accordingly, this Court must hold Defendant’s motion in abeyance pending an application to the Workers’ Compensation Board for determination of the parties’ rights under the Workers’ Compensation Law (Compas Med., P.C. v American Tr. Ins. Co., 2015 NY Slip Op 51675[U] *1; Great Health Care Chiropractic, P.C. v Lancer Ins. Co., 2014 NY Slip Op 50340[U] *1; Jamaica Med. Supply, Inc. v American Tr. Ins. Co., 2011 NY Slip Op 52371[U] *2; D.A.V. Chiropractic, P.C. v American Tr. Ins. Co., 2010 NY Slip Op 51738[U] *2).

III. Order

Accordingly, it is

ORDERED that Defendant’s Motion for summary judgment is held in abeyance pending determination of the Workers’ Compensation Board of the applicability of the Workers’ Compensation Law to this case, and it is further

ORDERED that the parties shall advise the Court of the status of any determination of [*3]the Workers’ Compensation Board by June 1, 2021.

This constitutes the DECISION and ORDER of the Court.

Dated: April 30, 2021

Queens County Civil Court

_____________________________

Honorable Wendy Changyong Li, J.C.C.

NY Wellness Medical P.C., as Assignee Of Shantay J.R., Plaintiff(s), against Ameriprise Insurance Company, Defendant(s).

CV-702516-19/QU

Plaintiff’s Counsel:

Law Offices of Gabriel & Shapiro

3361 Park Avenue, Suite 1000

Wantagh, NY 11793

Defendant’s Counsel:

Callinan & Smith, LLP

3361 Park Avenue, Suite 104

Wantagh, NY 11793

Wendy Changyong Li, J.

I. Papers

The following papers were read on Defendant’s motion for summary judgment seeking dismissal of Plaintiff’s complaint:

Papers Numbered

Defendant’s Notice of Motion and Affirmation in Support dated October 1, 2019 (“Motion”) and file stamped by the court on November 7, 2019.1

Plaintiff’s Affirmation in Opposition (“Opposition”) dated and electronically filed with the court on October 5, 2020. 2

Defendant’s Affirmation in Reply (“Reply”) dated and electronically filed with the court on November 16, 2020. 3

II. Background

In a summons and complaint filed on February 7, 2019, Plaintiff sued Defendant [*2]insurance company to recover a total of $5,739.44 in unpaid first party No-Fault benefits for medical services provided to Plaintiff’s assignor Shantay J.R. from October 2017 to April 2018, plus attorneys’ fees and statutory interest. The First cause of action was for recovery of a bill for services provided October 18 to November 2, 2017 (“First Bill“) in the amount of $405.60. The Third cause of action was for recovery of a $333.12 bill for services provided November 3 to 15, 2017 (“Second Bill“). The Fifth cause of action was for recovery of a $130.32 bill for services provided November 17 to 30, 2017 (“Third Bill“). The Seventh cause of action was for recovery of a $80.02 bill for services provided on October 13, 2017 (“Fourth Bill“). The Ninth cause of action was for recovery of a $148.69 bill for services provided on October 11, 2017 (“Fifth Bill“). The Eleventh cause of action was for recovery of a $92.97 bill for services provided on November 15, 2017 (“Sixth Bill“). The Thirteenth cause of action was for recovery of a bill in an unspecified amount for services provided at an unspecified time (“Seventh Bill“). The Fifteenth cause of action was for recovery of a $204.41 bill for services provided on October 11, 2017 (“Eighth Bill“). The Seventeenth cause of action was for recovery of a $204.41 bill for services provided on November 15, 2017 (“Ninth Bill“). The Nineteenth cause of action was for recovery of a $2,597.08 bill for services provided from December 26, 2017 to April 12, 2018 (“Tenth Bill“). The Twenty-First cause of action was for recovery of a $1,542.82 bill for services provided from October 13 to December 28, 2017. In a stipulation dated May 15, 2019, the parties amended such Twenty-First cause of action to recover a $593.76 bill for services provided December 1 to 28, 2017 (“Eleventh Bill“) (see Motion, Soriano Aff., Ex. C). This stipulation effectively reduced the amount Plaintiff sought to recover to $4,790.38. The Second, Fourth, Sixth, Eighth, Tenth, Twelfth, Fourteenth, Sixteenth, Eighteenth, Twentieth, and Twenty-Second causes of action sought recovery of attorneys’ fees for each of the separate bills. Unlike the First Bill, Second Bill, Third Bill, Fourth Bill, Fifth Bill, Sixth Bill, Eighth Bill, and Ninth Bill, the Tenth Bill and Eleventh Bill are composed of several smaller bills for dates of service within the range of service dates alleged in the complaint.

Defendant now moved for summary judgment dismissing Plaintiff’s complaint on the ground that Plaintiff failed to attend scheduled Examinations Under Oath (“EUO“), or alternatively for judgment that Defendant established its prima facie case. Plaintiff opposed Defendant’s motion for summary judgment. No cross-motion was filed by Plaintiff. An oral argument by both parties was conducted by this Court on April 8, 2021.

III. Discussion

CPLR 3212 provides that “a motion for summary judgment shall be supported by affidavit, by a copy of the pleadings and by other available proof, such as depositions and written admissions” (CPLR 3212[b]). “Mere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient” (Zuckerman v. City of New York, 49 NY2d 557, 562 [1980]). “A defendant moving for summary judgment [seeking an order dismissing plaintiff’s complaint] has the initial burden of coming forward with admissible evidence, such as affidavits by persons having knowledge of the facts, reciting the material facts and showing that the cause of action has no merit” (GTF Mktg. v Colonial Aluminum Sales, 66 NY2d 965, 967 [1985]; Anghel v Ruskin Moscou Faltischek, P.C., 190 AD3d 906, 907 [2d Dept 2021], see Jacobsen v. New York City Health & Hosps. Corp., 22 NY3d 824, 833 [2014]). A motion for summary judgment “shall be granted if, upon all the papers and proof submitted, the cause of action or defense shall be established sufficiently to warrant the court as a matter of law in directing judgment in favor of any party” (CPLR 3212[b]; Zuckerman v. City of New York, at [*3]562, see GTF Mktg. v Colonial Aluminum Sales, 66 NY2d at 968).

Insurers must pay or deny No-Fault benefit claims “within thirty (30) calendar days after receipt of the proof of the claim” (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498, 501 [2015]; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 563 [2008]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317 [2007]; see Insurance Law § 5106[a]; 11 NYCRR § 65-3.8[c]; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 278 [1997]). Failure to establish timely payment or denial of the claim precludes the insurer from offering evidence of its defense to non-payment (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 506; Fair Price Med. Supply Corp. v. Travelers Indem. Co., 10 NY3d at 563; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d at 281-86). Noncompliance with an insurance policy provision requiring disclosure through an EUO is a failure of a condition precedent to an insurer’s duty to indemnify (IDS Prop. Cas. Ins. Co. v Stracar Med. Servs., P.C., 116 AD3d 1005, 1007 [2d Dept 2014]; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 54 Misc 3d 131[A], 2017 NY Slip Op 50028[U] *1 [App Term 2d Dept 2017]) and is a material policy breach precluding recovery of proceeds under the insurance policy (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d 755, 756 [2d Dept 2020]; Interboro Ins. Co. v Clennon, 113 AD3d 596, 597 [2d Dept 2014]).

Plaintiff’s Thirteenth Cause of Action

As noted above, Plaintiff’s Thirteenth cause of action did not specify the amount of the bill or the dates of service for which the bill was issued. In its answer, Defendant denied knowledge or information sufficient to form a belief as to all the allegations in Plaintiff’s complaint, but asserted as the Third Affirmative Defense that the “complaint fail[ed] to state a proper cause of action as against [the] answering defendant” (Motion, Soriano Aff. Ex. B). Moreover, Plaintiff addressed only ten (10) bills in its Opposition, even though eleven (11) bills were alleged in Plaintiff’s complaint. Here, this Court grants Defendant’s motion for summary judgment dismissing Plaintiff’s Thirteenth cause of action for failure to state a cause of action (CPLR 3211[a][7]; 3212).

Plaintiff’s First, Seventh and Fifteenth Causes of Action

Plaintiff’s First, Seventh and Fifteenth causes of action concerned the First Bill for $405.60, Fourth Bill for $80.02, and Eighth Bill for $204.41. At the outset, the Court notes that Plaintiff alleged in its First cause of action that the amount of its First Bill was $405.60 and that no payment was made by Defendant. Defendant’s supporting evidence, however, indicated that the original First Bill was indeed in the amount of $456.36 and that Defendant’s adjuster, Kurz, allowed $405.60 as of March 1, 2018, leaving a balance of $50.76 (see Aff. Of Soriano, Ex. X and Y). Because Plaintiff only prayed for $405.60 regarding its First Bill in its compliant, this Court will only address Plaintiff’s First Bill in the amount of $405.60, not $456.36. Defendant argued that the foregoing described causes of action should be dismissed because the above three (3) bills were paid.

To support its motion, Defendant presented explanations of benefits dated November 22 and December 28, 2017, in which Defendant acknowledged receiving the three (3) bills on November 13, 2017 (see Motion, Soriano Aff. Ex. T, V, and X). The explanations of benefits dated November 22 and December 28, 2017 (“November and December EOB“), advised Plaintiff that Defendant received the bills but was delaying payment “pending the Examination Under Oath of the above-mentioned claimant” (id.). The explanations of benefits included in the [*4]November and December EOB identified the claimant as J.R. (see id.). Here, the November and December EOB indicated that Defendant sought verification from J.R. who is Plaintiff’s assignor, but not Plaintiff. This Court notes that Defendant allegedly delayed its payment to the above three (3) bills pending EUO on Plaintiff’s assignor, not on Plaintiff itself, based on Defendant’s supporting documents presented in the Motion. Since letters that do not request verification to a plaintiff are insufficient to delay an insurer’s time to pay or deny a claim by such plaintiff (Mount Sinai Hosp. v Triboro Coach, 263 AD2d 11, 17 [2d Dept 1999]; Parsons Med. Supply Inc. v Progressive Northeastern Ins. Co., 36 Misc 3d 148[A], 2012 NY Slip Op 51649[U] *2 [App Term 2d Dept 2012]; Points of Health Acupuncture, P.C. v Lancer Ins. Co., 28 Misc 3d 133[A], 2010 NY Slip Op 51338[U] *2 [App Term 2d Dept 2010]; Alur Med. Supply, Inc. v Progressive Ins. Co., 21 Misc 3d 134[A], 2008 NY Slip Op 52191[U] *1 [App Term 2d Dept 2008]), Defendant’s November and December EOB failed to toll Defendant’s time to pay the claims submitted by Plaintiff.

On another note, this Court does not have a reason to believe, based on the evidence presented by Defendant, that the language in Defendant’s November and December EOB, indicating that the delay of payment pending only Plaintiff’s assignor’s EUO, were typographical errors. Here, Defendant did not address this issue in the Motion or in the Reply. Furthermore, Defendant’s explanations of benefits regarding the Second Bill, Third Bill, Sixth Bill, Ninth Bill, and Eleventh Bill noted that payment was being delayed pending an EUO of both claimant (i.e., Plaintiff’s assignor) and provider (i.e., Plaintiff) (see Motion, Soriano Aff. Ex. Z, BB, DD, FF, HH, and JJ).

While Defendant presented evidence that it paid the First Bill, Fourth Bill, and Eighth Bill on March 1, 2018 (see Motion, Soriano Aff. Ex. ZZ and AAA), Defendant’s failure to toll the time to pay the bills received November 13, 2017, rendered the payments untimely. As such, Defendant failed to meet its initial burden of demonstrating entitlement to dismissal of Plaintiff’s First, Seventh, and Fifteenth causes of action, and Defendant’s motion for summary judgment dismissing these causes of action must be denied (Neptune Med. Care, P.C. v Dairyland Ins. Co., 53 Misc 3d 152[A], 2016 NY Slip Op 51705[U] *1 [App Term 2d Dept 2016]); Concourse Chiropractic, PLLC v State Farm Mut. Ins. Co., 42 Misc 3d 131[A], 2013 NY Slip Op 52225[U] *2 [App Term 2d Dept 2013], see Natural Therapy Acupuncture, P.C. v American Tr. Ins. Co., 51 Misc 3d 129[A], 2016 NY Slip Op 50389[U] * 1 [App Term 2d Dept 2016]).).

The failure to timely pay these claims precludes Defendant from raising defenses to non-payment of the claims (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 506; Fair Price Med. Supply Corp. v. Travelers Indem. Co., 10 NY3d at 563; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318; New York & Presbyt. Hosp. v Eagle Ins. Co., 17 AD3d 646, 647 [2d Dept 2005]). In addition, “[b]y statute, overdue payments earn monthly interest at a rate of two percent and entitle [Plaintiff] to reasonable attorneys’ fees incurred in securing payment of a valid claim” (Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318, see Ins. Law § 5106[a]; 11 NYCRR §§ 65-3.9[a], 3.10[a]; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d at 563; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d at 278). In the instant matter, although Defendant paid Plaintiff for the First Bill, Fourth Bill and Eighth Bill as alleged in Plaintiff’s First, Seventh and Fifteenth causes of action, such payments were untimely. As a result, Plaintiff is entitled to a statutory interest (11 NYCRR 65-3.9[c]; East Acupuncture, P.C. v Allstate Ins. Co., 61 AD3d 202, 207-08 [2d Dept 2009]). The amount of Plaintiff’s attorneys’ fees for the First, Seventh and [*5]Fifteenth causes of action is governed by statute and regulation (Insurance Law § 5106[a]; 11 NYCRR §§ 65-3.10[a]; 65-4.6[c] and [d]). Although Plaintiff would have been entitled to summary judgment on statutory interest and attorneys’ fees based on those causes of action (Nyack Hosp. v. Encompass Ins. Co., 23 AD3d 535, 536 [2d Dept 2005]; Optimal Well-Being Chiropractic, P.C. v MVAIC, 46 Misc 3d 134[A], 2014 NY Slip Op 51861[U] * 2 [App Term 2d Dept 2014]) if they were prayed for, here, Plaintiff did not cross move for summary judgment. Consequently, this Court will not award Plaintiff with statutory interest or attorney’s fee based on the motion papers currently before this Court.

Plaintiff’s Third, Fifth, Ninth, Eleventh, Seventeenth, Nineteenth, and Twenty-First Causes of Action

Defendant argued that the Third, Fifth, Ninth, Eleventh, Seventeenth, Nineteenth, and Twenty-First causes of action based respectively on the Second Bill, Third Bill, Fifth Bill, Sixth Bill, Ninth Bill, Tenth Bill, and Eleventh Bill were properly denied because Defendant timely denied the claims based on Plaintiff’s failure to attend duly scheduled EUOs.

In order to establish a defense that an insured failed to attend a duly scheduled EUO, an insurer must present evidence of the timely and proper mailing of the EUO scheduling letters (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; Progressive Cas. Ins. Co. v Metro Psychological Servs., P.C., 139 AD3d 693, 694 [2d Dept 2016]). This may be established with evidence of the actual mailing or by an affidavit of a person “with personal knowledge of the standard office practice for ensuring that the letters are properly addressed and mailed” (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; Progressive Cas. Ins. Co. v Metro Psychological Servs., P.C., 139 AD3d at 694).

To support its motion, Defendant presented the first request letter dated December 11, 2017, scheduling the EUO for January 9, 2018 (see Motion, Soriano Aff., Ex. G). Defendant also presented a letter from Plaintiff’s counsel dated January 3, 2018, which acknowledged receipt of the December 11, 2017 scheduling letter, but objected to the EUO (see Motion, Soriano Aff. Ex. K) on grounds addressed more fully below. Here, such evidence established timely submission of the EUO request by Defendant (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; First Class Med., P.C. v State Farm Mut. Auto. Ins. Co., 55 Misc 3d 141[A], 2017 NY Slip Op 50593[U] *2 [App Term 2d Dept 2017]; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 2017 NY Slip Op 50028[U] *1. In addition, after Plaintiff failed to appear for the January 9, 2018 EUO, Defendant timely sent a second scheduling letter dated January 10, 2018, which scheduled the EUO for January 25, 2018 (see Motion, Soriano Aff. Ex. H) (11 NYCRR § 65-3.6[b]; see Active Care Med. Supply Corp. v Ameriprise Auto & Home, 58 Misc 3d 138[A], 2017 NY Slip Op 51835[U] *2 [App Term 2d Dept 2017]; ARCO Med. NY, P.C. v Lancer Ins. Co., 34 Misc 3d 134[A], 2011 NY Slip Op 52382[U] *2 [App Term 2d Dept 2011]). The transcripts of the EUO proceedings (see Motion, Soriano Aff. Ex. J and M) constituted adequate proof of Plaintiff’s nonappearance at the EUOs (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; TAM Med. Supply Corp. v 21st Century Ins. Co., 57 Misc 3d 149[A], 2017 NY Slip Op 51510[U] *1 [App Term 2d Dept 2017]; First Class Med., P.C. v State Farm Mut. Auto. Ins. Co., 2017 NY Slip Op 50593[U] *2; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 2017 NY Slip Op 50028[U] *1).

In an affidavit appended to the Motion sworn October 31, 2019, Mueller, Defendant’s litigation examiner, established Defendant’s claim processing and standard mailing procedures designed to ensure timely mailing and the timely denial of Plaintiff’s claims within thirty (30) [*6]days after the last scheduled EUO at which Plaintiff failed to appear (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; Tam Med. Supply Corp. v 21st Century Ins. Co., 2017 NY Slip Op 51510[U] *1; First Class Med., P.C. v State Farm Mut. Auto. Ins. Co., 2017 NY Slip Op 50593[U] *2; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 2017 NY Slip Op 50028[U] *1). Regarding the Second Bill, Third Bill, Sixth Bill, Ninth Bill, and two of the bills included within the Eleventh Bill, for which Plaintiff submitted claims to Defendant before Plaintiff’s second non-appearance at an EUO, Defendant presented explanations of benefits, which delayed payment pending EUOs of both claimant (i.e., assignor) and provider (i.e., Plaintiff) (see Motion, Soriano Aff. Ex. Z, BB, DD, FF, HH, and JJ). Since Defendant timely mailed the EUO request letters to Plaintiff, these explanations of benefits, which requested verification from Plaintiff, tolled Defendant’s time to pay or deny the claims submitted by Plaintiff (Doctor Goldshteyn Chiropractic, P.C. v ELRAC, Inc., 56 Misc 3d 132[A], 2017 NY Slip Op 50923[U] *1 [App Term 2d Dept 2017]). Finally, with respect to the Tenth Bill and a bill included within the Eleventh Bill, which were submitted after Plaintiff’s second non-appearance at an EUO, Defendant presented the explanations of benefits and denial of claim forms which denied the claims based on these bills for Plaintiff’s failure to attend the EUOs (see Motion, Soriano Aff. Ex. LL, MM, NN, OO, PP, QQ, RR, SS, TT, UU,VV, WW, XX, and YY). Therefore, Defendant’s denials of the Third, Fifth, Ninth, Eleventh, Seventeenth, Nineteenth, and Twenty-First causes of action based on the Second Bill, Third Bill, Fifth Bill, Sixth Bill, Ninth Bill, Tenth Bill, and Eleventh Bill on February 5, 2018 and subsequent to that date were timely (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757, see 11 NYCRR §§ 65-3.5[a]; 65-3.5[a]). Defendant’s evidence that it requested Plaintiff’s appearance at EUOs twice, that Plaintiff failed to appear both times and that Defendant denied Plaintiff’s claim on that basis satisfied Defendant’s burden of establishing a material policy breach by Plaintiff (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; IDS Prop. Cas. Ins. Co. v Stracar Med. Servs., P.C., 116 AD3d at 1007; Interboro Ins. Co. v Clennon, 113 AD3d at 597).

IV. Plaintiff’s Opposition to Defendant’s Motion

In opposition, Plaintiff contended that factual issues existed precluding Defendant’s motion for summary judgment.

Plaintiff contended that Defendant failed to respond to Plaintiff’s objections to the EUOs. In the January 3, 2018 letter, Plaintiff’s counsel objected to Plaintiff’s EUO request based on the ground that the December 11, 2017 request letter from Defendant’s counsel did not identify the dates of service or state objective reasons for requesting an EUO and argued that invoking State Farm Mut. Auto. Ins. Co. v Mallela (4 NY3d 313 [2005]) did “not allow a carrier to obtain any and all information it request[ed]” (Motion, Soriano Aff. Ex. K). Plaintiff’s counsel also notified Defendant’s counsel that Plaintiff required $1,000.00 as reimbursement for loss of wages for attending an EUO.

Here, this Court’s research revealed no case law or statutory or regulatory authority that a letter objecting to an EUO tolls or delays the time for a No-Fault benefit applicant to appear for an EUO. The “insurer is entitled to receive all items necessary to verify the claim directly from the parties from whom such verification was requested” (11 NYCRR § 65-3.5[c]). A letter objecting to an EUO does, however, preserve the No Fault benefit applicant’s objections to the reasonableness of a requested EUO for litigation (see National Med. & Surgical Supply, Inc. v ELRAC, Inc., 54 Misc 3d 131[A], 2017 NY Slip Op 50028[U] *1 [App Term 2d Dept 2017]; Starcar Med. Servs. v State Farm Mut. Auto. Ins. Co., 53 Misc 3d 133[A], 2016 NY Slip Op [*7]51415[U] *1 [App Term 2d Dept 2016]; Professional Health Imaging, P.C. v State Farm Mut. Auto. Ins. Co., 52 Misc 3d 134[A], 2016 NY Slip Op 51026[U] *1 [App Term 2d Dept 2016]). In our instant case, regarding the objections Plaintiff’s counsel raised in its January 3, 2018 objection letter and in opposition to the Motion, the Court notes that Defendant’s counsel’s December 11, 2017 EUO request letter indeed indicated the claim number and date of loss which Plaintiff indicated on each claim Plaintiff submitted to Defendant. Moreover, “[a]ny requests by an insurer for additional verification need not be made on any prescribed or particular form” (11 NYCRR § 65-3.5[b]). The No-Fault regulations do not require “an insurer’s notice of scheduling an EUO to specify the reason[s] why the insurer is requiring the EUOs” (City Chiropractic, P.C. v State Farm Ins., 64 Misc 3d 134[A], 2019 NY Slip Op 51102[U] *1 [App Term 2d Dept 2019]; Bronx Chiropractic Care, P.C. v State Farm Ins., 63 Misc 3d 132[A], 2019 NY Slip Op 50423[U] *1 [App Term 2d Dept 2019]; Flow Chiropractic, P.C. v Travelers Home & Mar. Ins. Co., 44 Misc 3d 132[A], 2014 NY Slip Op 51142[U] *1 [App Term 2d Dept 2014], see Longevity Med. Supply, Inc. v Praetorian Ins. Co., 47 Misc 3d 144[A], 2015 NY Slip Op 50685[U] *1 [App Term 2d Dept 2015]). Based on the evidence presented before this Court, it appears that Plaintiff’s EUO request letter dated December 11, 2017 did not cite State Farm Mut. Auto. Ins. Co. v Mallela (4 NY3d 313 [2005]), as Plaintiff’s counsel alleged, and has complied with the requirement that it advise that Plaintiff “will be reimbursed for any loss of earnings and reasonable transportation expenses incurred in complying with the request” (11 NYCRR § 65-3.5[e]). Further, a request for a flat fee for attending an EUO is improper (Professional Health Imaging, P.C. v State Farm Mut. Auto. Ins. Co., 51 Misc 3d 143[A], 2016 NY Slip Op 50698[U] *1 [App Term 2d Dept 2016]).

Contrary to Plaintiff’s position, Defendant in fact responded to Plaintiff’s letters objecting to the EUOs (see Motion, Soriano Aff. Ex. L, O and Q) even though no such response is required to establish noncompliance with a scheduled EUO (see Interboro v Clennon, 113 AD3d at 597; 21st Century Pharm., Inc. v Integon Natl. Ins. Co., 69 Misc 3d 142[A], 2020 NY Slip Op 51364[U] *1 [App Term 2d Dept 2020]; Dynamic Balance Acupuncture, P.C. v State Farm Ins., 62 Misc 3d 145[A], 2019 NY Slip Op 50171[U] *1 [App Term 2d Dept 2019]). Also contrary to Plaintiff’s argument, Defendant was not required to provide “objective reasons for requesting [an] EUO” (21st Century Pharm., Inc. v Integon Natl. Ins. Co., 2020 NY Slip Op 51364[U] *1; Gentlecare Ambulatory Anesthesia Servs. v Geico Ins. Co., 57 Misc 3d 150[A], 2017 NY Slip Op 51518[U] *1 [App Term 2d Dept 2017], see New Way Med. Supply Corp. v State Farm Mut. Auto. Ins. Co., 64 Misc 3d 136[A], 2019 NY Slip Op 51158[U]*2 [App Term 2d Dept 2019]; Dynamic Balance Acupuncture, P.C. v State Farm Ins., 2019 NY Slip Op 50171[U] *2). Finally, Plaintiff cited Matter of Progressive Cas. Ins. Co. [Elite Med. Supply of NY, LLC] (162 AD3d 1471 [4th Dept 2018]), which held that claimants objecting to verification requests were entitled to have an arbitrator to decide controversy, but which had no bearing on the instant matter.

Here, Plaintiff failed to raise factual issues regarding Defendant’s defense of Plaintiff’s failure to attend an EUO. This Court finds that Defendant has presented prima facie admissible evidence proving that there is no material issue of fact, that the controversy regarding Plaintiff’s third, fifth, ninth, eleventh, seventeenth, nineteenth, and twenty-first causes of action can be decided as a matter of law (CPLR 3212 [b]; Jacobsen v New York City Health and Hosps. Corp., 22 NY3d 824 [2014]; Brill v City of New York, 2 NY3d 648 [2004]), that Plaintiff has failed to raise factual issues requiring a trial (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at [*8]757; Nova Chiropractic Servs., P.C. v Ameriprise Auto & Home, 58 Misc 3d 142[A], 2017 NY Slip Op 51882[U] *1 [App Term 2d Dept 2017]; K.O. Med., P.C. v IDS Prop. Cas. Ins. Co., 57 Misc 3d 145[A], 2017 NY Slip Op 51454[U] *1 [App Term 2d Dept 2017]), and that Defendant is entitled to dismissal of Plaintiff’s third, fifth, ninth, eleventh, seventeenth, nineteenth, and twenty-first causes of action.

Plaintiff’s Second, Fourth, Sixth, Eighth, Tenth, Twelfth, Fourteenth, Sixteenth, Eighteenth, Twentieth, and Twenty-Second Causes of Action

This Court notes that in Plaintiff’s second, fourth, sixth, eighth, tenth, twelfth, fourteenth, sixteenth, eighteenth, twentieth, and twenty-second causes of action, Plaintiff improperly pleaded claims for attorneys’ fees based on each individual bill. It is well established by case law that in No-Fault actions, attorneys’ fees are calculated based on a single insured, not on each bill submitted by a provider (LMK Psychological Servs., P.C. v State Farm Mut. Auto. Ins. Co., 12 NY3d 217, 223 [2009]; A.M. Med. Servs., P.C. v New York Cent. Mut. Ins., 26 Misc 3d 140[A], 2010 NY Slip Op 50264[U] *2 [App Term 2d Dept 2010]). As discussed above, this Court finds that Defendant failed to timely pay the claims under the first, seventh and fifteenth causes of action, which entitles Plaintiff to recover attorneys’ fees (Insurance Law § 5106[a]; 11 NYCRR 65-3.9[a]; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d at 563; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d at 278). Given that Plaintiff’s first, seventh and fifteenth causes of action survive summary judgment dismissal, the Court dismisses the improperly pleaded second, fourth, sixth, eighth, tenth, twelfth, fourteenth, eighteenth, twentieth, and twenty-second causes of action, but preserves the sixteenth cause of action for attorneys’ fees regarding the first, seventh, and fifteenth causes of action.

V. Decision

As discussed above, although Defendant paid the bills pleaded in Plaintiff’s first, seventh and fifteenth causes of action, Defendant paid those bills untimely and Plaintiff is entitled to recovery attorney’s fees and statutory interest. As a result, Plaintiff’s first, seventh and fifteenth causes of action survive Defendant’s motion for summary judgement to dismiss. Although Plaintiff improperly pleaded claims for attorneys’ fees based on each individual bill in its respective eleven (11) causes of action, this Court preserves Plaintiff’s sixteenth cause of action but otherwise dismisses other causes of action regarding attorneys’ fees in order to address the attorney’s fee for the first, seventh, and fifteenth causes of action. Because Plaintiff did not cross-move for summary judgement, here, this Court will not grant Plaintiff with attorney’s fee or statutory interest sua sponte. The rest of Plaintiff’s causes of action are dismissed due to Plaintiff’s failure to attend scheduled EUO.

VI. Order

Accordingly, it is ORDERED that Defendant’s Motion is granted to the extent of dismissing Plaintiff’s second, third, fourth, fifth, sixth, eighth, ninth, tenth, eleventh, twelfth, thirteenth, fourteenth, seventeenth, eighteenth, nineteenth, twentieth, twenty-first, and twenty-second causes of action based on Plaintiff’s Second Bill, Third Bill, Fifth Bill, Sixth Bill, Seventh Bill, Ninth Bill, Tenth Bill and Eleventh Bill and the separately pleaded claims for attorneys’ fees, but is otherwise denied, and it is further

ORDERED that Plaintiff’s first, seventh, and fifteenth causes of action to recover the First, Bill, Fourth Bill and Eighth Bill, respectively in the amounts of $405.60, $80.02 and [*9]$204.41, for services provided respectively, from October 18 through November 2, 2017, on October 13, 2017, and on October 11, 2017, shall proceed to trial only on the issue of the amount of statutory interest, and it is further

ORDERED that Plaintiff’s sixteenth cause of action to recover attorneys’ fees shall proceed to trial.

This constitutes the DECISION and ORDER of the Court.

Dated: April 29, 2021
Queens County Civil Court
_____________________________________

Honorable Wendy Changyong Li, J.C.C.

Arthur Ave. Med. Servs., PC v GEICO Ins. Co.

2021 NY Slip Op 21108 [72 Misc 3d 342]

April 20, 2021

Mallafre Melendez, J.

Civil Court of the City of New York, Kings County

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

As corrected through Wednesday, July 28, 2021

[*1]

Arthur Avenue Medical Services, PC, as Assignee of Zuri Adams, Plaintiff, v GEICO Insurance Company, Defendant.

Civil Court of the City of New York, Kings County, April 20, 2021

APPEARANCES OF COUNSEL

Rivkin Radler, LLP, Uniondale (Donald Kernisant Jr. of counsel), for defendant.

Law Office of Melissa Betancourt, P.C., Brooklyn (Jaime Koo of counsel), for plaintiff.

Consuelo Mallafre Melendez, J.

In this first-party no-fault action, defendant moves pursuant to CPLR 2221 to reargue that portion of this court’s February 28, 2019 decision which reserved the reasonableness of the content of defendant’s request for post-examination under oath (EUO) additional verification as an issue of fact for trial. Defendant contends its request is not subject to judicial review and is valid under the no-fault rules as a matter of law. Defendant claims the court misapprehended the law when it reserved for trial the question of the reasonableness of these additional verification requests. Plaintiff claims defendant failed to establish its outstanding verification defense and that, under the circumstances of this case, the substance of the additional requests was improper and an abuse of the verification process. Plaintiff maintains that defendant’s demand for this type of additional verification placed an improper onus on the provider to supply documents outside the scope of the claim verification process. They claim that defendant’s denial was improper as it was based on a claimed failure to provide some or all of these impermissible requests. Plaintiff further argued that defendant had acquired sufficient information to determine whether to verify or [*2]deny the claim from the provider’s EUO and defendant’s own related investigation. The court notes that defendant interposed a Mallela defense in its answer and that similar demands were made in combined demands served upon plaintiff.

The decision of whether to grant reargument is within the sound discretion of the motion court (see Matter of Anthony J. Carter, DDS, P.C. v Carter, 81 AD3d 819, 820 [2d Dept 2011]; Degraw Constr. Group, Inc. v McGowan Bldrs., Inc., 178 AD3d 772, 773 [2d Dept 2019]; Barnett v Smith, 64 AD3d 669 [2d Dept 2009]). A motion for reargument “ ’is not designed to provide an unsuccessful party with successive opportunities to{**72 Misc 3d at 344} reargue issues previously decided, or to present arguments different from those originally presented’ ” (Matter of Anthony J. Carter, DDS, P.C. v Carter, 81 AD3d at 820, quoting McGill v Goldman, 261 AD2d 593, 594 [2d Dept 1999]; Jaspar Holdings, LLC v Gotham Trading Partners #1, LLC, 186 AD3d 582 [2d Dept 2020]). The movant must make an effort to demonstrate in what manner the court, in rendering the original determination, overlooked or misapprehended the relevant facts or law (see Nicolia v Nicolia, 84 AD3d 1327 [2d Dept 2011]; Matter of Anthony J. Carter, DDS, P.C. v Carter, 81 AD3d at 820).

“Once the court reviews the merits of the movant’s arguments, the court, by doing so, has granted reargument, and must determine whether to adhere to the original determination, or alter the original determination. If the movant has alleged that the original determination overlooked or misapprehended the relevant facts or law, and the court disagrees, it will adhere to the original determination” (Ahmed v Pannone, 116 AD3d 802, 810-811 [2d Dept 2014, Hinds-Radix, J., dissenting] [citation omitted]).

Upon review of the parties’ submissions, defendant’s motion for leave to reargue is granted, and upon reargument, defendant’s motion is denied. Defendant failed to demonstrate that the court overlooked or misapprehended relevant facts or misapplied governing principles of law (see McGill v Goldman, 261 AD2d 593 [2d Dept 1999]). Accordingly, the court adheres to its original decision wherein it ruled that the reasonableness of defendant’s post-EUO request for additional verification remained an issue of fact for trial.

As an initial matter, this court notes that defendant’s post-EUO request for additional verification is the matter at issue herein. The court emphasizes this because in the instant motion, paragraph three of defendant’s affirmation and much of its supporting legal authority pertain to the issue of an EUO no-show, a matter that at no point was in dispute or an issue in the underlying motion. Conversely, at the outset of defendant’s affirmation in support of the underlying summary judgment motion, defendant argued for dismissal of the complaint “because Plaintiff failed to provide GEICO with post examination under oath (‘EUO’) verification that was timely requested pursuant to 11 NYCRR 65-3.5″ (emphasis added). Further, the affidavits in support of defendant’s underlying motion also relate to the issue of outstanding additional verification.{**72 Misc 3d at 345} Likewise, the arguments in plaintiff’s opposition to both the underlying and instant motions apply to outstanding additional verification requests. No other issue is properly before the court for reargument. It is also noted that reargument is not sought as to that portion of the decision wherein the court granted each party summary judgment to the extent that they established their prima facie case. Therefore, the court’s ensuing decision and analysis will discuss the issue of the outstanding post-EUO verification request only.

Defendant commenced an investigation into Arthur Avenue Medical Services because it claimed that it identified several facts and circumstances that called into question the provider’s eligibility to collect no-fault benefits. Defendant specifically investigated whether Arthur Avenue was truly owned and controlled by Jaime G. Gutierrez, M.D., or was actually owned and [*3]controlled by laypersons. The investigation included but was not limited to a review and analysis of claims files, public records, previous investigations into other entities that operate out of the same location, previous investigations into other entities where Dr. Gutierrez rendered services and billing submissions submitted to the carrier for reimbursement. Submitted with defendant’s original motion is the affidavit of Glenn Simmons, an investigator with GEICO’s Special Investigations Unit, which sets forth the extent of the investigation and conclusions arrived, namely that: patients treated at Arthur Avenue were referred to that provider by Dr. Gutierrez (who operates at the same location); Dr. Gutierrez provided services on behalf of Jaime G. Gutierrez, M.D., then referred the same patients to Arthur Avenue for additional medical treatment; various doctors performed services, yet the billing submissions name Dr. Gutierrez as the only service provider; improper performance of nerve testing including omissions of necessary steps in the administration of the tests; absence of variation in the pattern of treatment and use of predetermined treatment protocol, etc. Mr. Simmons states that the investigation uncovered indications that laypersons were improperly influencing the manner and method of treatment provided to claimants, that Arthur Avenue was rendering services pursuant to a predetermined treatment protocol designed to maximize profit and that Arthur Avenue’s charges may be the result of improper self-referrals.

In addition to the investigation, it is undisputed that on March 9, 2017, Jaime Gutierrez, M.D., appeared on behalf of{**72 Misc 3d at 346} Arthur Avenue in full compliance with defendant’s EUO request. The court’s review of the EUO transcript annexed to the underlying motion reveals that the EUO took place over the course of five hours with questioning involving medical treatment as well as the provider’s licensing and corporate structure. Dr. Gutierrez’s testimony lent further support to the concerns over fraud previously investigated by defendant, including whether Arthur Avenue was a party to unlawful financial relationships with unlicensed individuals and entities, whether laypersons were improperly influencing the manner and methods of treatment provided to GEICO’s insureds and whether Arthur Avenue is truly owned and controlled by Dr. Gutierrez or by laypersons all in contravention to New York law. Defendant claims that its request for additional verification was based on the information obtained during the EUO and that the EUO raised questions regarding improper corporate structure and fee sharing. Thus, by letter dated March 20, 2017, defendant requested that plaintiff provide the following additional verification:

“1. A complete copy of the lease agreements, if any, entered into by Arthur Medical, including any accompanying Schedules, Documents, Floor Plans or Riders, regarding the following premises:

“• 764 Elmont Road, Elmont

“• 293 East 53rd Street, Brooklyn

“• 2363 Ralph Avenue, Brooklyn

“• 9004 Merrick Boulevard, Jamaica

“• 2625 Atlantic Avenue, Brooklyn

“2. [*4]All article[s] of incorporation, including but not limited to any By-Laws for Arthur Medical;

“3. A complete copy of the billing agreement entered between Arthur Medical and Collection Services, Inc./Inna Lyubronestkaya;

“4. All invoices between Collection Services, Inc./Inna Lyubronestkaya and Arthur Medical;

“5. All W-2, 1099, and/or K-1 forms from Arthur Medical, including, but not limited to, any documentation regarding the employee status or relationship between Arthur Medical and any person rendering services on behalf of Arthur Medical;

“6. All quarterly payroll and tax returns (IRS Form 941 and NYS Form 45-MN) filed from 2016 to present by or on behalf of Arthur Medical;{**72 Misc 3d at 347}

“7. Opening/signatory authorization documents for the Arthur Medical Chase bank account;

“8. Copies of all bank statements and cancelled checks for Arthur Medical from 2016 to present;

“• These include, but is not to be limited to, all checks made to: (i) Collection Services, In[c]./Inna; (ii) Osvaldo; (iii) the physician assistant; and (iv) all rent payments.

“9. All documents relating to Arthur Avenue’s corporate card from 2016 to present;

“10. General ledgers for Arthur Medical from 2016 to present;

“11. Proof of payment of the P.O. Box utilized by Arthur Medical;

“12. All licenses to practice medicine in New York for Dr. Gutierrez as well as any certification to render EMG/NCV testing; and

“13. Proof of purchase of the medical equipment utilized by Arthur Medical, including but not limited to the EMG/NCV machine.”

[*5]

Relevant to the matter herein, 11 NYCRR 65-3.5 (b) of the No-Fault Law provides, “Subsequent to the receipt of one or more of the completed verification forms, any additional verification required by the insurer to establish proof of claim shall be requested within 15 business days of receipt of the prescribed verification forms.” This section authorizes an insurer, upon receiving the written proof of claim or written notice of its substantial equivalent, to request “any additional verification required . . . to establish proof of claim . . . within 15 business days of receipt of the prescribed verification forms” (Nyack Hosp. v General Motors Acceptance Corp., 8 NY3d 294, 299 [2007]; A.M. Med. Servs., P.C. v Progressive Cas. Ins. Co., 101 AD3d 53 [2d Dept 2012]). Additionally, section 65-3.2 (c) dictates that insurance carriers “not demand verification of facts unless there are good reasons to do so. When verification of facts is necessary, it should be done as expeditiously as possible” (11 NYCRR 65-3.2 [c]). Indeed, underlying the enactment of the no-fault regulations is the principle of expediency in the processing of claims (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d 274, 285 [1997]). “No-fault reform was enacted to provide prompt uncontested, first-party insurance benefits” (Presbyterian Hosp. in City of N.Y. v Maryland Cas. Co., 90 NY2d at 285).{**72 Misc 3d at 348}

In the context of no-fault reimbursement, to be eligible for benefits, a medical services corporation must be owned by a physician who practices medicine through the corporation (Business Corporation Law § 1508) and may not bill for medical services provided by physicians not employed by the corporation, such as independent contractors (11 NYCRR 65-3.11 [a]). Further, the corporation may not share professional service fees with third parties, such as referral fees (8 NYCRR 29.1 [b] [4]). It is well established that New York law prohibits unlicensed individuals from organizing a professional service corporation for profit or exercising control over such entities (State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]; 11 NYCRR 65-3.16 [a]). As relevant herein, the underlying policy concern in the medical field is “that the so-called ‘corporate practice of medicine’ could create ethical conflicts and undermine the quality of care afforded to patients” (Andrew Carothers, M.D., P.C. v Progressive Ins. Co., 33 NY3d 389, 404 [2019], quoting State Farm Mut. Auto. Ins. Co. v Mallela, 372 F3d 500, 503 [2d Cir 2004]).

In the seminal case, State Farm Mut. Auto. Ins. Co. v Mallela, the Court of Appeals held that medical providers that fail to meet the New York State licensing requirements are not eligible for no-fault reimbursement (State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d 313 [2005]).

“A successful Mallela defense permits an insurer to avoid paying an otherwise valid no-fault claims [sic] because the provider is not eligible to obtain payment of no-fault benefits because the entity providing the services is owned or significantly controlled by persons who are not licensed to practice the profession for which the professional business entity was formed” (Brownsville Advance Med., P.C. v Country-Wide Ins. Co., 33 Misc 3d 1236[A], 2011 NY Slip Op 52255[U], *3 [Nassau Dist Ct 2011] [citations omitted]).

An insurance carrier may, at any time, assert a non-precludable “Mallela defense” and deny payment based on the medical provider’s fraudulent incorporation (Matter of Acuhealth Acupuncture, P.C. v Country-Wide Ins. Co., 149 AD3d 828 [2d Dept 2017]; Lexington Acupuncture, P.C. v General Assur. Co., 35 Misc 3d 42, 44 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2012]). “Inasmuch as the defense of ‘fraudulent incorporation’ is not subject to the preclusion rule, the defendant may raise this defense in its answer, even if not asserted in the{**72 Misc 3d at 349} claim denial” (Island Chiropractic Testing, P.C. v Nationwide Ins. Co., 35 Misc 3d 1235[A], 2012 NY Slip Op 51001[U], *2 [Suffolk Dist Ct 2012]).

With regards to Mallela related documents, the case law clearly lays out a “good cause” [*6]standard which a carrier must demonstrate in order to investigate licensing violations. In its Mallela decision, the Court of Appeals emphasized the Superintendent’s regulation permitting carriers to withhold reimbursement from fraudulently licensed medical corporations:

“on the strength of this regulation, carriers may look beyond the face of licensing documents to identify willful and material failure to abide by state and local law. Defendants argue that the carriers will turn this investigatory privilege into a vehicle for delay and recalcitrance.

“The regulatory scheme, however, does not permit abuse of the truth-seeking opportunity that 11 NYCRR 65-3.16 (a) (12) authorizes. Indeed, the Superintendent’s regulations themselves provide for agency oversight of carriers, and demand that carriers delay the payment of claims to pursue investigations solely for good cause (see 11 NYCRR 65-3.2 [c]). In the licensing context, carriers will be unable to show ‘good cause’ unless they can demonstrate behavior tantamount to fraud. Technical violations will not do. For example, a failure to hold an annual meeting, pay corporate filing fees or submit otherwise acceptable paperwork on time will not rise to the level of fraud. We expect, and the Legislature surely intended, vigorous enforcement action by the Superintendent against any carrier that uses the licensing-requirement regulation to withhold or obstruct reimbursements to nonfraudulent health care providers” (State Farm Mut. Auto. Ins. Co. v Mallela, 4 NY3d at 321-322 [emphasis added]).

In the recently decided Andrew Carothers, M.D., P.C. v Progressive Ins. Co.,^[FN*] the Court of Appeals upheld its decision in Mallela and added that

“[a] corporate practice that shows ‘willful and material failure to abide by’ licensing and incorporation statutes (Mallela, 4 NY3d at 321) may support{**72 Misc 3d at 350} a finding that the provider is not an eligible recipient of reimbursement under 11 NYCRR 65-3.16 (a) (12) without meeting the traditional elements of common-law fraud” (Andrew Carothers, M.D., P.C. v Progressive Ins. Co., 33 NY3d 389, 405 [2019]).

In cases involving Mallela-type concerns, courts of competent jurisdiction have reviewed the reasonableness of verification requests similar to those at issue. In Island Chiropractic Testing, P.C. v Nationwide Ins. Co., the court held that “verification requests, seeking inter alia, copies of ‘sale of shares or transfer of ownership (and) lease agreements’ are impermissible and improper requests, and cannot support the finding of a denial ‘toll’ which would permit an award of summary judgment to defendant” (Island Chiropractic Testing, P.C. v Nationwide Ins. Co., 35 Misc 3d 1235[A], 2012 NY Slip Op 51001[U], *2 [Suffolk Dist Ct 2012]). “Permitting an insurer to obtain written documents such as tax returns, incorporation agreements or leases regarding a potential fraudulent incorporation ‘[Mallela]’ defense as part of the verification process defeats the stated policy and purpose of the no-fault law and carries with it the potential for abuse” (Island Chiropractic Testing, P.C. v Nationwide Ins. Co., 2012 NY Slip Op 51001[U], *2). In underlining that denying use of such requests does not prejudice the carrier, the court noted that as “the defense of ‘fraudulent incorporation’ is not subject to the preclusion rule, the defendant may raise this defense in its answer, even if not asserted in the claim denial” (Island Chiropractic Testing, P.C. v Nationwide Ins. Co., 2012 NY Slip Op 51001[U], *2).

Similarly, the court in Concourse Chiropractic, PLLC v State Farm Mut. Ins. Co. ruled that “Mallela type material cannot be obtained as verification of the claim. Requesting an [sic] [*7]provider to produce voluminous corporate records in order to obtain payment of a no-fault claim is an abuse of the EUO and the entire verification process” (Concourse Chiropractic, PLLC v State Farm Mut. Ins. Co., 35 Misc 3d 1213[A], 2012 NY Slip Op 50676[U], *6 [Nassau Dist Ct 2012], mod 42 Misc 3d 131[A], 2013 NY Slip Op 52225[U] [App Term, 2d Dept, 9th & 10th Jud Dists 2013]). This court notes that on appeal, the Appellate Term dismissed the plaintiff’s case based on an EUO no-show and therefore did not rule on the issue of the verification request content and reasonableness (Concourse Chiropractic, PLLC v State Farm Mut. Ins. Co., 2013 NY Slip Op 52225[U]).

By comparison, in the context of litigation wherein a carrier asserts a Mallela defense, courts have generally ruled on the{**72 Misc 3d at 351} propriety of pretrial discovery demands for corporate documents and information. The Appellate Term has consistently held that a plaintiff is obligated to produce the information sought except as to matters which are privileged or palpably improper (Marino v County of Nassau, 16 AD3d 628 [2d Dept 2005]; Midborough Acupuncture, P.C. v State Farm Ins. Co., 21 Misc 3d 10 [App Term, 2d Dept, 2d & 11th Jud Dists 2008]; Clinton Place Med., P.C. v USAA Cas. Ins. Co., 56 Misc 3d 136[A], 2017 NY Slip Op 51012[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]; Charles Deng Acupuncture, P.C. v United Servs. Auto. Assn., 58 Misc 3d 135[A], 2017 NY Slip Op 51810[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2017]). Further, discovery demands concerning a Mallela defense are granted as long as there are sufficient allegations supporting such a defense (see Lexington Acupuncture, P.C. v General Assur. Co., 35 Misc 3d 42, 43 [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2012]; BS Kings County Med., P.C. v State Farm Mut. Auto Ins. Co., 68 Misc 3d 879 [Civ Ct, Bronx County 2020]). However, it is proper for a court to deny discovery demands seeking information that is “irrelevant, overly broad, or burdensome” (Pesce v Fernandez, 144 AD3d 653, 655 [2d Dept 2016]; Midborough Acupuncture, P.C. v State Farm Ins. Co., 21 Misc 3d 10 [2008]).

Based on the foregoing, the court adheres to its decision on defendant’s summary judgment motion. To prevail on summary judgment, the moving party must provide sufficient evidence in admissible form to demonstrate the absence of any material issues of fact (Alvarez v Prospect Hosp., 68 NY2d 320 [1986]; Zuckerman v City of New York, 49 NY2d 557 [1980]). The “[f]ailure to make such showing requires denial of the motion, regardless of the sufficiency of the opposing papers” (Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853 [1985]). Defendant failed to establish its affirmative defense of outstanding verification in its underlying motion. The reasonableness of defendant’s post-EUO additional verification request remains an issue of fact for trial.

Defendant’s assertion that this court lacks the authority to preserve the reasonableness of additional verification requests for trial conflicts with prevailing no-fault regulations and case law. Both the Mallela and Carothers Courts stressed principles of expediency and good cause in investigations of fraudulent licensing and improper fee sharing and acknowledged that abuse of the verification process may exist. At no time did the{**72 Misc 3d at 352} Court of Appeals state that carriers have unfettered authority in the extent of these investigations. Although there is a lack of Appellate Term authority on this issue, courts of competent jurisdiction have reviewed the content of verification requests in cases similar to the instant matter and have ruled that comparable requests fall outside of the verification scheme. It is the court’s view that it has authority to review additional verification requests to ensure that parties comply with no-fault claim verification procedures. Thus, the question of whether the additional verification was reasonable and necessary for defendant to verify or to deny the claim, based on fraud, is within the court’s authority to determine.

[*8]

In this matter, the provider fully complied with defendant’s EUO request. Defendant obtained substantial Mallela-type information relevant to its suspicion of fraud during the course of the five-hour EUO, that included a multitude of questions related to corporate structure. Defendant also conducted its own investigation into plaintiff’s billing and medical practices as laid out in the affidavit of its special unit investigator. This inquiry and investigation were well within the guidelines of the No-Fault Law and adhered to the “good cause” requirement as set forth by Mallela and Carothers. However, defendant’s subsequent request for additional information through use of the no-fault claim verification process may be unreasonable and constitute an investigation that goes beyond the purview of the no-fault reimbursement system. “New York’s no-fault automobile insurance system is designed to ensure prompt compensation for losses incurred by accident victims without regard to fault or negligence, to reduce the burden on the courts” (Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 562 [2008] [internal quotation marks omitted]). The court emphasizes the limited purpose of the no-fault system: “Verification is permitted to ‘verify the claim.‘ 11 NYCRR 65-3.5(c)” (Concourse Chiropractic, PLLC v State Farm Mut. Ins. Co., 2012 NY Slip Op 50676[U], *4 [emphasis added]). A claim is either verified or it is not. Had defendant suspected fraud after the five-hour EUO, defendant may have denied the claim based on fraudulent incorporation at that point in time. Furthermore, in the context of verification of a claim, some of the requested information may be privileged or categorized as improper pre-litigation discovery. Thus, the propriety of the additional verification request upon which the defendant denied the claim remains an issue of fact for trial.{**72 Misc 3d at 353}

Notwithstanding the above, the court’s determination to adhere to its original decision is also based on defendant’s failure to provide the court with a complete record in support of its original request for summary judgment based on its outstanding verification defense. Defendant acknowledges in a footnote in its underlying motion that it received “some” of the requested documents from plaintiff. However, defendant does not identify what plaintiff provided and what remained outstanding from its comprehensive list of post-EUO verification requests, which includes documents subject to privilege and confidentiality rules. The court was unable to rule on the issue it preserved for trial in the absence of these relevant facts. Therefore, in accordance with the original decision, this defense remains an issue of fact for trial.

Finally, the court emphasizes that its decision should not be construed as a substantive ruling on the merit of defendant’s Mallela defense. Rather, the court’s decision is based on its adherence to claim verification procedures as laid out in the no-fault rules. The court is well versed in the public policy concerns underlying the no-fault regulations which govern medical provider licensing and prohibit fee sharing with nonmedical professionals. The prevalence of this fraud provides an insurance carrier with a choice of legal recourse including asserting a non-precludable Mallela defense or a defense related to licensing ineligibility within no-fault litigation, standing to bring a civil action against a medical provider based on fraud or filing a criminal complaint (see Travelers Indem. Co. v Parisien, 70 Misc 3d 1203[A], 2020 NY Slip Op 51561[U] [Sup Ct, Suffolk County 2020]; Concourse Chiropractic, PLLC v State Farm Mut. Ins. Co., 2012 NY Slip Op 50676[U]). However, in light of the aforementioned case law and principles, the court reaffirms that the propriety of the post-EUO request for additional verification is subject to the court’s review.

Based on the foregoing, defendant’s motion for leave to reargue is granted, and upon reargument, defendant’s motion is denied.

Footnotes

Footnote *:In Andrew Carothers, M.D., P.C. v Progressive Ins. Co., the Court of Appeals modified the definition of fraud previously laid out in Mallela.

Kings County Physicians Group AAO Seleznyov, Plaintiff(s), against Nationwide Insurance Company, Defendant(s).

CV-704182-19/QU

Plaintiff’s Counsel:

Gitelis Law Firm, P.C.

2004 Coney Island Avenue, 2d Floor

Brooklyn, NY 11223

Defendant’s Counsel:

Hollander Legal Group, P.C.

105 Maxess Road, Suite S128

Melville, NY 11747

Wendy Changyong Li, J.

 Papers

The following papers were read on Defendant’s motion for summary judgment seeking an order dismissing Plaintiff’s complaint:

Papers Numbered

Defendant’s Notice of Motion seeking summary judgment and Affirmation 1In Support dated July 29, 2019 (“Motion“) and file stamped by the court on August 7, 2019.

Plaintiff’s Affirmation in Opposition dated September 25, 2019 (“Opposition“). 2

Defendant’s Affirmation in Reply dated February 4, 2020 (“Reply“) 3and electronically filed with the court June 8, 2020.

Background

In a summons and complaint filed on March 1, 2019, Plaintiff sued Defendant insurance company to recover $9,609.62 in unpaid first party No-Fault benefits for medical services provided to Plaintiff’s assignor Seleznyov from February to July 2018, plus attorneys’ fees and statutory interest. Defendant moved for summary judgment dismissing the complaint on the ground that Plaintiff failed to attend scheduled Examinations Under Oath (“EUO”), or alternatively for judgment that Defendant established its prima facie case. Plaintiff opposed the motion.

Discussion and Decision

CPLR 3212 provides that “a motion for summary judgment shall be supported by affidavit, by a copy of the pleadings and by other available proof, such as depositions and written admissions…” (CPLR 3212 [b]). “Mere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient” (Zuckerman v. City of New York, 49 NY2d 557, 562 [1980]). “A defendant moving for summary judgment [seeking an order dismissing plaintiff’s complaint] has the initial burden of coming forward with admissible evidence, such as affidavits by persons having knowledge of the facts, reciting the material facts and showing that the cause of action has no merit” (GTF Mktg. v Colonial Aluminum Sales, 66 NY2d 965, 967 [1985]; Anghel v Ruskin Moscou Faltischek, P.C., 190 AD3d 906, 907 [2d Dept 2021], see Jacobsen v. New York City Health & Hosps. Corp., 22 NY3d 824, 833 [2014]). A motion for summary judgment “shall be granted if, upon all the papers and proof submitted, the cause of action or defense shall be established sufficiently to warrant the court as a matter of law in directing judgment in favor of any party” (CPLR 3212[b]; Zuckerman v. City of New York, at 562, see GTF Mktg. v Colonial Aluminum Sales, 66 NY2d at 968).

Insurers must pay or deny No-Fault benefit claims “within thirty (30) calendar days after receipt of the proof of the claim” (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498, 501 [2015]; Fair Price Med. Supply Corp. v Travelers Indem. Co., 10 NY3d 556, 563 [2008]; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d 312, 317 [2007]; see Insurance Law § 5106[a]; 11 NYCRR § 65-3.8[c]; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d 274, 278 [1997]). Failure to establish timely denial of the claim precludes the insurer from offering evidence of its defense to non-payment (Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 506; Fair Price Med. Supply Corp. v. Travelers Indem. Co., 10 NY3d at 563; Hospital for Joint Diseases v Travelers Prop. Cas. Ins. Co., 9 NY3d at 318; Presbyterian Hosp. in City of NY v Maryland Cas. Co., 90 NY2d at 281-86). Noncompliance with an insurance policy provision requiring disclosure through an EUO is a failure of a condition precedent to an insurer’s duty to indemnify (IDS Prop. Cas. Ins. Co. v Stracar Med. Servs., P.C., 116 AD3d 1005, 1007 [2d Dept 2014]; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 54 Misc 3d 131[A], 2017 NY Slip Op 50028[U] *1 [App Term 2d Dept 2017]) and is a material policy breach precluding recovery of proceeds under the insurance [*2]policy (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d 755, 756 [2d Dept 2020]; Interboro Ins. Co. v Clennon, 113 AD3d 596, 597 [2d Dept 2014]).

In order to establish a defense that an insured failed to attend a duly scheduled EUO, an insurer must present evidence of the timely and proper mailing of the EUO scheduling letters (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; Progressive Cas. Ins. Co. v Metro Psychological Servs., P.C., 139 AD3d 693, 694 [2d Dept 2016]). This may be established with evidence of the actual mailing or by an affidavit of a person “with personal knowledge of the standard office practice for ensuring that the letters are properly addressed and mailed” (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; Progressive Cas. Ins. Co. v Metro Psychological Servs., P.C., 139 AD3d at 694). To support its motion, Defendant presented the first demand letter dated April 5, 2018, scheduling the EUO for May 1, 2018, (see Motion, Aff. of Drapan, Ex. X). Further, in an affidavit sworn July 29, 2019, Hollander, president of Defendant’s law firm, attested to the standard office mailing procedures for sending EUO request letters (see Motion, Drapan Aff. Ex. GG), which established timely submission of the EUO request (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; First Class Med., P.C. v State Farm Mut. Auto. Ins. Co., 55 Misc 3d 141[A], 2017 NY Slip Op 50593[U] *2 [App Term 2d Dept 2017]; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 54 Misc 3d 131[A], 2017 NY Slip Op 50028[U] *1 [App Term 2d Dept 2017]). Although Seleznyov failed to appear for the EUO on May 1, 2018 with advanced notice, he appeared with counsel for the EUO rescheduled for May 30, 2018. Seleznyov’s counsel had a conflicting appointment, however, which did not allow the EUO to be completed (see Motion, Drapan Aff. Ex. AA). While a mutually agreed rescheduling prior to an EUO does not constitute a failure to appear (Apple Avicenna Med. Arts, P.L.L.C. v Ameriprise Auto & Home, 47 Misc 3d 145[A], 2015 NY Slip Op 50701[U] *1 [App Term 2d Dept 2015]; Five Boro Psychological Servs., P.C. v Utica Mut. Ins. Co., 2013 NY Slip Op 52005[U] *1; DVS Chiropractic, P.C. v Interboro Ins. Co., 36 Misc 3d 138[A], 2012 NY Slip Op 51443[U] * 2 [App Term 2d Dept 2012]), there is no evidence of such agreement despite Defendant’s acknowledgement that the law firm representing Seleznyov contacted Defendant’s counsel the day before the EUO scheduled on May 1, 2018, to advise that Seleznyov would not appear. Defendant also presented a letter dated June 5, 2018, which scheduled the continued EUO for June 26, 2018 (see Motion, Drapan Aff. Ex. BB), and, a letter dated June 28, 2018, which scheduled the continued EUO for July 25, 2018 (see Motion, Drapan Aff. Ex. DD), as well as a follow up letter dated June 29, 2018 (see Motion, Drapan Aff. Ex EE). These subsequent EUO scheduling letters timely scheduled the continued EUOs after each time Seleznyov failed to appear for the respective scheduled EUO (11 NYCRR § 65-3.6[b]; see Active Care Med. Supply Corp. v Ameriprise Auto & Home, 58 Misc 3d 138[A], 2017 NY Slip Op 51835[U] *2 [App Term 2d Dept 2017]; ARCO Med. NY, P.C. v Lancer Ins. Co., 34 Misc 3d 134[A], 2011 NY Slip Op 52382[U] *2 [App Term 2d Dept 2011]). The transcripts of the EUO proceedings (see Motion, Drapan Aff. Ex. Y, CC, FF) constituted adequate proof of Seleznyov’s nonappearance at the EUOs (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; TAM Med. Supply Corp. v 21st Century Ins. Co., 57 Misc 3d 149[A], 2017 NY Slip Op 51510[U] *1 [App Term 2d Dept 2017]; First Class Med., P.C. v State Farm Mut. Auto. Ins. Co., 2017 NY Slip Op 50593[U] *2; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 2017 NY Slip Op 50028[U] *1). Although Seleznyov appeared for one EUO, Defendant’s evidence still established Seleznyov’s failure to appear for an initial EUO on May 1, 2018, and a [*3]follow-up EUOs on June 26 and July 25, 2018, to prove Plaintiff’s failure of a condition precedent to Defendant’s duty to pay the claims (see Apple Massage Therapy, P.C. v Adirondack Ins. Exch., 56 Misc 3d 132[A], 2017 NY Slip Op 50935[U] *2 [App Term 2d Dept 2017]; Five Boro Psychological Servs., P.C. v Utica Mut. Ins. Co., 41 Misc 3d 140[A], 2013 NY Slip Op 52005[U] *2 [App Term 2d Dept 2013]).

The affidavits of Mclendon, Operations Manager of Defendant’s agent for processing incoming and outgoing mail, established Defendant’s standard mailing procedures designed to ensure timely mailing and the timely denial of Plaintiff’s claims within 30 days after the last scheduled EUO at which Seleznyov failed to appear (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; Tam Med. Supply Corp. v 21st Century Ins. Co., 2017 NY Slip Op 51510[U] *1; First Class Med., P.C. v State Farm Mut. Auto. Ins. Co., 2017 NY Slip Op 50593[U] *2; National Med. & Surgical Supply, Inc. v ELRAC, Inc., 2017 NY Slip Op 50028[U] *1). Therefore, Defendant’s denial of these claims on August 3, 2018 was timely (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757, see 11 NYCRR §§ 65-3.5[a]; 65-3.5[a]). Defendant’s evidence that it requested Seleznyov’s appearance at the continued EUOs twice after the EUO for which he did appear and testify, that he failed to appear both times for the scheduled continued EUOs and that Defendant denied Plaintiff’s claim on such basis satisfied Defendant’s burden of establishing a material policy breach by Plaintiff (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; IDS Prop. Cas. Ins. Co. v Stracar Med. Servs., P.C., 116 AD3d at 1007; Interboro Ins. Co. v Clennon, 113 AD3d at 597). Finally, Defendant’s evidence demonstrated that it paid a bill from Plaintiff that Defendant received on March 30, 2018 (see Motion, Drapan Aff. Ex K).

In opposition, Plaintiff presented no contrary evidence, but merely argued generally that Defendant’s evidence was inadmissible. In the instant matter, Defendant denied Plaintiff’s claims on the ground that Plaintiff assignor failed to attend scheduled EUO. In its Motion, Defendant presented various affidavits documenting Plaintiff assignor’s failure to attend the scheduled respective continued EUOs. This Court finds such affidavits admissible. Defendant also presented affidavits establishing its timely denial of Plaintiff’s claims, and this Court finds such affidavits also admissible. If Plaintiff were to present affidavit indicating that Plaintiff assignor indeed had attended such scheduled respective continued EUOs or that Plaintiff did not timely receive Defendant’s denial of claims, a factual issue would have been raised warranting a trial. Here, Plaintiff did not. This Court finds that Defendant has presented prima facie admissible evidence proving that there is no material issue of fact and that the controversy can be decided as a matter of law (CPLR 3212 [b]; Jacobsen v New York City Health and Hosps. Corp., 22 NY3d 824 [2014]; Brill v City of New York, 2 NY3d 648 [2004]), and that Plaintiff has failed to raise factual issues requiring a trial (Nationwide Affinity Ins. Co. of Am. v George, 183 AD3d at 757; Nova Chiropractic Servs., P.C. v Ameriprise Auto & Home, 58 Misc 3d 142[A], 2017 NY Slip Op 51882[U] *1 [App Term 2d Dept 2017]; K.O. Med., P.C. v IDS Prop. Cas. Ins. Co., 57 Misc 3d 145[A], 2017 NY Slip Op 51454[U] *1 [App Term 2d Dept 2017]). Although Plaintiff also argued without presenting any evidence, that Defendant failed to establish that its denials of claim were issued in duplicate, Mclerndon’s affidavits were sufficient to establish that Defendant’s explanations of review and denial of claim forms were submitted in duplicate (Lenox Hill Radiology, P.C. v Redland Ins. Co., 37 Misc 3d 140[A], 2012 NY Slip Op 52263[U] [*4]*1 [App Term 2d Dept 2012]). In any event, the failure to present a denial of claim in duplicate, standing alone, is not fatal to Defendant’s defense (Mollo Chiropractic, PLLC v American Commerce Ins. Co., 42 Misc 3d 66, 69 [App Term 2d Dept 2013]). Finally, in light of the Court’s dismissal of Plaintiff’s complaint, consideration of Defendant’s evidence that Plaintiff’s claims exceeded the applicable fee schedules is academic.

IV. Order

Accordingly, it is

ORDERED that Defendant’s Motion for summary judgment is granted and Plaintiff’s complaint is dismissed, and it is further

ORDERED that the clerk is directed to dispose of this index number for all purposes.

This constitutes the DECISION and ORDER of the Court.

Dated: April 16, 2021

Queens County Civil Court

Honorable Li, J.C.C.

New York Center for Specialty Surgery AAO Jennifer Barrera, Plaintiff, against State Farm Insurance Company, Defendant.

CV-705866-17
John A. Howard-Algarin, J.

A bench trial was held before this Court on March 23, 2021, in this action to recover first party no-fault benefits related to claims made by Assignee, New York Center for Specialty Surgery (hereafter “Specialty Surgery” or “Provider”), for manipulation under anesthesia (“MUA”) procedures performed on Assignor, Jennifer Barrera (“Barrera”). Specifically, Specialty Surgery seeks payment in the amount of: $5,113.01 for an MUA performed on February 12, 2017 (as to Index No. 705866-17); $3,821.76 for an MUA performed on February 25, 2017 (as to Index No. 705867-17); and, $5,113.01 for an MUA on March 4, 2017 (as to Index No. 705884-17). Defendant, State Farm Insurance Company (“State Farm”), has declined to pay for the procedures deeming them medically unnecessary. A prior court order disposed of all other matters save for the question of payment for the aforementioned procedures.

Prior to commencement of the trial, the parties stipulated to the timeliness of both the plaintiff’s claims for payment for the procedures and the defendant’s denials thereof. The parties also stipulated into evidence: a peer review and addendum by State Farm’s sole witness herein, Daniel Spostas, D.C., (Defendant’s Exhibits A and B); the relevant treatment records (Defendant’s Exhibit C); and a series of bills and denials related to the three procedures (Defendant’s Exhibits D through I). Finally, the parties stipulated to Chiropractor Sposta’s expertise in the field of chiropractic medicine. Having satisfied its prima facie burden by way of the evidentiary stipulations, and after bilateral waivers of opening statements, the plaintiff rested. As is well settled in no-fault insurance law, State Farm bore the burden of establishing that the MUA procedures were not medically necessary (See e.g., Tremont Medical Diagnostic, P.C., v. GEICO Ins. Co., 13 Misc 3d 131(A) [App Term, 2nd & 11th Jud Dists 2006]).

State Farm’s case in chief consisted solely of Dr. Spostas’ testimony. As anticipated, Spostas testified on direct examination that the MUA procedures performed on Barrera were not medically necessary. Following the arguments set forth in his peer review of April 4, 2017, and addendum of May 3, 2017 — both documents virtually identical in substance — Spostas testified concerning the general protocols for chiropractors considering use of MUA procedures. In this [*2]regard, he deemed those promulgated by the National Academy of Manipulation Under Anesthesia Physicians (“NAMUA”) to be authoritative.

Relying primarily on the NAMUA protocols and the scope of chiropractic treatment as defined in Education Law § 6551(1), Spostas opined that Barrera was not a proper MUA candidate given the absence of evidence in the medical record reflecting: (1) a second medical opinion or interdisciplinary advice concerning use of the procedure; (2) blood tests and other screening for the patient’s tolerance of anesthesia; (3) a history of severe pain, spinal adhesions, voluntary muscle contracture, apprehensive muscle splinting or severe spasms; or (4) a failure to improve after a period of conventional chiropractic treatment. He also opined that anesthetized manipulation of Barrera’s hip and shoulder regions exceeded the scope of medical treatment contemplated within the discipline of chiropractic medicine.

Notably, Spostas proffered most of these very same pre-MUA standards in Kraft v. State Farm Mutual Automobile Ins Co., 34 Mic. 376 [Civ Ct, Queens Cty, 2011]. His purported standards were generally found to be lacking merit in that case. They gain no traction in this one. Here, as in Kraft, Dr. Spostas cited to no authority to support his contention that a second medical opinion or interdisciplinary advice was required prior to performance of a MUA procedure on a chiropractic patient. To be sure, the NAMUA protocols appear to be silent on the matter, as they are respecting his suggestion that a patient’s blood must be screened as part of NAMUA’s preoperative procedures under the protocols. Hence, what remains to be considered is whether, in view of Barrera’s medical and treatment history and the protocols, implementation of the MUA procedures was justified. Upon review of the record in evidence here, this Court finds justification for each procedure.

Among other considerations, the NAMUA protocols suggest, in relevant part, that MUA procedures are clinically justifiable when a patient has responded favorably to conservative, non- invasive chiropractic treatment but continues to experience intractable (i.e., hard to control) pain that interferes with his or her lifestyle. NAMUA protocols further recommend that manipulative procedures be utilized in a clinical setting for 2 to 6 weeks prior to recommending the procedure. Finally, as correctly noted by Spostas, the protocols also consider the MUA candidate’s history of severe pain, spinal adhesions, voluntary muscle contracture or muscle spasms, among other symptoms.

In his peer review dated April 4, 2017, Spostas noted that Barrera received her initial chiropractic examination on September 8, 2016, approximately 9 days after the underlying August 30, 2016 vehicular accident that is believed to have caused her injuries.1 She was examined, at that time, by chiropractor Arthur Schoenfeld, who recorded complaints of headache, dizziness, upper middle and lower back pain, and left sided neck pain radiating to the left shoulder. Range of motion in her cervical and thoracolumbar spine was found to have decreased with pain, and positive findings were noted in the cervical compression, heel walk, SLR (straight leg raise) and Kemp’s tests. On November 2, 2016, approximately 8 weeks after the vehicular incident and 2 weeks beyond the 2 to 6 week preliminary chiropractic period contemplated by the NAMUA protocols, Schoenfeld wrote a Letter of Medical Necessity to State Farm indicating that, while Barrera had demonstrated some responses to physiotherapy, she was still experiencing pain and difficulty performing many daily activities. The letter was used to justify Schoenfeld’s prescription of various medical supplies including a cervical pillow and collar, a car seat support, and a bed board, among other items. The record also reflects that, up to that date, she participated in regular chiropractic adjustments and continued to receive such treatment until just before January 25, 2017, when she first presented at Pro Align Chiropractic, P.C. (“Pro Align”), for evaluation as a candidate for MUA.

At her January 25, 2017 evaluation at Pro Align, Barrera was diagnosed with various pathologies including: displacement of both cervical and lumbar intervertebral discs; cervical, [*3]thoracic, lumbar and sacroiliac segmental dysfunction; cervicobrachial syndrome; cervical radiculitis; and other symptoms related to her shoulder and hip joints. The evaluation also depicted her as experiencing a significant loss of range of motion in all areas, and having reached a “plateau” in her recovery efforts considerably below her maximum medical improvement. Her prognosis was guarded. From this, her first MUA was scheduled for February 12, 2017. The target treatment areas included her cervical, thoracic, lumbar, pelvic, hip and shoulder regions.^[FN1]

The first MUA procedure involved manipulation of all parts of her spine and its supporting musculature, and included her shoulders and left hip. Post procedure, she was found to have increased range of motion without significant muscle guarding. In his report, Dipti Patel, D.C. (“Patel”), the chiropractor who performed the MUA, noted that Barrera’s fibro-adhesive conditions were significantly impacted increasing the potential for appropriate neuromuscular re-education and healing. She was instructed to follow up at the surgery center to determine if a second MUA procedure was indicated. In the interim, passive manipulation to the treated areas was prescribed to prevent the reformation of muscular adhesions.

This Court finds that Barrera’s treatment record leading up to January 25, 2017 satisfies the NAMUA considerations justifying the procedure. By the initial MUA date, Barrera had participated in frequent conservative chiropractic sessions and, while experiencing some improvement, was still hampered by pain in her activities daily living. This was true beyond the initial 2 to 6 week conservative manipulation period contemplated by the NAMUA protocols, and the numerous positive findings during her pre-MUA evaluation at Pro Align confirm as much. Furthermore, in keeping with the protocols, Dr. Patel prescribed post-MUA series therapy to prevent the reformation of muscular adhesions, suggesting that adhesions — another justifying factor under the NAMUA protocols — were a complicating factor prior to the procedure. Although further analysis of the treatment record would more robustly justify the initial MUA procedure, it is hardly necessary. In this Court’s view, the procedure was justified. This leaves the question of whether Specialty Surgery’s MUA exceeded the scope of chiropractic practice by including, and billing for, the anesthetized manipulation of Barrera’s left hip and shoulders during the initial MUA. It is this Court’s conclusion that the issue need not be decided here.

New York Education Law § 6551(1) defines the scope of chiropractic practice as follows:

The practice of the profession of chiropractic is defined as detecting and correcting by manual or mechanical means structural imbalance, distortion, or subluxations in the human body for the purpose of removing nerve interference and the effects thereof, where such interference is the result of or related to distortion, misalignment or subluxation of or in the vertebral column.

NY Educ. Law § 6551(1). From this it would appear that the general purpose of chiropractic practice is to correct structural or biomechanical problems within the human body by providing manual or mechanical treatment to the spine. Pertinent here, however, given Specialty Surgery’s failure to call any witnesses, the court is without a medical basis upon which to determine whether the anesthetized manipulation of Barrera’s shoulders and left hip could somehow could have been justifiably brought within the scope of providing treatment to her spine for the purpose of correcting some biomechanical malfunction. Notwithstanding this hurdle, there is ample basis in the record upon which to find that Specialty Surgery should be compensated for the portion of the MUA applied directly to her spine.

An examination of the February 12, 2017 bill submitted by Specialty Surgery to State Farm for the first MUA shows the carrier as being billed $25,000 for the manipulation of Barrera’s spine (Code No. 22505), with additional amounts totaling $44,060 billed for all MUA [*4]treatment provided that day. Given that Specialty Surgery has demanded a total of $5,113.01 for the February 12, 2017 MUA (Index No. 705866-17), upon the medical record in evidence, this court finds ample basis for such compensation for the manipulation of the patient’s cervical, thoracic and lumbosacral spinal regions. Accordingly, justification of the February 25, 2017 (Index No. 705867- 17), and March 4, 2017 (Index No. 705884-17), remains. This court finds that those procedures were also medically justified.

The NAMUA protocols set forth general patient recovery benchmarks to consider prior to performing serial MUA procedures. Generally, the protocols contemplate that a second (or serial) MUA procedure is usually unnecessary when a patient regains and retains 80% or more of normal biomechanical function as a result of the first procedure and post-MUA therapy. However, if the patient regains only 50-70% or less of normal biomechanical function as a result of the first procedure and post-MUA follow up therapy, then a second (or serial) MUA procedure is recommended. While the NAMUA scheme appears to leave biomechanical recovery in the 70- 80% range out of consideration for additional MUA procedures, the protocols ultimately recommend serial MUAs until the patient achieves the 80% or greater biomechanical recovery threshold. With that in view, we turn to the second and third MUA procedures.

On February 25, 2017, the day of Barrera’s second MUA procedure, Barrera presented at Pro Align for a pre-MUA evaluation and was found to have experienced approximately 51%-79% improvement from the first procedure. The evaluation report also noted that she continued to experience chronic pain, adhesions and myofascial pain syndrome. This scenario repeated itself again when she presented at Pro Align for the third and final MUA procedure on March 4, 2017. Hence, according to the NAMUA protocols, as of February 25, 2017, and again on March 4, 2017, Barrera’s recovery fell within the range of justification for the second and third MUA procedures.

As with the February 12, 2017 bill from Specialty Surgery to State Farm, the February 25, 2017, and March 4, 2017 bills each charged $25,000 for the manipulation of Barrera’s spine (Code Nos. 225059 and 22505), with bills totaling $44,060 and $48,030, respectively, for all MUA related services provided on those dates. Given that Specialty Surgery has demanded only $3,821.76 (for February 25, 2017) and $5,113.01 (for March 4, 2017) for the MUA services provided, this Court finds that compensation is warranted in each case.

Accordingly, the clerk is directed to enter judgment in favor of the plaintiff, New York Center for Specialty Surgery, in each of the following matters herein: CV-70566-17; CV-705867- 17; and, CV-705884-17.

This constitutes the Decision and Order of the Court.

Dated: April 14, 2021
Hon. John A. Howard-Algarin, J.C.C.

Footnotes

Footnote 1:All references to the record would have included citations to specific pages therein had counsel complied with the court’s trial part rules and submitted documentary evidence with Bates stamped identifiers.

Happy Apple Medical Services, PC As Assignee of Mario Eustache, Plaintiff, against Liberty Mutual Insurance Company, Defendant.

CV-706933-20/RI

Sanders Barshay Grossman, LLC for Plaintiff;

Burke, Conway & Stiefeld For Defendant

Robert J. Helbock Jr., J.

Recitation, as required by CPLR 2219 (a), of the papers considered in the review of this application:

Papers Numbered

Amended Notice of Motion and Affirmation/Affidavit annexed 1-2

Affirmation in Opposition 3

Affirmation in Reply 4

Upon the foregoing cited papers, the decision on Defendant’s Motion to Dismiss is as follows:

Plaintiff, Happy Apple Medical Services, PC (hereinafter, “Plaintiff”), as assignee of Mario Eustache (hereinafter, “Assignor”), commenced this action against the defendant, Liberty Mutual Insurance Company (hereinafter, “Defendant”), to recover assigned first-party No-Fault benefits for medical treatment provided to Assignor.

Currently before the Court is Defendant’s motion seeking an order pursuant to CPLR 3211(a)(2) dismissing Plaintiff’s complaint for lack of subject matter jurisdiction. Plaintiff submitted opposition to Defendant’s motion, and Defendant submitted an affirmation in reply. The motion was deemed submitted and decision was reserved.

Defendant moves to dismiss Plaintiff’s complaint on the grounds that this Court lacks subject matter jurisdiction over the underlying causes of action. Specifically, Defendant argues that as the New York State Workers’ Compensation Board (the “Board”) has found the underlying action to be a work-related accident, the Board has exclusive jurisdiction over all [*2]workers’ compensation claims. Defendant argues this claim is not covered under its policy.^[FN1] Therefore, Defendant argues, the complaint must be dismissed because the underlying accident was determined by the Board to be work-related.

In opposition, Plaintiff argues that Defendant’s policy exclusion defense should be precluded because the defense was not timely raised by a denial of the bill within 30 days of the submission of the claim (see Ins. Law 5106(a); 11 NYCRR 65-3.8(c)). The Plaintiff argues that there are only four exceptions to preclusion all involving “lack of insurance coverage” and since the exclusion due to a work-related injury is not one of them, Defendant’s motion should fail. The Plaintiff does not make any argument regarding the subject matter jurisdiction of the Court.

Discussion

Defendant is correct in noting that the Board has jurisdiction over the determination of whether an accident occurred within the scope of a claimant’s employment (O’Rourke v Long, 41 NY2d 219, 228 [1976]). The Court of Appeals has ruled that the Board has “the primary jurisdiction, but not necessarily exclusive jurisdiction, in factual contexts concerning compensability.” (Liss v Trans Auto Sys, 68 NY2d 15, 20 [1986]). “When the question is purely one of fact, the Workers’ Compensation Board has exclusive jurisdiction over the issue and it is only when the issue involves statutory construction that the trial court may hear the issue” (Gyory v Radgowsk, 89 AD2d 867, 869 [2d Dept 1982]). Therefore, it is outside this Court’s jurisdiction to make a factual determination as to the eligibility of a claimant for workers’ compensation benefits.

However, Plaintiff has not asked this Court to make such a determination. The causes of action before this Court seek monetary damages relating to unpaid invoices and attorneys’ fees in accordance with a no-fault insurance policy allegedly issued by Defendant to Assignor. This determination is squarely within the Civil Court’s jurisdiction (NY City Civ Ct Act § 202). The fact that the Assignor’s accident was deemed to have been work-related does not divest the Civil Court of its jurisdiction. Rather the Board’s determination is relevant to the extent that “workers’ compensation benefits serve as an offset against first-party benefits payable under no-fault as compensation for ‘basic economic loss'” (Arvatz v Empire Mut. Ins. Co., 171 AD2d 262, 268 [2d Dept 1991]; Ins. Law § 5102(b)(2)).

Defendant’s motion mischaracterizes the underlying action as a claim for payment under a workers’ compensation insurance policy, rather than, as pleaded, for payment of benefits pursuant to a no-fault insurance policy. Therein lies the error of Defendant’s argument. The law provides the Defendant with a valid defense to such a Civil Court action — an exclusion from the no-fault insurance policy from payment in instances of a work-related accident.

The Insurance Law and corresponding regulations require the service of a timely denial of the payment of the bill upon the health care provider within 30 days to exercise the exclusion (Ins. Law § 5106(a); 11 NYCRR 65-3.8(c)). Defendant has failed not only to present any policy documentation but also a denial form, timely or otherwise. As such, that issue is not before the [*3]Court. Any discussion or argument pertaining to Defendant’s denial and issues of preclusion are not applicable to the current motion.

The sole question before this Court in the instant motion is whether the Court has subject matter jurisdiction. The matter before the Court is not a determination of a workers’ compensation claim, but rather a claim for reimbursement under a no-fault automobile insurance policy. The availability of workers’ compensation benefits can serve as a defense to the No-Fault claim, but it does not invalidate the Civil Court’s subject matter jurisdiction. This Court has jurisdiction to adjudicate the causes of action as it relates to the reimbursement and defenses under the no-fault insurance policy. The Defendant’s motion makes no other argument to justify the dismissal of the complaint other than alleging a lack of subject matter jurisdiction of the no-fault insurance claim.

Accordingly, the Defendant’s motion is hereby denied.

The foregoing constitutes the Decision and Order of the Court.

Dated: April 13, 2021

Staten Island, New York

Hon. Robert J. Helbock, Jr.

Judge, Civil Court

Footnotes

Footnote 1:While New York law permits No-Fault policies to exclude payment for treatment of work-related injuries (11 NYCRR 65-3.16), the Defendant did not offer a copy of the no-fault insurance contract containing such an exclusion. However, the Court assumes the exclusion applies as a matter of the regular industry practice. However, this assumption, without admissible evidence, does not factor into the Court’s decision.