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MARIO INTRONA, D.C. v. ALLSTATE INS. CO.

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NEW YORK


April 3, 1995

MARIO INTRONA, D.C., and CHIRO MED HEALTH SERVICES, Plaintiffs, against ALLSTATE INSURANCE COMPANY, Defendant.

The opinion of the court was delivered by: JOHN R. BARTELS

MEMORANDUM-DECISION AND ORDER

 Plaintiffs bring this action pursuant to New York State's Comprehensive Motor Vehicle Insurance Reparations Act, Insurance Law § 5101, et seq. (McKinney's 1985 & Supp. 1995), and the regulations promulgated thereunder (collectively the "No-Fault Law"). Plaintiff Mario Introna, D.C. ("Dr. Introna"), a licensed chiropractor, seeks to recover from defendant Allstate Insurance Company ("Allstate") the cost of certain medical services he provided to patients covered by no-fault insurance policies issued by defendant. Plaintiffs also seek costs, interest, and attorney's fees under Insurance Law § 5106(a).

 I. Background and Contentions of Parties

 Dr. Introna, as subrogee, submitted claims for reimbursement under a number of New York State no-fault insurance policies issued by Allstate. Allstate paid a portion of the claims but denied coverage on the remainder, asserting that Dr. Introna had charged fees in excess of those permitted under the No-Fault Law.

 Plaintiffs instituted the present action in the Civil Court of the City of New York, County of Richmond, seeking to recover the outstanding balance. Defendant removed the action to this Court on June 28, 1993. Both parties then cross-moved for summary judgment. In their motion papers, plaintiffs did not dispute that Dr. Introna charged his no-fault patients fees in excess of the office visit fees permitted under the No-Fault Law, but argued that he was entitled to collect additional compensation for certain services performed during those visits. Dr. Introna also argued that he was justified in basing his fees on rates prevalent in his geographic area. Allstate disputed plaintiffs' right to the additional charges, and argued that even if Dr. Introna were entitled to additional compensation, the No-Fault Law expressly requires him to base his fees on those charged for comparable medical procedures.

 In Introna v. Allstate Ins. Co., 850 F. Supp. 161 (E.D.N.Y. 1993), this Court awarded Dr. Introna an unidentified sum as additional compensation for the performance of certain diagnostic procedures, but held that the balance of services at issue were not separately compensable. Plaintiffs' request to determine additional fees on the basis of the prevailing rate was denied, and the Court ordered a trial on the issue of whether Dr. Introna charged his no-fault patients fees consistent with those charged for comparable procedures.

 The Court held a bench trial of this matter on May 23 and 24, 1994. At trial, plaintiffs reiterated what they alleged to be a complete absence of medical procedures with which to compare those performed by Dr. Introna and the resultant need to base his additional fees on the prevailing rate. Plaintiffs then presented expert testimony, most of which was provided by Dr. Introna himself, concerning the amount of fees to which he is entitled. Defendant contended that the comparable procedure method was the only means statutorily available to plaintiffs, and presented a comprehensive methodology by which to determine procedures comparable to those performed by Dr. Introna.

 According to plaintiffs, there remain five procedures for which the appropriate fee still must be determined. These include: Computerized Cervical Range of Motion tests; Autoscreen 3-D (or Metrecom) studies; Surface Electromyography ("Surface EMG"); Neurometer Screen Testing; and Plethysmography. Defendant generally agrees with plaintiffs' assessment, but argues that because Computerized Cervical Range of Motion tests fall within the ambit of the Court's prior ruling, the fees for this procedure are subsumed in already reimbursed office visit fees. Under Federal Rule of Civil Procedure 52, the Court reaches the following findings of fact and conclusions of law.

 II. Findings of Fact

 1. Plaintiff Dr. Introna, a licensed chiropractor authorized to practice within the State of New York, is a New York State resident who maintains his principal place of business in Staten Island, New York.

 2. Plaintiff Chiro Med Health Services is an unincorporated business entity wholly owned by Dr. Introna which acts as Dr. Introna's billing service and maintains its principal place of business in Staten Island, New York.

 3. Defendant Allstate is a corporation incorporated under the laws of the State of Illinois which maintains its principal place of business in Illinois.

 4. The amount in controversy exceeds $ 50,000.

 5. Dr. Introna submitted to Allstate claims totalling over $ 82,000 seeking reimbursement for chiropractic services provided to approximately 29 different patients, all of whom were involved in automobile accidents and whose injuries were subject to no-fault insurance policies issued by defendant.

 6. Dr. Introna provided all of the services at issue between April 1990 and February 1993.

 7. Allstate fully reimbursed plaintiffs for all office visit fees, and paid plaintiffs a total of over $ 32,000 in satisfaction of their claims.

 8. Allstate denied coverage on certain services Dr. Introna performed during office visits, including Computerized Cervical Range of Motion tests, Autoscreen 3-D studies, Surface EMG, Neurometer Screen Testing, and Plethysmography.

 Statutory Framework

 9. To contain the cost of providing medical services to patients treated under New York's No-Fault Law, the state legislature set limits on the fees health care providers may charge patients who sustain injuries in the use or operation of a motor vehicle. See Insurance Law §§ 5102, 5108. The legislature controlled costs by incorporating into the no-fault scheme the fee schedules established by the Workers' Compensation Board for industrial accidents. Insurance Law § 5108(a).

 10. Published fee schedules now establish maximum permissible charges for chiropractic services used to treat no-fault patients. See 11 N.Y.C.R.R. § 68, Appendix 17-A, Part C; 11 N.Y.C.R.R. § 68, Appendix 17-C, Part L; 12 N.Y.C.R.R. § 348, Appendix C-5.

  11. At the time relevant to this action, the Workers' Compensation Board fee schedules were divided into various sections, including Medicine, Physical Therapy, Anesthesia, Surgery, Radiology, and Pathology in the medical fee schedule, and Office and Home Visits and Radiology in the chiropractic fee schedule. See New York State Workers' Compensation Board Schedule of Medical Fees, effective September 1, 1986, as amended through September 1, 1993 (collectively the "1986 Medical Fee Schedule") (codified at 12 N.Y.C.R.R. § 329, Appendix C-3 and submitted in part as Defendant's Trial Exhibit ["Def. Ex."] B); New York State Workers' Compensation Board Chiropractic Fee Schedule, effective September 1, 1988, as amended through September 1, 1992 (collectively the "1988 Chiropractic Fee Schedule") (originally codified at 11 N.Y.C.R.R. § 68, Appendix 17-A, Part C and submitted in part as Plaintiffs' Trial Exhibit ["Pl. Ex."] 2).

 12. Each of these sections lists a variety of medical and chiropractic procedures, and assigns to each procedure a number known as a "CPT Code," or Current Procedural Terminology Registry Code. See American Medical Association, Physicians' Current Procedural Terminology (1989) (submitted as Pl. Ex. 4). These codes represent a uniform numerical classification of the most common treatments and diagnostic tests performed by physicians, chiropractors, and other medical providers. Trial Transcript ("Tr.") at 18.

 13. Each procedure listed in the fee schedules also is assigned a number representing its "unit value."

 14. To determine the maximum fee a provider may charge for any given procedure, the unit value assigned to that procedure is multiplied by a dollar "conversion factor." See Pl. Ex. 2, p. 4; New York State Workers' Compensation Board Chiropractic Fee Schedule, effective September 1, 1988, as amended through September 1, 1993 (collectively the "1993 Chiropractic Fee Schedule") (codified at 11 N.Y.C.R.R. § 68, Appendix 17-A, Part C and submitted as Def. Ex. B-1), p. 4.

 15. Conversion factors are provider- and procedure-specific; that is, they apply only to the category of health care provider and type of treatment for which they were established. See, e.g., Tr. at 154-55, 222; Pl. Ex. 2, p. 5; Def. Ex. B, pp. 7, 9, 41, 154, 175.

 16. Conversion factors also differ depending upon the location in which a provider practices. Tr. at 153. See also Def. Ex. B, p. 7A; Def. Ex. B-1, p. 5. In addition, conversion factors traditionally have been increased annually to reflect yearly increases in the costs of administering treatment. Tr. at 154-55. See also Def. Ex. B-1, p. 5.

 17. The 1988 Chiropractic Fee Schedule designated conversion factors for Office and Home Visits and Radiology treatments but did not provide conversion factors applicable to diagnostic procedures. Tr. at 155; Pl. Ex. 2, p. 5.

 18. Effective March 1, 1993, and September 1, 1993, the Workers' Compensation Board adopted revised chiropractic dollar conversion factors. See Def. Ex. B-1, p. 5. These amendments modified the conversion factors applicable to office visits and radiology, but, more importantly, established Electrodiagnostic Testing conversion factors for chiropractors. Id.

 III. Conclusions of Law

 1. Because complete diversity of citizenship existed at the time this action was filed and the amount in controversy exceeds $ 50,000, this Court has subject matter jurisdiction over this action under 28 U.S.C. § 1332.

 2. That plaintiffs' claims are governed by New York State's No-Fault Law is not in dispute.

 3. Plaintiffs are not entitled to additional compensation for Computerized Cervical Range of Motion tests performed during office visits. In rendering a decision on the cross-motions for summary judgment, this Court concluded that "simple range of motion exercises and/or tests . . . are neither 'unusual' nor 'unique' chiropractic services," and therefore are "'deemed included under the charges set forth in the Chiropractic Fee Schedule for Office Visits.'" Introna, 850 F. Supp. at 165 (quoting Tucciarone v. Progressive Ins. Co., No. 91-1981, November 19, 1992, slip op. at 6-7 [Sup. Ct. Schenectady Co. 1992], aff'd, 204 A.D.2d 864, 612 N.Y.S.2d 461 [3d Dep't 1994]). The Court finds no significant difference between what it previously termed "simple range of motion exercises and/or tests" and the Computerized Cervical Range of Motion tests now under consideration. The only distinction plaintiffs cite is that when conducting computerized tests, Dr. Introna utilized the aid of a computer attached to a three-dimensional arm to measure and record results rather than measuring a patient's cervical range of motion by eye. Tr. at 122-24. Although Dr. Introna testified that use of the computer "adds a dimension of scientific performance" to the test, Tr. at 123, at trial he admitted that he had characterized Computerized Cervical Range of Motion as a "simple test" during his deposition. Tr. at 123-24. Under these circumstances, plaintiffs have failed to meet their burden of demonstrating the "unique" or "unusual" nature of these services, and the Court finds that Computerized Cervical Range of Motion tests are included in fees charged for office visits. Accordingly, these tests are not separately compensable, and plaintiffs' claim for additional compensation is denied.

 4. Plaintiffs are entitled, however, to additional compensation for the performance of four remaining categories of diagnostic services, including Autoscreen 3-D, Surface EMG, Neurometer Screen Testing, and Plethysmography. See Introna, 850 F. Supp. at 165.

 5. When determining a fee, a provider must use the schedule "in effect on the date on which the chiropractic services were rendered, regardless of the date of accident." 12 N.Y.C.R.R. § 348.1. Because the services warranting additional compensation here were rendered between April 1990 and February 1993, the Court must apply the 1988 Chiropractic Fee Schedule to determine the amount of Dr. Introna's fees.

 6. Dr. Introna, whose practice is located in Staten Island, New York, falls within conversion factor Region 4. See Pl. Ex. 2, p. 6.

 7. Dr. Introna may not set his fees for diagnostic services in accordance with those typically charged by other providers in his geographic location. When establishing fees for unscheduled procedures, a health provider may look to the fee prevalent in his or her geographic location only where the Workers' Compensation Board has not adopted a fee schedule applicable to that provider. 11 N.Y.C.R.R. § 68.6(b). As this Court recognized previously, the promulgation of a chiropractic fee schedule clearly prohibits Dr. Introna from employing the "prevailing rate" method. Introna, 850 F. Supp. at 165-66. Under 11 N.Y.C.R.R. § 68.6(a), Dr. Introna is bound to set his fees in accordance with those charged for comparable procedures.

 8. To establish fees consistent with those charged for comparable procedures, the Court first must determine which procedure listed in the schedules is most similar to each of the diagnostic services presently under consideration. (The corresponding unit value for each of these procedures then will be multiplied by an appropriate dollar conversion factor.) At trial, Dr. Introna testified that he ascribed unit values primarily on the basis of the amount of time he spent performing a procedure. See, e.g., Tr. at 69, 71-72, 80. Dr. Introna conceded that he never provided Allstate unit values at the time he submitted his bills, Tr. at 91, and even admitted that he did not compute unit values for any of the tests he performed until preparing his trial testimony. Tr. at 91-92. Clearly, Dr. Introna could not possibly have determined his fees on the basis of comparable unit values.

 In contrast, defendant established a system of assigning unit values to the tests performed by Dr. Introna by examining the cost of the equipment Dr. Introna used in conducting a particular test, the training and time needed to perform the test, and the time required to interpret test results. Tr. at 170-71. Defendant then computed unit values for Dr. Introna's tests by adopting those unit values ascribed to procedures similar in cost, performance time, training, and interpretation time. To ensure internal consistency among fees, it is necessary to establish a coherent system of assigning unit values and conversion factors. The method developed by Allstate produces the most reliable results, and therefore, taking into consideration the cost of equipment involved, time needed to perform each test, training required, and interpretation time, the Court adopts the following comparable procedures and corresponding CPT Codes and unit values for each of the tests performed by Dr. Introna: a. Autoscreen 3-D: Computerized Muscle Tests CPT Code 97752 Unit Value = 9.7 units *fn1" b. Surface EMG: Needle Insertion EMG CPT Code 95869 Unit Value = 20 units c. Neurometer Screen Testing: Nerve Conduction Velocity CPT Code 95904 Unit Value = 9 units *fn2" d. Plethysmography: Plethysmography CPT Code 93890 Unit Value = 30 units

19950403

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