Liberty Queens Medical, P. C., as Assignee of Zarina Khan, Plaintiff,
Tri-State Consumer Insurance, Defendant.
Israel & Israel L. L. P., Great Neck, for plaintiff.
Murray Lemonik, Jericho, for defendant.
Kenneth L. Gartner, J.
The instant motion presents an issue which is both of first impression and of substantial significance to the no-fault insurance system.
This motion represents an attempt to expand beyond its already capacious bounds the much-litigated preclusion doctrine first enunciated by the Court of Appeals in Presbyterian Hosp. v Maryland Cas. Co. (90 N.Y.2d 274 ). The plaintiff's position is superficially supported by broad dicta contained in both the Presbyterian Hosp. decision itself, and in Appellate Division decisions. Nevertheless, scrutiny of the factual context within which those appellate tribunals made their statements; the text of the applicable Insurance Department regulations; and the statutory intent sought by those regulations to be implemented, leads to a rejection of the plaintiff's attempted interpretation.
For the reasons more fully set forth below, the Court of Appeals and Appellate Division dicta relied upon by the plaintiff is deemed confined to its facts. The plaintiff's motion is denied.
This is an action brought by a plaintiff provider of medical services, as assignee of the provider's patient, against the patient's insurer, for the recovery of an unpaid medical no-fault bill, statutory interest and attorney's fees. The plaintiff moves to strike the affirmative defenses alleged by the defendant in its answer, and to grant summary judgment to the plaintiff.
Insurance Law § 5106 (a) provides, inter alia, that " [p]ayments of first party benefits and additional first party benefits ... are overdue if not paid within thirty days after the claimant supplies proof of the fact and amount of the loss sustained." New York State Department of Insurance Regulations govern the applicable claim procedure.
11 NYCRR 65.15 (d) (1) provides that " [w]ithin 10 business days after receipt of the completed application for motor vehicle no-fault benefits, the insurer shall forward, to the parties required to complete them, those prescribed verification forms it will require prior to payment of the initial claim." If, following receipt of the completed prescribed verification forms, additional verification is needed, 11 NYCRR 65.15 (d) (2) gives the insurer another 10 business days to request the same. 11 NYCRR 65.15 (g) (1) (i) provides that " [n]o-fault benefits are overdue if not paid within 30 calendar days after the insurer
receives verification of all of the relevant information requested pursuant to subdivision (d) of this section."
Under the line of cases beginning with Presbyterian Hosp. (supra) and Central Gen. Hosp. v Chubb Group (90 N.Y.2d 195 ), the Court of Appeals established that a failure of an insurer to comply with the " thirty day rule" will result in the insurer being precluded from raising any defense, other than lack of coverage, to an action (such as the instant one) for benefits. Moreover--and notwithstanding the defendant's argument in the instant case to the contrary--it has been established that the preclusion will extend to a defendant insurer's argument that there has been an insufficient showing of the " medical necessity" of the services for which reimbursement is sought. (Central Gen. Hosp. v Chubb Group,228 A.D.2d 406, 407 [2d Dept. 1996], revd on other grounds 90 N.Y.2d 195 ; Vinings Spinal Diagnostic v Liberty Mut. Ins. Co., 186 Misc.2d 287 [Nassau Dist Ct 2000]; accord, Mount Sinai Hosp. v Triboro Coach, 263 A.D.2d 11, 18 [2d Dept. 1999] [" It is clear from the text of Central General that an insurer may not claim ... ...