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Thermographic Diagnostics Inc. v. Allstate Insurance Co.

Decided: August 5, 1991.


On certification to the Superior Court, Appellate Division, whose opinion is reported at 241 N.J. Super. 88 (1990).

For affirmance -- Chief Justice Wilentz and Justices Clifford, Handler, Pollock, O'Hern, Garibaldi and Stein. For reversal -- None. The opinion of the Court was delivered by Stein, J.


[125 NJ Page 494] Thermography is a relatively new diagnostic procedure that measures infrared energy emitted by the skin in order to ascertain the presence of significant temperature differences between corresponding areas of opposite sides of the body. Its proponents contend that thermography is useful in the diagnosis of selected neurological and musculoskeletal conditions. The critical issue raised by this appeal is whether thermography is sufficiently established as a valid diagnostic procedure to render it compensable as a reasonable and necessary medical

expense pursuant to the personal injury protection (PIP) coverage provisions of the New Jersey Automobile Reparation Reform Act, L. 1972, c. 70. (No Fault Act or Act). See N.J.S.A. 39:6A-2(e), -4(a). A collateral issue concerns the reasonableness of the fees charged for thermographic examinations and readings, an issue of particular significance because of evidence in the record that some physicians who frequently refer patients for thermographic procedures derive a financial gain by participating indirectly in the fees charged for the examination.

After a six-week trial in 1986, in the course of which the parties presented expert testimony favoring and denouncing thermography, the Law Division held that thermographic expenses were compensable under the No Fault Act. 219 N.J. Super. 208, 530 A.2d 56 (1987). Concluding that the evidence adduced at trial demonstrated that "neuromuscular thermography is sufficiently supported by credible expert testimony to have medical value," id. at 221, 530 A.2d 56, the Law Division held that the cost of thermography examinations was a necessary expense "if the treating physician orders a thermographic test based upon the physician's sincere belief that the procedure will further the diagnosis and treatment of [the] patient." Id. at 227-28, 530 A.2d 56. The court noted, however, that the reasonableness of the physician's belief in any given case was reviewable, particularly "where it can be shown that [thermographic] tests not warranted by the circumstances are ordered." Id. at 228, 530 A.2d 56. The Law Division also held reasonable the fees charged for thermographic examinations, concluding that they were within the range customarily charged for such services within the community. Id. at 230, 530 A.2d 56. Finally, in a post-trial proceeding subsequent to the filing of its opinion, the Law Division denied plaintiff's application for counsel fees.

The Appellate Division affirmed the trial court's determination that the charges for thermographic examinations can be compensable medical expenses under the No Fault Act. 241 N.J. Super. 88, 574 A.2d 485 (1990). The Appellate Division

declined to follow the "customary charge" standard in determining the reasonableness of those costs. The court reasoned that the high cost of thermographic examinations in relation to the price of thermographic equipment and the financial interest in thermography fees on the part of some of the referring physicians rendered that standard inappropriate. It remanded the issue of the reasonableness of the charges for redetermination by the trial court. Id. at 92, 574 A.2d 485.

We granted defendants' petition for certification, 122 N.J. 338, 585 A.2d 353 (1990), addressing whether and under what circumstances thermographic examinations constitute a necessary medical expense under the No Fault Act, as well as plaintiff's petition for certification, ibid., challenging the Appellate Division's remand to redetermine the reasonableness of the thermographic charges and its affirmance of the Law Division's denial of plaintiff's application for counsel fees.


Plaintiff, Thermographic Diagnostics, Inc. (TDI), is engaged in the business of performing thermographic examinations at two New Jersey facilities. TDI instituted separate actions, which were consolidated before trial, against Allstate Insurance Company (Allstate) and State Farm Mutual Insurance Company (State Farm), as assignees of approximately 300 automobile insurance policyholders of Allstate and State Farm. Those insureds had been involved in automobile accidents and had been referred by their respective physicians to TDI for thermographic studies. The insureds submitted TDI's fees for the thermograms to Allstate and State Farm. Both companies refused payment, contending that thermography is an experimental procedure not generally accepted within the medical profession and hence not a necessary medical expense compensable under the Act. Defendants also contended that even if thermography was determined to be a reimbursable procedure under the Act, the amounts charged by plaintiff for thermographic

examinations were excessive and unreasonable and should be adjusted by the court. The trial court permitted the pleadings to be amended during trial to name the New Jersey Automobile Full Insurance Underwriting Association (NJAFIUA) as a defendant, because NJAFIUA would be obligated to pay some of the claims asserted by TDI.

-- A --

We need not recapitulate the extensive trial testimony by plaintiff's experts detailing how thermograms are administered and why they are useful in the diagnosis of certain conditions, nor need we set forth in detail the criticisms of thermography outlined at length by defendants' experts. We offer some general observations, however, about the expert testimony presented at trial. Neither plaintiff's nor defendants' experts presented compelling evidence to resolve the underlying scientific debate about the usefulness of thermography. For the most part, plaintiff's experts were highly-qualified physicians who were actively engaged in providing thermographic examinations, generally deriving substantial income from a financial interest in an entity that owned thermographic equipment and administered examinations. Although the testimony of those experts was clear and comprehensive with respect to the medical value of thermography as a diagnostic tool, their personal interest detracted from the objectivity of their testimony.

In general, defendants' experts fell into two categories. Some were unfamiliar with thermography but provided expert testimony faulting the scientific basis for its effective use. That testimony was generally well presented but quite inconclusive. Substantively, their testimony fell short of discrediting the underlying premise of thermography -- that sensory nerve damage will affect blood flow and skin temperature in the affected area. Although highly-qualified physicians, those experts were also unpersuasive because they lacked the research and scientific credentials that would have imparted greater

weight and credibility to their opinions. Three of defendants' experts had engaged in studies designed to test the effectiveness of thermography. Two experts compared thermographic readings of examinations of both normal and diseased patients, concluding that thermography was virtually useless in the diagnosis of sciatica. Another expert collaborated in a study designed to test whether relief of back pain by local anesthesia would produce thermographic changes, concluding that thermography would not detect pain relief. Those studies, however, were subjected to various criticisms and appeared to be unpersuasive on the general question of thermography's value as a collateral diagnostic tool. Defendants also produced Dr. Jan Stolwijk, Chairman of the Department of Epidemiology and Public Health at the Yale University School of Medicine and an expert in skin temperature. Dr. Stolwijk testified that he had used infrared thermography to measure skin temperature, acknowledging that the human body was bilaterally symmetrical with respect to skin temperature and that blood flow was a critical factor affecting skin temperature. He was skeptical about whether the preparation period prior to a thermographic examination was adequate to offset external factors that could affect the accuracy of the examination, but his testimony did not substantially discredit thermography as a useful diagnostic procedure.

The Law Division's opinion includes a concise description of thermography, and a summary of the testimony of one of plaintiff's experts, Dr. Joseph Uricchio, explaining the theoretical physiological basis for its usefulness as a diagnostic procedure:

Thermography is a relatively new diagnostic tool. Its scientific basis was developed in space and agricultural research. Thermogram means literally a picture of heat. In preparation for a thermographic examination, an individual must follow a strict protocol which eliminates conditions that might affect skin temperature, and just before the pictures are taken the skin is equilibrated with a room temperature of 68 [degrees] to 74 [degrees] Fahrenheit. Thermography is the measure of the infrared radiation from the skin surface of the human body by a scanner. A control unit then converts these emissions into electronic signals, which are displayed by image on a monitor. Color is introduced into

the electronic signal, each color representing an approximate differential of 1 [degree] Centigrade. Pictures taken of this image by a 35-millimeter camera preserve the study for diagnostic purposes. The thermogram of a normal individual is symmetrical, one side of the body being the mirror image of the other. If asymmetry occurs, it is claimed that this differential of heat on the skin's surface shows that there is a nerve impingement or irritation at the root of the dermatome which affects that area of the skin. Also, localized areas of heat change may be reflective of disease states that are attributable to musculoskeletal pathology.

Joseph [Uricchio], M.D., a practicing orthopedic surgeon in Orange County, Florida, certified by the American Academy of Orthopedic Surgeons[,] testified concerning the medical basis of neuromuscular thermography. He said it is a physiological test that aids primarily in the diagnosis of sensory nerve irritation. He explained that sensory nerves emerge from the spine and travel in recognized patterns called dermatomes, to skin areas. For example, the nerve that emerges at L-4 comes down the buttock and over the front of the thigh and down into the big toe; from L-5 the sensory nerve comes down the side of the buttock and to the middle toes; and from S-1 the nerves come down the back of the thigh into the little toe. These sensory nerves, which allow one to feel sensations, are closely associated with the sympathetic nervous system over which we have no control. He testified that as much as one-third of every sensory nerve is composed of sympathetic nerve fibre. When a sensory nerve gets irritated through trauma or otherwise, the sympathetic nerve fibre associated with that nerve causes vasoconstriction of the capillaries under the skin. Cutting down the size of these blood vessels creates a cooler area on the skin area supplied by that nerve. However, it is only possible to approximate the level at which the irritation occurs since sensory nerves do not correlate exactly to dermatomes. A temperature change often appears on the skin at a dermatomal area one or two levels above or below the irritation. In some cases the temperature change will appear on the side of the body opposite from where the irritated nerve is present. Thermograms are not intended for exact anatomic localization of the irritation. Thermograms do not tell what causes a problem or precisely where it is. Other diagnostic tests are needed to get this information.

However, neuromuscular thermography is the best test for diagnosing the existence of sensory nerve irritation. Its uses are primarily helpful in forming a successful strategy for treatment. Since other tests such as myelograms and Computerized Tomography Scans (CT Scans) give positive results approximately one-third of the time in asymptomatic patients, neuromuscular thermography is indicated as a supplement to a CT Scan to determine whether more aggressive forms of treatment such as a myelogram, hospitalization or surgery are necessary. It is also indicated where patients do not respond to other forms of treatment and it is necessary to determine whether there is an organic basis to pain symptoms.

Dr. [Uricchio] reported on a study of 1,228 patients in which he compared thermographic results from other neurodiagnostic tests. He concluded that abnormal thermograms highly correlated with defects shown by CT Scans and myelograms and also detected abnormalities which were not picked up by those methods. [219 N.J. Super. at 210, 212-13, 530 A.2d 56.]

After describing the testimony of most of plaintiff's and defendants' expert witnesses, id. at 212-20, 530 A.2d 56, the Law Division offered this synopsis of the expert testimony:

To summarize the medical testimony, the defendants' experts agree that while there is a theoretical basis to thermography, there is no provable use for it by the practicing physician today. TDI's experts differ in some details as to how thermography shows bodily injury or disease and make clear that neuromuscular thermography should be applied with discretion. They would use a neuromuscular exam when patients have sensory complaints such as pain, numbness or dyesthesia (tingling sensations) and there is suspected sensory nerve root involvement. However, they believe that thermographic examination should not generally be given for musculoskeletal injuries such as a sprain or strain prior to six or eight weeks after the onset of these symptoms. The human body's natural tendency towards recuperation from this type of injury makes earlier use of thermography in most instances inappropriate. In such cases, neuromuscular thermography becomes appropriate when patients have not responded adequately to conservative forms of treatment such as bed rest, physical therapy or ice massage. Whether used earlier or later in treatment, the proponents of neuromuscular thermography assert two diagnostic purposes. First, it can be used in conjunction with other diagnostic tests to aid in planning treatment strategy. A thermogram in this instance provides an additional means of determining whether there is an organic basis to a patient's complaint. Second, a thermogram can help in determining whether more invasive and dangerous neurodiagnostic tests such as a myelogram or CT Scan [are] warranted. Neuromuscular thermograms correlate[ ] highly with myelograms, an invasive procedure that requires hospitalization and involves a risk of morbidity through injection of dye in the spinal canal as well as with CT Scans, which involve a statistical element of risk through emission of radiation. [ Id. at 220-21, 530 A.2d 56.]

Defendants argued in the Law Division and before us that a medical procedure is not reasonable and necessary, and hence the charge therefor is not reimbursable, under the No Fault Act unless the usefulness of the procedure is generally accepted by a majority of the relevant medical community. Defendants acknowledge that exceptions to the standard of general acceptance would be required for those experimental techniques not yet generally accepted that constitute the only available procedure

offering the potential for successful treatment of a patient's condition.

The Law Division rejected defendants' contentions, concluding that a standard of general acceptance by a majority of the medical community

would be inconsistent with the broad scope of the No Fault Act. The Act was intended to allow treating physicians wide discretion in determining the diagnostic test as well as the extent of treatment needed by their patients. This latitude includes minority medical viewpoints within the scope of coverage as well as remedial treatment rendered by religious healers. [ Id. at 227, 530 A.2d 56.]

Relying on its determination that the expert testimony at trial established that "neuromuscular thermography is sufficiently supported by credible expert medical testimony to have medical value," id. at 221, 530 A.2d 56, the Law Division instead adopted as the standard for reimbursement under the Act the requirement of a "physician's sincere belief that the procedure will further the diagnosis and treatment of his patient," id. at 227-28, 530 A.2d 56, qualified by the condition that the use of any procedure must be "warranted by the circumstances." Id. at 228, 530 A.2d 56.

Under the New Jersey No Fault Act, the "necessity" of a medical expense must be decided by the treating physician, the one most qualified to make such a judgment. It should not be the province of the Judiciary to decide, in the face of conflicting expert medical testimony, highly complex questions of medicine and science. Surely the Legislature could not have intended for the Judiciary to sit in the capacity of a medical board of review. Therefore, this court holds that "need" is shown if the treating physician orders a thermographic test based upon the physician's sincere belief that the procedure will further the diagnosis and treatment of his patient. Of course, abuses of this judgment by the physician, where it can be shown that multiple tests are ordered or tests not warranted by the circumstances are ordered, can receive individual scrutiny and review by a court. [ Id. at 227-28, 530 A.2d 56.]

Although defendants criticize the standard for reimbursement adopted by the Law Division as one that delegates to the "subjective sincere belief of the treating physician" the question whether medical expenses are necessary, the record indicates that after trial the parties attempted to ...

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