On appeal from the Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-875-08.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges R. B. Coleman, Sabatino and Simonelli.
Plaintiff Allstate New Jersey Insurance Company (Allstate) appeals from the June 4, 2008 Law Division order affirming an arbitration award for personal injury protection (PIP) benefits in favor of defendants Saddle Brook Pain Center (Pain Center), Hypnos Anesthesia (Hypnos), and Saddle Brook Surgicenter, Inc. (Surgicenter). We reverse.
The facts are straightforward. Surgicenter, a free-standing ambulatory surgical center solely owned by Dr. Ronald Solitto, permits non-owner physicians to use its facility for surgical procedures. It directly bills its fee to the non-owner physician's patient or his or her insurance carrier. The fee is Surgicenter's only form of compensation. Surgicenter does not share in or receive any portion of the non-owner physician's fee for service the physician renders to his or her patient.
Dr. Salomon Halioua is a pain management and anesthesiology specialist who conducts business through Pain Center and Hypnos. He is Pain Center's sole owner, and he also owns sixty-six percent of Hypnos.*fn1 From February 2005 to August of 2006, Hypnos was Surgicenter's sole provider of anesthesia services. Surgicenter did not pay Hypnos. Rather, Hypnos received compensation by directly billing a patient or his or her insurance company.
Dr. Halioua was also Surgicenter's unpaid medical director, and a member of Surgicenter's quality assurance and utilization review committee. The doctor did not own any interest in Surgicenter, and he received no compensation, financial benefit or incentive from Surgicenter for his, Pain Center's, or Hypnos' use of its facility.
On July 11, 2005, Allstate's insured, Sylvia Gonzalez (Gonzalez), was injured in a motor vehicle accident and received medical treatment from defendants. She submitted a claim to Allstate for PIP benefits, and assigned to defendants her rights to those benefits.
Prior to January 11, 2006, Gonzalez received chiropractic treatment from Kamel Kazan, D.C., and treatment from an orthopedic surgeon, David Basch, M.D.*fn2 Dr. Halioua first examined Gonzalez on January 11, 2006. She reported that she had cervical pain radiating down the left upper extremity, lumbrosacral pain with radiating pain down the left lower extremity, and left shoulder pain. The doctor recommended a series of three cervical and three lumbar epidural steroid injections using epidurography assistance and with simultaneous trigger point injections. He would perform these injections at Surgicenter, with Hypnos providing the anesthesia.
Before performing any procedures, on January 19, 2006, Dr. Halioua submitted to Allstate a request for pre-certification for the six injections.*fn3 On February 3, 2006, Allstate's physician advisor concluded that Gonzalez should only receive one cervical and one lumbar injection "to assess the response and length of time that the response lasts before certifying additional injections." Dr. Halioua administered the first cervical injection on February 6, 2006, and the first lumbar injection on February 13, 2006.
On February 14, 2006, Dr. Basch examined Gonzalez, at which time she reported that she only had mild relief from the cervical injection but still had "persistent neck and lower back pain," and was "still experiencing significant neck pain radiating into her shoulders and arms . . . [and] occasional radiating pains into her upper extremities, right greater than left." She also reported "numbness and tingling in her lower extremities with occasional radiating pains from her lower back . . . [and] difficulty with all activities including standing, sitting and ambulating for prolonged periods." Dr. Basch recommended that Gonzalez receive "the rest of the series of injections over the next month."
Despite receiving authorization for only one cervical and one lumbar injection, Dr. Halioua administered four more injections. On February 20, 2006, he administered a second lumbar injection, and on February 27, 2006, he administered a second cervical injection. In a report, dated February 27, 2006, the doctor noted that the injections provided Gonzalez "60-70% relief of her lumbosacral pain and lower extremity radicular symptomatology[,]" and "30-40% improvement of her cervical pain and upper extremity radicular symptomatology." However, on March 3, 2006, Gonzalez reported to Dr. Kazan that her neck and back pain had increased since his last examination, and was continuing to worsen.
Dr. Halioua administered a third lumbar injection on March 13, 2006, and a third cervical injection on March 21, 2006. In a report, dated March 21, 2006, the doctor noted that the injections provided Gonzalez "complete relief of her lower extremity radicular symptomatology and 70-80% relief of her lumbosacral pain[,]" and "60-70% relief of her cervical pain and upper extremity radicular symptomatology." Following each procedure, defendants ...