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Berman v. GEICO

May 10, 2010

ALANA BERMAN, INDIVIDUALLY AND PREMIER ORTHOPAEDICS AND SPORTS MEDICINE, P.C., AS ASSIGNEE, PLAINTIFF-APPELLANT,
v.
GEICO, DEFENDANT-RESPONDENT.



On appeal from Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-4071-09.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued January 20, 2010

Before Judge Carchman and Lihotz.

Plaintiff Alana Berman (Berman) and her Assignee, Premier Orthopaedics and Sports Medicine, P.C. (Premier) (collectively referred to as plaintiffs), appeal from the trial court's order denying their emergent application and dismissing their complaint for satisfaction of an arbitration award against defendant GEICO. After reviewing the record in light of the facts and applicable law, we affirm.

On August 15, 2007, Berman, then nine years old, was a passenger in a vehicle involved in an automobile accident. After the accident, Berman experienced "a bump on her left temple and [p]ain radiating onto the front of her head" and "reported getting sharp headaches." On August 29, Berman was brought to Premier for examination. Dr. Margaret Meyer diagnosed a head contusion and headaches. Given the child's age and the lapse of time since the accident, Dr. Meyer recommended Berman receive a CT scan to rule out brain injuries.

Premier billed GEICO for an initial office visit under Current Procedural Terminology [CPT] code 99204, reflecting a visit lasting approximately forty-five minutes and requiring a medical decision of "moderate complexity."*fn1 Such visits are assigned a value of $114.32 under New Jersey's automobile medical fee schedule. See generally N.J.A.C. 11:3-29.1 (establishing a fee schedule for PIP providers and insurers).

For reasons that are not explained in this record, a GEICO employee downgraded the visit to code 99203. This code reflected a visit lasting approximately thirty minutes, which required a medical decision of "low complexity." Visits coded 99203 are assigned a value of $80.02. GEICO then agreed to pay this amount, subject to any co-payment and contract deductibles.

Premier disputed GEICO's decision to downgrade its claim and, as Berman's assignee, filed a Demand for Arbitration with the National Arbitration Forum (NAF) for the cost of Berman's care on April 19, 2008. The Commissioner of Banking and Insurance has designated NAF as the body to handle arbitration of PIP disputes in New Jersey. N.J.S.A. 39:6A-5.1.

A hearing was conducted before Gary T. Lesser, a Dispute Resolution Professional with NAF. After reviewing the parties' submissions, Lesser found Premier had correctly coded Berman's care. The arbitrator entered an award of $114.32 in compensatory damages, less any sums GEICO previously paid, and $831.00 in attorney's fees and costs.

GEICO applied $34.30, which was the unpaid compensatory award, to Berman's deductible. It did not pay the attorney fee portion of the award.

On May 5, 2009, thirty-four days after the award was issued, plaintiffs filed a Verified Complaint and an Order to Show Cause (OTSC) demanding GEICO's payment of the remaining $831.00. To support their claim that GEICO had defaulted, plaintiffs relied upon N.J.A.C. 11:3-5.6(e), which states that "[i]f the [PIP arbitration] award requires payment by the insurer for a treatment or test, payment shall be made . . . within [twenty] days of receipt of a copy of the determination" on the award. Two days later, GEICO paid the sum awarded as attorney's fees and costs.

The Law Division reviewed the OTSC on June 8, 2009. In response to plaintiffs' allegations, GEICO acknowledged that at the time plaintiffs initiated their action, it had not satisfied all components of the arbitration award. However, GEICO maintained that, as the forty-five day appeal period provided by N.J.S.A. 2A:23A-13(a) had not expired, no actionable claim arose.

The court noted the conflict in the time frames stated in the statute and regulation, concluding the statute controlled and stating "the 20-day time period in which the award must be paid does not begin to run until the award ...


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