MONMOUTH MEDICAL CENTER, a/s/o MICHAEL ANNUCCI, Plaintiff-Respondent,
STATE FARM INDEMNITY COMPANY, Defendant-Appellant. SAINT BARNABAS MEDICAL CENTER, a/s/o PAUL HAM, Plaintiff-Respondent,
STATE FARM INDEMNITY COMPANY, Defendant-Appellant.
Submitted December 17, 2018
appeal from the Superior Court of New Jersey, Law Division,
Morris County, Docket Nos. L-2482-17 and L-0126-18.
Gregory P. Helfrich & Associates, attorneys for appellant
(Alison Leonard Schlein, on the briefs).
Celentano Stadtmauer & Walentowicz LLP, attorneys for
respondent Monmouth Medical Center (Steven Stadtmauer and
Megan Elizabeth Verbos, on the brief).
Celentano Stadtmauer & Walentowicz LLP, attorneys for
respondent Saint Barnabas Medical Center (Kristen
Ottomanelli, on the brief).
Judges Messano, Gooden Brown and Rose.
these back-to-back appeals, which we consolidate for the
purpose of issuing a single opinion, defendant State Farm
Indemnity Company (State Farm) seeks our review of two Law
Division orders that vacated decisions rendered by a dispute
resolution professional (DRP) pursuant to the Alternative
Procedure for Dispute Resolution Act (APDRA), N.J.S.A.
2A:23A-1 to -30. Because N.J.S.A. 2A:23A-18(b) bars any
"further appeal or review" of such trial court
orders, we dismiss the appeals.
A-3004-17, the record reveals that Michael Annucci was
injured in an automobile accident on June 21, 2013. As a
result of the injuries sustained in the accident, on April
30, 2015, Annucci received out-patient hospital services,
including surgical and ancillary support services, from
Monmouth Medical Center (Monmouth). Following Annucci's
discharge, Monmouth billed State Farm, Annucci's no-fault
insurance carrier, for its services in the total amount of
$21, 403.80. On the bill, Monmouth separately itemized its
charges, line-byline, in accordance with the Medicare Claims
Processing Manual. Thus, Monmouth separately billed for the
surgical services and the ancillary services, consisting of
anesthesia, recovery room services, supplies, and drugs
provided to Annucci.
Farm approved payment in the amount of $5707.80, representing
Monmouth's line item charges for the surgical services
only. In two separate Explanation of Benefits (EOB)
statements, State Farm explained that it processed the bill
in accordance with the New Jersey Hospital Outpatient
Surgical Facility (HOSF) fee schedule, the Consumer Health
Network (CHN) Preferred Provider Organization (PPO) contract,
and the New Jersey medical fee schedule. According to State
Farm, the ancillary services that were separately itemized on
Monmouth's bill were integral to the surgical procedure,
were bundled into the HOSF fee schedule facility rate, and
were not permitted to be reimbursed separately in an HOSF
Monmouth's internal appeal of the underpayment was
rejected by State Farm, Monmouth demanded arbitration
pursuant to the APDRA.Following a hearing, on August 14, 2017,
the assigned DRP issued an award denying Monmouth's
claims. The DRP found that Monmouth was "not entitled to
any further . . . medical expense benefits" and State
Farm properly excluded the ancillary services billed
separately by Monmouth. In the decision, relying on the
regulations promulgated by the Department of Banking and
Insurance (DOBI), the DRP initially acknowledged that it was
"uncontroverted" that the unpaid ancillary services
were, in fact, included in the list of covered services
authorized in N.J.A.C. 11:3-29.5(a). Further, the DRP found
"it noteworthy" that "the aggregate of the
charges invoiced by [Monmouth did] not exceed the HOSF fee
schedule rate assigned to the [applicable] primary procedure
according to the DRP, under N.J.A.C. 11:3-29.5(b),
HOSF fee encompassed all the covered services, including the
ancillary services, reimbursable for outpatient procedures
"provided in [an] HOSF setting." Because N.J.A.C.
11:3-29.5(b) "precluded" reimbursement for
separately billed "ancillary services provided in
support of the primary surgical procedures[, ]" it
"operate[d] as a regulatory preclusion" to any
other billing methodology. Acknowledging the "conflict .
. . between the preclusionary provisions" of N.J.A.C.
11:3-29.5(b) and "the Medicare billing requirements
cited by [Monmouth, ]" the DRP explained that "DOBI
[was] presumed to be aware of such Medicare billing
requirements" and "could have permitted the
invoicing of ancillary services in such instances."
However, in the absence of "an appropriate exemption . .
. inserted into N.J.A.C. 11:3-29.5(b) to permit the billing
practices employed by [Monmouth]," the DRP concluded
that "State regulations [took] precedence over the
Monmouth's application to the DRP for modification of the
award was denied, Monmouth filed a verified complaint and
order to show cause pursuant to N.J.S.A. 2A:23A-13(a) and
Rule 4:67-1(a), seeking to vacate the award on the
ground that the DRP violated N.J.S.A. 2A:23A-13(c)(3) and
(c)(5). Specifically, in the complaint, Monmouth alleged the
DRP "commit[ed] prejudicial errors when he imperfectly
executed his power and erroneously applied law to the issues
and facts presented." Monmouth sought a modified award,
entering judgment against State Farm for $12, 535.02,
together with attorneys' fees and costs.
oral argument, on February 5, 2018, Judge David H. Ironson
issued an order, vacating the arbitration award and entering
a modified award in favor of Monmouth in the amount of $14,
107.23. The judge then confirmed the modified award in
accordance with ...