291 F. Supp. 3d 1318
S.D. Fla.2017Background
- A&M Gerber Chiropractic (Plaintiff) sued GEICO seeking a declaratory interpretation of a sentence in GEICO's FLPIP (01-13) PIP endorsement: "A charge submitted by a provider, for an amount less than the amount allowed above, shall be paid in the amount of the charge submitted."
- The endorsement references fee schedules (e.g., 200% of Medicare Part B) and also states the insurer will pay 80% of medical benefits; dispute centers on whether the 20% coinsurance applies when a provider bills less than the fee-schedule amount.
- Plaintiff (assignee of insured Carruthers) submitted charges lower than the applicable 200% Medicare-based fee; GEICO paid 80% of billed amounts (applying coinsurance), leaving Plaintiff unpaid for what it contends the policy requires.
- GEICO defended on multiple fronts: (1) the M608 (01-13) notice/form is an endorsement affecting interpretation; (2) class rep adequacy/standing based on an alleged exhaustion/EMC issue and on alleged conduct by Plaintiff; (3) statutory language and policy formatting support a mandatory 20% coinsurance.
- Court found M608 (01-13) is a notice (not part of the policy endorsements), Plaintiff had standing and was an adequate class representative, and the disputed sentence in the FLPIP endorsement is ambiguous and construed against GEICO.
- Court granted Plaintiff partial summary judgment: when a provider bills less than 200% of the fee schedule, GEICO must pay the full billed amount (100%), subject to class members still proving individual entitlement and without foreclosing GEICO's other defenses in separate proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Plaintiff is an adequate class representative / member of the certified class | Gerber had a valid assignment and falls within the class as defined; no requirement to submit the assignment with the claim | GEICO: Gerber didn’t submit the assignment with the claim, so is not a class member; also alleged credibility issues | Denied: Plaintiff is a class member and adequate; GEICO’s timeliness and merits-focused credibility attack fail under Rule 23(a) analysis |
| Standing / jurisdiction (EMC/exhaustion defense) | Plaintiff: has standing to seek declaratory relief; case concerns policy interpretation, not recovery of benefits now | GEICO: Carruthers lacked EMC determination so policy limit was $2,500; Gerber overpaid and thus has no injury and no justiciable controversy | Denied as to standing: court treats GEICO’s argument as an affirmative defense (exhaustion), not a lack of Article III standing; Plaintiff has standing to litigate interpretation |
| Whether M608 (01-13) is an endorsement (part of the policy) | Plaintiff: M608 is a notice sent to comply with statutory notice requirements, not an endorsement altering policy terms | GEICO: M608 was attached and titled as a "Fee Schedule Endorsement" and therefore should be read into the policy | Court: M608 is a notice, not an endorsement; policy Declarations did not list M608, it lacks amendment language/signature, OIR guidance was permissive, so M608 does not alter policy terms |
| Interpretation of disputed provision: does 20% coinsurance apply when billed amount is less than fee-schedule amount? | Gerber: the sentence requires payment of the billed amount when it is less than the amount allowed above (i.e., less than 200% Medicare) — insurer must pay 100% of billed amount | GEICO: policy adopts statutory framework; the 80% reimbursement/20% coinsurance applies to all charges; the disputed sentence is indented under the 80% paragraph and thus limited by it | Court: provision is ambiguous; construing ambiguity against insurer, held that if a provider bills less than 200% of the fee schedule, GEICO must pay 100% of the billed amount (no automatic 20% reduction) |
Key Cases Cited
- Busby v. JRHBW Realty, Inc., 513 F.3d 1314 (11th Cir. 2008) (describing Rule 23(a)(4) adequacy two-part inquiry)
- Valley Drug Co. v. Geneva Pharm., Inc., 350 F.3d 1181 (11th Cir. 2003) (class representative adequacy principles)
- Amgen Inc. v. Conn. Ret. Plans & Tr. Funds, 568 U.S. 455 (2013) (courts should not resolve merits when deciding class certification)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary judgment standard; "genuine issue for trial")
- Mills v. Foremost Ins. Co., 511 F.3d 1300 (11th Cir. 2008) (insurance coverage/contract interpretation is not a standing defect)
- Kingsway Amigo Ins. Co. v. Ocean Health, Inc., 63 So.3d 63 (Fla. 4th DCA 2011) (insurer cannot unilaterally ignore policy payment language even where statute is incorporated)