ORDER
THIS CAUSE сame before the Court on Defendants, State Farm Mutual Automobile Insurance Company and State Farm Fire and Casualty Company’s (collectively “State Farm[’s]) Motion to Dismiss (“Motion”) [ECF No. 12], filed March 25, 2011. 1 The Court has considered the parties’ written submissions and applicable law.
I. BACKGROUND 2
This putative class action was filed by Plaintiff, Central Magnetic Imaging Open MRI of Plantatiоn, Ltd. (“CMI”), as assignee of three separate insured persons (collectively the “Insureds”).
(See
2d Am. Compl. ¶ 1 [ECF No. 26]). CMI seeks to recover for breach of contract by State Farm “for failing to pay the proper amounts for Magnetic Resonance Imaging (“MRI”) services” provided by CMI.
(Id.
¶ 1). CMI, as an MRI service provider,
Plaintiff brings this action on behalf of itself and “all other entities or persons who provided MRI services to Insureds covered by PIP policies issued by Defendants pursuant to Florida’s No Fault Insurance Law, who received an assignment of insurance benefits, and whose bills were paid based upon the OPPS fee schedule and/or the multiple diagnostic imaging rule.... ” (Id. ¶ 9). Plaintiff is unsure of the “precise number of members оf the Class,” and this may only be determined through discovery. (Id. ¶ 11). The class, however, “includes hundreds of people, and is so numerous that joinder of all members is impracticable.... ” (Id.).
The Insureds had contracts — insurance policies — with State Farm that obligated State Farm to pay for the Insureds’ MRIs. (See id. ¶ 2). State Farm’s payments were to be calculated based on the schedule of fees contained in Florida Statutes sections 627.736(a)(2)(f) and 627.736(5)(a)(3), which were incorporated into the contracts. (See id.). “Those fees are based upon 80% of 200% of the participating provider fee schedule of Medicare Part B” for the year when services are rendered, and the fees include “the proviso that such amount shall not be less than 80% of 200% of the amount allowable under the 2007 participating provider fees schedule for Medicare Part B.” (Id.). Because the insurance policies were sold in Florida, the policies were subject to Florida Statute sections 627.730 through 627.7405. (See id. ¶ 20).
CMI alleges State Farm is in breach of the contracts and is in violation of Florida Statute section 627.736. (See id. ¶ 3). It contеnds State Farm improperly calculated payment by incorporating what is known as the Medicare Multiple Diagnostic Imaging Rule(“MMDIR”), resulting in underpayments. (See id.). As a result of “Defendants’] refusal to properly calculate the payment,” Defendants did not properly reimburse it for MRI services. (Id.).
With respect to the three specific cases at issue, the Insureds wеre in separate car accidents that resulted in personal injuries, requiring medical services. (See id. ¶¶ 18, 21). The Insureds were covered by mandatory Florida Motor Vehicle No-Fault Insurance policies issued by State Farm. (See id. ¶ 16). The Insureds’ polices provided that State Farm would cover PIP benefits for “reasonable” medical services that were “related оr necessary as a result of an automobile accident.” (Id. ¶ 19). After their accidents, the Insureds received “reasonable, related and medically necessary MRI services” from Plaintiff. (Id. ¶ 22). Following the MRIs, the Insureds assigned their rights to receive payments and benefits to CMI in consideration for receiving the MRIs. (See id. ¶ 24).
After the Insureds assigned their benefits to CMI, CMI timely submitted its bills to State Farm fоr payment. (See id. ¶ 25). CMI “complied with all conditions precedent to obtaining payment of no-fault benefits from Defendants.” (Id. ¶ 26). After submitting the claims for payment, State Farm paid $1,432.86 on each claim. (See id. ¶ 27). While Defendants’ payments were supposed to be based on the statutory fee schedules, Defendants “failed to pay the Plaintiff 80% of 200% of the participating prоvider fee schedule of Medicare Part B for the year in which the services were rendered.” (Id.). “Instead the Defendants improperly paid a portion of the bill based upon application of the Medicare Multiple Diagnostic Imaging Rule----” (Id.). Furthermore, because Defendants paid pursuant to the policies, Defendants conceded thе MRIs are reimbursable. (See id. ¶ 28).
Plaintiff states three claims — one for breach of contract, one for unjust enrichment, and one for declaratory and injunc
CMI’s second claim, for unjust enrichment, is alleged in the alternativе to the breach-of-contract claim. (See id. ¶ 40). CMI alleges that by failing to fully pay on the claims, State Farm deprived Plaintiff of moneys owed to it, and State Farm was then unjustly enriched. (See id. ¶¶ 41-42). “Defendants cannot lawfully reduce coverage for the benefits and services provided to their PIP insurance contracts and are not lawfully entitled to keep the monies duе and owing to Plaintiff and the Class.” (Id. ¶ 43). CMI concludes “it would be inequitable for Defendant to retain the monies due and owing Plaintiff and the Class.” (/¿¶ 44).
The third claim, seeking injunctive and declaratory relief, seeks to answer the question whether Defendants may apply the MMDIR. (See id. ¶ 47). Without an injunction, Plaintiff alleges it and class members “will be subjected to irreparable harm by way of continued unlawful reductions in reimbursements thereby requiring the continuous need to file legal action regarding such reductions.... ” (Id. ¶ 50). This may lead to Plaintiff and class members being “discouraged from providing needed care to persons insured under Florida Personal Injury Protection policies.” (Id.).
State Farm has now moved to dismiss the Second Amended Complaint under Federal Rule of Civil Procedure 12(b)(6).
II. LEGAL STANDARD
“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ”
Ashcroft v. Iqbal,
When reviewing a motion to dismiss, a court must construe the complaint in the light most favorable to the plaintiff and take the factual allegations therein as true.
See Brooks v. Blue Cross & Blue Shield of Fla., Inc.,
A. Florida’s PIP Statute
Since 1971, Florida has had a No-Fault Law, “a comprehensive statutory scheme, the purpose of which is to ‘provide for medical, surgical, funeral, and disability insurance benefits without regard to fault, and to require motor vehicle insurance seeming such benefits.’ ”
Allstate Ins. Co. v. Holy Cross Hosp., Inc.,
Florida Statute section 627.736 contains the requirements for PIP bеnefits. Insurance policies shall provide personal injury protection for injuries “arising out of the ownership, maintenance, or use of a motor vehicle....” Fla. Stat. § 627.736(1). The PIP statute sets up a “unique” system, “abolishing] a traditional common-law right by limiting the recovery available to car accident victims” in exchange for making “PIP insurance compulsory and аllowing] recovery regardless of fault.”
State Farm Mut. Auto. Ins. Co. v. Nichols,
The parties address various subsections of section 627.736(5). Subsection (5) contains “strict guidelines for both PIP insurers and medical providers, including how and when charges must bе submitted and benefits paid.”
Allstate Ins.,
State Farm “elected to make payment in accordance with a schedule of fees” from Florida Statute section 627.736(5)(a)(2)(f) and Florida Statute section 627.736(5)(a)(3). (2d Am Compl. ¶2). Section 627.736(5)(a)(2)(f) allows insurers to limit their reimbursement to 80 percent of:
200 percent of the allowable amount under the participating physicians schedule of Medicare Part B. However, if such services, supplies, or care is not reimbursable under Medicare Part B, the insurer may limit reimbursement to 80 percent of the maximum reimbursable allowance under workers’ compensation, as determined under s. 440.13 and rules adopted thereunder.... Services, supplies, or care that is not reimbursable under Medicare or workers’ compensation is not required to be reimbursed by the insurer.
Fla. Stat. § 627.736(5)(a)(2)(f). Section 627.736(5)(a)(3) then sets
the applicable fee schedule or payment limitation under Medicare [as] the fee schedule or payment limitation in effect at the time the services, supplies, or care was rendered and for the area in which such services werе rendered, except that it may not be less than the allowable amount under the participating physicians schedule of Medicare Part B for 2007 for medical services,supplies, and care subject to Medicare Part B.
Fla. Stat. § 627.736(6)(a)(3).
The final provision at issue, Florida Statute section 627.736(5)(a)(4), restricts insurers’ ability to apply limitations on “the number of treatments” or “other utilization limits that apply under Medicare”:
Subparagraph 2. does not allow the insurer to apply any limitation on the number of treatments or other utilization limits that apply under Medicare or workers’ compensation. Am insurer that applies the allowable payment limitations of subparagraph 2. must reimburse a provider who lawfully provided care or treatment under the scope of his or her liсense, regardless of whether such provider would be entitled to reimbursement under Medicare due to restrictions or limitations on the types or discipline of health care providers who may be reimbursed for particular procedures or procedure codes.
Fla. Stat. § 627.736(5)(a)(4). Plaintiff contends that under this subsection, “the [Florida] Legislature intended to рrohibit additional reimbursement reductions, like the [MMDIR] reduction State Farm is utilizing to further reduce” Plaintiffs reimbursements. (Mot. Opp’n 7).
B. Reasonableness
Defendants assert that because reasonableness is a fact-based inquiry, the problem of individualized proof makes a class action inappropriate. (See Mot. 9-13). Furthermore, they state the reasonableness inquiry is for the trier of fact to determine on a case-by-case basis. (See id.).
The PIP statute allows for many considerations when determining whether a particular charge is “reasonable”:
With respect to a determination of whether a charge for a particular service, treatment, or otherwise is reasonable, consideration may be given to evidence of usuаl and customary charges and payments accepted by the provider involved in the dispute, and reimbursement levels in the community and various federal and state medical fee schedules applicable to automobile and other insurance coverages, and other information relevant to the reasonableness of the reimbursement for the service, treatment, or supply.
Fla. Stat. § 627.736(5)(a)(l).
The reasonableness inquiry may indeed be inappropriate for a class action. But this concern is irrelevant when considering the sufficiency of the pleading. Moreover, Plaintiff has removed the reasonableness question from consideration as it stipulates the calculations of the reimbursement аmounts were reasonable. (See Mot. Opp’n 7-8). Plaintiff only challenges State Farm’s “additional reductions” under the MMDIR. (Id. 8). Nevertheless, Defendants insist this is still, ultimately, a reasonableness inquiry and is ill-suited for a class action. (See Reply 2-6 [EOF No. 35]).
Defendants’ argument is unavailing. Plaintiff is not challenging the amounts State Farm reimbursed. Instead, it is challenging the use of the MMDIR itself. Under Plaintiffs theory, State Farm is liable for breach of contract simply by applying the MMDIR in violation of section 627.736(5)(a)(4), no matter the reimbursement amount. At the class-certification stage, the parties may address whether this is appropriate for a class action.
In arguing that the reasonableness determination is not proper for a class action, insisting it must be determined on a case-by-case basis, Defendants essentially concede thаt Plaintiff states a claim on which relief may be granted. (See Mot. 9-13; Reply 3-6). The breach of contract claim may proceed.
Second, State Farm maintains that Plaintiff may not seek restitution based on unjust enrichment as an alternative claim because Plaintiff may only sue under an insurance policy. (See Mot. 15-16).
A PIP suit seeks “to recover damages for breach of аn insurance contract.”
Nichols,
A party may only recover under an unjust enrichment theory when there is no valid express or implied-in-fact contract.
See Zarrella v. Pac. Life Ins. Co.,
Finally, unjust enrichment may only be pleaded in the alternative where one of the parties asserts that the contract governing the dispute is invalid.
See Zarrella,
D. Declaratory and Injunctive Relief
Defendants assert the third claim, for declaratory and injunctive relief, must also be dismissed. They maintain that because dаmages are an adequate remedy at law, there is no basis for declaratory or injunctive relief. (See Mot. 14-15). Plaintiff contends that the contract claim and the declaratory and injunctive relief claim have different goals. (See id. 13). It asserts the claim of breach seeks to remedy past wrongs, while the declaratory and injunctive relief claim is to “resolvе the issue for future cases.” (Id.).
“It is well-settled that ‘equitable relief is available only in the absence of an adequate remedy at law.' ”
SME Racks, Inc. v. Sistemas Mecanicos Para, Electronica, S.A.,
Here, there is an adequate legal remedy — damages for breach of contract.
See id.
at 504 (“Here, the district court properly determined that there are various forms of alternative relief available to the Appellants, namely damages for breach of contract.”). Existing legal remedies will adequately “vindicate” Plaintiffs rights should Defendants be found liable.
Id.
Additionally, “[declaratory relief is not available where the issue is whether an unambiguous contract has been breached.”
MRI Assocs. of St. Pete, Inc. v. State Farm Mut. Auto. Ins. Co.,
IV. CONCLUSION
For the foregoing reasons, it is
ORDERED AND ADJUDGED that the Motion [ECF No. 28] is GRANTED in part and DENIED in part. 3
DONE AND ORDERED.
Notes
. This case comprises three consolidated cases — 11-20857, 11-20861, and 11-20992.
. The allegations of Plaintiff’s Second Amended Complaint are taken as true.
. Defendants request the Court order the parties to mediate. (See Reply 7). The Court has already done so in the Scheduling Order. (See [ECF No. 31]).