Quality Psychological Servs., P.C. v. GEICO Ins. Co.
| Decision Date | 16 August 2010 |
| Docket Number | No. 02097/08.,02097/08. |
| Citation | 28 Misc.3d 1221,2010 N.Y. Slip Op. 51423,957 N.Y.S.2d 638 |
| Parties | QUALITY PSYCHOLOGICAL SERVICES, P.C., a/a/o Donald Burton, Plaintiff, v. GEICO INSURANCE COMPANY, Defendant. Quality Psychological Services, P.C., a/a/o Juana Berroa, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Cesar Alverez, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o John Acosta, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Alexander Rios, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Mario Diaz, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Akuoko Dartey, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Johanna Reyes–Castillo, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Yosef Abramov, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Robert Finley, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Mujtaba Qureshi, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Marik Abayev, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Michael Ackah, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Keith Forrester, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Jeffrey Fortune, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Vanessa Dingee, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Gary Faber, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Stella Barker, Plaintiff, v. Geico Insurance Company, Defendant. Quality Psychological Services, P.C., a/a/o Emmanuel Delrosario, Plaintiff, v. Geico Insurance Company, Defendant. |
| Court | New York Civil Court |
OPINION TEXT STARTS HERE
Melissa Betancourt, Esq., Brooklyn, for plaintiff.
Kylie A. Higgins, Esq. of the Law Offices of Teresa M. Spina, Woodbury, for defendant.
In an action to recover assigned first party no-fault benefits, defendant seeks leave to amend its answers, strike the notices of trial, and compel discovery, including a deposition. It also seeks to consolidate all nineteen (19) captioned actions. Plaintiff opposes the order to show cause.
Defendant argues that plaintiff fraudulently billed for medical services it allegedly rendered to its assignors.1 Though defendant admits that it did not deny plaintiff's bills on the basis of fraudulent billing, it maintains that it has a cause of action to recover benefits paid under a theory of fraud or unjust enrichment.2 Defendant therefore seeks leave to amend its answers to interpose counterclaims for fraud and unjust enrichment.
Upon such amendment, defendant argues that the notices of trial and certificates of readiness for the captioned actions must be vacated, and the matters stricken from the trial calendar because discovery, including a deposition is warranted with respect to plaintiff's billing practices. Defendant also seeks consolidation of the captioned actions, arguing that discovery on its counterclaims for fraud and unjust enrichment involve common questions of law and fact.
In opposition, plaintiff asserts that it responded to defendant's discovery demands and defendant fails to indicate how depositions would provide more relevant information than the responses and documentation previously provided. Plaintiff further alleges that leave to amend the answers must be denied because defendant did not submit an affidavit from a qualified individual with personal knowledge of the subject claim. It argues that the affidavit from Ellen Dargie, a supervisor in defendant's medical billing unit, who prepared a spreadsheet of the bills plaintiff submitted to defendant for the years 2007 and 2008, does not affirmatively state that plaintiff engaged in fraudulent billing. Finally, plaintiff contends that defendant is attempting to set forth a defense that it is precluded from asserting.
Pursuant to CPLR § 3025(b), a party may amend its pleading at any time by leave of the Court. See N.Y. CPLR § 3025(b); Murray v. City of New York, 43 N.Y.2d 400, 401 N.Y.S.2d 773 (1977); Cornell Med ., P.C. v. Mercury Cas. Co., 24 Misc.3d 58, 884 N.Y.S.2d 558 (App.Term, 2d Dept.2009); Perini Corp. v. City of New York (Honeywell Street and Queens Blvd. Bridges), 27 Misc.3d 813, 897 N.Y.S.2d 860 (Sup.Ct. N.Y. County 2010). Leave shall be freely given provided the proposed amendment is not palpably insufficient or patently devoid of merit. See Thomas Crimmins Contr. Co. v. City of New York, 74 N.Y.2d 166, 544 N.Y.S.2d 580 (1989) (); Kuslansky v. Kuslansky, Robbins, Stechel and Cunningham, LLP, 50 AD3d 1101, 858 N.Y.S.2d 212 (2d Dept.2008); Lucido v. Mancuso, 49 AD3d 220, 851 N.Y.S.2d 238 (2d Dept.2008) (); Uptodate Med. Servs, P.C. v. State Farm Mut. Auto. Ins. Co., 23 Misc.3d 42, 879 N.Y.S.2d 695 (App. Term, 2d, 11th & 13th Jud. Dists. 2009) (“The court must examine the merits of the cause of action or defense to be asserted in the proposed amendment since leave to amend should not be granted where the cause of action or defense to be asserted is totally without merit or is palpably insufficient as a matter of law.”).
In the no-fault context, a healthcare provider shall receive payment for services rendered to patients whose injuries arise from covered motor vehicle accidents. The insurance carrier has 30 days from the date of receipt of the claim to pay or deny it in whole or in part. See11 NYCRR 65–3.4; New York & Presbyterian Hosp. v. Progressive Casualty Ins. Co., 5 AD3d 568, 774 N.Y.S.2d 72 (2d Dept.2004); Jesa Medical Supply, Inc. v. American Transit Ins. Co., 905 N.Y.S.2d 842, 2010 N.Y. Slip Op. 20231 (Civ Ct. Kings County 2010). The law requires a claim for no-fault benefits to be timely and properly denied. See Careplus Med. Supply, Inc. v. Selective Ins. Co. of Am., 25 Misc.3d 48, 890 N.Y.S.2d 258 (App.Term, 2d Dept.2009). In other words, “all bases that an insurer has for denying a no-fault claim, except for specific and limited exceptions, must be raised in a timely denial.” Lincoln General Ins. Co. v. Alev Medical Supply, Inc., 25 Misc.3d 1019, 887 N.Y.S.2d 490 (Dist. Ct., Nassau County 2009). See also Fair Price Medical Supply Corp. v. Travelers Indem. Co., 10 NY3d 556, 860 N.Y.S.2d 71 (2008); PDG Psychological P.C. v. Utica Mut. Ins. Co., 11 Misc.3d 128(A), 815 N.Y.S.2d 496 (App. Term, 2d & 11th Jud. Dists. 2006) (An untimely denial precludes an insurance carrier from raising most defenses at the trial.); Devonshire Surgical Facility v. GEICO, 14 Misc.3d 1208(A), 836 N.Y.S.2d 484 (Civ.Ct., N.Y. County 2006); Alev Medical Supply, Inc. v. Progressive Ins. Co., 27 Misc.3d 1220, 2010 N.Y. Slip Op. 50813(U) (Dist. Ct., Nassau County 2010) (An insurance carrier is precluded from asserting any “precludable” defense not asserted in a timely denial.). Fraudulent billing is precluded as a defense unless it is raised in a timely denial. See Fair Price Med. Supply Corp., 10 NY3d at 564–565;Careplus Med. Supply, Inc., 25 Misc.3d at 49 (); M.G.M. Psychiatry Care, P.C. v. Utica Mut. Ins. Co., 12 Misc.3d 137(A), 824 N.Y.S.2d 763 (App. Term, 2d & 11th Jud. Dists. 2006) (Fraud defense whether premised on fraudulent billing, excessive medical treatment or otherwise is subject to the preclusion sanction.).
Herein, defendant's counterclaims for fraud and unjust enrichment are palpably insufficient and patently devoid of merit because the claims were not denied on the grounds of fraudulent billing. They were paid in part and denied in part based upon medical necessity and the charges not being in accordance with the fee schedule. Further, the denials were submitted for the first time in defendant's reply papers, without an affidavit attesting that the denials were timely mailed to plaintiff pursuant to a standard office practice or procedure. See Rengifo v. City of New York, 7 AD3d 773, 776 N.Y.S.2d 865 (2d Dept.2004) (); Fair Price Med. Supply v. Liberty Ins. Co., 12 Misc.3d 145(A), 824 N.Y.S.2d 762 (App. Term, 2d & 11th Jud. Dists. 2006) (Defendant failed to establish a timely denial via an affidavit by one with personal knowledge that the denial of claim form was timely mailed or an affidavit containing a sufficiently detailed description of standard office mailing procedure to...
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