Government Employees Insurance Co., et al., Respondents,v.Avanguard Medical Group, PLLC, Appellant.

Brief

N.Y.February 10, 2016

To be Argued by: CHARLES MICHAEL (Time Requested: 30 Minutes) APL-2015-00130 Nassau County Clerk’s Index No. 16313/11 Appellate Division-Second Department Docket No. 2013-02277 Court of Appeals of the State of New York GOVERNMENT EMPLOYEES INSURANCE CO., GEICO INDEMNITY CO., GEICO GENERAL INSURANCE CO. and GEICO CASUALTY CO., Plaintiffs-Respondents, - against - AVANGUARD MEDICAL GROUP PLLC, Defendant-Appellant. BRIEF FOR DEFENDANT-APPELLANT CHARLES MICHAEL Of Counsel BRUNE & RICHARD LLP Appellate Counsel for Defendant- Appellant One Battery Park Plaza New York, New York 10004 Tel.: (212) 668-1900 Fax: (212) 668-0315 CORPORATE DISCLOSURE STATEMENT Avanguard Medical Group PLLC is affiliated, by common ownership, with Metropolitan Medical and Surgical Group, P.C. Avanguard Medical Group PLLC has no other affiliates, and has no parent or subsidiary companies. TABLE OF CONTENTS INTRODUCTION ..................................................................................................... 1 QUESTION PRESENTED FOR REVIEW .............................................................. 3 JURISDICTION ......................................................................................................... 4 BACKGROUND ....................................................................................................... 5 The Parties ....................................................................................................... 5 Surgery Providers Under New York Law ....................................................... 5 New York’s No-Fault Insurance Law ............................................................. 8 Reimbursement of Facility Fees Under the No-Fault Laws ............................ 9 Resolving Disputes Under the No-Fault Laws ..............................................12 Prior Rulings on the Issue Presented .............................................................13 Trial Court Proceedings .................................................................................14 The Second Department’s Ruling..................................................................15 DISCUSSION ..........................................................................................................17 I. The No-Fault Laws Allow Office-Based Surgery Providers to Recover Facility Fees .....................................................17 A. Facility Fees Fall Within the Broad Statutory Definition of “Basic Economic Loss” ......................................17 B. The “Catch-All” Regulation Covers Facility Fees ...................20 C. Allegations that Office-Based Surgery Providers Face Lighter Regulation than Other Providers Are Irrelevant ..........22 D. The Second Department’s Preference that the Issue Be Decided by Lawmakers Reflects Question-Begging Logic .....23 II. The Arguments GEICO Raised but That the Second Department Did Not Adopt Are Meritless .............................24 - ii - A. The Regulation Barring Recovery By Providers Failing to Meet Applicable Licensing Requirements Is Irrelevant Here ..24 B. The Regulatory Documents GEICO Cites Are Irrelevant ........25 C. Efforts to Amend the No-Fault Laws Have No Bearing On the Meaning of Current Law ...........................27 CONCLUSION ........................................................................................................29 - iii - TABLE OF AUTHORITIES CASES Akita Med. Acupuncture, P.C. v. Clarendon Ins. Co., 41 Misc. 3d 134(A), 2013 WL 6038388 (1st Dep’t App. Term 2013) .........20 Ava Acupuncture P.C. v. ELCO Admin. Servs. Co., 10 Misc. 3d 1079(A), 2006 WL 286854 (N.Y. Civ. Ct. 2006) .....................20 Burke v. Crosson, 85 N.Y.2d 10 (1995) ........................................................................................ 5 Clark v. Cuomo, 66 N.Y.2d 185 (1985) ....................................................................................28 Forrest Chen Acupuncture Servs., P.C. v. GEICO Ins. Co., 54 A.D.3d 996 (2d Dep’t 2008) .....................................................................20 Gov’t Employees Ins. Co. v. Avanguard Med. Group PLLC, 2012 WL 2154984 (N.Y. Sup. Ct. June 1, 2012) ............................. 14, 15, 25 Gov’t Employees Ins. Co. v. Avanguard Med. Group, PLLC, 125 A.D.3d 803 (2d Dep’t 2015) ...................................................................16 Gov’t Employees Ins. Co. v. Avanguard Med. Group, PLLC, 127 A.D.3d 60 (2d Dep’t 2015) ....................................................................... 4 Great Wall Acupuncture, P.C. v. Geico Gen. Ins. Co., 8 Misc. 3d 1019(A), 2005 WL 1792759 (N.Y. Civ. Ct. 2005) .....................20 Kingsbrook Jewish Med. Ctr. v. Allstate Ins. Co., 61 A.D.3d 13 (2d Dep’t 2009) ......................................................................... 6 Matter of Rosenblum (Gov’t Employees Ins. Co.), 41 N.Y.2d 966 (1977) ....................................................................................12 Montgomery v. Daniels, 38 N.Y.2d 41 (1975) ........................................................................................ 8 N.A.A.C.P. v. Am. Family Mut. Ins. Co., 978 F.2d 287 (7th Cir. 1992) .........................................................................28 - iv - Okslen Acupuncture P.C. v. Travco Ins. Co., 44 Misc. 3d 135(A), 2014 WL 3899547 (1st Dep’t App. Term. 2014) ........20 Patterson v. McLean Credit Union, 491 U.S. 164 (1989).......................................................................................28 State Farm Mut. Auto. Ins. Co. v. Robert Mallela, 4 N.Y.3d 313 (2005) ......................................................................................22 Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc 3d 1219(A) (N.Y. Dist. Ct. 2012) ....................................................14 VS Care Acupuncture v. State Farm Mut. Auto. Ins. Co., 46 Misc. 3d 141(A), 2015 WL 792408 (1st Dep’t App. Term. 2015) ..........20 Walton v. Lumbermens Mut. Cas. Co., 88 N.Y.2d 211 (1996) ...................................................................................... 8 STATUTES N.Y. Ins. L. § 5102(a)(1) ................................................................................. passim N.Y. Ins. L. § 5106(b) ..............................................................................................12 N.Y. Ins. L. § 5108(a) ................................................................................................ 9 N.Y. Ins. L. § 5108(b) ................................................................................................ 9 N.Y. Pub. Health L. § 230-d ......................................................................... 3, 5, 7, 8 N.Y. Pub. Health L. § 2801(10) ................................................................................. 5 RULES AND REGULATIONS 10 NYCRR § 405.1 .................................................................................................... 6 10 NYCRR § 405.11 .................................................................................................. 6 10 NYCRR § 405.12 .................................................................................................. 6 10 NYCRR § 405.19 .................................................................................................. 6 10 NYCRR § 405.2 .................................................................................................... 5 - v - 10 NYCRR § 405.25 .................................................................................................. 6 10 NYCRR § 405.4 .................................................................................................... 5 10 NYCRR § 709.5(b)(1) .......................................................................................... 6 10 NYCRR § 755.1 .................................................................................................... 6 10 NYCRR § 755.2(a) ............................................................................................... 6 10 NYCRR § 755.7 .................................................................................................... 6 10 NYCRR § 755.8 .................................................................................................... 6 10 NYCRR § 86-4.40...............................................................................................27 10 NYCRR Part 405 .................................................................................................. 7 10 NYCRR Part 446 ..............................................................................................6, 7 10 NYCRR Part 755 ..............................................................................................6, 7 11 NYCRR § 65-3.16(a)(12) ...................................................................................24 11 NYCRR § 65-4.10...............................................................................................12 11 NYCRR § 68.5 ............................................................................................ passim N.Y. CPLR § 5601(a) ................................................................................................ 4 N.Y. CPLR § 7511 ...................................................................................................12 OTHER AUTHORITIES 2007 Sess. Law News of N.Y. Ch. 365 (S. 6052-A) ................................................ 7 N.Y. Bill Jacket, 2007 S.B. 6052, Ch. 365 ..........................................................7, 19 N.Y. Ins. Dep’t Gen. Counsel Op. 04-10-03 ...........................................................19 INTRODUCTION The Second Department announced an interpretation of New York’s “no-fault” insurance laws that is not only contrary to the plain statutory language at issue, but that, if allowed to stand, will substantially limit the treatment choices of car accident victims and wreak havoc on the nearly 1,000 office-based surgery providers in New York that will no longer be able to recoup the full costs associated with treating car accident injuries. The decision should be reversed. New York’s no-fault laws require insurers to cover customers (and certain others) injured in car accidents, regardless of fault, for up to $50,000 of “basic economic loss,” which is defined to include “[a]ll necessary expenses” for “medical . . . services.” N.Y. Ins. L. § 5102(a)(1). Car accident victims sometimes require surgery, which is of course a necessary medical expense. Surgery bills typically include both a professional fee to be paid to the surgeon and a “facility fee” to cover separate expenses, such as nurses and equipment, that are routinely incurred by hospitals or other medical facilities where services are performed. The Second Department’s ruling effectively eliminated the second portion of the charge for a broad class of medical providers. It held that office-based surgery providers could not under any circumstances recover any facility fees, even though the same types of expenses would be routinely covered if the same procedures - 2 - were performed in other types of regulated medical settings, such as hospitals or ambulatory surgery centers. The Second Department’s primary rationale for denying reimbursement was the fact that the relevant regulators have adopted fee schedules establishing the maximum amount hospitals and ambulatory surgery centers can recover in facility fees, but have not adopted similar schedules for office-based surgery providers. But the fact that facility fees in general are included in the fee schedules is only further confirmation that these fees, irrespective of the particular provider, fall within the broad statutory language authorizing reimbursement of “[a]ll necessary expenses” for “medical . . . services.” N.Y. Ins. L. § 5102(a)(1) (emphasis added). There is a specific “catch-all” rule in the regulations allowing recovery of fees “not set forth in fee schedules,” 11 NYCRR § 68.5, and that rule is designed for circumstances precisely like this one. That the regulators have not chosen to adopt a particular schedule for office- based surgery providers is hardly grounds to conclude that the legislature or any agency intended to categorically exclude those charges, particularly since office- based surgery providers are a relatively new type of regulated entity. The fee schedule for ambulatory surgery centers has not been updated since 2003 - five years before New York State defined and chose to regulate office-based surgery practices - and thus could not reflect any decision to exclude the charges here. - 3 - The Second Department expressed concern about allowing office-based surgery providers to recover the same level of facility fees as other medical providers that are differently - and perhaps more heavily - regulated, but that concern, even if valid, cannot justify the sweeping rule categorically barring any fees for the significant capital and operating expenses that office-based surgery providers unquestionably incur and that other types of providers routinely recover through facility fees. Recovery of those expenses is essential to making any significant surgical procedure possible, and hence the expenses are “necessary” within the meaning of the statute. At a minimum, office-based surgery providers should be permitted to prove in specific cases the extent to which the claims are recoverable, and, thus, the Second Department’s categorical rule must be reversed. QUESTION PRESENTED FOR REVIEW Whether the “no-fault” insurance laws, which require insurers to cover customers injured in car accidents for “[a]ll necessary expenses” for “medical . . . services,” N.Y. Ins. L. § 5102(a)(1) (emphasis added), up to $50,000, allows office-based surgery providers licensed under N.Y. Pub. Health L. § 230-d to recover “facility fees” - similar to what hospitals and other types of medical providers routinely charge - in order to recoup their costs for nurses, technicians, equipment and other expenses beyond doctors’ professional fees. - 4 - This question was squarely presented by the parties below and is preserved for appellate review. Avanguard opposed summary judgment by arguing that facility fees fall within the statutory language at issue and that the underlying regulations require those fees to be reimbursed. (See, e.g., R. 624-26 ¶¶ 22-26.) JURISDICTION This Court has jurisdiction over the appeal because the Second Department’s ruling “finally determine[d] the action.” N.Y. CPLR § 5601(a). The sole cause of action of the plaintiffs (collectively, “GEICO”) was for a judicial declaration that it was not required to reimburse any facility fees. (R. 558 ¶ 43.) The defendant, Avanguard Medical Group PLLC (“Avanguard”), brought one counterclaim for the opposite judicial declaration (that it was entitled to reimbursement) and another for damages in the amount of the facility fees. (R. 75- 77 ¶¶ 30-42.) 1 The Second Department remanded to the trial court “for the entry of a judgment declaring that the plaintiffs are not required to reimburse the defendant for facility fees as payable first-party benefits under Insurance Law § 5102,” Gov’t Employees Ins. Co. v. Avanguard Med. Group, PLLC, 127 A.D.3d 60, 67 (2d Dep’t 2015), and that ruling is final under CPLR § 5601(a)(1) because it “leaves 1 GEICO also sought an “order staying all pending law suits and arbitrations” by Avanguard against GEICO on the issue, but only sought that relief “pending a final determination of [the] action,” not as a separate cause of action or as a form of final relief. (R. 558.) - 5 - nothing for further judicial action apart from mere ministerial matters.” Burke v. Crosson, 85 N.Y.2d 10, 15 (1995). BACKGROUND The Parties Avanguard is a surgical facility in Brooklyn and an accredited provider of office-based surgery services under N.Y. Pub. Health L. § 230-d. (R. 71 ¶ 5; R. 73 ¶ 17.) Its owner, Dr. Mark Gladstein, is also among the physician owners of Metropolitan Medical and Surgical Group, P.C. (R. 71 ¶ 7.) When Dr. Gladstein performs a surgical procedure at Avanguard, the bill will typically involve two components: a professional fee billed by Metropolitan Medical and Surgical Group, P.C. and a facility fee billed by Avanguard. (R. 621 ¶ 16; R. 518 ¶ 8.) GEICO sells car insurance. (R. 44 ¶ 12.) Surgery Providers Under New York Law New York law regulates three types of surgery providers. The first is a “general hospital,” which is a medical facility “engaged in providing medical or medical and surgical services primarily to in-patients by or under the supervision of a physician on a twenty-four hour basis with provisions for admission or treatment of persons in need of emergency care and with an organized medical staff and nursing service.” N.Y. Pub. Health L. § 2801(10). The regulations concerning general hospitals address, for example, their internal governance, 10 NYCRR § 405.2, staffing and admitting privileges, id. § 405.4, - 6 - infection control, id. § 405.11, surgery training and procedures, id. § 405.12, emergency services, id. § 405.19, and organ and tissue donation, id. § 405.25. See 10 NYCRR § 405.1 (stating Part 405 is applicable only to general hospitals). General hospitals are also required to regularly report detailed information about their finances and operations to the Department of Health. See generally 10 NYCRR Part 446. There are 276 general hospitals in New York State. 2 The second type of surgery provider is an ambulatory surgery center, which provides “those surgical procedures which need to be performed for safety reasons in an operating room on anesthetized patients requiring a stay of less than 24 hours.” 10 NYCRR § 755.1; id. § 709.5(b)(1). The Department of Health first issued regulations defining and governing ambulatory surgery centers in 1985. See generally 10 NYCRR Part 755. Those regulations address, for example, procedures for transferring patients to a general hospital when necessary, 10 NYCRR § 755.2(a), medical records, id. § 755.7, and requirements for emergency medical equipment and staffing, id. § 755.8. In general, the regulations for ambulatory surgery centers, while significant, are much less extensive than those 2 See http://www.health.ny.gov/regulations/hcra/provider/provhosp.htm. Information “derived from official government Web sites may be the subject of judicial notice.” Kingsbrook Jewish Med. Ctr. v. Allstate Ins. Co., 61 A.D.3d 13, 20 (2d Dep’t 2009) (collecting cases). - 7 - pertaining to general hospitals. Compare 10 NYCRR Part 755 with 10 NYCRR Parts 405 and 466. There are 153 ambulatory surgery centers in New York State. 3 The third type of surgery provider is a licensed office-based surgery provider, see N.Y. Pub. Health L. § 230-d, which was defined and regulated for the first time under a law that passed in 2007 and went into effect in 2008. L. 2007, Ch. 365, § 2. The law was aimed an ensuring patients received “the same quality of care, regardless of the setting” i.e., whether in a hospital, an ambulatory surgery center or a surgical office. See N.Y. Bill Jacket, 2007 S.B. 6052, Ch. 365, at 12 (Division of Budget Recommendation); see also id. at 10 (similar statement in State Senate Introducer’s Memorandum in Support). Under the 2007 law, any surgery (except “minor” surgery) performed in New York State involving moderate or more sedation outside of certain hospital-type settings must be done in a licensed, office-based surgery practice setting. N.Y. Pub. Health L. § 230-d(3). Under the regulatory framework, office-based surgery providers must be accredited by a “nationally-recognized” agency chosen by the Department of Health, and must maintain that accreditation. N.Y. Pub. Health L. § 230-d (1)(a). The accrediting agencies establish significant technical and operational requirements for these surgical offices to be accredited, and charge office-based surgery providers significant fees to cover the necessary oversight. (R. 623 ¶ 20.) 3 See http://www.health.ny.gov/regulations/hcra/provider/provamb.htm. - 8 - Office-based surgery providers must report to the Department of Health any “adverse events” and also must report the transmission of certain diseases. Id. §§ 230-d(4)(a). The Department of Health is broadly empowered to “promulgate and enforce” regulations “deem[ed] appropriate . . . to effectuate the purpose” of the office-based surgery law. N.Y. Pub. Health L. § 230-d (5). There are 962 office-based surgery providers in New York State. 4 New York’s No-Fault Insurance Law In 1974, New York adopted a “no-fault” insurance law, N.Y. Ins. L. §§ 5101-5109, requiring insurers to cover their customers (as well as occupants in customers’ cars, pedestrians and certain others) for up to $50,000 in “basic economic loss” resulting from car accidents, “without regard to fault.” Montgomery v. Daniels, 38 N.Y.2d 41, 46 (1975). The purpose of the law was “to remove the vast majority of claims arising from vehicular accidents from the sphere of common-law tort litigation, and to establish a quick, sure and efficient system for obtaining compensation for economic loss suffered as a result of such accidents.” Walton v. Lumbermens Mut. Cas. Co., 88 N.Y.2d 211, 214 (1996). The term “basic economic loss” includes “[a]ll necessary expenses incurred for . . . medical, hospital. . ., surgical, nursing. . . [and] any other professional health services.” N.Y. Ins. L. § 5102(a)(1). The definition goes on to state that 4 See https://www.health.ny.gov/professionals/office-based_surgery/practices/ alphabetical_list.htm#ad - 9 - “basic economic loss” must in all events be consistent “with the limitations” of § 5108 of the Insurance Law, see id., which, in turn, prohibits expenses from “exceed[ing] the charges permissible under the schedules prepared and established by the chairman of the workers’ compensation board for industrial accidents.” N.Y. Ins. L. § 5108(a). Section 5108 also requires the Superintendent of the Department of Financial Services (formerly the Department of Insurance) to adopt regulations governing the no-fault laws, and to adopt fee schedules for services not already covered in the worker’s compensation schedules. Id. § 5108(b). Among the regulations is a “catch all” rule addressing fees for services and other expenses that are “reimbursable under section 5102(a)(1)” but that are “not set forth in fee schedules adopted or established by the superintendent.” 11 NYCRR § 68.5. In those cases, if the Superintendent has adopted a fee schedule specific to the provider, the provider can charge the rate for “comparable” charges on that schedule and, otherwise, the provider may charge the “prevailing fee” in the provider’s locality. Id. Reimbursement of Facility Fees Under the No-Fault Laws Bills for surgical procedures generally have two components: (i) a charge for the medical professional to perform a particular procedure (often referred to as the “professional” component), and (ii) a charge from the facility where the - 10 - procedure is performed for the facility itself and related support services (often referred to as the “technical” component). (R. 621 ¶ 16; R. 518 ¶ 8 (GEICO affidavit distinguishing the two).) For example, in this case, a pair of bills in 2010 for a procedure to reduce neck pain called a “cervical trigger point” injection (among other services) sought $3,630 in professional fees for Dr. Gladstein’s professional corporation (Metropolitan Medical and Surgical Group, P.C.), and $3,500 for Avanguard’s facility fee ($1,200 of which was for the cervical trigger point injection). (R. 544-45; see also R. 519 ¶ 9.) In this and other circumstances, the professional fee is for Dr. Gladstein’s services, and the facility fee is for the surrounding components that make the procedure possible, including nurses, surgical technicians, recovery room expenses, specialized medical equipment, surgical tools and so forth - the same charges that would appear on a bill had the patient been treated at a hospital. (R. 539-40.) Only the technical components of the bills (the “facility fees”) are at issue here. (R. 524-25 ¶ 31.) The Worker’s Compensation Board has adopted specific schedules addressing how much hospitals and ambulatory surgery centers can recover in - 11 - facility fees for particular surgical procedures. 5 There are separate “inpatient” schedules addressing the maximum fees that general hospitals may charge. 6 If Dr. Gladstein had performed the cervical trigger point injection at a hospital or ambulatory surgery center, these schedules would establish how much those facilities would recover under the no-fault laws for the technical component of the services, above and beyond Dr. Gladstein’s professional fee. For example, if Dr. Gladstein had performed the procedure at the Queens Surgical Center or the Brooklyn Plaza Ambulatory Surgery Center, either of those facilities would be able to recover a facility fee of $1,248.44 - more than what Avanguard charged on the bill discussed above. 7 There are no specific fee schedules addressing facility fees for licensed office-based surgery providers, even though the statute requires coverage for “[a]ll necessary expenses” for “medical . . . services,” N.Y. Ins. L. § 5102(a)(1) 5 www.wcb.ny.gov/content/main/hcpp/MedFeeSchedules/afs03memos.pdf (letter establishing 2003 Ambulatory Surgery Fee Schedule) and www.wcb.ny.gov/content/main/hcpp/MedFeeSchedules/2014medfee.jsp (“Ambulatory Surgery Rates for hospital based and free standing ambulatory surgery centers have been frozen at 2003 levels”). 6 http://www.wcb.ny.gov/content/main/hcpp/MedFeeSchedules/InpatientRates Effective0701201412312014.pdf. 7 www.health.ny.gov/facilities/hospital/drg/docs/products_of_ambulatory_surgery_ procedure_codes_2008.pdf (showing that “Injection(s); single or multiple trigger point(s)” is in“PAS” code category “34”) and www.wcb.ny.gov/content/main/ hcpp/MedFeeSchedules/freestan03.pdf at 7-8 (listing fees by facility and PAS code). - 12 - (emphasis added), without distinguishing the type of provider, and notwithstanding that office-based surgery providers plainly incur costs associated with acquiring and maintaining their facilities, hiring personnel, purchasing equipment, providing medical supplies and so forth. (R. 539-40.) The Department of Health has recognized that reimbursement of these fees “is a very significant issue of concern to physician providers of” office-based surgery, and that those providers report it may be “fiscally impossible to make ends meet” without reimbursement of facility fees. 8 Resolving Disputes Under the No-Fault Laws When disputes arise as to whether particular fees are covered by the no-fault laws, the claimant (which, as here, includes a medical provider that has been assigned the claims, see Matter of Rosenblum (Gov’t Employees Ins. Co.), 41 N.Y.2d 966, 966 (1977) (R. 76 ¶ 36)), has the option to pursue either litigation or arbitration. N.Y. Ins. L. § 5106(b). An initial arbitral award may be appealed to a “master arbitrator,” whose ruling may be reviewed thereafter (i) in court, if the award is $5,000 or greater, or (ii) under CPLR Article 75, which limits the review of arbitral awards to narrow grounds such as fraud or partiality of the arbitrator. See N.Y. CPLR § 7511; 11 NYCRR § 65-4.10 (a), (h). Arbitration decisions under 8 https://www.health.ny.gov/facilities/public_health_and_health_planning_ council/meetings/2013-07-17/docs/non_hospital_surgery_paper.pdf, at 10. - 13 - New York’s no-fault laws are available to the public online, and are text- searchable. 9 Prior Rulings on the Issue Presented Prior to the Second Department’s ruling in this case, the issue of whether office-based surgery providers could recover facility fees had arisen thousands of times. A computerized search for decisions with the terms “office-based surgery” and “facility fee” results in over 4,500 hits, including 1,775 in the calendar year 2014 alone. Avanguard’s analysis of those rulings found that, prior to the Second Department ruling, the arbitrators would generally rule the same way on the issue from case to case. Attached as Addendum A is a spreadsheet showing a sampling of their decisions and revealing that, prior to the Second Department’s ruling, the number of arbitrators that consistently allowed office-based providers to recover facility fees was over three times the number that did not allow them: Facility Fee Rulings Lower Arbitrators Master Arbitrators Total Percentage Consistently Allowed 65 3 68 69.4% Consistently Denied 20 2 22 22.4% Rulings Both Ways 6 2 8 8.1% The dominant theme in the rulings allowing recovery of facility fees is that those fees fall within the statutory definition of “basic economic loss,” and that 9 https://nysinsurance.adr.org/action/nofaultnewsearch?init=true. - 14 - nothing in the no-fault laws prohibits their recovery or states (as insurance companies often contend) that surgical facility fees are recoverable only by hospitals and ambulatory surgery centers. And, as one master arbitrator explained, office-based surgery providers “have become an accepted part of the nation’s health care, analogous to the greater use of paramedical treatment,” which is “consistent with the drive for more affordable medical care in situations in which fully staffed centers such as hospitals are not required.” 10 Prior to the Second Department’s ruling, the only two published trial court rulings to address the question had similarly concluded that office-based surgery providers could recover facility fees. See Gov’t Employees Ins. Co. v. Avanguard Med. Group PLLC, 2012 WL 2154984 (N.Y. Sup. Ct. June 1, 2012); Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc 3d 1219(A) (N.Y. Dist. Ct. 2012). Trial Court Proceedings GEICO brought this declaratory judgment action to resolve the question of whether it was required to reimburse Avanguard for facility fees. Its complaint alleges that Avanguard filed 167 arbitrations or lawsuits relating to facility fees against GEICO between June 2010 and September 2011, and that, in addition to 10 https://nysinsurance.adr.org/viewaward?awardId=429684 - 15 - those proceedings, Avanguard had over $700,000 in pending claims against GEICO. (R. 49 ¶ 28.) GEICO moved, by order to show cause, to enjoin preliminarily any pending suits or arbitrations (R. 520 ¶ 14), but the trial court denied the motion because it found GEICO was not likely to succeed on the merits. Gov’t Employees Ins. Co. v. Avanguard Med. Group PLLC, 2012 WL 2154984 (N.Y. Sup. Ct. June 1, 2012). Specifically, the court pointed out that facility fees in general fall “within the definition of ‘Basic economic loss’ as defined by section § 5102(a)(1) of the Insurance Law.” Id. The absence of a specific schedule for those fees did not bar their recovery, the court ruled, because the “catch-all” regulation specified how to calculate the fee under those circumstances. Id. (citing NYCRR § 68.5). GEICO then moved for summary judgment (R. 516-28), but the trial court denied the motion for substantially the same reasons. (R. 510-13.) GEICO appealed to the Second Department. (R. 508-09.) The Second Department’s Ruling The Second Department reversed. Gov’t Employees Ins. Co. v. Avanguard Med. Group, 127 A.D.3d 60 (2d Dep’t 2015). The court issued a broad and sweeping decision holding that, under the no-fault laws, licensed office-based surgery providers could not recover any facility fees under any circumstances. - 16 - Id. 11 The decision noted that there “is no provision in the workers’ compensation schedules expressly providing for payment of facility fees for office-based surgery,” and concluded that the “absence of such a provision supports GEICO’s argument that a facility fee is not a necessary expense.” Id. at 64-65. The court did not otherwise address how facility fees could fall outside the broad statutory language requiring recovery of “[a]ll necessary expenses” for “medical . . . services,” N.Y. Ins. L. § 5102(a)(1). The Second Department next ruled that the “catch-all” regulation allowing for recovery of fees “not set forth in fee schedules,” 11 NYCRR § 68.5, was inapplicable because, the court reasoned, the fees at issue are “set forth in fee schedules” - specifically, those fee schedules for hospitals and ambulatory surgery centers. Id. at 65. In other words, the Second Department apparently read the regulators’ decision to adopt fee schedules for certain types of medical providers as an affirmative decision to reject similar fees for office-based surgery providers. The court did not point to any evidence that any regulators had actually made a determination that facility fees are “necessary” when incurred by one type of medical facility but cease to be “necessary” in another. 11 On the same day, the Second Department denied as moot a separate appeal of GEICO’s motion to preliminarily enjoin Avanguard’s pending actions against it. Gov’t Employees Ins. Co. v. Avanguard Med. Group, PLLC, 125 A.D.3d 803 (2d Dep’t 2015). - 17 - Finally, the Second Department noted that there was “no legislative intent” to treat office-based surgery providers on par with ambulatory surgery centers and hospitals, which are “subject to detailed and extensive requirements governing the establishment, licensing, and operation of facilities.” Id. at 66. The Second Department did not explain why the fact that office-based surgery providers may be subjected to somewhat less regulation means that they should be afforded zero compensation for a nearly identical category of expenses. DISCUSSION I. THE NO-FAULT LAWS ALLOW OFFICE-BASED SURGERY PROVIDERS TO RECOVER FACILITY FEES A. Facility Fees Fall Within the Broad Statutory Definition of “Basic Economic Loss” The overarching flaw in the court’s reasoning was its failure to address the fact that facility fees fit squarely within the plain definition of “basic economic loss,” which broadly includes “[a]ll necessary expenses incurred for . . . medical [and] surgical . . . . services.” N.Y. Ins. L. § 5102(a)(1) (emphasis added). This expansive statutory language is why, prior to the Second Department’s ruling, all the trial courts and a three-to-one majority of arbitrators allowed office-based surgery providers to recover facility fees. In coming to the opposite conclusion, the Second Department seized on the fact that the existing schedules establish the maximum facility fees for hospitals and ambulatory surgery centers but do not address the amount office-based surgery - 18 - providers may charge. 127 A.D.3d at 64-65. The court thereby concluded that facility fees should not be available to office-based surgery providers at all. Id. But the fact that regulators have identified facility fees as recoverable in some long-established settings only confirms that this category of charges falls within the broad statutory language. In other words, if fees for surgical space, nurses, equipment, administrative personnel, medical supplies, and the like are among the “necessary expenses” under N.Y. Ins. L. § 5102(a)(1) in one type of state-regulated medical setting, then there is no reason why those same expenses are somehow unnecessary in another. The no-fault laws specifically contemplate recovery for fees that fit within the statutory language, but that are not addressed in fee schedules. That is precisely why the regulations provide a “catch-all” allowing providers to recover for matters “not set forth in fee schedules,” at either prevailing community rates or rates for similar items that do exist on the schedules. 11 NYCRR § 68.5. That the regulators have not adopted specific schedules for office-based surgery providers is hardly evidence of a conscious choice to categorically exclude them, especially since office-based surgery providers are a relatively new type of regulated health care provider. The Department of Health’s website states that the facility fee schedule for ambulatory surgery centers has been frozen since 2003 12 12 See www.wcb.ny.gov/content/main/hcpp/MedFeeSchedules/2014medfee.jsp. - 19 - - five years before the law relating to office-based surgery providers even went into effect. Whatever regulatory choices were made in 2003 could hardly have been designed to address reimbursement to office-based surgery providers. There is no evidence in the legislative record to suggest that anyone intended office-based surgery providers to be treated differently for purposes of no-fault insurance coverage. If anything, the law defining office-based surgery providers was intended to put those providers on par with hospitals and ambulatory surgery centers, insofar as the law was aimed at ensuring the “same quality of care, regardless of the setting.” N.Y. Bill Jacket, 2007 S.B. 6052, Ch. 365, at 12 (Division of Budget Recommendation); see also id. at 10 (similar statement in State Senate Introducer’s Memorandum in Support). In an analogous context, the courts and the Insurance Department have uniformly concluded that licensed acupuncturists can recover under the no-fault laws, even though fee schedules exist only for acupuncture treatments provided by doctors and chiropractors. See N.Y. Ins. Dep’t Gen. Counsel Op. 04-10-03 (Oct. 6, 2004) (available at http://www.dfs.ny.gov/insurance/ogco2004/ rg041003.htm). 13 Neither the courts nor the Insurance Department concluded that 13 See also VS Care Acupuncture v. State Farm Mut. Auto. Ins. Co., 46 Misc. 3d 141(A), 2015 WL 792408, at *1 (1st Dep’t App. Term. 2015); Okslen Acupuncture P.C. v. Travco Ins. Co., 44 Misc. 3d 135(A), 2014 WL 3899547 (1st Dep’t App. Term. 2014); Akita Med. Acupuncture, P.C. v. Clarendon Ins. Co., 41 Misc. 3d 134(A), 2013 WL 6038388, at *1(1st Dep’t App. Term 2013); Forrest Chen - 20 - the existence of fee schedules for acupuncture performed by doctors and chiropractors was evidence that the regulators intended to exclude those same services performed by acupuncturists. Quite the contrary, the fact that acupuncture in general is on the fee schedules is evidence that it can be a “necessary” medical expense falling within the broad statutory definition of “basic economic loss.” N.Y. Ins. L. § 5102(a)(1). Here, facility fees for surgical procedures in a regulated setting likewise clearly fall within the broad statutory language and should be recoverable, even by providers who are not the subject of specific schedules. B. The “Catch-All” Regulation Covers Facility Fees Because facility fees for office-based surgery providers fall within the broad statutory language, but are not the subject of fee schedules, the specific amount of any recovery is governed by the catch-all regulation in 11 NYCRR § 68.5. The Second Department concluded that the catch-all regulation was “inapplicable, by its own terms,” however, because that regulation covers only matters “not set forth in fee schedules.” 127 A.D.3d at 65 (quoting 11 NYCRR § 68.5). According to the Second Department, facility fees are set forth in the schedules because there exist facility fee schedules for hospitals and ambulatory surgery centers. Id. Acupuncture Servs., P.C. v. GEICO Ins. Co., 54 A.D.3d 996, 997(2d Dep’t 2008); Ava Acupuncture P.C. v. ELCO Admin. Servs. Co., 10 Misc. 3d 1079(A), 2006 WL 286854, at *6 (N.Y. Civ. Ct. 2006); Great Wall Acupuncture, P.C. v. Geico Gen. Ins. Co., 8 Misc. 3d 1019(A), 2005 WL 1792759, at *1 (N.Y. Civ. Ct. 2005). - 21 - The flaw in this analysis is that Avanguard is not claiming to qualify as a hospital or ambulatory surgery center, nor is it seeking to recover under the particular fee schedules for those types of facilities. Avanguard is seeking instead something that indisputably is not addressed in the schedules one way or the other: facility fees as a licensed, office-based surgery provider. The Second Department appears to have mistakenly concluded that Avanguard is attempting to recover fees as if it were an ambulatory surgery center. Specifically, the opinion claims it is “undisputed” that Avanguard billed GEICO using “the existing fee schedule and ‘PAS’ codes” for ambulatory surgery centers. Id. at 65. But that is simply wrong. In fact, Avanguard uses “CPT” codes that are not specific to any type of facility. (R. 175; R. 402 ¶ 5.) “PAS” codes for an ambulatory surgery center refer to numbers, from 1 to 45, that correspond to particular dollar amounts of reimbursement, 14 and Avanguard’s bills do not reference these codes at all. (R. 275.) In any event, even if Avanguard had attempted to bill GEICO as if it were an ambulatory surgery center (which it did not), the Second Department’s decision should still be reversed because its blanket holding - that “a no-fault insurer is not required to pay a facility fee for office-based surgery,” 127 A.D.3d at 62 - goes far beyond those limited circumstances. 14 http://www.wcb.ny.gov/content/main/hcpp/MedFeeSchedules/freestan03.pdf - 22 - The Second Department’s analysis of this point is also inconsistent with the cases and the Insurance Department opinion discussed above concerning acupuncture treatments, all of which applied the catch-all regulation to licensed acupuncturists, notwithstanding that the same treatments existed on the fee schedules for doctors and chiropractors. These authorities are flatly inconsistent with the Second Department’s flawed reasoning. On this point, the Insurance Department’s interpretation of the catch-all regulation should be followed, so long as it is “not irrational or unreasonable,” State Farm Mut. Auto. Ins. Co. v. Robert Mallela, 4 N.Y.3d 313, 321 (2005). At a bare minimum, it was reasonable for the Insurance Department to conclude that the existence of fee schedules for one type of provider does not categorically bar recovery of similar fees by other types of providers not addressed in the schedules. The Second Department’s holding to the contrary should be rejected. C. Allegations that Office-Based Surgery Providers Face Lighter Regulation than Other Providers Are Irrelevant The Second Department expressed concern about allowing office-based surgery providers to recover fees when they are not subject to the same level of “regulatory burdens and costs” as hospitals and ambulatory surgery centers, 127 A.D.3d at 66, but that concern, even if accurate, hardly justifies the sweeping judgment that office-based surgery providers, which are regulated to ensure the same quality of care, are never allowed to recover any fees, as a matter of law. - 23 - The Second Department’s conclusion is particularly inappropriate absent evidence to suggest that expenses associated with providing same or similar procedures in hospitals or ambulatory surgery centers are any different than those of office-based surgery providers. Any surgical provider will have to spend money on, for example, real estate, salaries for nurses and other personnel, medical equipment, recovery rooms and the like, regardless of how the provider is regulated, or what initial regulatory costs were incurred in establishing the facility. Even if it could be shown that office-based surgery providers can operate more cheaply, that can be addressed by judges and arbitrators establishing the extent to which particular fees are “necessary.” N.Y. Ins. L. § 5102(a)(1). There is simply no justification for singling out office-based surgery providers from recovering any fees at all, however, and this Court should therefore reverse. D. The Second Department’s Preference that the Issue Be Decided by Lawmakers Reflects Question-Begging Logic The Second Department ruled that “it is for the Legislature and the Superintendent of Financial Services to determine whether the laws and regulations” allow for facility fees in this context, id. at 66-67, but this statement begs the question by mistakenly assuming that that the Legislature and regulators have not addressed the question already. In fact, the Legislature already did address the issue when it broadly required reimbursement of “all” necessary expenses, N.Y. Ins. L. § 5102(a)(1), and the - 24 - regulators similarly already addressed the issue by adopting a catch-all rule for fees not specifically listed in the schedules, 11 NYCRR § 68.5. While it might be preferable for all involved if the regulators affirmatively establish exactly how much (or how little) of facility fees may be recovered by office-based surgery providers, those concerns have nothing to do with the question of what current law allows. II. THE ARGUMENTS GEICO RAISED BUT THAT THE SECOND DEPARTMENT DID NOT ADOPT ARE MERITLESS GEICO made three arguments, either in the courts below or in opposing Avanguard’s motion for leave to amend, that are not addressed in the Second Department’s opinion. These arguments are meritless and should be rejected. A. The Regulation Barring Recovery By Providers Failing to Meet Applicable Licensing Requirements Is Irrelevant Here The no-fault regulations prohibit recovery for any service performed by a provider who “fails to meet any applicable New York State or local licensing requirement necessary to perform such service in New York.” 11 NYCRR § 65- 3.16(a)(12). GEICO argues that this regulation bars Avanguard’s claims because Avanguard is not licensed as a hospital or ambulatory surgery center. (R. 46 ¶¶ 18- 19.) The obvious flaw in this argument, however, is that the regulation does not require that a provider be licensed as a hospital or ambulatory surgery center. It simply bars recovery if a provider is out of compliance with any licensing - 25 - requirements that are “applicable.” It is undisputed that Avanguard is an accredited office-based surgery provider, and GEICO does not claim that there are any other “applicable” licensing requirements that Avanguard has failed to meet. B. The Regulatory Documents GEICO Cites Are Irrelevant GEICO claims to find support for its position in various opinion letters and similar regulatory documents, but none have any application to the facts here. First, GEICO cites a 2006 opinion letter in which the Department of Health concluded that certain private businesses engaged in “the illegal corporate practice of medicine, illegal fee-splitting,” and “perhaps fraud” should not be allowed to recover “office-based costs.” (R. 55-57.) But that opinion is irrelevant to this case because there is no allegation here that Avanguard’s practices involve any illegal (or even improper) activity. The only question GEICO raises is whether Avanguard can be reimbursed for facility fees. And, as the trial court found, the opinion letter is also irrelevant because it “predates the 2008 enactment” of the office-based surgery law, and does not “address No-Fault reimbursement issues.” Avanguard, 2012 WL 2154984. Second, GEICO cites a 2006 Insurance Department opinion which concluded that pharmacies could not be paid directly under the no-fault laws (as opposed to having the patients reimbursed) because the regulation concerning direct payments applies only to “providers of health care services.” (R. 58-59.) - 26 - The Insurance Department concluded, without any elaboration, that pharmacies do not “provide health care services.” (R. 59.) This opinion has nothing to do with the question here because it was issued before the office-based surgery law, and because there can be no dispute that office-based surgery providers do “provide health care services” - which is why hospitals and ambulatory surgery centers receive direct reimbursement of facility fees for virtually identical services. Third, GEICO has referred to a “Frequently Asked Questions” section of the Department of Health Website,” which states: “Whether a third party insurer will pay a facility fee is a matter of negotiation between the insurer and the [office- based surgery] practice.” (R. 256, 290.) But whether private insurers agree to pay these fees does not address the question of whether reimbursement is required in no-fault cases, where the reimbursement is by statute, not contract. 15 Fourth, in opposing leave to amend, GEICO for the first time cited private opinion letters from the Workers’ Compensation Board stating, unremarkably, that only licensed ambulatory surgery centers could recover, under the workers’ 15 GEICO also refers to the statement on the webpage that Medicare and Medicaid do not “pay a separate facility fee” to office based surgery providers (R. 256, 290), but what Medicare and Medicaid do is likewise irrelevant to the question here. In any event, the reason there is no “separate” fee is because Medicare and Medicaid generally pay more for the professional services performed in office-based settings. See https://www.health.ny.gov/facilities/public_health_and_health_planning_ council/meetings/2013-07-17/docs/non_hospital_surgery_paper.pdf, at 8. The increased professional reimbursement is generally understood to account for the lack of reimbursement for the technical component. - 27 - compensation laws, the facility fees referenced in certain regulations that are specific to ambulatory surgery centers. (GEICO Opp. to Motion for Leave to Appeal, Ex. D (citing 10 NYCRR § 86-4.40).) But Avanguard is not seeking fees under any regulations or schedules applicable to ambulatory surgery centers, nor is it seeking to recover anything under the worker’s compensation laws. In any event, the two letters appear to not have been published anywhere, nor do they even claim to represent the Board’s official position on anything relevant here. Importantly, they state on their face that they are “provided for informational purposes only” and that “No-Fault cases may be subject to differing interpretations.” (Id.) C. Efforts to Amend the No-Fault Laws Have No Bearing On the Meaning of Current Law GEICO has also argued, for the first time in opposing leave to appeal, that the Court should take judicial notice of the fact that there is a proposed bill that would make clear that office-based surgery providers can recover facility fees, but that the legislature has yet to pass that bill. (GEICO Opp. to Motion for Leave to Appeal ¶¶ 42-45.) But this Court has long recognized that “[l]egislative inaction, because of its inherent ambiguity, ‘affords the most dubious foundation for drawing positive inferences’” about statutory interpretation. Clark v. Cuomo, 66 N.Y.2d 185, 190-91 (1985) (citation omitted). This case illustrates the wisdom of that warning. - 28 - First, while GEICO speculates that the legislative proposal is evidence that Avanguard’s supporters recognize they are not “entitled to reimbursement for facility fees” under current law (GEICO Opp. to Motion for Leave to Appeal ¶¶ 42-45), the more obvious reason to propose legislation is to correct the misinterpretation of the law by a portion of the arbitrators and, now, by the Second Department. Second, that the legislature today has not yet acted on the proposal can hardly change what the law meant when a different legislature adopted the statutory language in 1974. Patterson v. McLean Credit Union, 491 U.S. 164, 175n. 1 (1989) (holding that legislative “inaction cannot amend a duly enacted statute”); N.A.A.C.P. v. Am. Family Mut. Ins. Co., 978 F.2d 287, 299 (7th Cir. 1992) (holding that “unsuccessful proposals to amend a law, in the years following its passage, carry no significance”). Third, even if the views of today’s lawmakers were relevant to the question (and they are not), the failure to adopt a specific bill can be based on any number of reasons, including the balance of competing legislative priorities or a belief that this Court will see the Second Department’s error and reverse. ADDENDUM A-1 Addendum A: Table of Arbitration Rulings Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 1/06/14 412013034551 Aaron Maslow No Having been affirmed by two master arbitrators on this issue and not being persuaded by Applicant’s submission and arguments -- past and present --, it is my conclusion of law that Applicant cannot receive No-Fault insurance benefits for providing surgical facility fees. It is not an Article 28 surgical facility service center. This matter was raised by Respondent in a timely-issued denial of claim. I sustain that defense. I also sustain the defense that fees are not in accordance with fee schedule inasmuch as the pertinent fee schedule does not provide for compensation for Applicant. 1/24/14 412013038705 Aaron Maslow No Having been affirmed by two master arbitrators on this issue and not being persuaded by Applicant’s submission and arguments -- past and present --, it is my conclusion of law that Applicant cannot receive No-Fault insurance benefits for providing surgical facility fees. It is not an Article 28 surgical facility service center. I sustain that defense. I sustain the specific defense that fees are not in accordance with fee schedule inasmuch as the pertinent fee schedule does not provide for compensation for Applicant. This overcomes the prima facie case of entitlement to No-Fault compensation initially established by Applicant by stipulation. 5/02/14 412013121518 Aladar Gyimesi Yes If an office based surgery practice provides a valuable service, same is to be encouraged and in this Arbitrator’s judgment equity demands that the WCB Fee Schedule allow for a facility fee relative thereto. Thus, while accreditation alone does not require the payment of a facility fee, in this Arbitrator’s judgment other factors may be present which, in addition to accreditation status, support the payment of a facility fee. Arbitrators sit in equity and are empowered to reach a just result regardless of the technicalities.” Bd of Education, et. al. v. Bellmore- Merrick Central High School District, 39 N.Y. 2d 167, 383 N.Y.S. 2d 242 (1976) (citations omitted). Consequently, after having fully considered all of the documentation submitted by the parties herein, following due deliberation I conclude that all of Respondent’s defenses are lacking in merit. I find that Applicant has sustained its burden of proof relative to its reimbursement request. I award Applicant the total requested sum of $3,500.00, in payment of its facility fee, in connection with the MUA rendered on June 6, 2013. 8/13/14 412014032617 Aladar Gyimesi Yes If an office based surgery practice provides a valuable service, same is to be encouraged and in this Arbitrator’s judgment equity demands that the WCB Fee Schedule allow for a facility fee relative thereto. Thus, while accreditation alone does not require the payment of a facility fee, in this Arbitrator’s judgment other factors may be present which, in addition to accreditation status, support the payment of a facility fee. Arbitrators sit in equity and are empowered to reach a just result regardless of the technicalities.” Bd of Education, et. al. v. Bellmore- Merrick Central High School District, 39 N.Y. 2d 167, 383 N.Y.S. 2d 242 (1976) (citations omitted). Consequently, after having fully considered all of the documentation submitted by the parties herein, following due deliberation I conclude that all of Respondent’s defenses are lacking in merit. I find that Applicant has sustained its burden of proof relative to its reimbursement request. I award Applicant the total amended requested sum of $1,266.65, in payment of its facility fee . . . 10/21/14 412014011313 Alfred Weiner Yes OBS facilities are legally entitled to recover facility fees pursuant to Insurance Law §5102(a)(1) and since these fees were not contained in any fee schedule, they are reimbursable at the prevailing rate in the geographic location of the Provider. Accordingly, Applicant’s amended claim is granted. A-2 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 10/21/14 412013134640 Alfred Weiner Yes OBS facilities are legally entitled to recover facility fees pursuant to Insurance Law §5102(a)(1) and since these fees were not contained in any fee schedule, they are reimbursable at the prevailing rate in the geographic location of the Provider. Accordingly, Applicant’s amended claim is granted. 2/06/14 412013084424 Andrew Horn Yes After careful consideration of the issue, I find that Applicant’s recovery is not barred because it is not licensed under Article 28 of the Public Health Law. However, as both Master arbitrator Godson in the aforementioned case and the court in Upper E. Side Surgical, PLLC v. State Farm Ins. Co., 2012 NY Slip Op 50184(U) (Dist Ct Nassau Cty., Feb. 2, 2012, Murphy, J.), noted, reimbursement is pursuant to Insurance Law section 5102(a)(1) and not “under the ‘facility fee’ schedule” “because it is not an Art. 28 facility”. The court further explained that, since no fee schedule for the disputed service had yet been established, the provider was entitled to be reimbursed “the local geographic prevailing fee.” Id. 10/15/14 412014023934 Andrew Horn Yes Exemplifying the difficulties inherent in reaching a determination on this issue, Master arbitrator Frank G. Godson who had previously decided that unlicensed facilities could be not reimbursed, re-evaluated the issue in NY Premier Medical Practice and State Farm Ins. Co., AAA Case No. 412013018555, AAA Assessment No. 17 911 R 70324 13, noting that, while “(l)egislation has been proposed in the New York Legislature seeking to make clear that an office is entitled to receive a facility fee for office based surgery, … it appears that its purpose is not to change the law but to clarify it”. While recent letters from the Insurance Department have advised that reimbursement was not permissible, Master arbitrator Godson took the letters into consideration before determining, to the contrary, “(i)n the absence of a controlling court decision, … that an OBS is entitled to a facility” After careful consideration of the issue, I find that Applicant’s recovery is not barred because it is not licensed under Article 28 of the Public Health Law. 3/26/14 412013074286 Ann Russo Yes As stated in GEICO v. Avanguard Medical, the regulations do not provide that only Article 28 facilities are entitled to bill for facility fees under Insurance Law §5102(a)(1) or that an OBS entity is precluded from recovering facility fees except pursuant to their specified terms and rate schedules. See Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d. 1219(A), 2012 WL 335774 (District Court, Nassau County 2012). Accordingly, the applicant’s claim is partially granted. 8/18/14 412013134575 Ann Russo Yes As stated in GEICO v. Avanguard Medical, the regulations do not provide that only Article 28 facilities are entitled to bill for facility fees under Insurance Law §5102(a)(1) or that an OBS entity is precluded from recovering facility fees except pursuant to their specified terms and rate schedules. See Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d. 1219(A), 2012 WL 335774 (District Court, Nassau County 2012). Accordingly, the applicant’s claims are granted in this case. 1/30/14 412013054046 Anthony Bianchino Yes Based upon the fact that the Applicant is a certified AAAASF with class C-M standards which complies with New York State Law, 2007/Chapter 365/Section 6530/230-d (a) I find that based upon section 65-3.16 (a) (12) of the No-Fault regulations and Judge Sher’s order the Applicant is entitled to be bill under the No- Fault law for the facility fee. 9/11/14 412014009577 Anthony Bianchino Yes Based upon the fact that the Applicant is a certified AAAASF with class C-M standards which complies with New York State Law, 2007/Chapter 365/Section 6530/230-d (a) I find that based upon section 65-3.16 (a) (12) of the No-Fault regulations and Judge Sher’s order the Applicant is entitled to be bill under the No- Fault law for the facility fee. A-3 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 1/06/14 412013053364 Bernadette Connor Yes The record reveals that Regency Healthcare Medical, PLLC has been accredited by the American Association for the Accreditation of Ambulatory Surgical Facilities (AAAASF) as an Office Based Surgical facility (OBS), pursuant to Section 230-d of the New York Public Health Law. Therefore, Applicant, a properly licensed OBS, can be reimbursed for services it provided as an OBS. See Upper East Side Surgical PLLC v. State Farm Ins. Co., 2012 N.Y. Slip Op. 50184(U) (Dist Ct. Nassau Cty. Feb. 12, 2012). 1/09/14 412013066757 Bernadette Connor Yes As noted above, in AAA Case No. 412013012920, another matter involving the same parties, I considered the question of whether Applicant is entitled to a facility fee. After carefully reviewing the evidence presented, I found that Respondent failed to establish that Applicant should be denied reimbursement for the facility fee because it was not an Article 28 facility. I further found that Applicant was entitled to bill in accordance with similar fees in the geographic location where they conduct business. 2/04/14 412013012440 Bonnie Link No The OBSP rules prohibit the use of a facility by a non-member physician. Avanguard may not be used by non-members. It is not a facility, but is accredited as an “office based surgical” practice. The members of the practice may perform surgical procedures there. It is not entitled to a separate fee for its use. *** Accordingly, after considering all of the evidence and listening to the arguments of the parties, and researching cases and arbitrations awards that have been issued on either side, I find that Applicant is not eligible to recover for the services claimed in this case as it is an office based surgical practice and not a licensed Article 28 Ambulatory Surgery Center and, as such, is ineligible to recover no-fault benefits under the present regulations. 8/22/14 412013161427 Bonnie Link No I have previously decided that OBS practices may not impose facility fees and that this defense is non-precludeable, as it has to do with licensing and accreditation. See, AAA Case #412013005622, which was appealed to Master Arb. Donald T. DeCarlo and recently affirmed (November 20, 2013); AAA Case #412013054862, which was appealed to Master Arb. Victor D’Ammora and recently affirmed (3/7/2014). Avanguard may not bill for a facility fee as it is not a licensed, recognized facility, whether the services are provided by an employee of Avanguard or a provider that is employed by separate entity. 6/25/14 412013071304 Brett Hausthor Yes The court in Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d 1219(A), 2012 WL 335774 (Table, Tex in WESTLAW), Unreported Disposition, 2012 N.Y. Slip Op. 50184 (U), (Nassau Dist. Ct., Feb. 02, 2012) found that there is no requirement in the Regulations that NYS Public Health Law Article 28 licensure is a prerequisite to reimbursement of no-fault benefits for OBS fee services. The accreditation status of Applicant satisfies Public Health Law section 230-D. A-4 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 5/12/14 412013079941 Burt Feilich No I have recently issued an award in the case of Avanguard Medical Group, PLLC a/a/o Eloy S. and Geico Insurance Company, AAA Case # 412013024076, on September 16th, 2013, where I had a change of position and upheld respondent’s defense to the claim premised on the ground that applicant was not a licensed Article 28 Public Health Law ambulatory surgery center and thus it could not sustain a claim for the facility services rendered in that case. I rejected applicant’s argument that it could bill for a facility fee as an office-based surgical practice. It was noted that there are pending several court cases at the appellate level that might eventually lead to a clear cut determination of the viability of applicant’s claim and/or respondent’s defense. Furthermore, I also did not find any lower court decisions submitted by the parties to be controlling as settled law on the issues herein, including the decisions by Judges Murphy and Sher cited above. I find no reason to differ from my award issued within the last year in Avanguard Medical Group, PLLC a/a/o Eloy S. and Geico Insurance Company, AAA Case # 4120130240 with no intervening change in the law. 10/24/14 412013155933 Burt Feilich No Although respondent keeps making submissions after the date it was required to do so, as indicated to the parties at the hearing, I have recently issued an award in the case of Avanguard Medical Group, PLLC a/a/o Eloy S., and Geico Insurance Company, AAA Case # 412013024076, on September 16th, 2013, where I had a change of position and upheld respondent’s defense to the claim premised on the ground that applicant was not a licensed Article 28 Public Health Law ambulatory surgery center and thus it could not sustain a claim for the facility services rendered in that case. I rejected applicant’s argument that it could bill for a facility fee as an office-based surgical practice. In that award I had noted that the parties had each submitted a number of well-reasoned and well-documented recent arbitration awards that were favorable to its position and that the law in this area is not settled, meaning an award in favor of either party could be sustainable upon Master Arbitration review. They both also acknowledge that there are pending several court cases that might eventually lead to a clear cut determination of the viability of applicant’s claim and/or respondent’s defense. Furthermore, I also did not find any lower court decisions submitted by the parties to be controlling as settled law on the issues herein. There is no new substantive evidence submitted by the parties in the instant case that was not submitted by them in the case cited herein. I find no reason to differ from my award issued a short while ago. 4/16/14 412013023276 Camille Nieves Yes At issue is whether applicant, a practice accredited by the AAAASF may be reimbursed for a facility fee for office-based surgery performed on 10/5/12 by Dr. Perdue, a physician also accredited with the AAAASF. Respondent issued a timely denial setting forth a fee schedule defense based on their fee audit and an Article 28 Public Health Law defense based on the fact that applicant is not a licensed Article 28 ambulatory surgery facility but a medical practice performing office-based surgery accredited by the AAAASF. Under these circumstances, I and numerous other arbitrators have deemed there to be no impediment to such reimbursement and decide the issue in accordance with my earlier decisions as well as those of numerous other arbitrators and award the facility fee at issue. A-5 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 9/29/14 412013041868 Camille Nieves Yes There is no requirement in the Regulations that NYS Public Health Law Article 28 licensure is a prerequisite to No-Fault Claims reimbursement. The current applicable law, New York’s Office Based Surgery (OBS) Law passed on July 14, 2007 (Public Health Law Section 230- d), requires merely that an office-based surgery facility must obtain and maintain full accredited status by a national recognized accrediting agency approved by the Commissioner of Health. Here, no claim is made by the Respondent that the applicant provider is not in full compliance with the required registrations, certifications or accreditations to conduct its office-based surgery business under the applicable laws of New York, particularly PHL Section 230-d. 3/27/14 412013041909 Carolynn Terrell- Nieves Yes There is no dispute that applicant PC is an accredited OBS facility and that Drs Han and Kim are licensed physicians and the owners of applicant PC. The only question is whether an OBS facility may be reimbursed for facility fees for injections under the no fault scheme. I find myself in agreement with certain of my colleagues that there is no prohibition against an OBS facility recovering fees for services to no fault patients, and that the fact that an OBS facility is not licensed under Public Health Law Section 28 does not mean that such facility is “unlicensed” for the purposes of no fault reimbursement. 10/06/14 412014034776 Carolynn Terrell- Nieves Yes I find myself in agreement with certain of my colleagues that there is no prohibition against an OBS facility recovering fees for services to no fault patients, and that the fact that an OBS facility is not licensed under Public Health Law Section 28 does not mean that such facility is “unlicensed” for the purposes of no fault reimbursement. 8/15/14 412013134952 Cathryn Ann Cohen Yes I concur with the opinion of Judge Murphy that Applicant is entitled to reimbursement under No-Fault . . . . Without any evidence of prevailing facility fees in the geographic area of the provider when similar services are performed, the appropriate facility fee for these services cannot be determined. Such evidence should indicate not only what geographically similar OBS’s charge for a facility fee for similar services but also what amounts are actually paid by insurers for facility fees for such similar services. Therefore, the claim is dismissed without prejudice to renew upon submission of some evidence on geographic prevailing facility fees for similar services. 10/25/14 412014050234 Cathryn Ann Cohen Yes With respect to whether Applicant is entitled to No-Fault benefits, Applicant acknowledges that it is not listed, registered or certified with the NYS Workers’ Compensation Board as an ASC, nor does it hold itself out as a Public Health Law (PHL) Article 28 facility. However, Applicant asserts that there is no requirement in the regulations that NYS Public Health Law Article 28 licensure is a prerequisite to No-Fault reimbursement. The current applicable law, New York’s Office Based Surgery (“OBS”) Law passed on July 14, 2007 (Public Health Law Section 230-d), requires merely that an office-based surgery facility must obtain and maintain full accredited status by a nationally recognized accrediting agency approved by the Commissioner of Health. Applicant submits proof that it is accredited by the American Association for Accreditation of Ambulatory Surgery Facilities (AAAASF), which under PHL 230-d, is one of the accreditation entities approved by the Commissioner. Also, it appears that there is pending legislation to amend the Insurance Law to codify payments of a facility fee to an OBS. I concur with the opinion of Judge Murphy insofar as Applicant is entitled to reimbursement under No-Fault for a facility fee in connection with the services provided to Assignor. A-6 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 9/30/14 412013077703 Charles Blattberg No “The purpose of the “OBS” statute was to protect recipients of office based surgery by requiring private surgical practices to meet certain standards of care. To reiterate, an “OBSP” is not a facility but rather the private practice of medicine. Accreditation was never intended to elevate the private practice of medicine into the functional equivalent of an Article 28 facility. Article 28 facilities are subject to extensive oversight, and additionally incur surcharges on ambulatory surgery services which private physicians do not have to pay. From an equity point of view it is preposterous that Applicant be permitted to bill for a facility fee which it is not legally entitled to, and to compound the inequity it bills exorbitant rates that even Article 28 facilities (who are required to pay surcharges) would not be entitled to. 10/09/14 412013108584 Charles Blattberg No Accordingly, I join Arbitrators Sloane (412012134075), Maslow (412011066793), Ehrlich (4120111014226), Skelton (412011013205), Sawits (412009044156), Jacob (412010029997), Gallers (412011024746), Talay (412010050899), Bianchino (412011 003869), Moritz (412011022669), Adelson (412011022654), Melis (412001007221), Winning (412011046108), Feder (412012133317), Girolamo (412012137346), Hill (412013035692), Martino (412012084923), Casey (412012142509), Russo (412012015736), Resko (412013011461), Mandiberg (412011034267), Czuchman (412013014772), Peters (412012039869), Adler (412013049382), Feilich (412013024086), Link (412012138801), Rickman (412012129436), O’Grady (412013035792), in determining an OBS cannot collect facility fee 4/01/14 412013083567 Charles Sloane No Until such time as the Department of Health, the NYS Legislature or the DFS initiates legislation or further advice which allows an arbitrator to award reimbursement for such facility fee, provided that the respondent issues a timely denial of claim, preserving the Fee Schedule defense, I will adhere to my earlier decision that same is not automatically reimbursable. 10/23/14 412013132781 Charles Sloane No Until such time as the Legislature allows for an OBS to separately bill for a facility fee for services properly performed upon their facility, I will continue to find that an OBS, although properly licensed to performed office based surgery, is not entitled to an additional fee for the use of the facility. 5/08/14 412013108965 Darren Sheehan Yes Applicant is not authorized to be reimbursed for medical/surgical services it provided to its assignor under the “facility fee” schedule in accordance with The Products of Ambulatory Surgery (PAS) classification systems because it is not an Art. 28 facility. Applicant is, however, entitled to reimbursement under Insurance Law § 5102(a)(a) for the medical/surgical services it provided to its assignor (c.f. Great Wall Acupuncture v. GEICO, 16 Misc.3d 23 (App. Term, 2d Dept., 2007). 9/02/14 412013133013 Darren Sheehan Yes In particular, Respondent argues the following: . . . . 4.) The Applicant has provided no services itself and has instead repeatedly submitted a duplicate bill for the services billed by Metropolitan, adding a recovery room charge. . . . 6.) The Applicant is not a “facility” under the definition of the Department of Health. These issues have previously been before me, see 41-2013108965 and 41- 2013044444. There, as is here, I find no reason to deviate from my previous award which found that Respondent failed to establish that Applicant was not entitled to reimbursement. Next, the issue then turns to the fee charged. A-7 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 3/04/14 412013046710 Debbie Kotin Insdorf Yes The court in Upper E. Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d 1219(A), 950 N.Y.S.2d 494 (Table), 2012 N.Y. Slip Op. 50184(U), 2012 WL 335774 (Dist. Ct. Nassau Co., Terence P. Murphy, J., Feb. 2, 2012), aptly ruled that, while an office-based surgical facility “is not authorized to be reimbursed…under the ‘facility fee’ schedule…because it is not an Art. 28 facility”, it is “entitled to reimbursement under Insurance Law section 5102(a) (1)” at “the local geographic prevailing fee” for the use of its facility.” 5/29/14 412013130984 Debbie Kotin Insdorf Yes Dr. Kim wrote, “Insurance companies routinely attempt to deny me any payment at all, or reimburse my charges at a maximum of $1,226.94, using a formula that is predicated on factoring in Article 28 facilities that perform procedures under PAS code 1. However, my facility is not an Article 28 facility, and my costs are not the same as those incurred by Article 28 facilities…The insurance carrier has never provided me with any information that conflicts with my understanding of the prevailing geographic rate charged by OBS facilities in my region. The insurance carrier has never attempted to negotiate facility fee rates with me, but has instead either denied my fees outright or reimbursed me at a rate that has nothing to do with my practice or other OBS facilities.” After reviewing all of the documents on file in the Electronic Case Folder maintained by the American Arbitration Association and considering the arguments set forth by both sides, I find Applicant is entitled to $1,994.88, the balance billed for the facility fee. 9/24/14 412014010317 Dimitrios Stathopoulos Yes Thus in this instance, I find that the Applicant as an accredited OBS practice is entitled to reimbursement for a facility fee. Notwithstanding same, since office based surgery facility fees have no specific applicable fee schedule, but are similar to services billed under the Products of Ambulatory Surgery Fee Schedule (“PAS”); I find the Respondent showing that the PAS fee schedule for the services rendered herein is $1612.46 is sufficient to establish that this is the fee the Applicant is entitled to. 1/09/14 412013002495 Eileen Casey No I find that OBS accreditation status does not require a third-party insurer to pay a facility fee. Accordingly, Applicant’s claim is denied in its entirety. 10/16/14 412013153949 Eileen Casey No Based on the foregoing, I find the Respondent’s arguments to be persuasive and that only facilities certified under Public Health Law Article 28 as free-standing ambulatory surgery centers are entitled to reimbursement for facility fees under No-Fault insurance coverage and Applicant is not licensed under Article 28. I therefore find that Applicant violated 11 N.Y.C.R.R. § 65-3.16(a) (12), which states that providers of healthcare services are not eligible for reimbursement under Section 5012 (a) (1) of the Insurance Law if the provider fails to meet any applicable New York State or local licensing requirement necessary to perform such service in New York. Accordingly, Applicant’s claim is denied in its entirety. 2/17/14 412013056729 Ellen F. Weisman Yes I find that PHL Article 28 licensure is not a prerequisite to reimbursement for a facility fee under the No-Fault Regulation where the facility at which services were rendered is licensed as an OBS center and accredited by the AAAASF. [See, Upper East Side Surgical, PLLC v. State Farm Insurance Co., 2012 NY Slip Op 50184(U) (Nassau Co., 2/2/12, Murphy, J.).] . . . To find otherwise would essentially bar the use of OBS centers which provide safe and effective delivery of same-day surgical services, often at less cost than entities such as hospitals, which are specifically licensed as PHL Article 28 facilities. 10/05/14 412014011279 Ellen F. Weisman Yes I find that PHL Article 28 licensure is not a prerequisite to reimbursement for a facility fee under the No-Fault Regulation where the facility at which services were rendered is licensed as an OBS center and accredited by the AAAASF. [See, Upper East Side Surgical, PLLC v. State Farm Insurance Co., 2012 NY Slip Op 50184(U) (Nassau Co., 2/2/12, Murphy, J.).] . . . To find otherwise would essentially bar the use of OBS centers which provide safe and effective delivery of same-day surgical services, often at less cost than entities such as hospitals, which are specifically licensed as PHL Article 28 facilities. A-8 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 6/12/14 412013150848 Elyse Balzer Yes The issue of whether an accredited OBS facility (the accreditation of Park was not contested) has been decided by a number of arbitrators, myself included. In fact, in a case involving another carrier, I already ruled on whether applicant Park was eligible to recover no fault fees. That case is Park Slope Medical One Complete Services PC v. State Farm, AAA 412013070070. In that case I found that this accredited OBS facility was allowed to bill and recover no fault fees. That case was appealed and affirmed. The master arbitrator, Norman Dachs, set forth the reasons for affirming my award in his award, AAA Case No 17 991 R 23088 14. … Based on the above, I find that Park, an “OBS” facility, may recover fees for services provided to no fault patients. 10/08/14 412013140997 Elyse Balzer Yes I agree with Judge Sher’s reasoning and find that a duly accredited OBS practice may recover facility fees for services provided to a no fault patient. I do not find respondent’s presentation of various opinion letters from the Workers Compensation Board to be influential in the determination of whether a provider may be reimbursed under the No Fault system. . . . 4/01/14 412012102321 Felix Papadakis Yes Thus far, in countless arbitration hearings, I have seen no evidence that persuades me that the OBS facilities are not entitled to bill for a facility fee. If are found in either a trial or in the legislature to be precluded from doing so, then that shall govern different results. To date, I have been presented with no compelling argument to the contrary. 8/25/14 412013152059 Felix Papadakis Yes Note as well that I have, on numerous occasions, dealt with the issue of whether non Article 28 facilities may bill for the disputed facility fee herein. I find in favor of applicants on this issue and do not require (indeed there is no absolute requirement) of Article 28 licensure in order to be reimbursed for a facility fee. Therefore the defense that the services were performed in office is not accepted. 8/20/14 412013142150 Francisco Cruz No In its discussion of payment to a facility fee in an OBSP setting, the DOH stated, “Accreditation status alone does not require a third party insurer to pay a facility fee. Whether a third party insurer will pay a facility fee is a matter of negotiation between the insurer and the OBS practice. Neither Medicaid or Medicare will pay a separate fee for OBS.” Based on the above and awards by fellow Arbitrators, I deny Applicant’s claim for reimbursement of the disputed fees because it was not a licensed Article 28 Ambulatory Surgery Center or otherwise eligible for recovery under the existing No-Fault Regulation. 10/23/14 412013124279 Francisco Cruz No In its discussion of payment to a facility fee in an OBSP setting, the DOH stated, “Accreditation status alone does not require a third party insurer to pay a facility fee. Whether a third party insurer will pay a facility fee is a matter of negotiation between the insurer and the OBS practice. Neither Medicaid or Medicare will pay a separate fee for OBS.” Based on the above and well-reasoned awards by fellow Arbitrators, I deny Applicant’s claim for reimbursement of the disputed fees because it was not a licensed Article 28 Ambulatory Surgery Center or otherwise eligible for recovery under existing No-Fault Regulation. 9/03/14 412013135179 Frank Marotta Yes After a review of the documents contained in the ECF including various decisions supporting the position of both sides, and the arguments made at the hearing and outlined by the parties in their submission briefs, I find that the Respondent has not presented any evidence that the Public Health Law, Insurance Law or the No-Fault Regulation precludes payment to Applicant for its facility fee. A-9 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 3/21/14 412013041880 Gary Peters No Accordingly, after considering all of the evidence and listening to the arguments of the parties, and researching cases and arbitrations awards that have been issued on either side, I found that Applicant is not eligible to recover for the services claimed in this case as it is an office based surgical practice and not a licensed Article 28 Ambulatory Surgery Center and as such, is ineligible to recover no-fault benefits under the present regulations. 7/25/14 412013124591 Gary Peters No Accordingly, after considering all of the evidence and listening to the arguments of the parties, and researching cases and arbitrations awards that have been issued on either side, I find that Applicant is not eligible to recover for the services claimed in this case as it is an office based surgical practice and not a licensed Article 28 Ambulatory Surgery Center and, as such, is ineligible to recover no-fault benefits under the present regulations. Accordingly, the claim is denied in its entirety. 3/09/14 412013098836 Glen Cacchioli Yes In the case of Upper East Side Surgical, PLLC v. State Farm Insurance Co., 2012 NY Slip Op 50184(U) (Nassau Co. 2/2/12, Murphy, J.) the court held that while an OBS center is not an Article 28 facility, it is entitled to reimbursement under Insurance Law Sec. 5102(a)(1). The absence of a specific code within the fee schedule is not a bar to reimbursement as the PAS code provides a corollary fee which is reasonable. To find otherwise would essentially bar the use of OBS centers which provide safe and effective delivery of same-day surgical services, often at less cost than those facilities which are specifically licensed as PHL Article 28 facilities. 10/07/14 412014010320 Glen Cacchioli Yes Recently, in Upper East Side Surgical, PLLC v. State Farm Ins. Co., supra, the Court considered essentially the same OBS-facility fee issue raised here. The Court noted that the PAS fee schedules were, by their terms, applicable only to Article 28 facilities, but that OBS facilities were nevertheless legally entitled to recover facility fees pursuant to Insurance Law § 5102(a)(1). Since, however, fee schedules applicable to OBS providers had not been issued, the facility rate issue effectively defaulted to the provisions of § 68.5(b) - under which fees would then be payable based on prevailing rates in the involve geographic area. See Upper East Side Surgical, PLLC v. State Farm Ins. Co., supra at 3” Based on the evidence presented at this hearing, the relevant case law and statutes establish that applicant is eligible to charge a facility fee. Accordingly, Applicant’s claim is granted in the amended amount of $1667.03. 3/27/14 412013070173 Glen Wiener Yes Clearly we are not dealing with health insurance plans but these same sentiments, inequities and concerns appear to be creeping into the No-Fault arena. No-Fault coverage has always been much broader than private health insurance coverage. Services like dental care, chiropractic manipulation, massage therapy, psychological testing, and acupuncture treatments are fully covered expenses and unlike health insurance do not require additional endorsements or supplementary coverage for reimbursement. In fact, Respondent does not aver that facility fees in general are not compensable under No-Fault. Rather Respondent argues that only Article 28 Facilities are entitled to reimbursement. This narrow view is not supported by any statute, regulation, published court case, or agency opinion letter. There is no logical reason why these “critical access points for vital, affordable health care services” should not be provided reimbursement under No-Fault. A-10 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 7/25/14 412014004631 Glen Wiener Yes Clearly we are not dealing with health insurance plans but these same sentiments, inequities and concerns appear to be creeping into the No-Fault arena. No-Fault coverage has always been much broader than private health insurance coverage. Services like dental care, chiropractic manipulation, massage therapy, psychological testing, and acupuncture treatments are fully covered expenses and unlike health insurance do not require additional endorsements or supplementary coverage for reimbursement. In fact, Respondent does not aver that facility fees in general are not compensable under No-Fault. Rather Respondent argues that only Article 28 Facilities are entitled to reimbursement. This narrow view is not supported by any statute, regulation, published court case, or agency opinion letter. There is no logical reason why these “critical access points for vital, affordable health care services” should not be provided reimbursement under No-Fault. 7/17/14 412013152959 Greta Boldi Yes Second, I am cognizant of the fact that this very issue has been the subject of multiple, conflicting arbitration decisions. There is admittedly a split amongst my colleagues’ opinions on this issue, and I see no clear consensus either way. However, I am persuaded by several notable decisions of my colleagues including, but not limited to the following: Arbitrator Richard G. Martino’s award in Staten Island Special Surgery and Geico, AAA case number 41201106152; Arbitrator Heidi L. Obiajulu in Upper East Side Surgical, PLLC and Geico, AAA case number 41201101328; Arbitrator Gyimesi in NY Premier Medical Practice PC and State Farm Company, AAA case number 412013014568; arbitrator Jeffrey A. Held’s award in Newkirk Avenue office-based surgical center versus State Farm, AAA case number 412013014348; and Arbitrator Heidi L Obiajulu in Newkirk Avenue Office-Based Surgical Center v. Geico, AAA case number 412013104356. See also, award from Master Arbitrator Frank G. Godson in NY Premier Medical Practice, PC and State Farm Insurance Company, AAA case number 412013018555. . . . Following my review of all of the above mentioned cases as well as numerous others not mentioned specifically herein, I am of the opinion that finding that a mandate exists requiring Public Health Article 28 licensure in order to allow for a facility fee for an accredited OBS would be inappropriate. . . . . 1/28/14 412013081585 Heidi Obiajulu Yes For the reasons and analysis set forth in the linked case, NY Premier Medical Practice, PC and Geico Insurance Company, AAA Case No. 412013050749, AAA Assessment No., 17 991 48815 13, decided by me earlier today, I find that Respondent failed to meet its burden of proof in establishing its defense that Applicant is not entitled to reimbursement of the unlisted service 99499 [“facility services’] performed on March 20, 2013 because it violated NYCRR section 65- 3.16 (12). Also, I find that Respondent failed to demonstrate that only article 28 facilities and hospitals are entitled to reimbursement of “facility services” . . . . 7/14/14 412013029407 Heidi Obiajulu Yes The undersigned has previously decided that an OBS practice is entitled to reimbursement of “facility services,” provided the underlying surgery was performed by an owner or employee of the facility. See Upper Eastside Surgical PLLC and Geico Insurance Co., AAA Case No. 412011015706, AAA Assessment No. 17 991 12299 11 (decided June 7, 2011). My rationale was that Respondent failed to demonstrate that only article 28 facilities/hospitals were allowed to charge for facility services [and] that Public Health Law section 230-d does not prohibit an OBS practice from charging such fee, . . . . A-11 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 2/24/14 412012138634 Henry Sawits Yes Respondent does not claim that Applicant is not properly accredited as a licensed Office Based Surgical Practice or that Applicant’s accreditation is not recognized by New York State and in good standing. Respondent argues that an Office Based Surgical Practice (in essence any Office Based Surgical Practice, not just this Applicant) is not entitled to receive reimbursement for facility fees. Respondent has cited various authorities to support this position . . . . I find that Respondent has not submitted sufficient evidence to sustain any defense it has asserted against this claim for reimbursement. Applicant is, therefore, entitled to reimbursement for this claim in the amended amount of $2,230.62. 8/19/14 412013123053 Henry Sawits Yes For all of the reasons set forth above I agree with Justice Sher that OBS facilities are entitled to separate reimbursement of facility fees. I would add that such reimbursement is dependent upon a finding that the use of a surgical facility was medically necessary for the performance of the underlying procedures and that the underlying procedures were performed by duly licensed health care professionals within the scope of a duly licensed and accredited Office Based Surgical Practice and in accordance with all Department of Health and licensing requirements. None of those issues were raised by Respondent in this case. . . . . 1/14/14 412012129471 Howard Jacob Yes The Respondent also raised an Article 28 defense, namely that the Applicant is not certified under Article 28 of the Public Health Law as an ambulatory surgery center. Counsel argued that this is a Chubb defense and that it can be raised without a denial. I note that under Section 5102(a)(1) of the Insurance Law a provider is not eligible for reimbursement if the provider fails to meet any applicable New York state or local licensing requirement to perform such service in New York. The Applicant concedes that it is not certified under Article 28. Dr. Mark Gladstein and his wife, who is also a physician, are the owners of Avanguard Medical Group, PLLC. Dr. Gladstein is a licensed physician and Avanguard is an accredited office- based surgery practice under Section 230-d of the Public Health Law. There is no licensing issue as to the services that were performed. There is a reimbursement issue as to whether an office-based surgery practice is entitled to bill for a facility fee, in addition to its fee for surgical services. I find that this is not a Chubb defense and I further find that this defense requires a timely denial. Since no denial was issued, the defense is precluded. 10/03/14 412014008952 Howard Jacob Yes I note that under Section 5102(a)(1) of the Insurance Law a provider is not eligible for reimbursement if the provider fails to meet any applicable New York state or local licensing requirement to perform such service in New York. The Applicant concedes that it is not certified under Article 28. Dr. Mark Gladstein and his wife, who is also a physician, are the owners of Avanguard Medical Group, PLLC. Dr. Gladstein is a licensed physician and Avanguard is an accredited office-based surgery practice under Section 230-d of the Public Health Law. There is no licensing issue as to the services that were performed. Nor is there any evidence of fraudulent incorporation. There is a reimbursement issue as to whether an office- based surgery practice is entitled to bill for a facility fee in addition to its fee for surgical services . . . . 8/05/14 412014010974 James Hogan Yes Respondent has not demonstrated that the Applicant is excluded from recovering a facility fee as an unlicensed facility. Based upon applicant’s qualifications as a certified facility by the AAASF, which is an accrediting agency under the regulations of the New York State Department of Health, it is entitled to bill for facility fees. The facility fee is a necessary medical expense under Insurance Law §5102. . . . A-12 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 9/19/14 412013125875 James Hogan Yes Under No-fault, Insurance Law section 5102, if a licensed facility performs a medically necessary service, it is entitled to be paid. If there is no established fee schedule to cover the services of the Applicant, then, as per the Great Wall case, the Respondent may pay the Applicant pursuant to a fee schedule that is already in existence for the services rendered. In the instant case, the Respondent’s position is that since the Applicant is not a licensed ASF, then it is not entitled to be paid at all. I disagree. Currently, there is a dispute within the No-fault community as to whether an OBS is entitled to a facility fee, since it is not an ambulatory surgery facility, as authorized under Article 28 of the Public Health Law. This is the argument made by the Respondent. The Community is awaiting a decision from the Appellate Division which, hopefully, speaks to this issue, thereby resolving a number of cases pending. As to this case, I find that the Respondent’s position is lacking. The Insurance Law clearly states that a licensed entity, providing a medically necessary service, is entitled to be paid. 6/18/13 412012124378 James Skelton Yes Public Health Law Sec. 230- d however allows for office-based surgery facilities (OBSF) provided that they obtain and maintain accreditation by a nationally recognized accrediting agency approved by the Commissioner of Health and that the individual performing services are so accredited. No issue has been raised by the respondent in any of these matters that the services were performed in violation of the aforementioned statutes or regulations 10/23/14 412014010316 Jeffrey Grob Yes The denial issued in response to the billing under consideration is primarily premised on the assertion that the Applicant has not been certified as an Ambulatory Surgery Center and licensed under Article 28 of the Public Health Law. As a consequence, the Respondent maintains that the Applicant is not entitled to a facility fee or procedure room fee. The Applicant, notwithstanding its variant status, nonetheless urges its entitlement to compensation for the service provided. The Respondent’s primary position, with its roots firmly grounded in the Public Health Law, cannot be sustained. (See, Government Empls. Ins. Co. v. Avanguard Med. Group PLLC, 2012 NY Slip Op 31516(U), 2012 N.Y. Misc. LEXIS 2687 [N.Y. Sup. Ct. May 31, 2012]); Upper E. Side Surgical, PLLC v State Farm Ins. Co., 34 Misc. 3d 1219(A) ([N.Y. Dist. Ct.2012]); see also, Matter of Avanguard Medical Group, PLLC v Geico Insurance Company, AAA Case #412014011279 [Weisman, NFA, 10/5/14]) 4/24/14 412013014335 Jeffrey Held Yes I find nothing on this hearing record and/or in any argument made at the hearings to depart from holding in favor of the Applicant on the issue of its entitlement to reimbursement for the services at issue. See also, Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d 1219(A), 950 N.Y.S.2d 494 (Table), 2012 N.Y. Slip Op. 50184(U), 2012 WL 335774 (Dist. Ct. Nassau Co., Terence P. Murphy, J., Feb. 2, 2012); NY Premier Medical Practice, PC/AA and Geico Insurance Company, (Conner, Arb.), AAA 3 case number 412012140306, NY Premier Medical Practice// assignor and Geico Insurance Company, (Jacob, Arb.), AAA case number 412013018876. 7/10/14 412013014348 Jeffrey Held Yes Implicit in my holding is my rejection of the Applicant’s further arguments, as memorialized, in part, in its February 27, 2013 brief. While not wholly unpersuasive, I find that many of the arguments raised therein beg, rather than persuade on the question of entitlement to reimbursement at bar. At the end of the day and consistent with the position that I have taken in prior awards, in the absence of a controlling court decision or legislative and/or regulatory clarification, I decline to find a mandate requiring Public Health Article 28 licensure in order to allow for a facility fee for an accredited OBS. A-13 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 8/01/14 412013119300 Jeffrey Silber No Accordingly, after considering all of the evidence and listening to the arguments of the parties, and researching cases and arbitrations awards that have been issued on either side, I find that I am in agreement with the reasoning of Arb. Brandes, NY Ambulatory & Anesthesia, P.C. v. Geico Insurance Company, AAA 412013104311. That the claim is to be dismissed without predjudice. Arb. Brandes concluded that: “Under the current law, Applicant is correct; it is permitted to charge for a facility fee. And under current law, Respondent may pay the fee. However, also under current law, reimbursements are neither required nor prohibited. (Department of Health Opinion letter Respondent’s Ex 2). Ultimately, what is most convincing here is pending legislation, An act to amend the insurance law, in relation to registration of office-based surgery facilities and payments for the use thereof (proposed bill A7944-2013 (also known as S2944-2013). This pending legislation includes the following statement: “The legislature further finds that while office-based surgery practices are recognized in statute pursuant to the accreditation requirements in section 230-d of the public health law, there is nothing in current law or regulations that specifically identifies accredited office- based surgery entities as facilities entitled to seek reimbursement for facility related costs.” The bill authorizes payments to OBS retroactive to January 18, 2009. Absent legislation authorizing reimbursement for the fee, Applicant’s claim is dismissed without prejudice. While payment may not be ripe at the present moment, it may become ripe for resolution at a later date. 8/05/14 412013108913 Jeffrey Silber No Accordingly, after considering all of the evidence and listening to the arguments of the parties, and researching cases and arbitrations awards that have been issued on either side, I find that I am in agreement with the reasoning of Arb. Brandes, NY Ambulatory & Anesthesia, P.C. v. Geico Insurance Company, AAA 412013104311. That the claim is to be dismissed without predjudice. Arb. Brandes concluded that: “Under the current law, Applicant is correct; it is permitted to charge for a facility fee. And under current law, Respondent may pay the fee. However, also under current law, reimbursements are neither required nor prohibited. (Department of Health Opinion letter Respondent’s Ex 2). Ultimately, what is most convincing here is pending legislation, An act to amend the insurance law, in relation to registration of office-based surgery facilities and payments for the use thereof (proposed bill A7944-2013 (also known as S2944-2013). This pending legislation includes the following statement: “The legislature further finds that while office-based surgery practices are recognized in statute pursuant to the accreditation requirements in section 230-d of the public health law, there is nothing in current law or regulations that specifically identifies accredited office- based surgery entities as facilities entitled to seek reimbursement for facility related costs.” The bill authorizes payments to OBS retroactive to January 18, 2009. Absent legislation authorizing reimbursement for the fee, Applicant’s claim is dismissed without prejudice. While payment may not be ripe at the present moment, it may become ripe for resolution at a later date. 7/25/14 412013144684 Jennifer Zeidner Yes In that regard, I find that the Products of Ambulatory Surgery fee schedule (PAS) should be applied to the instant services, as the Applicant, while not an Article 28 facility, is entitled to recover a facility fee as an office based surgery center under Public Health Law section 230-d. A-14 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 7/25/14 412013161497 Jennifer Zeidner Yes Both parties concede, with regard to the rate of reimbursement, that the Products of Ambulatory Surgery fee schedule (PAS) should be applied to the instant services, as the Applicant, while not an Article 28 facility, is entitled to recover a facility fee as an office based surgery center under Public Health Law section 230-d. (See Upper Eastside Surgical, PLLC v. State Farm Insurance Company, 34 Misc. 3d 1219 (A), 950 N.Y.S. 2d 494 (Dist. Ct. Nassau 2012); Geico v. Avanguard Medical Group PLLC, 2012 N.Y. Misc. LEXIS 2369, NY Slip Op 31331 (U) (Sup. Ct. Nassau 2012).) Thus, at issue in this case is only the appropriate interpretation of the PAS fee schedule to the codes billed. 5/20/14 412013153508 Joanne Andreotta Yes Based upon the fact that the Applicant is a certified AAAASF with class C-M standards which complies with New York State Law, 2007/Chapter 365/Section 6530/230-d (a) I find that based upon section 65-3.16 (a) (12) of the No-Fault regulations and Judge Sher’s order the Applicant is entitled to be bill under the No- Fault law for the facility fee. 1/28/14 412013085083 John O’Grady No The ultimate question is whether the applicant may be reimbursed for facility charges as a “freestanding ambulatory surgery center” as that term is defined in the Regulations entitling applicant to reimbursement under the Workers’ Compensation Fee Schedule. In order to be reimbursed for a “facility fee”, where the amounts of such reimbursement has been established by the New York State Workers’ Compensation Board as one of 45 PAS Rates, a facility must be certified under Article 28 of the New York State Public Health Law. Reimbursement for facility fees can only be made to a facility that qualifies to receive a PAS Rate. In order to qualify to receive a PAS Rate of reimbursement, a facility must be a “free- standing ambulatory surgery center” as defined in the Regulations and licensed under the New York Public Health Law Article 28. Applicant here is not certified under Article 28 as such a surgery center and is not entitled reimbursement of a facility fee. 10/23/14 412013138536 John O’Grady No Because applicant lacks an operating certificate from the State Department of Health, no rates of reimbursement have been calculated by the Department of Health and it cannot receive reimbursement under Workers’ Compensation, meaning it cannot receive compensation under No-Fault. Applicant’s accreditation by the American Association for Accreditation of Ambulatory Surgery Facilities, Inc., (AAAASF) is not sufficient reason to award it compensation for its services as an ambulatory surgical service center. This accreditation is required pursuant to Public Health Law § 230-d, but is a requirement separate and apart from the statutory requirement discussed above with respect to Public Health Law §§ 2801 et seq. 1/18/14 412013023148 John Talay No Pursuant to 11 NYCRR Section 65-3.16 (a) (12), providers of healthcare services are not eligible for reimbursement under Section 5012 (a) (1) of the Insurance Law if the provider fails to meet any applicable New York State or local licensing requirement necessary to perform such service in New York. This is a non- precludable defense that need not be raised in a timely denial. See State Farm V. Mallella, 4 NY3d 313 (2005). In conclusion, I find that applicant has violated Section 230-d of the Public Health Law and is therefore not eligible to receive reimbursement for the services claimed in this proceeding. A-15 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 8/28/14 412013108182 John Talay No Pursuant to 11 NYCRR Section 65-3.16 (a) (12), providers of healthcare services are not eligible for reimbursement under Section 5012 (a) (1) of the Insurance Law if the provider fails to meet any applicable New York State or local licensing requirement necessary to perform such service in New York. This is a non- precludable defense that need not be raised in a timely denial. See State Farm V. Mallella, 4 NY3d 313 (2005). Both sides have submitted in-depth position papers and case law. Respondent has submitted the more persuasive in my opinion. Annexed thereto are cases of both lower and master arbitrator’s that have found that providers seeking a facility fee were ineligible. They reach the same interpretation of the public health law and denied a facility fee to OBS practices that did not have Article 28 license. These arbitrators have decided on several occasions that Article 28 licensing is necessary for the reimbursement of a facility fee.\ 7/11/14 412012131269 Jonathan Hill Yes As to the Respondent’s contention that the Applicant is not entitled to a reimbursement of its claim because only licensed Public Health Law Article 28 facilities are eligible to receive a facility fee, initially I note that three court decisions have recently addressed said contention and all three have held that an OBS facility is in fact entitled to reimbursement under No-Fault Law. See GEICO v. Avanguard Medical Group PLLC, 2012 NY Slip Op31331U (Sup. Ct. Nassau Co. May 5, 2012); GEICO v. Avanguard Medical Group PLLC, 2012NY Slip Op 31516U (Sup. Ct. Nassau Co. May 31, 2012); Upper East Side Surgical v. State Farm Insurance Co., 34 Misc. 3d 1219A (Dist. Ct Nassau Co. 2012). See, Upper E. Side Surgical, PLLC v. State Farm Ins. Co., 2012 NY Slip Op 50184(U) (Dist Ct Nassau Cty., Feb. 2,2012, Murphy, J.) which held that while an office-based surgical facility “is not authorized to be reimbursed ... under the ‘facility fee’ schedule ... because it is not an Art. 28 facility,” it is entitled to reimbursement under Insurance Law section 5102(a) (1) at the local geographic prevailing fee for the use of its facility. . . I am not persuaded by the Respondent’s submission that the Applicant is not entitled to a reimbursement of its claim based on Public Health Law Article 28. 8/20/14 412013153300 Jonathan Hill Yes As to the Respondent’s contention that the Applicant is not entitled to a reimbursement of its claim because only licensed Public Health Law Article 28 facilities are eligible to receive a facility fee, initially I note that three court decisions have recently addressed said contention and all three have held that an OBS facility is in fact entitled to reimbursement under No-Fault Law. See GEICO v. Avanguard Medical Group PLLC, 2012 NY Slip Op31331U (Sup. Ct. Nassau Co. May 5, 2012); GEICO v. Avanguard Medical Group PLLC, 2012NY Slip Op 31516U (Sup. Ct. Nassau Co. May 31, 2012); Upper East Side Surgical v. State Farm Insurance Co., 34 Misc. 3d 1219A (Dist. Ct Nassau Co. 2012). See, Upper E. Side Surgical, PLLC v. State Farm Ins. Co., 2012 NY Slip Op 50184(U) (Dist Ct Nassau Cty., Feb. 2,2012, Murphy, J.) which held that while an office-based surgical facility “is not authorized to be reimbursed ... under the ‘facility fee’ schedule ... because it is not an Art. 28 facility,” it is entitled to reimbursement under Insurance Law section 5102(a) (1) at the local geographic prevailing fee for the use of its facility. . . I am not persuaded by the Respondent’s submission that the Applicant is not entitled to a reimbursement of its claim based on Public Health Law Article 28. 9/09/13 412012132069 Joshua Adler Yes It is undisputed that applicant is an accredited Office Based Surgical Facility (“OBSF”). An OBSF does not require Article 28 certification to collect a facility fee (see Master Arbitration Award of Master Arbitrator Frank G. Godson, AAA Case No. 412012096528, dated 7/10/13; AAA Case No. 412011015706 [Arbitrator Heidi L. Obiajulu, dated 6/7/11]). A-16 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 9/09/13 412013012563 Joshua Adler Yes It is undisputed that applicant is an accredited Office Based Surgical Facility (“OBSF”). An OBSF does not require Article 28 certification to collect a facility fee (see Master Arbitration Award of Master Arbitrator Frank G. Godson, AAA Case No. 412012096528, dated 7/10/13; AAA Case No. 412011015706 [Arbitrator Heidi L. Obiajulu, dated 6/7/11]). 1/09/14 412013040515 Karen Fisher- Isaacs Yes Respondent contends that Avanguard is not entitled to collect a facility fee as it is not Licensed under Article 28 of the Public Health Law. This argument has been previously heard and determined by myself and other Arbitrators -- Arbitrator DiGirolomo AAA case number 412012142517as well as Arbitrator Bianchino in AAA case number 412012140074, Arbitrator Feilich in AAA case number 412013003849, Arbitrator Weissman in AAA case number 412012125151, Arbitrator Martino in AAA case number 412013000518 and by numerous other arbitrators in numerous other awards. All have found that the Applicant is entitled to collect a facility fee. 9/30/14 412013119113 Karen Fisher- Isaacs No In the past, I have awarded Applicant its facility fee. However, in the instant case I am convinced by Respondent’s argument at the hearing and its written submissions that the facts do no warrant such an award. I am now convinced after studying the legislative history and the relevant statutes that it was not contemplated that OBS facilities would be reimbursed for a facility fee. The substantial regulatory and reporting requirements of hospitals and Article 28 facilities are not applicable to OBS facilities. Likewise, OBS facilities are exempt from the statutory surcharge under PHL 2807- j. It is clear that the import of PHL 230-D is patient safety. In the absence of clear legislative intent to the contrary, it seems intuitive that physicians should not be able to charge a facility fee for the use of their own office. 7/10/14 412013142145 Keith Tola Yes I also agree with Arbitrator Horowitz, who has decided this very issue in AAA Case No.: 412012123285. Therein, Arbitrator Horowitz indicated: “At the hearing of this matter, respondent argued that applicant was not a licensed Public Health Law Article 28 facility, and that therefore, it was not entitled to any reimbursement case. This unsupported claim is not persuasive, and is contrary to current case law. See, e.g., Upper East Side Surgical PLLC v. State Farm Ins. Co., 34 Misc.3d 1219(A), NY Slip Op. 50184(U), Dist. Ct. Nassau Co. 2012, and a recent arbitration decision from Arbitrator Stacey Charkey, AAA Case No.: 412011047386. In Upper East Side Surgical, the Court held that while an officebased surgical facility “is not authorized to be reimbursed… Under the facility fee schedule… Because it is not an Article 28 facility,” it is “entitled to reimbursement under insurance law §5102(a)(1).” The court noted that since the insurance department had not established a fee schedule, the provider was entitled to be reimbursed at “the local geographic prevailing fee.” 10/21/14 412014024448 Keith Tola Yes As the Court held in Upper East Side Surgical, PLLC v. State Farm Ins. Co., 2012 NY Slip Op 50184(U) (Nassau County, 2/12/12, Murphy, J.), while an OBS center is not an Article 28 facility, it is entitled to reimbursement under Insurance Law Section 5102(a)(1). The Court noted that since the Insurance Department has not established a fee schedule, the provider was entitled to be reimbursed at “the local geographic prevailing fee.” Id. A-17 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 4/07/14 412013056448 Kenneth Rybacki Yes Respondent contends that only freestanding ambulatory surgery centers licensed pursuant to Article 28 of the Public Health Law may receive a facility fee. The applicant is an office based surgery facility (OBS). Public Health Law Sec. 230-d allows for office-based surgery facilities provided that they obtain and maintain accreditation by a nationally recognized accrediting agency approved by the Commissioner of Health. Respondent raises no issue that applicant was not properly licensed as an OBS. Nor does the respondent allege that applicant was fraudulently licensed which is a nonwaivable defense despite an untimely denial, Midwood Acupuncture P.C. v. State Farm Mutual Automobile Ins. Co., 14 Misc.3d 131(A). Respondent is therefore precluded from raising its defense as there is no proof in the admitted record that the defense was raised within the thirty-day claim- determination period. Applicant is accordingly awarded $1,891.13. 9/19/14 412014042569 Kenneth Rybacki Yes [T]here is currently no fee schedule established for an OBS facility. If the superintendent of insurance has not adopted or established a fee schedule applicable to the provider, then the permissible charge for such service shall be the prevailing fee in the geographic location of the provider subject to review by the insurer for consistency with charges permissible for similar procedures under schedules already adopted or established by the superintendent, 11 N.Y.C.R.R. 68.5. 5/22/14 412013006317 Lester Hill Yes In AAA case number 412013005605, I previously decided in favor of the applicant in which the sole issue was whether the claim by the applicant was entitled to reimbursement for a facility fee for an OBS procedure. I answered that question in the affirmative . . . .I find that the PAS fee schedule, however imperfect, is some evidence of the prevailing fee in the geographic location. Without evidence to the contrary are the applicant, I find that the PAS code amount of $864.40 for the facility fee for the October 11, 2012 procedure is appropriate. 6/14/14 412013123038 Lester Hill No I find from the legislative history and the relevant statutes that it was not contemplated that OBS facilities would be reimbursed for a facility fee. The substantial regulatory and reporting requirements of hospitals and Article 28 facilities are not applicable to OBS facilities. Likewise, OBS facilities are exempt from the statutory surcharge under PHL 2807- j. It is clear that the import of PHL 230-D is patient safety. In the absence of clear legislative intent to the contrary, it seems intuitive that physicians should not be able to charge a facility fee for the use of their own office. 1/16/14 412013033030 Lisa Capruso Yes There is no requirement in the Regulations that NYS Public Health Law Article 28 licensure is a prerequisite to No-Fault Claims reimbursement. The current applicable law, New York’s Office Based Surgery (OBS) Law passed on July 14, 2007 (Public Health Law Section 230-d), requires merely that an office-based surgery facility must obtain and maintain full accredited status by a national recognized accrediting agency approved by the Commissioner of Health. Here, no claim is made by the Respondent that the applicant provider is not in full compliance with the required registrations, certifications or accreditations to conduct its office-based surgery business under the applicable laws of New York, particularly PHL Section 230-d. 10/14/14 412014053273 Lisa Capruso Yes There is no requirement in the Regulations that NYS Public Health Law Article 28 licensure is a prerequisite to No-Fault Claims reimbursement. The current applicable law, New York’s Office Based Surgery (OBS) Law passed on July 14, 2007 (Public Health Law Section 230-d), requires merely that an office-based surgery facility must obtain and maintain full accredited status by a national recognized accrediting agency approved by the Commissioner of Heath. Here, no claim is made by the Respondent that the applicant provider is not in full compliance with the required registrations, certifications or accreditations to conduct its office-based surgery business under the applicable laws of New York, particularly PHL Section 230-d. A-18 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 1/15/14 412013066923 Lori Ehrlich Yes In the absence of any fee schedule applicable to Office Based Surgery Centers, 11 NYCRR 68.5(b) provides that the permissible charge for such service shall be the prevailing fee in the geographic location of the provider subject to review by the insurer for consistency with charges permissible for similar procedures under schedules already adopted or established by the superintendent. Upon careful review of the evidence presented and the arguments of counsel, I find that reimbursement at the PAS rate is both fair and reasonable and consistent with charges permitted for similar procedures pursuant to fee schedules already adopted by the Superintendent. 1/16/14 412013059271 Lori Ehrlich Yes In the absence of any fee schedule applicable to Office Based Surgery Centers, 11 NYCRR 68.5(b) provides that the permissible charge for such service shall be the prevailing fee in the geographic location of the provider subject to review by the insurer for consistency with charges permissible for similar procedures under 3 schedules already adopted or established by the superintendent. Upon careful review of the evidence presented and the arguments of counsel, I find that reimbursement at the PAS rate is both fair and reasonable and consistent with charges permitted for similar procedures pursuant to fee schedules already adopted by the Superintendent. 2/26/14 412013085060 Lucille DiGirolomo Yes Citing to Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc. 3d 1219(A) (Dist. Ct. Nassau County 2012) Judge Sher advised that OBS facilities are legally entitled to recover facility fees pursuant to Insurance Law §5102(a)(1) and since these fees were not contained in any fee schedule, they are reimbursable at the prevailing rate in the geographic location of the Provider. . . . Based on the foregoing, I again find the Respondent’s denial based on the Applicant not being a licensed Article 28 facility cannot be sustained. 5/15/14 412013116452 Lucille DiGirolomo Yes Respondent’s counsel has referred to number 35 of the “Office -Based Surgery (OBS) Frequently Asked (FAQ’s) for Practitioners” which discusses a facility fee. The answer does not prohibit the reimbursement of a facility fee. The answer advises that the Public Health Law “does not address or require reimbursement of an OBS facility fee” and that “[a]ccreditation status does not require a third party to pay a facility fee”. I do not find this dispositive of the issue. Merely answering that there is no requirement to pay is not a ban on reimbursement. This is especially true where, as indicated above, the Courts have found a facility fee is allowed. Therefore, I continue to find the Respondent’s denial based on the Applicant not being a licensed Article 28 facility cannot be sustained. 9/23/14 412013122540 Marcelle Brandes No Clearly legislation, and only legislation will clarify how and when OBSs are to be paid. Absent legislation authorizing payment, Applicant’s claim is dismissed without prejudice. While payment may not be ordered now, it may become ripe for adjudication at a later date. 10/08/14 412014008475 Marcelle Brandes No Only legislation will clarify how and when OBSs are to be paid. Absent legislation authorizing payment, Applicant’s claim is dismissed without prejudice. While payment may not be ordered now, it may become ripe for adjudication at a later date. 1/02/14 412013067787 Marilyn Felenstein Yes While the Arbitrator does concede that Applicant is not a licensed Article 28 facility, there is no requirement under the No - fault regulations that a properly accredited OBS facility must have such licensure to receive reimbursement of its facility services. Respondent cannot point to any provision in the No - fault regulations that expressly provides that an Article 28 license is required for reimbursement of facility services. 7/16/14 412013102427 Marilyn Felenstein Yes After reviewing the entire record and after careful consideration of the arguments After reading the case law relied on by the parties, the Arbitrator finds that a properly licensed OBS facility is entitled to reimbursement of its facility fee provided it can show proper accreditation at the time that the procedure was performed. Respondent has submitted no evidence to demonstrate that in OBS is in eligible to receive reimbursement of its facility fee in the absence of Article 28 licensure. A-19 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 1/02/14 412013032860 Matthew Maroney Yes I find that there is no requirement in the Regulations that NYS Public Health Law Article 28 licensure is a prerequisite to No-Fault Claims reimbursement. The current applicable law, New York’s Office Based Surgery (OBS) Law passed on July 14, 2007 (Public Health Law Section 230-d), requires merely that an office- based surgery facility must obtain and maintain full accredited status by a national recognized accrediting agency approved by the Commissioner of Health. Here, no claim is made by the respondent that the applicant provider is not in full compliance with the required registrations, certifications or accreditations to conduct its office-based surgery business under the applicable laws of New York, particularly PHL Section 230-d. 1/02/14 412013049529 Matthew Maroney Yes There is no requirement in the Regulations that NYS Public Health Law Article 28 licensure is a prerequisite to No-Fault Claims reimbursement. The current applicable law, New York’s Office Based Surgery (OBS) Law passed on July 14, 2007 (Public Health Law Section 230-d), requires merely that an office-based surgery facility must obtain and maintain full accredited status by a national recognized accrediting agency approved by the Commissioner of Health. 10/10/14 412014025641 Maureen Callahan No Applicant argues that the assignee is a properly formed OBS and entitled to the facility fee . . . . I have listened to the arguments and evaluated the evidence. I find in favor of the respondent, and find that applicant is not entitled to a facility fee for the 8/19/13 procedure. Thus, this award is in favor of the respondent. The claim is denied. 10/24/14 412013147990 Maureen Callahan No It is agreed by the parties that the applicant facility is an OBS facility. Applicant argues that the Article 28 status is a creature of the State, and does not preclude the billing for a facility fee. Applicant argues he is entitled to payment of the facility fee for this OBS, and that the owner, Dr. Zelefsky was the one who performed the MUA. Vigorous arguments were heard with respect to this denial of claim. Applicant argues there is no prohibition for the charge. Applicant argues that the assignee is an accredited OBS facility and entitled to payment of a facility fee. Respondent argues to the contrary. I look to the Department of Health’s, frequently asked questions (0/2013 FAQ35) which addresses this issue. “The Public Health Law, Section 230 - D does not require the reimbursement of in OBS facility fee. Accreditation status does not require a third-party insurer to pay a facility fee. An OBS practice is not a health care facility under PHL Article 28 or as defined by PHL Sec18. Neither Medicaid or Medicare pays a facility fee to private physician’s offices for officebased surgery. The Department of Health does not establish the schedules for billing guidelines for office-based surgery.” 9/04/14 412013077308 Melissa Melis Yes Applicant argues that they are entitled to reimbursement for the facility fee even though Applicant is not licensed under Article 28 of the Public Health Law. I agree with Applicant’s argument. See, Upper E. Side Surgical, PLLC v. State Farm Ins. Co., 2012 NY Slip Op 50184(U) (Dist Ct Nassau Cty., Feb. 2, 2012, Murphy, J.) which held that while an office-based surgical facility “is not authorized to be reimbursed ... under the ‘facility fee’ schedule ... because it is not an Art. 28 facility,” it is entitled to reimbursement under Insurance Law section 5102(a)(1) at the local geographic prevailing fee for the use of its facility. 9/04/14 412013076872 Melissa Melis Yes Respondent’s next argument is that Applicant is not entitled to reimbursement since only licensed, freestanding ambulatory surgery centers are eligible to charge a facility fee. The term “licensed” refers to those free standing surgery centers licensed pursuant to Article 28 of the Public Health Law.” Applicant argues that they are entitled to reimbursement for the facility fee even though Applicant is not licensed under Article 28 of the Public Health Law. I agree with Applicant’s argument. See, Upper E. Side Surgical, PLLC v. State Farm Ins. Co., 2012 NY Slip Op 50184(U) (Dist Ct Nassau Cty., Feb. 2, 2012, Murphy, J.) which held that while an office-based surgical facility “is not authorized to be reimbursed ... under the ‘facility fee’ schedule ... because it is not an Art. 28 facility,” it is entitled to reimbursement under Insurance Law section 5102(a)(1) at the local geographic prevailing fee for the use of its facility. A-20 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 8/05/14 412013021342 Michael Achtziger No As stated by Arbitrator Steven Czuchman in his award dated 12/10/13 (412013044524), the Courts have previously rejected Respondent’s position. Government Employees Insurance Co. v. Avanguard Medical Group PLLC, 2012 NY Slip Op Dennis L. Sher, J., May 3, 2012); Upper East Side Surgical PLLC v. Stay Farm Mutual Automobile Insurance Co., 34 Misc 3d 1219(A), 950 NYS 2d 494 (Table), 2012 NY Slip Op 50184(u), 2012 WL 335774 (Dist Ct, Nassau Co., Terrance P Murphy, J., February 2, 2012). In fact, it was on the strength of these two decisions that I recently rendered an Award in Applicant’s favor on this issue, (412013068503). In reaching my decision this date in favor of Respondent, I have carefully reviewed decisions of other Arbitrators and the Courts on this subject. In reversing my own thinking, I find as controlling the Department of Health’s revised (9/2013) Frequently Asked Questions, specifically FAQ 35 which asks: Does OBS accreditation qualify a private OBS practice to receive a “facility fee”?, and states “PHL 230 - D does not address or require the reimbursement of an OBS facility fee. Accreditation status does not require a third party insurer to pay a facility fee. An OBS practice is not a healthcare facility under Article 28 or as defined by PHL 18. Neither Medicaid nor Medicare pays a facility fee to private physicians’ offices for office-based surgery. DOH does not establish fee schedules or going guidelines for OBS”. 10/07/14 412013154474 Michael Achtziger No Respondent denied this bill contending that the provider was not eligible for reimbursement of this fee as it is not a licensed freestanding surgery center pursuant to Article 28 of the Public Health Law. In reaching my determination in favor of Respondent, I refer the reader to my determination and 412013021763 on 3/7/14 which notes a determination of Arbitrator Stephen Czuchman, Esq. dated 12/10/13 (412013044524). In both Awards, Arbitrator Czuchman and I explained that we had reversed prior holdings on this issue based upon the Department of Health’s revised Frequently Asked Questions (9/2013), specifically FAQ 35 . . . . 10/07/14 412013102197 Michael Parsons Yes In Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc. 3d 1219(A) (Dist. Ct. Nassau County 2012) it was held that OBS facilities are legally entitled to recover facility fees pursuant to Insurance Law §5102(a)(1). I am in accord with the decision. 6/4/1014 412013102455 Michael Parsons Yes Citing to Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc. 3d 1219(A) (Dist. Ct. Nassau County 2012) Judge Sher advised that OBS facilities are legally entitled to recover facility fees pursuant to Insurance Law §5102(a)(1) and since these fees were not contained in any fee schedule, they are reimbursable at the prevailing rate in the geographic location of the Provider. Respondent’s counsel has advised that Justice Sher’s determination is currently on appeal to the Appellate Division Second Department. Counsel argues that Justice Sher’s finding is incorrect and should not be followed by this Arbitrator. Currently, Justice Sher’s decision stands as the law of the case on the issue of the Applicant’s ability to charge a facility fee and, as indicated above, I agree with his determination. Even if I did not, I am not inclined to sit as an appellate court. 3/07/14 412013042609 Michael Resko Yes I have also written numerous Awards addressing the issue of Avanguard, a properly accredited OBS, billing and collecting a facility fee for services rendered by Metropolitan. In these previously issued Awards, I have held that both Avanguard and Metropolitan are ineligible to collect no-fault benefits . . . . A-21 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 6/04/14 412013134260 Michael Resko Yes I do not believe there is an absolute prohibition against an OBSP billing for, and collecting a “facility fee” under New York State Insurance Law. I recognize that Medicare and Medicaid will not pay such claims. However, the New York State Department of Health has taken the position that: Practices and third-party reimbursers privately negotiate payment for OBS. An OBSP is not a health care facility (hospital) under PHL Article 28; however, under New York’s OBS laws, third-party reimbursers are neither required to nor prohibited from paying OBSPs “facility” fees. DOH does not establish fee schedules or billing guidelines for OBS. New York State Department of Health letter, dated 05/30/12 (“DOH Letter”). See also, Upper East Side Surgical, PLLC v. State Farm, 34 Misc.3d 1219(A), 2012 WL 335774 (Dist. Ct. Nassau Cty. 2012), which held that under New York State Insurance Law an OBSP is not precluded from collecting a “facility fee” merely because it lacks Article 28 licensure. Accordingly, since lack of Article 28 licensure is Respondent’s only proffered defense to the claim in this action, Applicant must be awarded the amount claimed. 10/27/14 412014050347 Michelle Entin Yes Based upon the facts herein and in accordance with the holdings in Upper E. Side Surgical, PLLC v. State Farm Insurance Co., and GEICO v. Avanguard Medical Group, PLLC, supra, I find that Applicant is not ineligible for reimbursement for the services herein. As such, I find that Applicant is entitled to reimbursement in the amount sought. 10/27/14 412013072732 Michelle Entin Yes In the case of Upper E. Side Surgical, PLLC v. State Farm Ins. Co., 2012 NY Slip Op 50184(U) (Dist Ct Nassau Cty., Feb. 2, 2012, Murphy, J.), the Court found that, while an office-based surgical facility “is not authorized to be reimbursed ... under the ‘facility fee’ schedule ... because it is not an Art. 28 facility”, it is “entitled to reimbursement under Insurance Law section 5102(a)(1).” The Court further noted that, since the Insurance Department had not established a fee schedule, the provider was entitled to be reimbursed at “the local geographic prevailing fee.” Since there was “no proof ... as to the local geographic prevailing fee” and the court declined to utilize the worker’s compensation fee schedules to establish the local prevailing fees, a trial was ordered to resolve the issue. It is further noted that in the Upper E. Side Surgical, PLLC, case, the Court noted that, “The current applicable law, New York’s Office Based Surgery (OBS) Law passed on July 14, 2007 (Public Health Law § 230-d), requires merely that an office-based surgery facility must obtain and maintain full accredited status by a national-recognized accrediting agency approved by the Commissioner of Health. . . . .Based upon the foregoing, I find that Applicant is not ineligible for reimbursement for the facility fee at issue and is entitled to reimbursement for same. 5/02/14 412013100610 Nancy Kramer Avalone Yes In reading this, I find that there was intent for these facilities to be paid from the start and it is the insurers that have “refuse[d] to pay office-based surgery facilities a facility fee”. The legislature, in fact, finds it “inexplicable” that carriers refuse to pay these facility fees. Again I reiterate that it defies logic that an OBS would go through an accreditation process that is both timely and costly and not be able to charge for their services. . . . . 8/08/14 412013140894 Nancy Kramer Avalone No The foregoing suggests that the new OBS law was designed to regulate, for patient safety reasons, the practice of performing surgery in an office based setting. It was not the basis to create a new class of establishments (medical facilities) that can bill, separately, for a ‘facility’ fee in addition to the fees billed for actual surgical procedures performed in a physician’s office (as opposed to a hospital or an ambulatory surgical center). . . . A-22 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 2/24/14 412013047033 Pamela Hirschhorn Yes The DOH letter does not address NoFault reimbursement issues where statutory mandates compel carriers to pay properly reimbursable expenses. See, Insurance Law Sec. 5102 (a) (1). See, also, Government Empls. Ins. Co. v. Avanguard Med. Group, PLLC supra. Moreover, the DOH letter takes the position that facility fees are permissibly recoverable to the extent contractually agreed upon by the parties involved. Accordingly, this arbitrator finds that applicant as an accredited office based surgical facility may recover a facility fee pursuant to Insurance Law Sec. 5102 (a) (1). 8/12/14 412014005811 Pamela Hirschhorn Yes This arbitrator has reviewed the available record and has considered the foregoing case law and arbitration awards and finds that applicant as an accredited office based surgical facility may recover a facility fee pursuant to Insurance Law Sec. 5102 (a) (1).. 6/13/14 412013090113 Paul Israelson Yes Thus, the mere fact that the applicant is not authorized to be reimbursed for the medical/surgical services it provided to the injured person under the “facility fee” schedule in accordance with The Products of Ambulatory Surgery (PAS) classification system because it is not an Art. 28 facility does not mean that the applicant cannot recover payment for its medical services rendered to the injured person. The applicant has provided in the record its accreditation as an “office based surgery” facility by the American Association for Accreditation of Ambulatory Surgery Facilities for the period of June 6, 2012 to June 6, 2013. Pursuant to the above cited ruling in Upper E. Side Surgical, PLLC v State Farm Ins. Co. 34 Misc.3d 1219(A), 2012 WL 335774 (Nassau Cty. District Ct. 2012), because the applicant had full accredited status as an “office based surgery” facility from a nationally recognized accrediting agency approved by the Commissioner of Health, to wit: it was accredited as an “office based surgery” facility by the American Association for Accreditation of Ambulatory Surgery Facilities, Inc. during the period of 6/28/11 to 6/28/12, which included the time period of this claim, the applicant may recover no-fault benefits. Based upon the analysis and determination of Arbitrator John J. Grady in AAA Case No. 412012036586, AAA Assessment No. 17 991 25847 12, the applicant is entitled to payment for the subject medical services in the claimed amount. 8/07/14 412013154046 Paul Israelson Yes Essentially, Arbitrator John J. Grady in AAA Case No. 412012036586, AAA Assessment No. 17 991 25847 12 determined that, absent the applicant providing evidence to the contrary, the PAS code amount is the correct “prevailing fee in the geographic location” of the applicant. This same determination concerning the correct calculation of the facility fee where the facility is not a licensed under the Public Health Law but is accredited by a professional organization such as the American Association for Accreditation of Ambulatory Surgery Facilities, Inc. (which is the case for the within applicant) was also persuasively utilized by Arbitrator Walter R. Winning in AAA case number 412013014839. In that same arbitration matter, Arbitrator Winning determined that the applicant (who is the identical applicant in the within arbitration matter before me) was awarded a facility fee at the Article 28 rate, to wit: $1,266.65 for the subject epidural steroid injection procedure in connection with that arbitration matter, because the Article 28 rate was the “prevailing fee in the geographic location” of the applicant, absent evidence to the contrary submitted by the applicant (which was not submitted in that same arbitration matter). A-23 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 6/13/14 412013085079 Philip Wolf Yes Pursuant to 11 NYCRR 68, (Regulation 83) 68.5, subd. 1(b): If a professional health service is performed which is reimbursable under section 5102(a)(1) of the Insurance Law, but is not set forth in fee schedules adopted or established by the superintendent, and (b) if the superintendent has not adopted or established a fee schedule applicable to the provider, then the permissible charge for such service shall be the prevailing fee in the geographic location of the provider subject to review by the insurer for consistency with charges permissible for similar procedures under schedules already adopted or established by the superintendent. Based on the foregoing, I find that Applicant is entitled to reimbursement for the services it rendered pursuant to the local geographic prevailing fee. 7/07/14 412013102609 Philip Wolf Yes Pursuant to 11 NYCRR 68, (Regulation 83) 68.5, subd. 1(b): If a professional health service is performed which is reimbursable under section 5102(a)(1) of the Insurance Law, but is not set forth in fee schedules adopted or established by the superintendent, and (b) if the superintendent has not adopted or established a fee schedule applicable to the provider, then the permissible charge for such service shall be the prevailing fee in the geographic location of the provider subject to review by the insurer for consistency with charges permissible for similar procedures under schedules already adopted or established by the superintendent. 8/15/14 412013153205 Preeti Priya Yes According to the medical records, the procedures involved sedation and under PHL §230-d (h), the procedures involving sedation are considered OBS. Dr. Perdue performed the procedures at Avanguard which has OBS accreditation. See item #2. I find Dr. Gladstein is an accredited physician within the Avanguard practice and can perform the procedures at Avanguard. Thus, Avanguard is entitled to payment. 9/23/14 412013153205 Preeti Priya Yes According to the medical records, the procedures involved sedation and under PHL §230-d (h), the procedures involving sedation are considered OBS. Dr. Perdue performed the procedures at Avanguard which has OBS accreditation. See item #2. I find Dr. Gladstein is an accredited physician within the Avanguard practice and can perform the procedures at Avanguard. Thus, Avanguard is entitled to payment. 3/04/14 412013038128 Rebecca Feder No In order to qualify to receive a PAS Rate of reimbursement, a facility must be a “free-standing ambulatory surgery center” as defined in the Regulations and licensed under the New York Public Health Law Article 28. Applicant here is not certified under Article 28 as such a surgery center and is not entitled reimbursement of a facility fee.” I agree with Arbitrator Skelton’s analysis and conclusion. I do not find that Applicant here is entitled to reimbursement of their facility fee as they are not an Article 28 licensed facility. 10/02/14 412013152774 Rebecca Feder No In order to qualify to receive a PAS Rate of reimbursement, a facility must be a “free-standing ambulatory surgery center” as defined in the Regulations and licensed under the New York Public Health Law Article 28. Applicant here is not certified under Article 28 as such a surgery center and is not entitled reimbursement of a facility fee.” I agree with Arbitrator Skelton’s analysis and conclusion. I do not find that Applicant here is entitled to reimbursement of their facility fee as they are not an Article 28 licensed facility. A-24 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 6/10/14 412013086976 Regina Anzalone Kurz Yes I therefore find that Applicant’s status as an accredited office-based surgery facility (as indicated in its Certificate from the American Association for Accreditation of Ambulatory Surgery Facilities, Inc.) is sufficient for reimbursement in this matter . . . Although the regulations on which plaintiffs rely contain Workers Compensation-derived “PAS” fee schedules which apply to Article 28 licensed entities (see Insurance Law § 5108(a) and (b); 10 NYCRR §§ 86-4.40, 86-4.1(a), 800.8; 11 NYCRR § 68.1(a)), the regulations do not state that they are applicable to OBS facilities. Similarly, they do not provide that only Article 28 facilities are entitled to bill for facility fees under Insurance Law § 5102(a)(1) or that an OBS entity - or any other No-Fault provider - is precluded from recovering facility fees except pursuant to their specified terms and rate schedules. See Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d. 1219(A), 4 2012 WL 335774(District Court, Nassau County 2012). 9/19/14 412012131579 Regina Anzalone Kurz Yes I therefore find that Applicant’s status as an accredited office-based surgery facility (as indicated in its Certificate from the American Association for Accreditation of Ambulatory Surgery Facilities, Inc.) is sufficient for reimbursement in this matter . . . Although the regulations on which plaintiffs rely contain Workers Compensation-derived “PAS” fee schedules which apply to Article 28 licensed entities (see Insurance Law § 5108(a) and (b); 10 NYCRR §§ 86-4.40, 86-4.1(a), 800.8; 11 NYCRR § 68.1(a)), the regulations do not state that they are applicable to OBS facilities. Similarly, they do not provide that only Article 28 facilities are entitled to bill for facility fees under Insurance Law § 5102(a)(1) or that an OBS entity - or any other No-Fault provider - is precluded from recovering facility fees except pursuant to their specified terms and rate schedules. See Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d. 1219(A), 4 2012 WL 335774(District Court, Nassau County 2012). 7/28/14 412013142296 Rhonda Barry Yes There is nothing in any of respondent’s submission to suggest that the applicant is not in full compliance with the required registrations, certifications or accreditations to conduct its office-based surgery business under the applicable law. Further, the applicant may be entitled to reimbursement under insurance law §5102 (A) (1) for the services provided by its own employees/owner under its own accreditation. See, Upper East Side Surgical, PLLC V State Farm Insurance Company, 2012 NY Slip op 50184 (U), 34 Misc. 3d 1219 (A) (Dist. Ct. Nassau County 2012) 8/26/14 412013141244 Rhonda Barry Yes [A}n OBS practice is entitled to reimbursement provided the underlying surgery was performed by an owner or employee of the facility. See, Upper East Side Surgical PLLC v. State Farm Insurance Company, 34 Misc. 3d 1219 (A), 950 NYS 2d 494 (Dist. Ct. Nassau County 2012); Geico v. Avanguard Medical Group, PLLC, 2012 NY Slip op 31331(U) (Sup. Ct. Nassau 2012). 4/15/14 412013075164 Richard Horowitz Yes As it has in these many, many cases involving these same parties, and these same issues, Respondent has also raised arguments with regard to the providers’ lack of proper accreditation [and] the legality of Applicant’s billing for a facility fee as an office based surgery practice. . . . As this arbitrator has stated before, however, Respondent submits nothing more than legal arguments on all of these issues. Respondent has submitted nothing from any authority that persuasively establishes that Applicant, and/or the physicians who provided these services, did so illegally. 6/13/14 412013089537 Richard Horowitz Yes Based on a review of all the evidence, and the arguments of the parties at the hearing, Applicant’s argument on this issue is persuasive. See, e.g., Geico v. Avanguard Med. Group PLLC, 2012 NY Slip Op. 31516 (U) (Sup. Ct., Nassau County, May 31, 2012); Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d 1219 (A), 2012 NY Slip Op . 50184 (U), Nassau Dist. Ct, February 2, 2012). There are many arbitration decisions in accord. See, e.g., AAA case #412013005565 (Arb. Obiajulu); #412012132443 (Arb. Czuchman), and #412013011912 (Arb. Bianchino). Therefore, Applicant’s claim is granted. A-25 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 1/07/14 412013044728 Richard Kokel Yes It has been noted that the type of medical provider is irrelevant, i.e., ambulatory surgical centers or outpatient hospital facilities. Generally such facilities may bill for their services using PAS grouping codes (see Kenneth J. Munnelly letter from the Workers’ Compensation Board, Office of the General Counsel, dated August 14, 2009). Such reasoning may apply to office-based surgery facilities, since Public Health Law § 230-d) references certification for an office-based surgery facility that obtains/maintains full accredited status by a national-recognized accrediting agency approved by the Commissioner of Health. In view of these factors, such office based facilities may be entitled to recover for the services they rendered, and I find that the Respondent’s Article 28 defense, standing alone, is invalid. 10/20/14 412013155666 Richard Kokel No [I]n a OBS Frequently Asked Questions for Practitioners document (distributed by the Department of Health Office of Professional Misconduct) it was noted that PHL Section 230-d does not address or require reimbursement of an OBS facility fee, that accreditation does not require a third party insurer to pay a facility fee, that an OBS practice is not a health care facility under PHL Article 28 or as defined by PHL Section 18, that neither Medicaid nor Medicare pays a facility fee to private physician’s offices for office-based surgery, and that the DOH does not establish fee schedules or billing guidelines for OBS (see question numbers 12 and 35 in the 9-2013 document). I find the foregoing documentary evidence relevant, in addition to being applicable to NoFault. As such, I find that the Respondent cannot be compelled to reimburse the Applicant for a ‘facility’ fee since they are not eligible to receive such reimbursement. The Applicant’s claim is thereby denied. 10/23/14 412014097995 Richard Martino Yes The No-Fault Law was enacted to and allows for recovery of basic economic loss to “eliminate the vast majority of auto accident negligence suits,” and, concomitantly, to decrease premiums (Governor’s Approval Mem, Bill Jacket, L 1973, ch 13, at 31, 1973 McKinney’s Session Laws of NY, at 2335). Basic economic loss is defined, as pertinent here, as all necessary expenditures incurred for medical and surgical services (Ins Law § 5102[a][1]), with reimbursement limited to the amount permissible under the schedules prepared and established by the chairman of the workers’ compensation board for industrial accidents (Ins Law § 5108[a]). Applicant is not authorized to be reimbursed for the medical/surgical services it provided to its assignor under the “facility fee” schedule in accordance with The Products of Ambulatory Surgery (PAS) classification system because it is not an Art. 28 facility. Applicant is, however, entitled to reimbursement under Insurance Law § 5102(a)(1) for the medical/surgical services it provided to its assignor (c.f. Great Wall Acupuncture v. GEICO Gen. Ins. Co., 16 Misc 3d 23 (App. Tm., 2d Dept, 2007). Applicant is therefore entitled to be reimbursed for the service at issue. 1/13/14 412013065060 Richard Martino Yes There is no dispute that Applicant is accredited to provide free-standing ambulatory surgical facilities based upon a license issued by the American Association for Accreditation of Ambulatory Surgery Facilities, Inc., having met the class “C” standards to perform office-based orthopedic surgery. This certificate includes the following language: “AAAASF Accreditation of this facility complies with New York State Law, 2007/Chapter 365/Section 6530/230-d (a).” It is also undisputed that Applicant is not an authorized PHL Article 28 facility and that Applicant does not appear on the list of New York State Worker’s Compensation Board ambulatory surgery centers which identifies every facility that has obtained the Article 28 certification along with its individual applicable PAS reimbursement rate. I have reviewed the evidence before me, and I find that this Applicant is sufficiently accredited as an office-based orthopedic surgery practice and an ambulatory surgery facility, and is entitled to receive No-Fault benefits for the service performed in the instant case. A-26 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 4/22/14 412013069568 Robyn McAllister Yes While there is a split in opinion in the arbitrator panel on this issue, I am persuaded by those arbitrators, who like the courts, have concluded that a duly accredited OBS is entitled to reimbursement for No-Fault benefits. 4/28/14 412013099849 Robyn McAllister Yes Numerous arbitrators already have addressed these issues between these parties and the majority of arbitrators have concluded that Applicant is entitled to reimbursement. (See, e.g. AAA Case Nos: 412012130419 (Winning), 412012135529 (Stathopoulos), 412013011473 (Skelton), 412013003554 (Rybacki), 412013003849 (Feilich), 412012140074 (Bianchino). Moreover, this conclusion has been upheld by Master Arbitrator Frank Godson in AAA Case No.: 412013016786. Thus, in the instant case, I find that since Applicant established a prima facie showing of entitlement . . . . 2/06/14 412013069151 Sandra Adelson Yes Recently, in Upper East Side Surgical, PLLC v. State Farm Ins. Co., supra, the Court considered essentially the same OBS-facility fee issue raised here. The Court noted that the PAS fee schedules were, by their terms, applicable only to Article 28 facilities, but that OBS facilities were nevertheless legally entitled to recover facility fees pursuant to Insurance Law § 5102(a)(1). Since, however, fee schedules applicable to OBS providers had not been issued, the facility rate issue effectively defaulted to the provisions of § 68.5(b) - under which fees would then be payable based on prevailing rates in the involve geographic area. See Upper East Side Surgical, PLLC v. State Farm Ins. Co., supra at 3.” . . . . Based on the evidence presented to this hearing, the relevant case law and statutes establish that applicant is eligible to charge a facility fee. 10/21/14 412014009703 Sandra Adelson Yes Although the regulations on which plaintiffs rely contain Workers Compensation- derived “PAS” fee schedules which apply to Article 28 licensed entities (see Insurance Law § 5108(a) and (b); 10 NYCRR §§ 86-4.40, 86-4.1(a), 800.8; 11 NYCRR § 68.1(a)), the regulations do not state that they are applicable to OBS facilities. Similarly, they do not provide that only Article 28 facilities are entitled to bill for facility fees under Insurance Law § 5102(a)(1) or that an OBS entity - or any other No-Fault provider - is precluded from recovering facility fees except pursuant to their specified terms and rate schedules. See Upper East Side Surgical, PLLC v. State Farm Ins. Co., 34 Misc.3d. 1219(A), 2012 WL 335774 (District Court, Nassau County 2012); Defendant’s Affirmation in Opposition Exhibit C. I therefore find that the prevailing rate for an OBS would be analogous to the No fault fee rate for Article 28 entities. 9/24/14 412014052410 Stacey Charkey Yes Ms. Perdikos thus maintains that applicant should be reimbursed at the same PAS rate as an Article 28 facility in its geographic location, and that respondent’s assertions are unsubstantiated. Indeed, Respondent has failed to support its defense with any competent evidentiary proof. However, applicant has set forth ample proof in support of its assertion it was entitled to reimbursement. Accordingly, an award shall be issued in favor of applicant in regard to the facility fee as amended. 1/24/14 412013057092 Stacey Erdheim Yes I agree with the above well reasoned, well written arbitration decisions which are directly on point. I find that Respondent’s denial based on the defense that Applicant is not entitled to reimbursement since only licensed, freestanding ambulatory surgery centers are eligible to charge a facility fee can not be upheld. A-27 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 12/16/14 412013044233 Stacey Erdheim Yes I agree with Applicant. I am also persuaded by the affidavit of Dr. Gladstein that it is his normal business practice to notify the AAAASF of every physician that will perform an OBS procedure. Finally, Respondent argues that Applicant has violated Public Health Law section 230-d. Public Health Law 230-d requires that OBS practices/settings become accredited by an agency designated by the NYS Department of Health such as the American Association for Accreditation of Ambulatory Surgical Facilities. Respondent argues that Applicant was not accredited as required and this is a violation. Applicant counters that this defense should be precluded since it was not raised in a timely denial. He also argues that Respondent is misapplying the statute in that it is only required that the doctor who performed the services must be accredited. Applicant argues that the doctor who performed the services is in fact accredited. Respondent is not asserting that the doctor is not accredited. I agree with Applicant. This defense was not raised in a timely denial. I am also persuaded by Applicants application of the statute. Accordingly, in light of the foregoing, based on the arguments of the parties’ representatives and after thorough review and consideration of all submissions, I find in favor of the Applicant and grant the claim in its entirety. 5/20/14 412012120832 Stacy Presser Yes The Applicant herein is an accredited OBS facility and as such is entitled to reimbursement for the facility fee charged in association with the arthroscopic surgery disputed herein. There is no requirement in the Regulations that NYS Public Health Law Article 28 licensure is a prerequisite to No-Fault Claims reimbursement.” 7/15/14 412013075778 Stephen Czuchman No I find therefore, based on 11 NYCRR § 65-3.16(a)(12), that since applicant is not a licensed “health care facility” pursuant to PHL Article 28 or as defined by PHL § 18, and does not have a PAS rate for reimbursement, respondent has no duty to pay applicant a facility fee, as applicant does not meet the licensing requirements entitling it to a such a fee. Based on a fair preponderance of the credible evidence, the denial of claim is sustained. 8/19/14 412013127059 Stephen Czuchman No While applicant may be licensed to allow doctors in the practice perform ambulatory surgery at its OBSP, it is not entitled to reimbursement for what amounts to a duplicate bill for the underlying medical services. I find therefore, based on 11 NYCRR § 65-3.16(a)(12), that since applicant is not a licensed “health care facility” pursuant to PHL Article 28 or as defined by PHL § 18, and does not have a PAS rate for reimbursement, respondent has no duty to pay applicant a facility fee, as applicant does not meet the licensing requirements entitling it to a such a fee. 4/28/14 412013084827 Steven Greif Yes Based upon applicant’s qualifications as a certified facility by the AAASF, which is an accrediting agency under the regulations of the New York State Department of Health, it is entitled to bill for facility fees. The facility fee is a necessary medical expense under Insurance Law §5102. In the absence of a fee schedule covering applicant’s charges, the prevailing rates as referred to by Nurse Amy Blitz in her affidavit mentioned above, are the most appropriate rates to pay applicant for the facility fees it has billed for. Accordingly, applicant is awarded $2,230.62. 10/20/14 412013155205 Steven Greif Yes There are two cases in New York that would appear to permit entities that have complied with Public Health Law §230 - d to seek facility fees. . . . I find that under Insurance Law §5102 (a) (1), applicant is entitled to recover a facility fee to be paid in accordance with the prevailing fee in the geographical location of the provider. I also find the prevailing fee in the geographical location of the provider to be the PAS code rate sought by the applicant, as there is no other evidence of the appropriate fee to be paid, and the PAS rate is the best evidence of the prevailing fee in the geographical location of the provider. A-28 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 1/09/14 412013002038 Steven Rickman No A facility fee is a properly reimbursable expense if billed by a provider that is legally authorized to present same for payment. For reasons set forth at length hereafter, it is now my determination that Applicant’s recovery is barred because it is not licensed under Article 28 of the Public Health Law. The Applicant herein does not possess the requisite license/certification which allows it to receive no- fault compensation for a facility fee. 6/02/14 412013119517 Steven Rickman No A facility fee is a properly reimbursable expense if billed by a provider that is legally authorized to present same for payment. For reasons set forth at length hereafter, it is now my determination that Applicant’s recovery is barred because it is not licensed under Article 28 of the Public Health Law. The Applicant herein does not possess the requisite license/certification which allows it to receive no- fault compensation for a facility fee. 7/17/14 412013100603 Susan Haskel No Finally, I note that while there is authority on this issue favoring Applicant’s position, it is clear that the issue of OBS practice compensation for facility use is far from settled law at this juncture. See Award in AAA Case No. 412012129436 (Arb. Steven Rickman); see also Award in AAA Case No. 412011066793 (Arb. Aaron Maslow, aff’d by Master Arb. on 05/01/2012). As such, while I have reviewed the decision in Upper East Side Surgical PLLC v. State Farm Ins. Co., I do not find that it requires me to find differently than I have herein. I similarly note that there has been a legislative proposal to amend Public Health Las §230-d to allow Office based surgical practices to bill separately for the use of their facilities. I agree with Arbitrator Bonnie Link that the proposed amendment is further evidence that at the present time, OBS practices are not entitled to facility fees in addition to the provider fees. See Award in AAA Case No. 412013049103. 3/07/14 412013073772 Susan Mandiberg Yes . Furthermore, I adopt the proposition - followed by many of my fellow Arbitrators - that the Regulation does not mandate NYS Public Health Law Article 28 licensure to allow such a facility to be reimbursed under the New York Sate Workers’ Compensation Fee Schedule, particularly when the services for which the facility fee was generated were performed by a physician who is qualified to perform the procedures. 10/22/14 412014036950 Susan Mandiberg Yes Furthermore, I adopt the proposition - followed by many of my fellow Arbitrators - that the Regulation does not mandate NYS Public Health Law Article 28 licensure to allow such a facility to be reimbursed under the New York Sate Workers’ Compensation Fee Schedule, particularly when the services for which the facility fee was generated were performed by a physician who is qualified to perform the procedures. 1/07/14 412013033308 Tali Philipson Yes To date, there is nothing in the Respondent’s voluminous submission other than unfounded allegations against the Applicant. In fact, each time I re-read Dr. Gladstein’s transcript, review the various Opinion Letters and FAQs and re- evaluate the Public Health Law, I become more persuaded of that. There is no regulation that prohibits billing for a facility fee. Both the AAAASF, which was chosen as the designated accrediting agency by the DOH, and the legislative intent behind the Public Health Law, contemplated a fee. The fact that there is no specific fee schedule does not in and of itself mean that no fee is permitted. And in what universe is it wrong to seek payment for providing a service? Avanguard, as testified to by Dr. Gladstein, is providing post operative services utilizing personnel and equipment that is distinct from the surgical services provided by Metropolitan. 10/21/14 412013138263 Tali Philipson No Although I still do not find that an OBS is prohibited from billing for the facility fee, I now find that if there is no legislative body or regulation requiring payment of the fee, I certainly am not in a position to mandate a non-existent requirement. At this juncture, and absent any other guiding regulatory scheme, it will be a matter of negotiation between the parties. 6/07/14 412013125541 Tara Maher Yes In this case, I find in favor of Applicant as the Courts have determined that an OBS is entitled to be paid. A-29 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 9/17/14 412013134661 Tara Maher Yes In Upper East Side Surgical, PLLC, v. State Farm Ins. Co. (supra) the Court considered essentially the same OBS-facility fee issue raised here. The District Court determined that a facility is entitled to be paid at rates prevailing in the geographic area In this case, I find in favor of Applicant as the Courts have determined that an OBS is entitled to be paid. 1/16/14 412013056639 Teresa Girolamo No I find that irrespective of the fact that Respondent failed to provide a Denial of Benefits that Applicant is not entitled to the payment in the amount of $2,550.00 as Applicant is an OBS practice and is not a health care facility under PHL Article 28 or as defined in PHL § 18. 10/21/14 412014006510 Teresa Girolamo No I find that Applicant is not entitled to the payment in the amount of $1,891.13 as Applicant is an OBS practice and is not a health care facility under PHL Article 28 or as defined in PHL § 18. 2/27/14 412013054083 Thomas Stock Yes I find that PHL Article 28 licensure is not a prerequisite to reimbursement under the No-Fault Regulation where the facility is licensed as an OBS center. As the Court held in Upper East Side Surgical, PLLC v. State Farm Insurance Co., 2012 NY Slip Op 5018(U) (Nassau Co., 2/2/12, Murphy, J.), while an OBS center is not an Article 28 facility, it is entitled to reimbursement under Insurance Law Sec. 5102(a)(1). The absence of a specific code within the fee schedule is not a bar to reimbursement as the PAS code provides a corollary fee which is reasonable. To find otherwise would essentially bar the use of OBS centers which provide safe and effective delivery of same-day surgical services, often at less cost than those facilities which are specifically licensed as PHL Article 28 facilities 9/16/14 412013152783 Thomas Stock Yes I further find that PHL Article 28 licensure is not a prerequisite to reimbursement under the No-Fault Regulation where the facility is licensed as an OBS center. As the Court held in Upper East Side Surgical, PLLC v. State Farm Insurance Co., 2012 NY Slip Op 5018(U) (Nassau Co., 2/2/12, Murphy, J.), while an OBS center is not an Article 28 facility, it is entitled to reimbursement under Insurance Law Sec. 5102(a)(1). The absence of a specific code within the fee schedule is not a bar to reimbursement as the PAS code provides a corollary fee which is reasonable. To find otherwise would essentially bar the use of OBS centers which provide safe and effective delivery of same-day surgical services, often at less cost than those facilities which are specifically licensed as PHL Article 28 facilities. 1/16/14 412013085610 Timothy Mcnamara No After review all the documents and hearing arguments of counsel, I find from legislative history and the relevant statutes that it was not contemplated that OBS facilities would be reimbursed for a facility fee. The substantial regulatory and reporting requirements of hospitals and Article 28 facilities are not applicable to OBS facilities. The claim of the Applicant in each of these cases is denied its entirety. 1/16/14 412013085614 Timothy Mcnamara No After review all the documents and hearing arguments of counsel, I find from legislative history and the relevant statutes that it was not contemplated that OBS facilities would be reimbursed for a facility fee. The substantial regulatory and reporting requirements of hospitals and Article 28 facilities are not applicable to OBS facilities. The claim of the Applicant in each of these cases is denied its entirety. 8/04/14 412013138024 Toby Susan DeSimone Yes Applicant argued that there is no statutory requirement that a surgical office be an approved Article 28 facility in order to bill and collect facility fee payments. I find that the unsubstantiated reviews submitted by Respondent are contradictory. The reviews do not adequately justify or explain if the Applicant should be paid at all, or that a reduced payment should be made. Respondent failed to submit any calculations that would explain a reduction or non-payment for the supplies. I rely upon the recent decisions of Arbitrator Zeidner (AAA #412013142313) and Arbitrator Kannengieser (AAA # 412014010523) in reaching this decision. A-30 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 10/07/14 412013154701 Toby Susan DeSimone Yes Applicant is not authorized to be reimbursed for medical services it provided to its assignor under the “facility fee” schedule in accordance with the Products of Ambulatory Surgery (PAS) classification system because it is not an Article 28 facility. Applicant is, however, entitled to reimbursement under Insurance Law §5102. Here, I find that the PAS rate of reimbursement is highly probative insofar as establishing a “prevailing fee.” By awarding compensation commensurate with the PAS rate, Applicant would be reimbursed consistent with charges permissible for similar procedures under schedules already adopted or established by the Superintendent. 6/18/13 412012080230 Valerie Greaves Yes Respondent submitted numerous documents in opposition; however, there is no persuasive evidence that Applicant is required to be licensed under Public Health Law Article 28 to be reimbursed for its facility fees. Respondent’s denial cannot be upheld. 9/05/14 412014050069 Valerie Greaves Yes NADENT-HDS maintains that Applicant’s certification as an office based surgery practice does not constitute an Article 28 certification and that such a certificate is required to receive compensation for facility fees under the New York No-Fault insurance system. Respondent submitted no persuasive evidence that Applicant is required to be licensed under Public Health Law Article 28 to receive facility fees reimbursement under New York State NoFault regulations. Respondent’s denial cannot be upheld. 2/19/14 412012140063 Victor Moritz Yes [T]here is no claim that a facility fee is not a recoverable service under Insurance Law Section 5102 (a) (1). Further, the absence of a preexisting rate does not preclude reimbursement to the applicant here. While the superintendent has not established a fee schedule applicable to this specific provider, reimbursement is then to be made in conformity with prevailing fee rates in the geographic location citing to Upper Eastside Surgical PLLC v. State Farm Insurance Co., 2012 NY Slip Op., 50184 (U), 34 Misc. 3d., 1219 (A) (District Ct., Nassau Co., Judge Murphy February 2, 2012). 7/07/14 412013129366 Victor Moritz Yes In reading this, I find that there was intent for these facilities to be paid from the start and it is the insurers that have “refuse[d] to pay office-based surgery facilities a facility fee”. The legislature, in fact, finds it “inexplicable” that carriers refuse to pay these facility fees. Again I reiterate that it defies logic that an OBS would go through an accreditation process that is both timely and costly and not be able to charge for their services. Although I recognize this bill remains in the Senate, I nevertheless find the justification and comments instructive with regards to the portions of Public Health Law 230-d that are currently in effect. . . . In sum, the applicant is entitled to reimbursement for the use of their premises during the underlying procedure. A-31 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 5/06/14 412013090328 Vincent Esposito Yes The position taken by the respondent that it can escape liability in these situations simply does not make sense. The intent of the legislature in allowing for an office based surgical practice was to help to control the cost of medical care. There is nothing contained in this legislation, however, that would suggest that a properly accredited office based surgical practice would perform a service that it was licensed to perform and at the same time an insurance company who is charged with the responsibility of paying No Fault Benefits for care and treatment of injuries sustained by individuals in automobile accidents could avoid paying for these services. The No Fault Law and the No Fault Regulations make it clear that a No Fault insurance carrier is responsible for paying for medically necessary services. Since the services in issue were medically necessary and were perform at a facility with appropriate credentials and licensing, a respondent cannot escape liability simply because there is no specific reference or guidelines contained in the fee schedules for the exact amounts to pay in these situations. 5/20/14 412013113238 Vincent Esposito Yes The applicant has never contended that it was an Article 28 facility under the Public Health Law of the State of New York. I note that various surgical services may be performed at these facilities. The rates to be charged for these services are listed under PAS codes which are deemed to be part of the Workers’ Compensation Fee Schedule. It was clear that these codes are only applicable to Article 28 facilities. The applicant, however, is a licensed office based surgical practice. I note that it received its accreditation on August 28, 2008 from the American Association for Accreditation of Ambulatory Surgical Facilities, Inc. (AAASF). This organization has been recognized by the State of New York as one that may issue such accreditations. I note that New York State Public Health Law Section 230-d sets the requirements for office based surgery. It is clear that the applicant has met these requirements. The legislature noted that certain types of surgical procedures could be performed by a doctor in his office so long as his practice has been officially certified as an office based surgical practice. The fact that these procedures can be done on an in office basis would theoretically increase the availability of these services to people who required same and would also theoretically reduce the cost of medical care as these services need not now be performed at hospitals or ambulatory surgical centers. 2/24/14 412013043885 Vincent Gerardi Yes The applicant has cited a Master Arbitration Award by Master Arbitrator Frank G. Godson, AAA case no.: 412013018555. Master Arbitrator Godson stated, at the outset of his decision, that the never-ending list of cases on this issue have resulted in conflicting and confusing findings, and the lack of a truly definitive decision in the Courts. Master Arbitrator Godson concluded, after careful analysis, that an OBS is entitled to a facility fee. The respondent has not raised an issue as to the actual fee, or Fee Schedule, in its denial. Accordingly, I find for the applicant and grant its award in its entirety. 8/20/14 412013044218 Vincent Gerardi Yes Master Arbitrator Norman Dachs, who authored a book on No-Fault insurance along with writing a regular column in the New York Law Journal for years on No- Fault insurance Law, wrote a definitive Master Arbitration Award on this matter under AAA case no.: 412013040335. Master Arbitrator Dachs wrote that the principal argument advanced by the insurer herein has been before me in several prior cases (see, Avanguard v. Geico, AAA Appeal 17-991-R81307, Metropolitan v. Geico, AAA Appeal 17-991-R67853). In each case the insurer’s argument has been rejected. The insurer’s constant repetition of virtually the same argument will not produce a different outcome, unless of course an Appellate Court Decision otherwise instructs. Accordingly, I find for the applicant and grant its claim in its entirety. 9/08/14 412014011000 Walter Higgins Yes Since no fee schedule has been adopted or established by the superintendent for OBSP, the permissible charge for such service shall be the prevailing fee in the geographic location of the provider. A-32 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 1/14/12 412011046108 Walter Winning No I have reevaluated the legal question, and it is apparent that Article 28 licensing is difficult to obtain. However, by allowing unlicensed facilities to collect benefits would essentially encourage the circumvention of the statute. After reviewing numerous prior decisions, I have elected to follow the reasoning of Arbitrator H. Sawits in Upper Eastside Surgical PLLC v. GEICO, AAA No. 412009044156, (Sept. 2010). In a thorough and cogent decision, which is directly on point, Arbitrator Sawits concluded that Article 28 licensure was mandated for Ambulatory Surgery Centers. I similarly conclude that Article 28 licensing is required for the reimbursement of Ambulatory Surgical Centers under the No-Fault regulations. 6/25/13 412013000219 Walter Winning Yes In a thorough and cogent decision, which is directly on point, Arbitrator Weisman concluded that there was no mandate in the No-Fault regulations for Article 28 licensure by Ambulatory Surgery Centers. I further note that in a recent decision, Arbitrator L. Yantzos similarly found no mandate for Article 28 licensure in the No-Fault regulations, and awarded a facility fee to a facility licensed under New York State Public Health Law Section 230(d). See Pain Medicine v. GEICO, AAA No. 412012132185 (Yantzos Arb. June 2013). In her decision, Arbitrator Yantzos specifically noted that in the memorandum accompanying Senate Bill No. 4597, it was indicated that they always intended that OBS facilities be allowed to seek compensation for facility fees. I elect to follow the above decisions, and find Applicant eligible to collect a facility fee. Accordingly, I award Applicant $1,226.94. Master Arbitration Rulings Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 12/02/13 412013006317 Frank Godson Yes The decision of Judge Terence P. Murphy in the case of Upper East Side Surgical PLLC/Munlyn v. State Farm Insurance Co. (NY District Court) 2012 N.Y. Slip Op. 50184 (U) appears to be the leading case law to date. There the court, in ruling on the insurer’s motion for summary judgment, found that the claimant was entitled to reimbursement for its facility fee, but ruled that there must be a trial on the amount recoverable. In this case, it does not appear that there was evidence by either side concerning the prevailing fee in the geographic location of the provider, and I will remand the case to the lower arbitrator for a hearing on that issue. 8/26/14 412013119517 Frank Godson Yes In previous cases, I have held that OBS centers may obtain reimbursement under Section 65.5(b) of Regulation 83 which holds that “If the superintendant has not adopted or established a fee schedule applicable to the provider, then the permissible charge for such service shall be the prevailing fee in the geographic location of the provider subject to review by the insurer for consistency with charges permissible for similar procedures under schedules adopted or established by the superintendent.” I believe the proper remedy in this case is to permit applicant to reframe its claims in terms of the equipment, supplies and safeguards provided and the prevailing fees for those things in the geographic location of the provider. The situation is one which clearly requires action by the New York Legislature. A-33 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 9/30/14 412013129877 Frank Godson Yes This appeal, and four others involving the same parties, are five of a large number of arbitration decisions in the last few years concerning the right under the no-fault law to reimbursement for a facility fee in connection with office-based surgery. The numerous and never ending list of NFA decisions as well as master arbitrator decisions have resulted in conflicting and confusing findings. Adding to the confusion is the lack of passage of a bill before the New York State Legislature and the lack of a truly definitive decision in the courts. In the absence of a controlling court decision, I agree with the NFA that an OBS is entitled to a facility fee, and that the amount of such fee should be determined under Section 65.5(b) of Regulation 83. 10/07/14 412013046817 Marilyn Felenstein No The lower arbitrator, after conducting a comprehensive hearing, held that the Applicant was not eligible to recover a facility fee for services performed by one of its members as it was not a licensed Article 28 Ambulatory Surgery Center and as such was ineligible to recover no-fault benefits for the use of its own facility. While it is clear that this issue is complex and that the arguments have many nuances, it is the determination of the Master Arbitrator that the lower arbitrator has set forth a rational basis for the decision reached and the award of the lower arbitrator is affirmed. 1/30/14 412013040335 Norman Dachs Yes While reviewing the extraordinarily voluminous papers submitted by the parties, especially those submitted on behalf of the Respondent/Appellant insurer, the 1942 popular song “I’ve Heard That Song Before” suddenly came to mind. The words “It seems to me I’ve heard that song before, its from an old familiar score, I know it well, that melody” kept ringing in my ears. I suppose it is because the issues involved in this appeal have been presented to numerous Lower and Master Arbitrators. The principal argument advanced by the insurer herein has been before me in several prior cases, including Avanguard Medical Group v. GEICO, AAA Appeal Case #17-991-R-83107- 13 and Metropolitan Medical and Surgical v. GEICO, AAA Appeal Case #17-991-R-67853-13 in each of which the insurer’s arguments have been rejected. Applicant’s submission is replete with citations to other Lower and Master Awards with similar results. The Insurer’s constant repetition of virtually the same arguments will not produce a different outcome, unless, of course, an Appellate Court decision otherwise instructs. 5/14/14 412013081436 Norman Dachs Yes [A]s the Lower Arbitrator correctly observed with respect to the amount of the fee that is allowable, “11 NYCRR Section 68.5(b) provides In sum that if a health service is reimbursable under Insurance Law Section 5102(a)(1) but the Superintendent has not established a fee for that specific provider then the reimbursement is then to be made In conformity with the prevailing fee In the geographical location of the provider. The respondent has not submitted sufficient credible evidence establishing that the amount claimed by the applicant Is not In accordance with the local geographic prevailing rate.” My reason for upholding the Lower Arbitrator’s award herein are Identical to those previously stated. See also, Govt. Employees Ins. Co. v. Avanguard Medical Group, 2012 WL2154984, 2012 N.Y. Slip Op. 31516 (U), (Sup. Ct., Nassau Cty., Sher, J.) Although Appellant has gone to the trouble of citing to numerous Lower Arbitrator and a Master Arbitrator declsion purportedly espousing a different view, and has Invited me to reconsider my decisions, I decline the Invitation. 8/08/14 412013077243 Norman Dachs Yes Thus, until an appellate decision, or even a persuasive nisi prius decision, holds otherwise, I am constrained to follow those cited above. I believe It is my duty to give stare decisis effect to judicial determinations whether I agree with them or not. A-34 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 12/27/13 412013006108 Peter J. Merani No The Respondent insurer argues that the Applicant was not a license facility pursuant to Article 28 of the New York Public Health Law and therefore not entitled to payment for a facility fee. The lower arbitrator found for the Applicant and awarded the bill in issue. The lower arbitrator fails to address all of the issues raised by the Respondent on the facility fee issue. The master arbitrator is unable to determine whether the lower arbitrator’s award is supported by the evidence presented at the hearing below. I find the award below was not supported by sufficient evidence and the award is vacated as arbitrary and capricious and incorrect as a matter of law and the case is remanded for a new hearing before a new arbitrator for a decision on the facility fee issue. 12/30/13 412013014703 Peter J. Merani No In this case the lower arbitrator’s decision, to permit payment of the facility fee where the Applicant was not licensed under Article 28 of the New York Staet Public Health Law, was arbitrary and capricious and incorrect as a matter of law and is vacated in its entirety. 7/03/14 412013047116 Richard Ancowitz No Another factually and legally similar matter was presented to this master arbitrator last year In NY Premier Medical Practice, P C and State Farm Ins Co, 17 991 R 56732 13. In that holding, I affirmed an award to applicant, and I see no reason to adjudicate the Instant matter differently - the Instant award should be affirmed, albeit In respondent’s favor In both cases, compelling arguments were presented by each side. While the applicant appears to have the better of the arguments on the law, I cannot say that the award is arbitrary and capricious, irrational, or clearly contrary to law Thus, given my limited powers of review, I do not discern any error of law or irrationality In the arbitrator’s reasoning, or otherwise In the award itself. There is a rational basIs for the award, and I thus have no basis to disturb same. As noted, I do not find the award to be arbitrary and capricious, nor against the weight of the evidence. Further, in the absence of appellate authority to the contrary, and a consequent demonstration of clear error of law, the award herein should be affirmed. 9/22/14 412013071304 Richard Ancowitz Yes At issue before the arbitrator was $6,250.00 in OBS billing, which was agreed by applicant to be reduced to $1,266.65. The arbitrator found that although applicant did not qualify for reimbursement as a facility licensed by the State per Article 28 of the Public Health Law as a “free standing ambulatory surgery center”, reimbursement was warranted as per Public Health Law Section 230-d, due to applicant’s accreditation by the American Association for Accreditation of Ambulatory Surgery Facilities, Inc. The arbitrator then rendered an award accordingly, citing to Great Wall Acupuncture v. GEICO, 16 Misc.3d 23 (App. Term 2nd Dept 2007) and Upper East Side Surgical v. State Farm Ins. Co., 34 Misc. 3d 1219 (A) (Nassau Co. Dist. Ct. 2012). Several other factually and legally similar matters have been presented to this master arbitrator earlier this year, and in past years as well, e.g. Park Slope Medical One, P.C. a/a/o Frances Eames, 17 991 R 83800 14; NY Premier Medical Practice, P.C. and State Farm Ins. Co., 17 991 R 56732 13. In those holdings, I affirmed awards to applicant, and I see no reason to adjudicate the instant matter differently. In both cases, as in the current matter, compelling arguments were presented by each side. In any event, given my limited powers of review, I do not discern any clear error of law or irrationality in the arbitrator’s reasoning, or otherwise in the award itself. A-35 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 5/07/14 412013070730 Robyn D Weisman Yes The arbitrator discussed the differing opinions amongst the arbitrators as to this issue. It seems that just as many decisions upheld the defense as those that rejected it in a careful review of all law on the case, the arbitrator made a rational decision to reject the defense. As such the arbitrator reasoned that the charge must then be a prevailing rate. In the local geographic region.In the case, Government Empls Ins Co v Avanguard Medical Group PLLC, 2012, NY Slip Op 3133, where in a declaratory Judgment action was brought by GEICO regardIng this issue. The Court found the arguments presented by GEICO to be unpersuaslve allowing the Applicant the right to bill for Its facility fee. This rationale and law has been following in numerous cases and Master Arbitrations, Upper Eastside Surgical v GEICO, AAA No412009047950,412012135898, and 412012125151.The Applicant had submitted evidence which the Arbitrator found credible as to the “prevailing fees” and found reimbursement of $5,205.55 was proper as the average rate.Based upon the decision and rationale of the lower arbitrator, I am not convinced by the Appellant’s arguments to overturn the decision 9/28/14 412013079941 Robyn D Weisman No I have decided this same issue in the past. It seems that just as many decisions upheld the defense as those that rejected it. The Appellant has not made any arguments in this case. Each case has to be looked at individually and decided based upon the issue and rationale as decided by the arbitrator. Hopefully, at one time this issue shall have a final determination but as a Master Arbitrator, it is my role to review the underlying arbitrator’s decision to determine if the decision was arbitrary or capricious or against prevailing law. Based upon the decision and rationale of the lower arbitrator and lack of briefs, I am not convinced to overturn the decision. 9/18/13 412012088700 Victor D’Ammora Yes The lower arbitrator conducted a hearing including testimony and reviewed all of the evidence including the applicable law and regulations. The lower arbitrator determined that Public Health Law Article 28 licensure is not a prerequisite for reimbursement where the facility is a licensed as an OBS Center. The lower arbitrator further determined that the “outside” health care provider may utilize the OBS facility since an MUA is neither surgery nor an invasive procedure. Thus, Arbitrator Weisman allowed the claim. I agree with Arbitrator Weisman’s analysis and conclusion. I have reached similar conclusions in numerous prior Master Arbitration decisions that an MUA is neither invasive nor surgical. Moreover, I cannot conclude on the basis of the record before me that Arbitrator Weisman’s decision was incorrect as a matter of law or arbitrary and capricious. Therefore, I must affirm the award. 9/22/14 412013096776 Victor D’Ammora Yes The lower court arbitrator conducted a hearing and did a review of all of the evidence as well as the applicable law and Insurance Regulations. The lower arbitrator determined that the Applicant was not an Article 28 facility. However, Arbitrator Hausthor’s further determined that the Applicant was licensed, incorporated, and accredited by and under the laws of the State of New York and as such was entitled to reimbursement for the facility fee. The lower arbitrator found that the Respondent’s OBS and other licensing defenses were without merit. There are numerous other lower arbitrators’ and Master Arbitrators’ decisions which come to identical conclusions, including prior decisions of this Master Arbitrator. Thus, I agree with Arbitrator Hausthor’s analysis and conclusions. However, it is recognized that there are decisions and opinions to the contrary. This matter needs to be addressed by either or both an Appellate Court or the Legislature.More importantly, there is nothing in the record before to indicate that Arbitrator Hausthor’s decision was arbitrary, capricious or incorrect as a matter of law. Thus, I find that the arbitrator’s award should not be disturbed in accordance within the standards set forth above. Therefore, I must affirm the award. A-36 Date /Case No. Arbitrator Fee? Excerpt of Relevant Discussion 9/19/13 412012050347 Victor J Hershdorfer No The lower arbitrator conducted a hearing and carefully considered all of the evidence before him. The decision was well-reasoned. There was no question but that the services were performed at an OBS facility and not an Article 28 facility. There was no question but that the services were performed by a chiropractor. His determination tht as a result the applicant was not entitled to a fee is consistent with many other no-fault arbitration and master arbitration decisions. It is also true that there are many other decisions that have reached a contrary conclusion. I cannot conclude on the basis of the record before me that the arbitrator’s determination was violative of public policy, incorrect as a matter of law, arbitrary or capricious. 1/14/14 412013026851 Victor J Hershdorfer Yes In the case of Upper East Side Surgical PLLC v. State Farm Insurance Co., 2012 N.Y. Stip Op 50184 (u) Dist. Ct. - Nassau County 2012, the decision of the Court stated, “This Court finds that the plaintiff is not authorized to be reimbursed for the medical surgical services it performed to its assignor under the ‘facility fee’ schedule in accordance with The Products of Ambulatory Surgery (PAS) classification system because it is not an Art. 28 facility. Plaintiff is, however, entitled to reimbursement under Insurance Law Section 5102(a)(1) for the medical/surgical services it provided to its assignor...”While it is true that the Upper East Side Surgical case was decided in response to a summary judgment motion, it does set forth a principle of law upon which the no-fault arbitrator coudl rely in making his decision. The determination by the no-fault arbitrator is supported by both court decisions and arbitration decisions. It is not arbitrary, capricious or incorrect as a matter of law.