MRI Associates of Tamps Inc. (MRI Associates) went to the Supreme Court in hopes of overturning a previous ruling in favor of State Farm Insurance Co. (State Farm). The lawsuit centers on State Farm’s method for calculating reimbursements under Florida’s personal injury protection (PIP) law.
According to court documents, the MRI center stated insurance companies must follow either a fact-dependent method or a schedule of maximum charges. According to MRI Associates’ complaint, the MRI center alleges State Farm broke the law when it used both methods to determine reimbursements.
In its PIP policy, State Farm states that the insurer “will limit payment of medical expenses described in the insuring agreement of this policy’s no-fault coverage to 80% of a properly billed and documented reasonable charge, but in no event will we pay more than 80% of the following No-Fault Act ‘schedule of maximum charges.”
“When I just focus on the text of this statute, and I see the language that says the insurer may limit reimbursement to 80% of the following schedule of maximum charges, I have a hard time understanding why that doesn’t mean what it says, that it is giving the insurer the option of limiting reimbursement in that manner, ‘may limit reimbursement,’” said Chief Justice Charles Canady.
The Supreme Court was to clarify whether the PIP statute, as amended in 2013, permits an insurer to conduct a fact-dependent calculation of reasonable charges while allowing the insurer to limit its payment in accordance with the schedule of maximum charges under the law.
“Based on the current construction of the PIP statute, we conclude that there are no longer two mutually exclusive methodologies for calculating the reimbursement payment owed by the insurer,” the appeals court said.