If you haven’t heard the news, the Florida Supreme Court issued its ruling in Revival Chiropractic on April 25, 2024, and rejected the so-call Billed Amount (BA) argument. The BA argument stands for the proposition that insurers that elected to use the Medicare fee schedules must pay 100% of the submitted charge, the billed amount, if the amount submitted was less than 80% of the fee schedule.

For further discussion of the Revival Chiropractic decision, see our previous blog post linked here: Allstate Ins. Co. v. Revival Chiropractic, LLC

The Revival Chiropractic decision overruled prior decisions from the Fourth and Fifth districts. Subsequently, the Fifth district has released two opinions applying Revival Chiropractic to two different insurer policies.

In Auto Club, the Fifth district repeated the Revival Chiropractic holding “that Florida’s statutory scheme for medical care provided through PIP called for reimbursement at the rate of eighty percent of the reasonable amount charged for necessary treatment limited by the statutory maximum benefit amount if the insurer had included that provision in its policy.” The court reaffirmed the three central points of the Revival Chiropractic holding:

1. PIP pays for 80% of reasonable amounts charged that can be limited by the statutory maximum (if notice is provided).
2. A provider that submits charges below the maximum reimbursement does not entitle them to payment in full up to the maximum amount.

The Court continued to note that the policy language of the insurer in Hands On and Muransky was materially different from this insurer’s policy language. Interestingly, the Auto Club decision does not mention the subsequent statement from the Revival Chiropractic Court: “Indeed, we conclude that they have been undermined to the extent that whatever they might have to say relevant to the issue in this case has been superseded by our analysis in MRI Associates.” Allstate Ins. Co. v. Revival Chiropractic, LLC, No. SC2022-0735, 2024 Fla. LEXIS 623, at *12 (Fla. April 25, 2024) (emphasis added). Regardless, the Fifth DCA found that the Auto Club policy language required reversal based upon the Revival Chiropractic decision.

In First Acceptance, the Fifth DCA again followed a similar format. The court acknowledged that the policies in Hands On and Muransky contained “atypical policy language.” The notable addition is that, unlike in Auto Club, the First Acceptance Court mentioned the previous analysis that the Revival Chiropractic decision undermined the prior decisions.

Neither case discusses the MRI Associates decision in detail. The MRI Associates decision answered the question whether an insurer that elected to use the schedule of maximum charges could also issue payment under the reasonableness factor test. MRI Assocs. Of Tampa, Inc. v. State Farm Mut. Auto. Ins. Co., 334 So. 3d 577, 579 (Fla. 2021). As the Supreme Court in MRI Associates and in Revival Chiropractic explained, the “hybrid-payment methodology” argument was categorically rejected.

While the BA argument appears to be dying, there are some unanswered questions. First, whether certain insurer’s policy language would still compel a different result despite these decisions allowing insurers to utilize either method (including paying 80% of the billed amount, which the insurer can presume to be reasonable). Second, if certain policy provisions would compel a different result, which policies are at risk and would still require a different result. Last, how will these payments that potentially require payments above the required PIP coverage provision affect other issues, such as challenges to exhaustion of benefit defenses.

Revival Chiropractic also deals a significant blow to the Budget Neutrality Argument, commonly referred to as the BNA issue. Although BNA is not directly addressed in the opinion, the Court’s analysis bolsters the argument that insurers do not have to remove the BNA from their payments.

Please speak to a Dutton Law Group attorney today to review your policy provisions and to discuss strategies for defending these issues moving forward.