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HomeMy WebLinkAbout2005-3844 Civil ANNIE A. KROL-KNIGHT IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA v. PEERLESS INSURANCE, A member of LIBERTY MUTUAL GROUP NO. 2005 - 3844 CIVIL TERM CIVIL ACTION - LAW IN RE: DEFENDANT' S PRELIMINARY OBJECTIONS BEFORE BAYLEY, P.L GUIDO, J. OPINION AND ORDER OF COURT Plaintiff has filed a two count amended complaint against her insurance company. Count I is for breach of contract arising from the defendants alleged improper refusal to pay first party medical benefits as required under the Pennsylvania Motor Vehicle Financial Responsibility Law (MVFRL).l Count II is an action for bad faith under 42 Pa. C.S.A. S 8371. Defendant has filed preliminary objections in the nature of a demurrer to Count II. It has also filed a demurrer "to the extent that the claims are based upon the alleged impropriety of an insurer relying on a PRO physician's opinion that certain treatment was not reasonable and necessary as a result of the accident."2 Standard of Review The standard of review to be applied to preliminary obj ections in the nature of a demurrer is well settled. It should be sustained only when plaintiff has pleaded no facts sufficient to establish a right to relief. Bower v. Bower, 531 Pa. 54, 611 A.2d 181 (1992). 175 Pa. C.S.A. ~ 1711 et seq. 2 See Preliminary Objections to Plaintiff's Amended Complaint. NO. 2005 - 3844 CIVIL TERM "(A)ll material facts set forth in the complaint as well as all inferences reasonably deducible therefrom are admitted as true. . .". Vosk v. Encompass, Ins. Co., 851 A.2d 162, 164 (Pa.Super 2004). Finally, "(w)here a doubt exists as to whether a demurrer should be sustained, this doubt should be resolved in favor of overruling it" (citation omitted). Price v. Brown, 545 Pa. 216, 221, 680 A.2d 1149, 1151 (1996). Bad Faith Count II of the amended complaint is an action for bad faith based upon 42 Pa. C.S.A. S 8371. Plaintiff alleges, inter alia, that the defendant contracted with a PRO physician in bad faith "to manufacture a basis upon which to seek to avoid (its) contractual obligation to provide medical expense benefits to plaintiff.,,3 In McIntyre v. State Farm Automobile Ins. Co., 47 Cumbo 206 (1998) the plaintiff alleged that "Defendant's peer review was a sham, conducted for the sole purpose of intimidating plaintiff' at 207. After a lengthy discussion we overruled defendant's demurrer to the bad faith claim under 42 Pa. C.S.A. S 8371. Based upon McIntyre, which we find to be factually indistinguishable, Defendant's demurrer to the bad faith claim in the instant case will also be overruled. PRO Physician's Opinion as to Causation Plaintiff makes several allegations to the effect that defendant improperly contracted with a PRO physician to determine whether the medical services rendered were causally related to the automobile accident. She contends that this goes well 3 See Amended Complaint, paragraphs 34 (d) and 36. 2 NO. 2005 - 3844 CIVIL TERM beyond the authority granted under the MVFRL' s peer review plan.4 She has cited several cases in support of her position that an insurer cannot use the peer review plan to deny payment for services on the basis that they were not causally related to the accident. On the other hand, defendant cites numerous cases to support its position that a causation determination is within the perogative of a PRO physician. However, for one reason or another, none of the cases cited by either party is binding upon this court. Having reviewed the cases cited by the parties, we are persuaded by the reasoning of Judge Ford Elliot in her dissent in Bodtke v. State Farm, 432 Pa.Super 31, 637 A.2d 648 (1994) (reversed on other grounds 540 Pa. 540,659 A.2d 541 (Pa. 1995). As Judge Ford Elliot stated: I cannot agree "that [the PRO's determination that] certain injuries treated were not related to the accident is simply another way of stating that they were not medically necessary." Majority memorandum at 3. Section 1797(b )(1) specifically provides that the evaluation of a PRO "shall be for the purpose of confirming that such treatment, products, services or accommodations conform to the professional standards of performance and are medically necessary." I do not equate either of these functions with causation and coverage under an insurance policy. Whether treatment is medically necessary for a specified injury is an entirely different issue from whether that injury is causally related to the accident and therefore covered under the applicable policy of insurance. 659 A.2d at 650 (emphasis added). We adopt her reasoning and will overrule the demurrer. 4 Section 1797 (b) (1) provides: (b) Peer review plan for challenges to reasonableness and necessity of treatment.- (1) Peer review plan.- Insurers shall contract jointly or separately with any peer review organization established for the purpose of evaluating treatment, health care services, products or accommodations provided to any injured person. Such evaluation shall be for the purpose of confirming that such treatment, products, services or accommodations conform to the professional standards or performance and are medically necessary. (emphasis added). 3 NO. 2005 - 3844 CIVIL TERM ORDER OF COURT AND NOW, this 24TH day of MARCH, 2006, for the reasons stated in the accompanying opinion the defendant's preliminary objections in the nature of a demurrer are OVERRULED. By the Court, Isl Edward E. Guido Edward E. Guido, J. Jeffrey T. McGuire, Esquire Peter J. Speaker, Esquire :sld 4