Fourth District Court of Appeal Issues Important Ruling on Determining the Proper Medicare Fee Schedule for Purpose of PIP Reimbursement, Receding from Its Prior Ruling and in Conflict with the Third District

Posted in Legal Alerts on April 26, 2023

On April 26, 2023, the Fourth District Court of Appeal addressed the ever expanding litigation over the proper Medicare Fee Schedule, overturning a trial court’s ruling that insurers must pay the higher 2007 Non-Facility Limiting Charge, and holding the proper reimbursement rate was the lower 2007 non-facility participating price, in Progressive Select Insurance Company v. In House Diagnostic Services, Inc., a/a/o Darryl Frazier, No. 4D21-2581. In doing so, the entire Court, not just a three-judge panel, officially receded from its own prior precedent.
 
The appellate court’s ruling comes almost exactly two years after the Third District’s ruling in Priority Medical Center, LLC. a/a/o Susan Boggiardino v. Allstate No. 3D20-291 and its own ruling in Allstate Fire & Casualty Insurance Co. v. Jeffrey L. Katzell, M.D., P.A., 323 So. 3d 191 (Fla. 4th DCA 2021). The Fourth District determined that its own opinion in Katzell was wrongly decided based on the reasoning in Priority. This ruling creates a direct conflict with the Third District Court of Appeal and the Fourth District has now certified the issue to the Supreme Court, stating “We conclude that the reimbursement rate for the provided imaging services should have been calculated using the lower 2007 Medicare Part B non-facility participating price rather than the higher 2007 Medicare Part B non-facility limiting charge. We therefore recede from Katzell.”
 
Notably, in its certification of conflict, the Fourth District stated that the Third District’s failure to consider the nature of the limiting charge under the Medicare Program lead to incorrect decisions in both Priority and Katzell.  The Fourth District reasoned that Priority was incorrectly decided because the Third did not properly consider the full statute or Medicare’s use of the limiting charge.  Rather, Priority and Katzell overlooked the fact that nowhere in the relevant statutory provision is the phrase  “limiting charge” mentioned.  The Court  further addressed the importance of the 2012 changes to the statute; namely the legislatures intentional retention of the phrase “participating fee schedule” in subparagraph 1.f.(I).  In fact, by Medicare’s own definition, the “limiting charge is not a fee schedule at all, but rather is only the amount which a provider may directly bill an insured.”