1 NOTICE Decision fi led 03/25/11. The text of this decision may be changed or correct ed prior

to t he fi ling of a Peti tio n for

Rehearing o r th e disposit ion of

the same. NO. 5-09-0178 I N THE AP PE LLA TE C O U R T O F IL LIN O IS

FI FTH DI STRI CT
F. RYAN BEM IS , d/

b/a Fr ank Bem is & ) Appeal from the Assoc iates, Individ ually a nd o n B ehalf o f All ) Circuit Court of Others S imil arly S ituat ed, ) Madison County. ) Plaintiff -Appell ee, ) ) v. ) No. 05-L-152 ) SA FECO INSURANCE COMPANY OF AMERI CA ) and SA FECO INSURANCE COM PANY OF ) ILLINOIS, ) Ho nora ble ) Barba ra L. Crow der, Defendants-Appellants. ) Jud ge, p resid ing.
JUSTICE SPOMER deliv ered the judgment of the cour

t, wit h opinion. Justi ce St ewart concur

red in t he judg ment and opi nion. Justi ce Donovan speci ally c oncurred, with opini on. O P I N I O N The defendant s, Saf

eco Ins ur ance Com pany of Ameri ca and Saf eco Ins urance Company of Illinois (Safe co), a ppea l, pursu ant to Illinois Su prem e Co urt R ule 306(a)(8) (eff. Sept. 1, 2006 ), the March 25, 2009, or der of t he circ uit cour

t of Madison County that

grant ed the mot ion of t

he plai ntif

f, F. Ryan Bemis, doing bus iness a s Frank Bemis & Associ ates (Bemis), to certi fy count I of his first amended complaint, al leg ing a breach of contrac t, as a class acti on. For the f ollowingreasons, we revers e and remand.

FACTS In his firs t amended class a ction c om plaint (complai nt), Bemis alleg es that he is a doctor of ch iropra ctic medici ne and treat ed Thatcher L evi , one of S afeco' s insur eds, in and before 200 2 for in

juries su stained in an a utom obile acc iden t for w hich M r. Le vi was entitled2

to covera ge und er the m edica l paym ents p rovis ion of his Safeco pol icy. The compl aint alle ges upon infor

mation and belie f that

the medi cal payment s prov isi on in Mr. Lev i' s Saf eco insurance policy provide s that Safeco wil l pay rea sonable expe nses for necessar y medical
serv ices incu rred as a resu lt of a cove red acc iden t. Ac cor din g to the c om plain t, M r. Le vi assigned his cl aim for

medicalpayments cov erage under the Safeco policy to Bem is. Be mis submitteda billto Saf

eco for $75 f

or a physicalperfor

mance test

he pro vided to M r. Le vi
on De cemb er 23 , 200 2, ide nti fied by current proceduraltermi nology ( CPT) Code 97750. According

to the c omplaint , Saf

eco m ade a $9.0 5 red uction of this b ill and p aid B emis $65.95 for that proced ure. Exhibit A to the complai nt is an explanation of r ev ie w (EO R) that a ccompanied Sa fe co 's payment t o Bemis and ref lect ed the $9.05 deduc tion. According to the EOR, the date of the a ccide nt for w hich th e med ical payment s cover age appl ied was November 23, 2002
. CPT Code 97750 w as "[r ]eimbur sed according to UCR 80th percentile data." The complai nt alleges tha t this reducti on was produced by a compute rized review of B emis's bill usingbiasedsoftware , which "re- prices " medicalprocedures to a prede termi ned maximum percent ile. Count I of

the compl aint a lleg es a cause of acti on for a br each of cont ract on t he basis that S afeco bre ached the i nsurance cont ractby fail ing to pay the ful l amountof medical expenses Mr. Le vi incurred. Althou gh the c omp laint also conta ined c oun ts alle gingcauses of acti on for a v iolation of t he Il linoi s Consumer Fraud and Deceptiv e Business Pr acti ces Act (815 IL CS 505/1 et seq. (West 2006)) and unj ust enr ichmen t, t he se counts were not the subject of Bem is's subsequent mo tion for class certification and thu s are not a subj ect of this appe al. Safeco f

iled a motion to dism iss cou nt I of the c omp laint, argu ing that M r. Levi did not make a valid assignment of his c laim to B emis and that, thu s, B emis did not have standi ng to p urs ue a b rea ch- of- cont rac t c la im. Th e c ircuit co urt den ied the motion to3

dismiss. Subseque ntly, Safeco fil ed an an swer to the complaint, attach ing a copy o f Mr. Le vi 's insurance poli cy. Under the t erms of the m ed ic al pa ym en ts co ve ra ge of M r. Le vi 's policy, Safeco agreed to p ay "the usu al and custo mary charge s incur red for reasonabl e and necessary medica l *** ex penses b ecause o f bodily injury ca used by an accide nt." Therea fter, Bemis fi led an amendedmotion f or clas s cert ifi cati on, which included a request to certif y a proposed class as follows: "All persons insured by S afeco prope rty and ca sualt y insurance companies in the states o f Arkans as, C olorad o, C onn ecticu t, Illinois, Indian a, Iow a, M ississipp i, New Hampshire, New Mexico, Ohio, Sout h Dakota, Texas , Wisconsin and We s t Virgi nia (and t

heir as signee medicalprovi ders), who: (a) duringthe peri od from Februa ry 11, 19 95, to the da te of this Order, submittedone or

more c lai ms for payment of medicalexpenses pur suant t o an automobil e polic y's medicalpayments cov erage ; (b) had their

clai m(s) adj usted and r evi ewed by computer bi ll r evi ew software incorpor ating

Ing enix ' MD R modules;'and (c) received or w ere tendere d payment i n an amount l ess than the subm itted me dical e xpen ses du e to charge s purp ortedly exce eding th e usu al,
cu st om ar y o r r ea so na bl e a m ou nt , b as ed on th e I ng en ix 'M D R m od ul es .' " Excluded from the class are "per sons whose medpay cover age expr essly r eserv ed the right to use ' computeri zed databas es' to rev iew reas on ableness of expenses " and "pers ons whose clai ms were refe rred t o Safeco' s Speci al Investigativ e Unit and were f ound fraudulent." Also excluded were any claims for which t he insur erpaid an amount other t han the amount recommende d by the com puter d ataba se, claim s base d on paym ents p ursua nt to stat e-mandate d fee schedul es, cl aims by members of t he Il linoi s judi ciary, and clai ms by any officer or director of Safeco and their immediate famil y members.4

At a hea ring on th e ame nded motion for clas s certifica tion, co unse l for B emis indicatedto the c ircuit co urt that B emis was only reques tingclass certi fication on the breachof-cont ractclaim sta ted in c oun t I of the c omp laint. On M arch 25, 2 009, the c ircuit court entere d an order ce rti fyingthe cl ass as def ined in t he amended motion f

or class certi fication set for th abo ve. Safec o filed a timely p etition fo r leave to a ppea l pursu ant to Illinois Supr eme Court Rule 306(a )(8) ( eff. S ept. 1, 2006), which a div idedpanel of t his court denie d
o n February 5, 2010. O n Ma y 26, 2010, the Illinois Supreme Court issued a supervis o r y orderdirecting t

his court to v acate the prior o rder an d to gran t the pe tition for le ave to appe al. Bemis v. Safec o Insurance Co. of America , 236 Ill. 2d 550 (2010). On July 2, 2010, this cou rt granted Safeco leave to a ppea l. AN AL Y SIS We b e gin our ana ly si s wi tha s tate me ntof th e appl ic ab le st an da rdof re vi ew. "Decisi ons regarding c lass c erti fication are wit hin the s ound discr etion of the trial court and shou ld be overturned only w here the co urt clearly abused its discretion or a ppli ed impermissibl e legal criteri a." Avery v. State F arm Mutual Automobile I nsurance Co. , 216 Ill. 2d 1 00, 125 -26 (20 05) (citin g McCabe v. Burge ss , 75 Ill. 2 d 457, 464 (1979), and Eshaghi v. Hanley Dawson Cadi llac Co. , 214 I ll. App. 3d 995, 10 01 (199 1)). However, the tri al court' s discr etion mus t be exer cisedwithin t he bounds of sec tion 2- 801 of the Illinois Code of Civi l Procedur e (the Code) (735 I LCS 5/2- 801 (West 2006)), which s ets f orth t he fourprerequi sit es that t

he proponent of

class certi fication must

establ ish bef

ore the c lass may be certified. Avery , 216 I ll. 2d at 126. These were explai ned in Avery as follows: "(1) numero sity ('[t]he class is so nu merous tha t joinder of all mem bers is impracticable'); (2) commonal ity ( '[ t]her e are questions of f act or law common to the class, wh ich co mmo n qu estions pred omin ate over any q uestion s affec ting only indiv idual membe rs'); (3) adequ acy of repre sentatio n ('[t]he rep resen tative parties will5

fairly and adequately protect the int erest

of the cl ass' ); and ( 4) appropri ateness (' [t] he class action is an app ropriate method for the fair and eff icient a djudication of

the controversy' )." Id . at 125 (qu oting 735 ILCS 5/2-80 1 (W est 1998)). On appe al, Safec o foc uses p rimarily on the second r equirement of sect ion 2-801 of the Code (735 IL CS 5/2-801 ( West 2006)), arguing that common questi ons of fac t or l aw do not predominate over the questi ons a ffecti ng only individu al class m emb ers. In ord er to satisfy the commonal ity r equirement , the proponent of class certi fication must show thatthe

" 'successf

ul adju dicatio n of th e pur ported class re prese ntatives' individu al claims will establisha right of re covery in other cl as s members.' " Avery , 216 I ll. 2d at 128 (quoting Go etz v. Vi llage of

Hoffman Estates , 62 I ll. App. 3d 233, 236 (19 78)). W here this test is m et,

" ' "a judgem ent in fa vor of the class m emb ers sho uld decisi vel y sett le the entir e controv ersy, and a ll that sho uld rem ain is for other member s of

th e c la ss to fi le pr oo f o f t he ir cl ai m ." ' " Sm ith v. Illinoi

s Central

R.R. Co. , 22 3 Ill. 2d 441 , 44 9 (2 006 ) (qu otin g Southwestern Refining Co. v. Bernal , 22 S.W.3d 425, 434 (Tex. 2000) (qu otin g Life I nsurance Co. of t

he Southw est v. Brister , 722 S.W .2d 764 , 772 (T ex. Ct. Ap p. 1986 ))). "Determi ning wh ether iss ues c omm on to the cla ss pred omin ate over indivi dual is sues
re qui res the court to identi fy the substantiv e issues that willcontrol the outcome, assess which issues will pr edominat e, and then de termi ne whether the se iss ues are common t o the class." Id . (citin g O'Sullivan v. Countryw ide Home Loans, Inc. , 319 F.3d 732 , 738 (5th Cir. 2003)). "Such an inq uiry requires the c ourt to look beyond the ple ading s to under stand t he claims, de fenses , relevant facts, and applicable subst antive l aw." Id . (citin g Castano v. American Tobacco Co. , 84 F.3 d 734, 7 44 (5th C ir. 1996)). "The test forpred omin ance is not whether the common issues outnumber t he indiv idual one s, butwhe ther common or indiv idual issues will be t he object of most of

the efforts of the litigants and the court ." Id

. at448 -49 (citin g Southw ester n Refining Co. , 22 S.W .3d at 434 ). Acco rdingly, in orde r to6

revi ew the ci rcuit

court' s finding reg ardingcommonalit y and predo mi nance, we mu st exami ne th e subs tanc e of Bemi s' s bre ach-o f-c ontr act c lai m. In coun t I of the c omp laint, B emis a lleges that Sa feco b reach ed its insurance contr act with Bem is's patient, M r. Levi, by reducing th e b il l B em is su bm it te d t o S af ec o f or M r. Le vi 's treat ment by $9.05. In orde r to recover fo r a breac h of contr act, Bemi s must pr ove the exist ence of a val id contractand assignment, t he terms of the cont

ract, fullperfor

mance by the a ssignor of the contra ct' s prov isi ons, and Sa feco' s breach of the cont ract' s ter ms. See Perl man v. Time, Inc. , 133 I ll. App. 3d 348, 353 (1985) . The ins urance cont ract at is sue requir es S af

eco to pay "t

he usual and c ustomar y charge s incur

red for reasonabl e and necessary medical*** expenses because of bodi ly inj ury caused by an a ccident ." Theref ore, in order t o show that Safe co br each ed the insura nce c ontrac t, Bem is will nee d to prov e that the charge he su bmitted wa s usu al and custo mary an d that the charge was incurred as a reasonab le and nec essary med ical expense

. Bem is argues that

the predominant issue in thi s case is whether the computer database util izedby Safeco i s inaccur ate and whether the use of the dat abase jus tif ies a l imit ation of p aymentunder the m edical paym ents provision of the p olicy. Ho wever, if Bemis i s successf ul in prov ing t

his, i t does not

foll ow that al l the ot

her cla ss members submitted usual and customar

y charge s representing reason able and n ecessary medicalexpenses. Whether the usual and cus tomary charge for a class member' s reasona ble a nd necessary medical expenses went unpaid i s not a commonquesti on but is an ind ividu al qu estio n th at w ill ha ve to be answered for

each claimant. Because proof that the usual andcustomar y charge for one class member' s reasona

ble andnecessary medical expenses went unpaid w ould not establish
a righ t of re covery f

or any other

class member, common i ssues do not predominat e. See Avery , 216 Ill. 2d a t 12 8 (q uot ing Goetz v. Vi llage of Hoffman Estates , 62 Il l. App. 3d 233, 236 (19 78)).7

The theory Bemi s advance s, which is that a ll t he bill s submit

ted by a medi cal prov ider are pres umed to ref

lect usual and c ustom ary ch arges fo r reaso nable and necessar y medical
serv ices under

the term s of the insura nce c ontrac t, is contrar y to I llinois l aw, and the case s he cit es in suppor

t of this theo ry are in applic able. In Illinois , there is no presumpt ion that
a billed charge is a usua l and custom ary charge for a reasonabl e and necessary medical
serv ice. See Vict

ory Memorial Hospit

al v. Ric e , 143 Ill. App. 3d 6 21, 624 -25 (198 6). Evidence woul d be req uired, on an indiv iduali zed basis , in orde r to det ermine whethe r Safeco breached i ts cont ract to pay the usu al and customary charg e for r easonable and necessary services for each class m ember. More importantly, S afeco has t he right to r ebut that eviden ce on an ind ividual b asis an d sho w th at any charge s it failed to pay were not usual and custo mary charge s for rea sona ble and necessar y medicalserv ices. The issue of whether each billcontai ns the usual and customar y charge for re asonable and necessar y medical
serv ices wo uld b e "the o bject o f most o f the effo rts of the litigants and th e cou rt" ( Sm ith , 223 Ill. 2d at448 -49 (citin g Sou th w es te rn R ef in in g Co ., 22 S. W.3d at 434)) in a djudicatingthe breach-of-contract cl aims of the class members. Finally, we note th at there is a split of autho rit y unde r Il linoi s law reg ardingwhat contrac tual languag e amo unts to an ass ignment vers us an authorizat ion for payment. S ee Robert S. Pinzur, Ltd. v. The Hartford , 158 Ill. App . 3d 8 71, 8 76 (1 987 ); cf. Lo yola Un iversity Medi ca lCe nter v. Med Ca reHMO , 180 Ill. App. 3d 471, 475-76 ( 1989). We find this to be another pot en tialindiv iduali zed iss ue that would prevent

class certi fication. According ly, the commonal ity r equirement of sect ion 2-801 of

the Code is not m et in this
case. CONCL USI ON For the reas ons set f

orth abov e, the March 25, 2009, order of the ci rcuit

court of Madison County that granted Bemis' s motio n to certify count I of his first amended8

com plaint, allegi ng a bre ach o f con tract, as a class a ction, is reversed , and this cau se is remanded to t

he circ uit cour

t for further procee dings not incons ist ent with t his opi nion.
Reversed; cause remande d.

JU STIC E D ON OV AN , spe cially con cur ring: I concurwith the ma

jori ty that , based onthe rec ord prese nted, t he class certi fication shou ld be reve rsedand th e cau se rem ande d to the circuit co urt. I agree th at a bill ed charg e, in and of it self

, is not suffi cient

proof that the charge s ther ein are reasonabl e or usualand
c ustomar y. In this case , the circ uit cou rt incorre ctly ac cepte d B emis's argum ent that th e reasonableness of his b ill and th e bills of th e class mem bers c ould be pro ven by simply submittingtheir bil led chiropracti c charges. This streamlined method of pr oof was central to the court' s decision to cert ify the class

. I do n ot agree with the majority tha t testimon y on an ind ividual b asis is t he only way that Bemis can prove the reasonableness o f his or the cl ass members ' c harges . Bemis can establishreasonabl eness "by i ntroducing the test imony of a pers on havi ng knowle dge of t he
serv ices rendered and the usualand customary charges for such serv ices" ( Arthur v. Catour , 216 Il l. 2d 72, 82, 833 N.E.2d 847, 853-54 (2005) ). Once the witness is shown to possess the requis ite k

nowledge, the reasonableness requir ement neces sary for admissi on is satisfi ed if t he wi tness testifies that the bills are fair and reasona ble. Arthur , 216 I ll. 2d at 82, 833 N.E.2d at 853-54. In t

his cas e, Saf

eco used expert tes timony t o determine the amount it paid to Bemi s a nd t

he o th erpot entia l c la ss member s. I ts dec is io n t o r ei mbu rs e ac cor di ng to "UCR 80th" perce ntile data was not arr ived at by an ind ividual an alysis o f each class m emb er's bill. On remand, Bemis should be al lowed to mak e a showing that he can p resent expe rt testimon y, ba sed o n data relied o n by expe rts in the f ield, that would e stabl ish thatSafeco9

did not p ay the reaso nable or usualand customar y charge s for

treat ments he and t

he other class membe rs provided to their patients. Bem is should be allowed to prove reasonableness in the same fashion Safeco deter mined reasonableness. I concur in allother as pects of

the maj orit

y's opinion.NO. 5-09-0178 I N THE AP PE LLA TE C O U R T O F IL LIN O IS

FI FTH DI STRI CT

___________________________________________________________________________________ F. RYAN BEM IS , d/

b/a Fr ank Bem is & ) Appeal from the Assoc iates, Individ ually a nd o n B ehalf o f All ) Circuit Court of Others S imil arly S ituat ed, ) Madison County. ) Plaintiff -Appell ee, ) ) v. ) No. 05-L-152 ) SA FECO INSURANCE COMPANY OF AMERI CA ) and SA FECO INSURANCE COM PANY OF ) ILLINOIS, ) Ho nora ble ) Barba ra L. Crow der, Defendants-Appellants. ) Jud ge, p resid ing.

___________________________________________________________________________________ Opini on Fi led : March 25, 2011

___________________________________________________________________________________ Justi ces : Honorable Stephen L. Spomer, J.

Hon orable B ruce D . Stewart, J., Con curs Hon orable Jame s K. D onovan, J., Specially Con curs

___________________________________________________________________________________ Attorn eys Thom as Q. K eefe, Jr., Th omas Q . Keefe , Jr., P.C., # 6 Exe cutive W oods C t., for Bellev ill e, I L 62226; Randal K. Mullendore, Robyn D. Buck, MairiLough, Husch Appellants Blackwell , LLP, 190 Car ondelet Plaza, S uite 600, St. Louis, MO 63105

___________________________________________________________________________________ Attorn eys Timothy F. Campbel l, Campbell& McG rady Law Offic e, 3017 Godfrey Road, for P. O. B ox 50 5, G od fre y, IL 62035; Robert W. Schmi eder, Jonathan B. Piper, Andr ew Appell ee W. K uhlmann, LakinChapman, L LC, 300 Evans Av enue, P.O. Box 229, Wood

River , I L 62095-0229

___________________________________________________________________________________