Title: Allstate Insurance Co. v. Orthopedic Specialists
Citation: N/A
Docket Number: SC15-2298
State: Florida
Issuer: Florida Supreme Court
Date: January 26, 2017

Supreme Court of Florida 
 
 
____________ 
 
No. SC15-2298 
____________ 
 
ALLSTATE INSURANCE COMPANY,  
Petitioner, 
 
vs. 
 
ORTHOPEDIC SPECIALISTS, etc.,  
Respondents. 
 
[January 26, 2017] 
 
CANADY, J. 
 
In this case we consider whether a personal injury protection (“PIP”) 
insurance policy provides legally sufficient notice of the insurer’s election to use 
the permissive Medicare fee schedules identified in section 627.736(5)(a)2., 
Florida Statutes (2009), to limit reimbursements for medical expenses.  The case is 
before the Court for review of the decision of the Fourth District Court of Appeal 
in Orthopedic Specialists v. Allstate Insurance Co., 177 So. 3d 19 (Fla. 4th DCA 
2015), which held that the policy language is not legally sufficient to authorize 
Allstate to apply the Medicare fee schedules.  The Fourth District certified that its 
decision is in direct conflict with the decision of the First District Court of Appeal 
 
 
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in Allstate Fire & Casualty Insurance v. Stand-Up MRI of Tallahassee, P.A., 188 
So. 3d 1, 3 (Fla. 1st DCA 2015), which held that identical policy language “g[ave] 
sufficient notice of [the insurer’s] election to limit reimbursements by use of the 
fee schedules.”  We have jurisdiction.  See art. V, § 3(b)(4), Fla. Const.  For the 
reasons that follow, we hold that Allstate’s insurance policy provides legally 
sufficient notice of Allstate’s election to use the permissive Medicare fee schedules 
identified in section 627.736(5)(a)2. to limit reimbursements.  We therefore quash 
the decision of the Fourth District in Orthopedic Specialists and approve the 
decision of the First District in Stand-Up MRI on the conflict issue. 
I.  BACKGROUND 
In the case on review, Orthopedic Specialists and various medical services 
providers (“the Providers”) challenged the reimbursements made by Allstate 
Insurance Company (“Allstate”) under PIP no-fault insurance policies issued to 
Allstate’s insureds.  Orthopedic Specialists, 177 So. 3d at 20.  The Providers 
argued that Allstate’s policy is ambiguous as to whether Allstate has elected to 
reimburse the Providers in accordance with the Medicare fee schedules provided 
for in section 627.736(5)(a)2. or merely reserved its right to elect to do so.  Id. at 
20-21.  Specifically, the Providers argued that the “shall be subject to” provision, 
contained within an endorsement to the Allstate policy, is ambiguous.  Id. at 21. 
The policy at issue provides that Allstate will make payments as  
 
 
 
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follows: 
Allstate will pay to or on behalf of the injured person the following 
benefits: 
 
     1.  Medical Expenses 
Eighty percent of all reasonable expenses for medically necessary 
medical, surgical, X-ray, dental, and rehabilitative services, including 
prosthetic devices, and medically necessary ambulance, hospital, and  
nursing services. 
 
Id.  An endorsement to the policy provides: 
Limits of Liability 
. . . . 
Any amounts payable under this coverage shall be subject to any and 
all limitations, authorized by section 627.736, or any other provisions 
of the Florida Motor Vehicle No-Fault Law, as enacted, amended or 
otherwise continued in the law, including, but not limited to, all fee 
schedules. 
 
Id. (emphasis and alterations omitted). 
On appeal, the Fourth District examined this Court’s decision in Geico 
General Insurance Co. v. Virtual Imaging Services, Inc., 141 So. 3d 147 (Fla. 
2013), and concluded that “Virtual Imaging’s central holding is clear: To elect a 
payment limitation option, the PIP policy must do so ‘clearly and  
unambiguously.’ ”  Orthopedic Specialists, 177 So. 3d at 25.  The Fourth District 
explained that in order to provide legally sufficient notice in accordance with 
Virtual Imaging, a policy must “plainly and obviously limit[] reimbursement to the 
Medicare fee schedules exclusively.”  Id. at 25-26.  The Fourth District further 
concluded that “[t]he policy must make it inescapably discernable that it will not 
 
 
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pay the ‘basic’ statutorily required coverage [mandate of eighty percent of 
reasonable expenses for medically necessary services] and will instead substitute 
the Medicare fee schedules as the exclusive form of reimbursement.”  Id. at 26. 
After examining the endorsement to the Allstate policy, the Fourth District 
held that the policy language is not legally sufficient to authorize Allstate to apply 
the Medicare fee schedules because the “shall be subject to” language at issue is 
“ambiguous,” “inherently unclear,” and “must therefore be construed in favor of 
the Providers.”  Id. at 21, 26.  The Fourth District reasoned that it is ambiguous 
concerning whether Allstate will apply the Medicare fee schedule limitations to 
limit reimbursements: 
Here, providing that any amounts payable would be “subject 
to” “any and all limitations” authorized by the statute or any 
amendments thereto, Allstate did nothing more than state the obvious 
by indicating that there was a possibility (and the statutory 
authorization) for Allstate to apply a specific reimbursement 
limitation.  The only reasonable way to read the language is as a 
general recital of Allstate’s reservation of its right to apply limitations 
authorized by law, with the accompanying and corresponding 
obligation to notify its policy holders of the election. 
 
Id. at 24.  The Fourth District rejected Allstate’s argument that the use of the term 
“shall” removes any possible ambiguity regarding whether the Medicare fee 
schedule limitations were to be applied: 
The word “shall” is meaningless because it simply emphasizes the 
obvious.  Broken down to its most simple form, Allstate’s policy says 
that “any amounts payable under this coverage shall be subject to any 
and all limitations” in the PIP statute.  The policy text does not say 
 
 
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that the limitations “shall be applied”; only that they shall be subject 
to being applied.  The word “shall” does not make it clear whether 
Allstate will utilize the alternative method or is simply recognizing its 
entitlement to do so. 
 
Id. at 25. 
II.  ANALYSIS 
“Because the question presented requires this Court to interpret provisions of 
the Florida Motor Vehicle No-Fault Law—specifically, the PIP statute—as well as 
to interpret the insurance policy, our standard of review is de novo.”  Virtual 
Imaging, 141 So. 3d at 152. 
“Where the language in an insurance contract is plain and unambiguous, a 
court must interpret the policy in accordance with the plain meaning so as to give 
effect to the policy as written.”  Washington Nat. Ins. Corp. v. Ruderman, 117 So. 
3d 943, 948 (Fla. 2013).  “Further, in order for an exclusion or limitation in a 
policy to be enforceable, the insurer must clearly and unambiguously draft a policy 
provision to achieve that result.”  Virtual Imaging, 141 So. 3d at 157.  “Policy 
language is considered to be ambiguous . . . if the language ‘is susceptible to more 
than one reasonable interpretation, one providing coverage and the other limiting 
coverage.’ ”  Travelers Indem. Co. v. PCR Inc., 889 So. 2d 779, 785 (Fla. 
2004) (quoting Swire Pac. Holdings v. Zurich Ins. Co., 845 So. 2d 161, 165 (Fla. 
2003)).  “[A]mbiguous insurance policy exclusions are construed against the 
drafter and in favor of the insured.”  Auto-Owners Ins. Co. v. Anderson, 756 So. 
 
 
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2d 29, 34 (Fla. 2000).  “To find in favor of the insured on this basis, however, the 
policy must actually be ambiguous.”  Penzer v. Transp. Ins. Co., 29 So. 3d 1000, 
1005 (Fla. 2010) (emphasis omitted). 
“When interpreting insurance contracts, we may consult references 
commonly relied upon to supply the accepted meanings of words.”  Garcia v. Fed. 
Ins. Co., 969 So. 2d 288, 291-92 (Fla. 2007).  Moreover, “when analyzing an 
insurance contract, it is necessary to examine the contract in its context and as a 
whole, and to avoid simply concentrating on certain limited provisions to the 
exclusion of the totality of others.”  Swire, 845 So. 2d at 165.  This Court has 
“consistently held that ‘in construing insurance policies, courts should read each 
policy as a whole, endeavoring to give every provision its full meaning and 
operative effect.’ ”  Id. at 166 (quoting Auto-Owners, 756 So. 2d at 34). 
The PIP Statute 
“[T]he PIP statute sets forth a basic coverage mandate: every PIP insurer is 
required to—that is, the insurer ‘shall’—reimburse eighty percent of reasonable 
expenses for medically necessary services.”  Virtual Imaging, 141 So. 3d at 155.  
This provision—the reasonable medical expenses coverage mandate—is “the heart 
of the PIP statute’s coverage requirements.”  Id.  “[T]here are two different 
methodologies for calculating reimbursements to satisfy the PIP statute’s 
reasonable medical expenses coverage mandate.”  Id. at 156 (emphasis omitted).  
 
 
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Compare § 627.736(5)(a)1., Fla. Stat. (2009), with § 627.736(5)(a)2., Fla. Stat. 
(2009).  Under the first payment methodology contained within section 
627.736(5)(a)1., “reasonableness is a fact-dependent inquiry determined by 
consideration of various factors.”  Virtual Imaging, 141 So. 3d at 155-56.  Under 
the alternative, permissive payment methodology contained within section 
627.736(5)(a)2., “insurers ‘may limit reimbursement’ to eighty percent of a 
schedule of maximum charges set forth in the PIP statute.”  Id. at 154 (quoting § 
627.736(5)(a)2., Fla. Stat.).  Reimbursements made under section 627.736(5)(a)2. 
satisfy the PIP statute’s reasonable medical expenses coverage mandate.  See id. at 
150, 156-57. 
In Virtual Imaging, this Court “h[eld] that under the 2008 amendments to the 
PIP statute, a PIP insurer cannot take advantage of the Medicare fee schedules to 
limit reimbursements without notifying its insured by electing those fee schedules 
in its policy.”  Id. at 160.  This Court concluded that 
notice to the insured, through an election in the policy, is necessary 
because the PIP statute, section 627.736, requires the insurer to pay 
for “reasonable expenses . . . for medically necessary . . . services,”     
§ 627.736(1)(a), Fla. Stat., but merely permits the insurer to use the 
Medicare fee schedules as a basis for limiting reimbursements, see     
§ 627.736(5)(a)2., Fla. Stat. 
  
Id. at 150 (alterations in original).  Accordingly, this Court reasoned that 
[b]ecause the fee schedule provision of section 627.736(5)(a)2.f. is 
permissive and not mandatory, and because the Medicare fee 
schedules are not the only mechanism for calculating reimbursements, 
 
 
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. . . the insurer cannot take advantage of the Medicare fee schedules to 
limit reimbursements without notifying its insured by electing those 
fee schedules in its policy. 
 
Id. at 158-59.  As this Court explained, “when the plain language of the PIP statute 
affords insurers two different mechanisms for calculating reimbursements, the 
insurer must clearly and unambiguously elect the permissive payment 
methodology in order to rely on it.”  Id. at 158 (citing Kingsway Amigo Ins. Co. v. 
Ocean Health, Inc., 63 So. 3d 63, 67-68 (Fla. 4th DCA 2011)). 
The Instant Case 
Allstate’s PIP policy provides legally sufficient notice of Allstate’s election 
to use the permissive Medicare fee schedules identified in section 627.736(5)(a)2. 
to limit reimbursements.  The endorsement to Allstate’s policy clearly and 
unambiguously states that “[a]ny amounts payable” for medical expense 
reimbursements “shall be subject to any and all limitations, authorized by section 
627.736, . . . including . . . all fee schedules.”  When read in its context and as a 
whole with Allstate’s policy, the plain and obvious meaning of the endorsement is 
that reimbursements will be made in accordance with all of the fee schedule 
limitations contained within section 627.736(5)(a)2.  See, e.g., Stand-Up MRI, 188 
So. 3d at 3 (“Virtual Imaging requires no other magic words from Allstate’s policy 
and its simple notice requirement is satisfied by Allstate’s [unambiguous] language 
limiting ‘[a]ny amounts payable’ to the fee schedule-based limitations found in the 
 
 
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statute.” (second alteration in original)); Fla. Wellness & Rehab. v. Allstate Fire & 
Cas. Ins. Co., 201 So. 3d 169, 173 (Fla. 3d DCA 2016) (“The use of the phrase 
‘subject to’ in the policy places the insured on notice of the limitations elected by 
Allstate; indeed, we cannot discern any other alternative meaning to this 
language.”); Allstate Indem. Co. v. Markley Chiropractic & Acupuncture, LLC, 41 
Fla. L. Weekly D793, 2016 WL 1238533, at *4 (Fla. 2d DCA Mar. 30, 2016) 
(explaining that “Virtual Imaging did not dictate a form of notice” or require 
insurers to specifically state the word “Medicare”).  Allstate’s policy thus places 
both providers and insured on notice of Allstate’s election to use the permissive 
Medicare fee schedules identified in section 627.736(5)(a)2. to limit 
reimbursements. 
Respondents argue that Allstate’s policy is ambiguous under Virtual 
Imaging because it fails to state that Allstate: (1) will not actually pay eighty 
percent of reasonable charges and (2) will instead calculate benefits only under the 
permissive Medicare fee schedules contained within section 627.736(5)(a)2.  But 
Respondents’ argument misconstrues Virtual Imaging.  A PIP policy cannot 
contain a statement that the insurer will not pay eighty percent of reasonable 
charges because no insurer can disclaim the PIP statute’s reasonable medical 
expenses coverage mandate.  See Virtual Imaging, 141 So. 3d at 155.  
Furthermore, a PIP policy cannot state that the insurer will calculate benefits solely 
 
 
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under the Medicare fee schedules contained within section 627.736(5)(a)2. because 
the Medicare fee schedules are not the only applicable mechanism for calculating 
reimbursements under the permissive payment methodology.  See id. at 159 
(explaining that “the Medicare fee schedules are not the only mechanism for 
calculating reimbursements”).  Compare § 627.736(5)(a)2.a., d.-f., Fla. Stat. 
(referring to the Medicare fee schedules), with § 627.736(5)(a)2.b.-c., Fla. Stat. 
(referring to the non-Medicare fee schedules). 
Respondents argue that Allstate’s policy is ambiguous because the term 
“shall” can reasonably be construed as “must” or “may.”  This argument 
unreasonably suggests that we ignore the context in which “shall” appears.  
Respondents correctly note that the term “shall” can be construed as “must” or 
“may.”  See, e.g., Black’s Law Dictionary (10th ed. 2014) (defining “shall” in 
relevant part as “will” or “may”).  But it is frequently unambiguously the case that 
“[t]he word ‘shall’ is mandatory in nature.”  Sanders v. City of Orlando, 997 So. 2d 
1089, 1095 (Fla. 2008); see Virtual Imaging, 141 So. 3d at 155 (interpreting the 
word “shall” contained within section 627.736(1) as mandatory).  This Court has 
recognized that “[a]lthough there is no fixed construction of the word ‘shall,’ it is 
normally meant to be mandatory in nature” and “[i]ts interpretation depends upon 
the context in which it is found.”  S. R. v. State, 346 So. 2d 1018, 1019 (Fla. 1977) 
(citation omitted).  Nothing within Allstate’s policy indicates that this Court should 
 
 
- 11 - 
construe the word “shall” contrary to its normal usage.  Given the context of the 
policy provision, the only reasonable interpretation of the term “shall” is as “must” 
or “will.” 
Respondents argue that even if the term “shall” is interpreted as mandatory, 
Allstate’s policy is ambiguous because the phrase “subject to” can reasonably be 
construed as a mandatory command or a permissive instruction.  Again, this 
argument suggests that we should ignore the context.  Respondents correctly note 
that the phrase “subject to” can be construed as a permissive instruction.  See, e.g., 
Oxford American Dictionary & Thesaurus 1301-02 (2nd ed. 2009) (defining 
“subject to” in relevant part as “dependent or conditional on” or “under someone’s 
or something’s control or authority”); St. Augustine Pools, Inc. v. James M. 
Barker, Inc., 687 So. 2d 957, 958 (Fla. 5th DCA 1997) (“The term ‘subject to’ 
means ‘liable, subordinate, subservient, inferior, obedient to; governed or affected 
by; provided that; provided; answerable.’ ” (quoting Black’s Law Dictionary 1425 
(6th ed. 1990))).  Because insurance contracts must be read as a whole and not in 
isolated parts, the appropriate inquiry in this case is whether the phrase “shall be 
subject to” is ambiguous within the full context of Allstate’s PIP policy. 
Although there is no fixed construction of the phrase “shall be subject to,” it 
is normally meant to be mandatory in nature and its interpretation depends upon 
the context in which it is found.  See, e.g., Certain Interested Underwriters at 
 
 
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Lloyd’s London v. Pitu, Inc., 95 So. 3d 290, 293 (Fla. 3d DCA 2012) (holding that 
an endorsement to a homeowner’s insurance policy stating “loss(es) paid arising 
out of, or caused by, water damage shall be subject to a maximum amount of 
$25,000 during the policy term” clearly and unambiguously limited reimbursement 
of losses for water damage to $25,000 (alteration in original) (emphasis added)); 
cf. S. R. v. State, 346 So. 2d at 1019 (reasoning that the word “shall” is normally 
meant to be mandatory in nature and its interpretation depends upon the context in 
which it is found).  This Court has interpreted the phrase “shall be subject to” as a 
mandatory command and a permissive instruction in different contexts.  Compare 
Robertson v. State, 143 So. 3d 907, 908-09 (Fla. 2014) (explaining that because the 
Legislature has mandated in section 921.141(4), Florida Statutes (2013), that “[t]he 
judgment of conviction and sentence of death shall be subject to automatic review 
by the Supreme Court of Florida,” Florida law “requires that this Court shall 
automatically review every judgment of conviction and sentence of death” 
(alteration in original) (emphasis added)), and St. Mary’s Hosp., Inc. v. Phillipe, 
769 So. 2d 961, 972 (Fla. 2000) (“Arbitration is not voluntary according to section 
766.207(7)(k) because ‘a claimant who rejects a defendant’s offer to arbitrate shall 
be subject to the provisions of section 766.209(4),’ which limits the noneconomic 
damages to be awardable at trial to $350,000.” (emphasis added)), with Fallis v. 
City of N. Miami, 127 So. 2d 883, 884 (Fla. 1961) (holding that the phrase “shall 
 
 
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be subject to referendum” contained within the charter of the City of North Miami 
was “not mandatory” because it was “obviously intended to permit a referendum 
on a bond ordinance when such is demanded in accordance with other provisions 
of the municipal charter”). 
Here, in the context of Allstate’s PIP policy, the only reasonable 
interpretation of the phrase “shall be subject to” is as a mandatory command.  By 
stating that “[a]ny amounts payable” for medical expense reimbursements “shall be 
subject to any and all limitations, authorized by section 627.736, . . . including . . . 
all fee schedules,” Allstate’s policy endorsement states in mandatory language that 
benefit payments must or will be made in accordance with such limitations.  The 
use of the word “shall”—which is mandatory in nature—supports this conclusion, 
and nothing within Allstate’s policy indicates that this Court should construe the 
phrase “shall be subject to” as a permissive instruction.  To interpret the provision 
as argued by the Respondents would effectively make the provision meaningless.  
Under that interpretation, the provision amounts to nothing more than a nugatory 
recitation of the statutory authorization. 
Respondents argue that Allstate’s policy is ambiguous because the phrase 
“all fee schedules” includes both the non-Medicare fee schedules listed in section 
627.736(5)(a)1. and the Medicare fee schedules listed in section 627.736(5)(a)2.  
Not so.  In the context of Allstate’s policy, the endorsement unambiguously 
 
 
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references “any and all limitations, authorized by section 627.736, . . . including . . 
. all fee schedules.”  (Emphasis added.)  A review of section 627.736 reveals that 
the only fee schedule limitations applicable to insurer payments contained within 
that statute are located in section 627.736(5)(a)2.  See § 627.736(5)(a)2., Fla. Stat. 
(“The insurer may limit reimbursement to 80 percent of the following schedule of 
maximum charges . . . .” (emphasis added)); § 627.736(5)(a)3.-5., Fla. Stat. 
(referencing the fee schedule limitations contained within section 627.736(5)(a)2.).  
The “fee schedules” referred to in subsection (a)1. are not within the category of 
“limitations” referred to in the policy endorsement.  In explaining the factors that 
are relevant to determining what constitutes a reasonable charge, subsection (a)1. 
simply provides that “consideration may be given” to various relevant factors, 
including “various federal and state medical fee schedules applicable to automobile 
and other insurance coverages.”  These fee schedules may be considered in 
determining the amount of reasonable charges, but they—unlike the fee schedules 
referred to in subsection (a)2.—do not operate as “limitations” on charges. 
 
Orthopedic Specialists erroneously concluded that Allstate’s policy language 
is not legally sufficient to authorize Allstate to apply the Medicare fee schedules.  
Stand-Up MRI correctly concluded that Allstate’s PIP policy provides legally 
sufficient notice of Allstate’s election to use the permissive Medicare fee schedules 
identified in section 627.736(5)(a)2. to limit reimbursements. 
 
 
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III.  CONCLUSION 
We approve Stand-Up MRI on the conflict issue and quash Orthopedic 
Specialists.   
It is so ordered. 
LABARGA, C.J., and QUINCE, and POLSTON, JJ., concur. 
PARIENTE, J., dissents with an opinion, in which LEWIS, J., and PERRY, Senior 
Justice, concur. 
 
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION, AND 
IF FILED, DETERMINED. 
 
PARIENTE, J., dissenting. 
 
 
I dissent and would adopt the Fourth District’s well-reasoned decision in 
Orthopedic Specialists v. Allstate Insurance Co., holding that the policy language 
in the Allstate personal injury protection (PIP) policy is “inherently unclear” and 
did not properly provide legally sufficient notice to the insured or medical 
providers of the insurer’s election to use the permissive Medicare fee schedule.  
177 So. 3d 19, 20-21 (Fla. 4th DCA 2015).  If an insurer elects to use the Medicare 
fee schedule as the standard for reimbursement, “the insurer must clearly and 
unambiguously draft a policy provision to achieve that result.”  Geico Gen. Ins. 
Co. v. Virtual Imaging Servs., Inc., 141 So. 3d 147, 157 (Fla. 2013).  Likewise, I 
agree with the Fourth District’s analysis that “[a] policy is not sufficient unless it 
plainly and obviously limits reimbursement to the Medicare fee schedules 
exclusively.”  Orthopedic Specialists, 177 So. 3d at 25-26.   
 
 
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As the majority stated, the policy language at issue in this case states: 
Allstate will pay to or on behalf of the injured person the 
following benefits: 
 
      
1.  Medical Expenses 
Eighty percent of all reasonable expenses for medically necessary 
medical, surgical, X-ray, dental, and rehabilitative services, including 
prosthetic devices, and medically necessary ambulance, hospital, and 
nursing services. 
 
. . . . 
 
Limits of Liability 
. . . . 
Any amounts payable under this coverage shall be subject to any and 
all limitations, authorized by section 627.736, or any other provisions 
of the Florida Motor Vehicle No-Fault Law, as enacted, amended or 
otherwise continued in the law, including, but not limited to, all fee 
schedules. 
 
Majority op. at 3. 
 
I agree with the Fourth District’s explanation that the policy language 
including “all fee schedules” authorized by Florida’s PIP statute does not clearly 
and unambiguously put providers on notice that Allstate elects the Medicare fee 
schedule.  As the Fourth District also explained regarding the “subject to” 
language:  
The policy cannot leave Allstate’s choice of reimbursement method in 
limbo under the guise of the words, “subject to” without incorporating 
specific words to that effect.  The policy must make it inescapably 
discernable that it will not pay the “basic” statutorily required 
coverage and will instead substitute the Medicare fee schedules as the 
exclusive form of reimbursement. 
Dozens of courts have weighed in on the meaning of the 
language at issue in this appeal, and there is a sharp divide as to 
 
 
- 17 - 
whether the language is legally sufficient to invoke utilization of the 
Medicare fee schedules and thereby meet its statutory duty to provide 
clarity and specificity.  And to be sure, Allstate owns the burden to 
avoid latent ambiguity.  See [Wash. Nat’l Ins. Co. v.] Ruderman, 117 
So. 3d [943,] 950 [(Fla. 2013)] (recognizing, with regard to 
ambiguous language, that “ ‘[i]t has long been a tenet of Florida 
insurance law that an insurer, as the writer of an insurance policy, is 
bound by the language of the policy, which is to be construed liberally 
in favor of the insured and strictly against the insurer’ ” (quoting 
Berkshire Life Ins. Co. v. Adelberg, 698 So. 2d 828, 830 (Fla. 
1997))).  While we recognize that a lack of consensus among the 
courts does not raise a presumption of ambiguity, it would be 
disingenuous for us to say that this widespread debate does not make 
us question Allstate’s suggestion that its policy is, as it argues, 
“crystal clear.”  As Judge Klein said in State Farm Fire & Casualty 
Insurance Co. v. Deni Associates of Florida, Inc., 678 So. 2d 397, 408 
(Fla. 4th DCA 1996): “If Judges learned in the law can reach so 
diametrically conflicting conclusions as to what the language of the 
policy means, it is hard to see how it can be held as a matter of law 
that the language was so unambiguous that a layman would be bound 
by it.” 
 
Orthopedic Specialists, 177 So. 3d at 26. 
 
The Amicus Brief of the Florida Medical Association, in support of the 
medical provider, explains in detail both the history of Florida’s PIP statute and its 
many amendments and the dilemma posed by this ambiguous policy provision, 
which allows Allstate to select any method of reimbursement rather than 
exclusively electing the Medicare fee schedule.  As the Amicus states in explaining 
the importance of clarity in the PIP carrier’s election of a fee schedule: 
The election as to which payment methodology is utilized by 
Allstate is critical to the medical profession and carries with it 
ramifications that directly affect physician reimbursements and the 
doctor patient relationship.  For example, if an insurer elects the fact 
 
 
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dependent method of subsection (5)(a)1 to calculate benefits, the 
physician is still permitted to charge and is in a position to collect 
what the physician considers a reasonable amount for their services.  
On the other hand, if an [sic] PIP insurer properly elects the fee 
schedule method of subsections (5)(a)2 the physician is limited to a 
payment that may be below the cost of rendering the care or in a worst 
case scenario to no compensation if the treatment is “not reimbursable 
under Medicare or workers’ compensation.”  See § 627.736(5)(a)2.f.  
The physician further is prohibited from balance billing their patients.  
See § 627.736(5)(a)5.  In short, the fee schedule amount is a “take it-
or leave it” proposition.   
Unfortunately, the practice of medicine requires physicians to 
make some difficult choices.  One of those is whether it can continue 
to treat patients based on certain reimbursement rates.  Under 
traditional health insurance a provider may enter into a managed care 
network agreement with a health insurance company and agrees to 
reduce its rates, it does so in exchange for different forms of 
consideration.  There is an opportunity for additional business and the 
provider has none of the procedural obstacles that face providers who 
agree to treat automobile accident insureds.   
Until the enactment of the permissive fee schedule, medical 
providers knew that No-Fault insurance was one of the last bastions of 
first party coverage where reimbursement was based solely on 
reasonable charges.  If a provider felt that its charge was reasonable, it 
knew that the insurer will have to pay based on that amount or the 
provider had the right to challenge the insurer’s determination in 
court.  It was this trade-off that made the “red-tape” inherent in 
complying with the PIP statute—or to engage in first and third party 
litigation—somewhat economical to the provider.  If, however, the 
reimbursement will be limited, each provider will have to decide 
whether the meager amounts payable under the fee schedules are 
sufficient to justify the “red tape”, limitations and requirements 
inherent in providing services to an injured accident victim.[n.9]  
[N.9]  Several appellate court decisions have recognized, 
the disparity between payment under the “fee schedule 
method” that pays much lower benefits (commensurate 
with meager Medicare rates) than would be payable 
under the “fact based payment method.”  See Geico 
Indem. Co. v. Physicians Grp. LLC, 47 So. 3d 354, 356 
 
 
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(Fla. 2d DCA 2010) (PIP insurer unlawfully relied on 
Medicare fee schedules to pay merely $1,122.86 for a 
$10,800 surgery); Nationwide Mutual Ins. Co. v. AFO 
Imaging, Inc., 71 So. 3d 134, 137 (Fla. 2d DCA 2011) 
(fee schedule method is “utilized in computing the 
minimum amount” payable by PIP); [Allstate Fire & Cas. 
Ins. Co. v.] Stand-Up MRI, [188 So. 3d 1, 3 (Fla. 1st 
DCA 2015)] (fact dependent reasonable amount method 
“apparently results in higher reimbursements” than 
permissive fee schedule method). 
 
Br. of Amicus Curiae Fla. Medical Ass’n (Mar. 11, 2016), at 14-16. 
 
 
Due to the ramifications a PIP carrier’s fee schedule selection has on 
physicians, as the Amicus explained, and the resulting importance that policies be 
“clear and unambiguous,” as our precedent requires, I agree with the Fourth 
District that “the language at issue is ambiguous and . . . must therefore be 
construed in favor of the Providers.”  Orthopedic Specialists, 177 So. 3d at 26. 
LEWIS, J., and PERRY, Senior Justice, concur. 
Application for Review of the Decision of the District Court of Appeal – Certified 
Direct Conflict of Decisions 
 
 
Fourth District - Case No. 4D14-287 
 
 
(Palm Beach County) 
 
Suzanne Youmans Labrit and Douglas Gerard Brehm of Shutts & Bowen LLP, 
Tampa, Florida; Peter J. Valeta of Cozen O’Connor, Chicago, Illinois; and Richard 
C. Godfrey of Kirkland & Ellis, LLP, Chicago, Illinois, 
 
 
for Petitioner 
 
 
 
 
 
- 20 - 
Gary M. Farmer and Gary Michael Farmer, Jr. of Farmer Jaffe Weissing Edwards 
Fistos & Lehrman P.L., Fort Lauderdale, Florida; David Michael Caldevilla of De 
La Parte & Gilbert, P.A., Tampa, Florida; and Stephen Douglas Deitsch and 
Lindsay Capri Porak of Deitsch & Wright, P.A., Lake Worth, Florida, 
 
 
for Respondents 
 
Edward Herbert Zebersky of Zebersky Payne, LLP, Fort Lauderdale, Florida; and 
Lawrence Mark Kopelman of Lawrence M. Kopelman, P.A., Fort Lauderdale, 
Florida,  
 
 
for Amicus Curiae Florida Medical Association