Court Opinion

ID: 9716589
Source: CourtListenerOpinion
Date Created: 2023-08-26 06:45:03.210656+00
Date Added: 2024-06-11T18:23:47.016706
License: Public Domain

DISSENTING OPINION BY
Judge LEAVITT.
Respectfully, I dissent. The majority holds that Southeastern Pennsylvania Transportation Authority (SEPTA), a self-insured Commonwealth agency, must pay interest to medical providers who do not receive payment within 30 days of the submission of an invoice by an individual claiming to have been injured in a bus accident. First, and foremost, the General Assembly did not impose a 12% late payment interest obligation upon the sovereign because the clear and unmistakable statutory language required for such an unusual liability is missing. Second, precedent teaches that requirements imposed upon commercial insurance companies by the Motor Vehicle Financial Responsibility Law (MVFRL)1 will not be extended to self-insureds where impractical. This is the case for SEPTA.
“Insurers” are required to adjust first-party medical claims within 30 days of receipt. 75 Pa.C.S. § 1716.2 The sanction for not meeting this deadline is the payment of 12% interest, starting on day 31, and, in some cases, a “reasonable attorney fee.” Id. SEPTA is not an “insurer” under Section 1716, as the majority acknowledges. This does not end the inquiry, however, because Section 1787 of the MVFRL requires a self-insurer to satisfy *1109the Department of Transportation that it has made financial arrangements necessary to provide first-party medical benefits “subject to the provisions of Subchapter B.” 75 Pa.C.S. § 1787(a)(1).3 The question is whether the sanctions established in Section 1716 apply to SEPTA because Section 1716 is part of Subchapter B.
The majority acknowledges that many provisions in Subchapter B that relate to commercial insurance business practices simply cannot apply to SEPTA. For example, insurers must give certain notices to their policyholders and include certain mandatory provisions in their insurance policies. See, e.g., 75 Pa.C.S. § 1725.4 SEPTA cannot be expected to comply with all Subchapter B provisions because SEPTA does not issue policies and does not have policyholders. The majority reasons, nevertheless, that because Section 1716 falls within Subchapter B, its imposition on “insurers” to pay 12% interest for late payment of first-party medical bills applies to self-insureds such as SEPTA. I disagree.
First, Section 1716 does not directly bind the Commonwealth to the 12% interest obligation. Our Supreme Court has explained that a statute should not be construed to deprive the Commonwealth of property unless “the intention to do so is clearly manifest.” Lichtenstein v. Pennsylvania Turnpike Commission, 398 Pa. 415, 418, 158 A.2d 461, 462 (1959). In the absence of a statutory provision expressly imposing an interest obligation upon the Commonwealth, no such liability will be found. See, e.g., Summit House Condominium v. Commonwealth of Pennsylvania, 514 Pa. 221, 523 A.2d 333 (1987). The rationale for this principle has been expressed as follows:
The theory on which interest is allowed, except in cases of contract to pay interest, is that it is damages for delay or default in payment by the debtor, measured by a rate per cent. The state is not liable to pay interest on its debts unless bound by statute or by contract of its executive officers. The government is presumed to be always ready to pay, and it would be against public policy to declare it otherwise.
Philadelphia County v. Commonwealth, 276 Pa. 12, 14, 119 A. 723, 723 (1923). Section 1716 does not state that the 12% interest requirement applies to a self-insurer that is a Commonwealth agency. At best, the obligation follows indirectly from the Section 1787 filing made with the Department of Transportation to qualify as a self-insurer. In short, Section 1716 cannot be read to impose the 12% interest requirement on SEPTA.
*1110Second, it is impractical to require SEPTA to pay a provider’s invoice within 30 days of receipt, rendering Section 1716 another of the many provisions in Sub-chapter B that cannot be followed by self-insureds. Westbrook v. Robbins, 416 Pa.Super. 543, 611 A.2d 749 (1992), is instructive on this point.
In Westbrook, the Pennsylvania Superi- or Court held that the Pennsylvania Financial Responsibility Assigned Claims Plan was not liable to pay interest on overdue medical benefits because it was not an “insurer.”5 Like SEPTA, the Assigned Claims Plan does not collect premiums; does not issue liability insurance policies; and does not have an insurer-insured relationship with the injured claimant. The Superior Court held that it was impractical to hold the Assigned Claims Plan to the 30-day limit imposed by Section 1716. Before paying the claim, the Assigned Claims Plan has to determine whether the injured party is a Pennsylvania resident; was injured in a Pennsylvania motor vehicle accident; does not own a motor vehicle required to be registered in Pennsylvania; was not the operator or passenger of a motor vehicle owned by the federal government or an entity immune from liability; was not entitled to receive other benefits as a result of the accident; and was not the operator or passenger of a recreational vehicle. Because of these challenges, the Superior Court determined that it would be impractical to impose the 30-day requirement to pay first-party medical claims upon the Assigned Claims Plan, which is not doing the commercial business of insurance.
This rationale applies with equal force to SEPTA. Upon notice of a claim, SEPTA must send the claimant an application for benefits to determine whether the injured party has an automobile insurance policy, which is the primary source of first-party medical benefits owed to passengers injured in a bus accident. 75 Pa.C.S. § 1713. To confirm that the claimant does not own a vehicle for which insurance is required, SEPTA must request confirmation from the Pennsylvania Department of Motor Vehicles (PennDOT). Next, SEPTA must investigate the facts of the accident to determine if an accident occurred; if the claimant was involved in the accident; and if the claimant’s injuries are causally related to the accident. This investigation involves interviewing the bus driver; reviewing TransPass records; examining the complete claims application; examining deposition testimony or findings by a court or arbitration panel; and reviewing the bus route to determine the location of the bus at the date and time of the alleged accident.
If SEPTA is to be required to make payment before these investigations are complete, it will be forced to pay some fraudulent claims. There are times when SEPTA receives invoices for payment when there is no evidence that a SEPTA vehicle was involved in an accident or that the claimant was a passenger. Affidavit of Francis X. Comely, Sr., SEPTA Director of Claims, at ¶ 12; Reproduced Record at 226a. As with the Assigned Claims Plan, information vital to evaluating the medical benefit claim is beyond SEPTA’s control and securing that information can take longer than 30 days.
*1111In addition, SEPTA faces challenges unique to it. The Assigned Claims Plan may refuse a claim where the accident was not “reported to the police or proper governmental authority.” Gunter v. Constitution State Service Company, 432 Pa.Super. 295, 638 A.2d 233, 236 (1994) (quoting 75 Pa.C.S. § 1702). SEPTA has no such easy out. It must investigate some claims, i.e., slip and falls, where the bus driver has no knowledge of the alleged incident, there is no police report, no witnesses and no damage to a SEPTA vehicle.
It seems doubtful that the General Assembly intended that SEPTA pay providers within 30 days of receiving a claim from strangers who may, or may not, have been passengers on a SEPTA bus. A 30-day payment deadline is impractical for all the above-stated reasons. In any case, the sanction in Section 1716, which does not even refer to self-insurers, let alone self-insurers that are Commonwealth agencies, does not provide the clear and unmistakable language required to make the sovereign pay 12% interest. Accordingly, I would reverse the order of the trial court.

. 75 Pa.C.S. §§ 1701-1799.7.

. Section 1716 of the MVFRL states:
Benefits are overdue if not paid within 30 days after the insurer receives reasonable proof of the amount of the benefits. If reasonable proof is not supplied as to all benefits, the portion supported by reasonable proof is overdue if not paid within 30 days after the proof is received by the insurer. Overdue benefits shall bear interest at the rate of 12% per annum from the date the benefits become due. In the event the insurer is found to have acted in an unreasonable manner in refusing to pay the benefits when due, the insurer shall pay, in addition to the benefits owed and the interest thereon, a reasonable attorney fee based upon actual time expended.
75 Pa.C.S. § 1716 (emphasis added). SEPTA does not satisfy the statutory definition of "insurer,” which is a “motor vehicle liability insurer.” 75 Pa.C.S. § 1702. SEPTA is not licensed as an insurer; does not do the business of insurance in the Commonwealth; does not issue policies; does not collect premiums; and has no insurer-insured relationship with injured claimants.

. Section 1787 establishes that to effect valid self-insurance, a filing must be made with the Department of Transportation that provides evidence that "reliable financial arrangements” have been made, satisfactory to "the department,” that the self-insurer will
[pjrovide the benefits required by section 1711 (relating to required benefits), subject to the provisions of Subchapter B (relating to motor vehicle liability insurance first party benefits), except the additional benefits and limits provided in sections 1712 (relating to availability of benefits) and 1715 (relating to availability of adequate limits).
75 Pa.C.S. § 1787(a)(1). A first-party medical benefit of $5,000 is required by Section 1711, which states, in relevant part:
An insurer issuing or delivering liability insurance policies covering any motor vehicle of the type required to be registered under this title ... shall include coverage providing a medical benefit in the amount of $5,000.
75 Pa.C.S. § 1711(a).

. Section 1725 requires every policy to contain a notice in “boldface” as to whether the policy's collision coverage includes damage to rental vehicles. 75 Pa.C.S. § 1725.

. The Assigned Claims Plan is a statutory facility established in Subchapter E of the MVFRL, 75 Pa.C.S. §§ 1751-1757. The Assigned Claims Plan provides first party medical benefits for those individuals injured in motor vehicle-related accidents who do not own a vehicle and, as such, do not have an automobile insurance policy responsible for the individual’s first $5,000 in medical benefits. 75 Pa.C.S. § 1752. These persons include, for example, pedestrians or passengers injured by an uninsured motor vehicle.