Court Opinion

ID: 9746917
Source: CourtListenerOpinion
Date Created: 2023-08-27 14:44:59.313792+00
Date Added: 2024-06-11T07:25:18.220498
License: Public Domain

BROSKY, Judge;
concurring.
Appellant reasons that because a PRO is not an administrative agency; she is not required to follow the PRO review *105procedure outlined in the statute before obtaining judicial review. This argument is premised on the assumption that the statute in question provides to appellant, as an insured, a vehicle by which to obtain judicial review. Appellant argues that if the statute does provide a method of obtaining judicial review of a PRO determination, this procedure is unduly restrictive in violation of due process. In this latter vein, appellant maintains that since the statute frames the request for reconsideration by an insured, an insurer or a provider of an unfavorable determination of a PRO in non-mandatory language, the failure of any aggrieved party to request reconsideration from a PRO does not bar the right to judicial review of this adverse determination. Appellant argues, alternatively, that the statute does not provide a right to judicial review. I agree with appellant insofar as the statute in question does not provide a forum for judicial review of a determination of a PRO.
The majority chooses not to address the question whether the statute at bar provides a forum for judicial review of a determination of a PRO “because of [its] preference for affirming orders on the narrowest possible grounds rather than a belief that Peer Review process is not subject to judicial review after statutory remedies are exhausted.” Majority Opn. at p. 1038, note 6. In this vein, the majority also “note[s] that a denial of a [sic] access to a court of law after the conclusion of the Peer Review process would raise serious constitutional problems, especially in light of the financial relationship between an insurer and PROs.” Id. However, I believe that the question whether the statute in controversy provides a forum for judicial review, and, if it does not, whether the lack of such forum violates due process goes to the heart of appellant’s contention at bar. Since I consider this question pivotal, I concur only in the decision of the majority to affirm the Order of the trial court. My reasoning follows.
Section 1797(b) of the MVFRL, 42 Pa.C.S.A. § 1797(b), is entitled “Peer review plan for challenges to reasonableness *106and necessity of treatment”, and subsection (1) thereof describes the operation of the plan as follows:
(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 of performance and are medically necessary. An insurer’s challenge must be made to a PRO within 90 days of the insurer’s receipt of the provider’s bill for treatment or services or may be made at any time for continuing treatment or services.
Section 1797(b) also contains two subsections relating to the methods by which challenges may be made to the medical necessity of health care services or products. Section 1797(b)(2) provides for reconsideration by a PRO of its initial determination. It reads in relevant part as follows:
(2) PRO reconsideration.—An insurer, provider or insured may request a reconsideration by the PRO of the PRO’s initial determination. Such a request for reconsideration must be made within 30 days of the PRO’S initial determination.
(Emphasis supplied.) Section 1797(b)(4) sets forth the condition under which a court may hear a challenge to an insurer’s refusal to pay for health care services. This subsection states in pertinent part:
(4) Appeal to court.—A provider of medical treatment or rehabilitative services or merchandise or an insured may challenge before a court an insurer’s refusal to pay for past or future medical treatment or rehabilitative services or merchandise, the reasonableness or necessity of which the insurer has not challenged before a PRO.
(Emphasis supplied.) The Insurance Department regulation in effect during the time period here involved described the initial procedure by which an insurer could dispute the medical necessity of a health care provider’s services or products and the subsequent method by which an insurer, a health care *107provider or an insured might challenge a determination by a PRO. Former 31 Pa.Code § 68.2(c) provided in pertinent part:
(c) A property and casualty insurer that disputes a provider’s bill for treatment or services may request that the bill be reviewed by a PRO. Following the PRO’s initial determination, an insurer, provider or insured may request reconsideration of the decision.... If an insurer has not challenged the propriety of medical treatment or services, a provider may challenge an insurer’s refusal to pay for the treatment in the courts of this Commonwealth. The Insurance Department interprets Act 6 [Section 1797(b) ] to permit that upon final determination by the PRO, an insurer, provider or insured may appeal the decision in court.
20 Pa.Bull. at 2055. (Emphasis supplied.) I am also aware of two federal decisions which have reached the same interpretative conclusion. See Elliott v. State Farm Mutual Automobile Insurance Co., 786 F.Supp. 487 (E.D.Pa.1992), and Danton v. State Farm Mutual Insurance Co., 769 F.Supp. 174 (E.D.Pa. 1991). In like vein, the Danton court stated with respect to an insured’s right to judicial review after an adverse determination by a PRO:
[T]he insured or provider still has the right to sue if the insurance company refuses to pay the provider’s bill in full without consulting a PRO. Furthermore, the insured still has the right to appeal the decision of the PRO to court if it is against the insured. This route to the courts may be more indirect than [previous legislation allowed], but ultimately, the insured or provider has the right to challenge the insurance company decision in court.
769 F.Supp. at 176. (Emphasis supplied.)
My reading of Section 1797(b) leads me to conclude that its plain, unambiguous language does not provide for a forum for judicial review of a PRO determination and, therefore, does not lend itself to the interpretation cast upon it by the Insurance Department and the federal court. Moreover, the regulation of the Insurance Department interpreting Section *1081797(b) to provide the right to judicial review of a PRO determination appears to be at odds with the plain language of the statute, itself, which is silent on this subject. It is well established that a regulation cannot be upheld if it is contrary to the statute under which it is promulgated. Consulting Engineers Council of Pennsylvania v. The State Architects Licensure Board, 522 Pa. 204, 560 A.2d 1375 (1989); Commonwealth v. De Fusco, 378 Pa.Super. 442, 549 A.2d 140 (1988), appeal granted, 522 Pa. 572, 559 A.2d 34 (1989), appeal denied, 523 Pa. 425, 567 A.2d 1043 (1990), and courts are not so bound to follow such contrary regulations. Lookenbill v. Garrett, 340 Pa.Super. 435, 490 A.2d 857 (1985). Where, as here, an apparent conflict or inconsistency between a statute and a regulation promulgated thereunder exists, the statute prevails. Commonwealth v. De Fusco, supra; Tiani v. Commonwealth, Dept. of Public Welfare, 86 Pa.Commw. 640, 486 A.2d 1016 (1985). Therefore, I am not bound to consider and hold as controlling this regulation or the decisions of the federal court which have adopted the interpretation of the Insurance Department with respect to a party’s right to judicial review of a PRO determination, see Lookenbill, supra, since the regulation in question appears to be inconsistent and conflicts with the plain terms of the statute.1
To summarize, with respect to a PRO determination, the statute in question provides:
1. When an insurer receives a request for payment of health care services or products, only the insurer may initiate a request for determination by a PRO of the medical necessity therefor. Section 1797(b)(1).
*1092. After the PRO has made its determination as to the medical necessity or not of a health care service or product, the insurer, or the insured or the provider may, not must, request the PRO to reconsider the matter. Section 1797(b)(2).
3. If, however, the insurer does not initiate a request with a PRO for a determination of the medical necessity of a health care service or product, then and only then may the the insured or the provider initiate a proceeding in court challenging the insurer’s refusal to pay for the health care service or product. Section 1797(b)(4).
To reiterate, the statute does not provide for further review of a PRO determination by a court. If no reconsideration of an initial determination of a PRO is sought by the insurer, the insured or the provider, that determination is final and binding upon the parties. If any one of the parties—insurer, insured or provider—requests reconsideration by a PRO of its initial determination, the PRO’s decision upon reconsideration is likewise final and binding upon all parties. Resort to a court of record may only be employed to obtain relief by an insured or a provider where the insurer (1) refuses to pay a health provider’s bill and (2) has not challenged the medical necessity of this bill before a PRO. The fact that the heading to Section 1797(b)(4) reads “Appeal to court”, we think, is not misleading. The plain language within the text of this subsection makes it obvious that an appeal in the context of a judicial review is not to be understood therefrom. I believe, moreover, that my refusal to embrace this interpretation of Section 1797(b) is consistent with the purpose of the MVFRL, which is to reduce the escalating costs of motor vehicle insurance. Lambert v. McClure, 407 Pa.Super. 257, 595 A.2d 629 (1991).
The function of a PRO is to evaluate “treatment, health care services, products or accommodations provided to any injured person.” Section 1797(b)(1). The purpose of such evaluation is to “confirm[ ] that such treatment, products, services or accommodations conform to the professional standards of performance and are medically necessary.” Id. Hence, the function of a PRO is not to make policy. Rather, the role of *110the PRO is to factually determine whether a service or a product was medically necessary and whether it conformed to professional standards of performance. Pennsylvania Chiropractic Federation v. Foster, 136 Pa.Commw. 465, 583 A.2d 844 (1990).
If reconsideration is requested concerning “the services of a physician or other licensed health care professional, then the reviewing individual must be, or the reviewing panel must include an individual in the same specialty as the individual subject to review.” Section 1797(b)(2). Hence, the statute provides that the person or the panel making the determination of medical necessity must be or must include not simply a licensed health care professional but, rather, one whose specialty is the same as the one whose service or product is being reviewed. The Legislature has determined that a licensed health care professional in the same specialty as the one whose service or product is the subject of review is in the best position to evaluate the medical necessity therefor. Thus, the insurer and the insured are protected against hasty and/or uninformed decision making by non-experts.
In the event an insurer refuses to make payment for a health care provider’s services or products and does not submit the claim to a PRO for evaluation, then the insured or the provider may institute a cause of action against the insurer in a court for such refusal of payment. Section 1797(b)(4). The Legislature, in its wisdom, has decided that the insurer must first be given the opportunity to avail itself of the expertise of a PRO. If the insurer fails to avail itself of this opportunity, the insured or the provider, to whom the Legislature has not accorded the right to initiate a challenge before a PRO, may seek to invoke the protection of a court of record from an insurer’s unilateral determination of the non-necessity of a medical service or product.
However, I query why appellant expresses concern that the statute in question either restricts or makes no provision for judicial review of a PRO determination adverse to her, for the statute contains a provision which our examination thereof has *111led me to conclude insulates an insured, like appellant, from such adverse determination. Section 1797(b)(7) provides:
Determination in favor of insurer.—If it is determined by a PRO or court that a provider has provided unnecessary medical treatment or rehabilitative services or merchandise or that future provision of such treatment, services or merchandise will be unnecessary, or both, the provider may not collect payment for the medically unnecessary treatment, services or merchandise. If the provider has collected such payment, it must return the amount paid plus interest at 12% per year within 30 days. In no case does the failure of the provider to return the payment obligate the insured to assume responsibility for payment for the treatment, services or merchandise.
Emphasis supplied.
Hence, if a PRO determines that a service or product is medically unnecessary, the provider thereof may not collect payment. I interpret this to mean that the provider is barred from collecting from the insurer as well as from the insured. I am mindful that the purpose of the MVFRL is to reduce the escalation of motor vehicle insurance costs to the consumer. Lambert, supra. It would be doing violence to the intent of the Legislature to protect the consumer against the rising costs of automobile insurance were it to be the case that the provider would be able to look to the insured for payment of services or products which were determined to have been medically unnecessary in the first instance. If an insured is not required to reimburse the insurer in the event the provider of medically unnecessary services or products refuses to return payment made to it by the insurer, it does not logically follow that an insured should be required to compensate a provider for medically unnecessary services or products, either.
The majority expresses concern in footnote number five that a situation may exist where “the insured may be forced to submit a claim to the insurer in anticipation of future expenses.” Majority Opn., p. 103, note 5. The majority anticipates that the insured will not be held harmless by Section *1121797(b)(7) in that event. The short response to that concern is that the scenario described by the majority in footnote five is not presently before us. However, the ultimate decision rendered by the majority appears to rest upon this speculative scenario and is, therefore, in the nature of an advisory opinion.
In footnote number six, the majority states that it is refraining from a discussion of whether the Section 1797(b) provides for judicial review “because of a preference for affirming orders on the narrowest possible grounds rather than a belief that Peer Review process is not subject to judicial review after statutory remedies are exhausted.” Majority Opn., p. 104, note 6. The majority then expresses concern that the lack of a procedure for judicial review following exhaustion of the peer review process would pose serious constitutional problems and correctly notes that the statute in question does not restrict judicial review, since a provider may challenge in court the insurer’s refusal to pay medical expenses if the insurer fails to invoke the peer review process. See Section 1797(b)(4). However, the majority also notes, incorrectly in my view, that an insured may also proceed to court. As I have already exhaustively discussed elsewhere in this concurring opinion, the statute does not provide to an insured a forum for judicial review of non-payment of his/her medical expenses because of the insulating provisions of Section 1797(b)(7). See pp. 100-103, supra. My position in this regard is further bolstered by the language of Section 1797(a) which provides in relevant part:
(a) General rule.—A person or institution providing treatment, accommodations, products or services to an injured person for an injury covered by liability or uninsured and underinsured benefits or first party medical benefits, including extraordinary medical benefits, for a motor vehicle described in Subchapter B [footnote omitted] ... shall not require, request or accept payment for the treatment, accommodations, products or services in excess of 110% of the prevailing charge at the 75th percentile; 110% of the applicable fee schedule, the recommended fee or the inflation index charge; or 110% of the diagnostic-related groups *113(DRG) payment; whichever pertains to the speciality service involved, determined to be applicable in this Commonwealth under the Medicare program for comparable services at the time the services were rendered, or the provider’s usual and customary charge, whichever is less. The General Assembly finds that the reimbursement allowances applicable in the Commonwealth under the Medicare program are an appropriate basis to calculate payment for treatments, accommodations, products or services for injuries covered by liability or uninsured and underinsured benefits or first party medical benefits insurance---- Providers subject to this section may not bill the insured directly but must bill the insurer for a determination of the amount payable. The provider shall not bill or othenvise attempt to collect from the insured the difference betiveen the provider’s full charge and the amount paid by the insurer.
Emphasis supplied.
Thus, unlike the majority, I can imagine no scenario where an insured will not be held harmless and, in keeping with the factual scenario actually before this court, the insured in this case has no need to resort to the judicial process to resolve her claim. The majority’s imagined scenario which it relates in its footnote number five, supra, will never come to fruition because, pursuant to Section 1797(a), it is the provider who must submit the claim to the insurer. The insured will never be in the position of having to pay the provider “up front.” Nor will the insured be harmed by the insurer’s refusal to pay for future treatment or a series of treatments based upon a peer review determination of medical non-necessity because the statute bars the provider from billing an insured for any service or product ultimately determined to be medically unnecessary. Thus, it is apparent to me that Section 1797(a) and (b)(7) complement each other and provide for consistency of interpretation. I also believe that Section 1797(a) and (b)(7) provides the answer to the question why the statute does not provide to an insured a forum for judicial review of an adverse determination of a PRO. Simply put, within the framework of Section 1797, an insurer has no standing to challenge a PRO’s *114determination because the administrative procedures of submission of bills and issuance of payment thereof involve an interplay between only two parties—i.e., the provider and the insurer.2
I would affirm the Order in question for the reasons set forth above.

. The majority cites 31 Pa.Code § 69.52(m) which it states is "a regulation promulgated by the Insurance Commissioner, [sic] which interprets § 1797 to allow for judicial review only after reconsideration by a PRO has been made.” This regulation was not in effect at the time that the questioned services had been rendered. See 31 Pa.Code § 69.2 which provides in relevant part: "This chapter applies to insurer payments to providers for services rendered on and after November 30, 1991.” This matter is academic, however, because of my belief that both the new regulation and the one in effect at the time that services were provided is contrary to the language in question. See pp. 95-99 in text.

. Appellant similarly lacks standing to make this argument on behalf of the health care providers here involved, since none of these individuals or entities is/are (a) party/ies to this action.