Insurance
— Personal injury protection — Discovery — Reasonableness of charges —
Trial court did not err in denying insurer’s amended petition to discovery
requests under section 627.736(6)(b) about reasonableness of charges, including
discovery regarding amount others paid to provider for the same services and
treatments — Discovery under section 627.736(6)(b) is limited to facts of
treatment and to related billing of injured person — Section 627.736(5), which
mandates that medical providers may charge only a reasonable amount for
services rendered, is inapplicable to discovery sought under section
627.736(6)(b)

STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Appellant,
v. DELRAY MEDICAL CENTER, INC., Appellee. 4th District. Case No. 4D14-2287.
November 4, 2015. Appeal from the Circuit Court for the Fifteenth Judicial Circuit,
Palm Beach County; Lucy Chernow Brown, Judge; L.T. Case No.
50-2012-CA022717XXXXMB. Counsel: Kenneth P. Hazouri of de Beaubien, Knight,
Simmons, Mantzaris & Neal, LLP, Orlando, for appellant. Robert S. Covitz of
Falk, Waas, Hernandez, Cortina, Solomon & Bonner, P.A., Coral Gables, for
appellee.

(LEVINE, J.) State Farm appeals the dismissal of its
petition seeking discovery from Delray Medical Center pursuant to Florida’s PIP
statutes. We are asked to determine whether section 627.736 permits State Farm
to request discovery about the reasonableness of charges by Delray Medical,
including discovery regarding the amount others paid to Delray Medical for the
same services and treatments. We find that discovery is limited under section
627.736(6)(b) to the facts of the treatment and to the related billing of the
injured person. We further find that section 627.736(5) is inapplicable to
discovery sought under section 627.736(6)(b). We therefore find the trial court
did not err in denying State Farm’s amended petition for discovery. We further
find no merit in the argument that the trial court erred in not taking judicial
notice of a cost report submitted to the Agency for Health Care Administration.

Delray Medical, after treating two of State Farm’s insureds,
sought PIP payments from State Farm. In response, State Farm sent Delray
Medical two letters requesting documentation and information to assist in
determining the reasonableness of the billed charges, pursuant to section
627.736(6)(b), Florida Statutes (2012). State Farm questioned the
reasonableness of the charges, since the charges were significantly higher than
what is allowable under Medicare billing rates. State Farm attached to the
letters twenty-three discovery requests. After Delray Medical provided only
some of the requested documentation, State Farm filed a petition and motion for
discovery pursuant to section 627.736(6)(c), Florida Statutes (2012), alleging
that Delray Medical charged significantly more than the Medicare reimbursement
rate.

Delray Medical filed objections and moved for a protective
order. In response, State Farm filed a new production request in which it
limited its prior requests for production to the following documents:

COST
OF TREATMENT

1.
A statement of your best estimate of the cost to your facility for each line
item associated with the specific health care goods and services at issue
(whether based on cost-accounting data, budgeting allocations, or otherwise). 

2.
The most recent Medicare Cost Report you submitted to the Centers for Medicare
and Medicaid Services (CMS). 

PAYMENTS
ACCEPTED BY THE PROVIDER 

3.
For each good and service reflected on the bills at issue, documentation
(whether physical documents or a printout from your electronic records) showing
the actual amounts you accepted as payment in full for the same care from other
payers in the 3 months immediately preceding the dates of service for the bills
at issue, broken down by the following categories: 

a.
Medicare, 

b.
Medicaid, 

c.
Worker’s compensation, 

d.
Commercial insurers, 

e.
Uninsured patients, and 

f.
Any other payments 

[This
request is intended to allow State Farm to compare the amounts you accepted as
full payment from others to the amounts you billed State Farm for the same
health care provided to our insureds. Therefore, please do not provide
aggregate totals. Instead, please identify either your average acceptance rates
for each type of payer for each of the CPT codes at issue, or the actual
payments accepted from each payer itemized by CPT code for the goods and
services rendered.] 

4.
All contracts you had in force at the time you provided the health care goods
and services at issue, by which you agreed to accept an amount less than your
“usual and customary” billed charges from commercial insurers. 

5.
Your most recent financial statements submitted to Florida’s Agency for Health
Care Administration (AHCA) which details gross charge revenues and contractual
allowances and other revenue adjustments. 

REIMBURSEMENT
RATES IN THE COMMUNITY 

6.
Any information you have showing actual reimbursement rates in your community
(i.e., amounts actually accepted by other hospitals in full payment for billed
charges) for the health care goods and services reflected on the bills at
issue.

The trial court denied the petition without prejudice for
failure to show good cause. State Farm then filed an amended petition and
motion for discovery, which contained similar allegations to the original
petition. In addition, State Farm alleged that Delray Medical charged more than
other hospitals and that a report from the Agency for Health Care
Administration showed that Delray Medical’s actual reimbursement rate was
significantly less than the amount charged. State Farm asked the court to take
judicial notice of the report.

The trial court denied the amended petition, finding that
State Farm did not demonstrate good cause under section 627.736(6)(c). The
court also found the request to be “overbroad” and “extremely far-reaching.”
The court declined State Farm’s request to take judicial notice of the report
and stated that, even considering the report, the court’s findings and ruling
would not be different.

Section
627.736(6), Florida Statutes (2012), provides in pertinent part:

(6)
Discovery of facts about an injured person; disputes.
—

. .
. .

(b)
Every physician, hospital, clinic, or other medical institution providing,
before or after bodily injury upon which a claim for personal injury protection
insurance benefits is based, any products, services, or accommodations in relation
to that or any other injury, or in relation to a condition claimed to be
connected with that or any other injury, shall, if requested to do so by the
insurer against whom the claim has been made, furnish forthwith a written
report of the history, condition, treatment, dates, and costs of such
treatment of the injured person and why the items identified by the insurer
were reasonable in amount and medically necessary, together with a sworn
statement that the treatment or services rendered were reasonable and necessary
with respect to the bodily injury sustained and identifying which portion of
the expenses for such treatment or services was incurred as a result of such
bodily injury, and produce forthwith, and permit the inspection and copying of,
his or her or its records regarding such history, condition, treatment, dates,
and costs of treatment . . . . Any insurer that requests documentation or
information pertaining to reasonableness of charges or medical necessity
under this paragraph without a reasonable basis for such requests as a
general business practice is engaging in an unfair trade practice under the
insurance code. 

(c)
In the event of any dispute regarding an insurer’s right to discovery of facts
under this section, the insurer may petition a court of competent jurisdiction
to enter an order permitting such discovery. The order may be made only on
motion for good cause shown . . . . Such court may, in order to protect against
annoyance, embarrassment, or oppression, as justice requires, enter an order
refusing discovery or specifying conditions of discovery . . . .

(emphasis
added).

Initially, State Farm’s interpretation is contrary to the
title of subsection (6). Subsection (6) is entitled “[d]iscovery of facts about
an injured person; disputes.” “The descriptive title of a statute in enacting
legislation is an indicator of legislative intent.” City of Fort Pierce v.
Shannon R. Ginn Constr. Co., 705 So. 2d 934, 936 (Fla. 4th DCA 1997). See
also Fla. Dep’t of Envtl. Prot. v. ContractPoint Fla. Parks, LLC, 986 So.
2d 1260, 1266 (Fla. 2008) (“To discern legislative intent, courts must consider
the statute as a whole, including the evil to be corrected, the language,
title, and history of its enactment, and the state of law already in existence
on the statute.”) (citation omitted); 1A Sutherland Statutory Construction §§
21:4, 47:14 (7th ed.) (noting that a section heading illuminates legislative
intent). From the title of subsection (6), we know that the discovery of
documents will center on the facts regarding the injured person.

State Farm’s interpretation is also contrary to the plain
language of subsection (6)(b). Specifically, subsection (6)(b) states that
providers, like Delray Medical, must

if
requested to do so by the insurer against whom the claim has been made, furnish
forthwith a written report of the history, condition, treatment, dates, and
costs of such treatment of the injured person and why the items
identified by the insurer were reasonable in amount and medically necessary,
together with a sworn statement that the treatment or services rendered were
reasonable and necessary with respect to the bodily injury sustained and
identifying which portion of the expenses for such treatment or services was
incurred as a result of such bodily injury.

(emphasis added). Based on the plain language of this subsection,
as well as the title of the subsection, it is clear that the focus of this
provision is the discovery of documents regarding the treatment and related
billing of the individual injured person.

This court in Kaminester v. State Farm Mutual Automobile Insurance Co.,
775 So. 2d 981 (Fla. 4th DCA 2000), examined the parameters of section
627.736(6)(b). In Kaminester, a health care provider refused the
insurer’s request for the invoice for an MRI. The provider claimed that there
was no invoice from the MRI facility, since the provider leased the equipment
used to provide the service in question. Further, the provider claimed that the
terms of the lease were between the provider and the owner of the MRI
equipment, and the lease was not discoverable under section 627.736(6). This
court found the MRI lease agreement was discoverable under the statute since
the “lease is well within the meaning of the statutory discovery provision ‘the
costs of such treatment.’ ” Id. at 985. This court concluded that good
cause, as required under the statute, was established because the provider
refused to “supply anything” regarding the MRI lease. Id. at 986.

However, it is clear that Kaminester is different
than the case at bar. Here, Delray Medical did provide bills and records
relating to the insured, unlike Kaminester, where the provider refused
to “supply anything.” More importantly, the documentation sought in Kaminester
was directly related to treatments and services provided to the injured
party, unlike here where State Farm sought information regarding amounts paid
by others.

State Farm Mutual Automobile Insurance Co. v. Goldstein,
798 So. 2d 807 (Fla. 4th DCA 2001), also examined the parameters of section
627.736(6)(b). In that case, the court found good cause was shown where the
insureds provided sworn statements denying that they had received health care
for which the health care providers were seeking payment. Unlike Goldstein,
this case does not involve a situation where the insureds denied receiving the
health care for which Delray Medical sought payment. Further, Goldstein involved
discovery about services allegedly provided to the injured, not to others.

State Farm also relies on section 627.736(5) in arguing that
its discovery was permissible because that subsection mandates that medical
providers may charge only a reasonable amount for services rendered. Section
627.736(5) provides, in pertinent part:

(5) Charges for treatment of
injured persons. –

 (a)
1. Any physician, hospital, clinic, or other person or institution lawfully
rendering treatment to an injured person for a bodily injury covered by
personal injury protection insurance may charge the insurer and injured party
only a reasonable amount pursuant to this section for the services and
supplies rendered . . . . In no event, however, may such a charge be in excess
of the amount the person or institution customarily charges for like services
or supplies. With respect to a determination of whether a charge for a
particular service, treatment, or otherwise is reasonable, consideration may be
given to evidence of usual and customary charges and payments accepted by the
provider involved in the dispute, and reimbursement levels in the community and
various federal and state medical fee schedules applicable to automobile and
other insurance coverages, and other information relevant to the reasonableness
of the reimbursement for the service, treatment, or supply.

(emphasis added).

As to the interplay between section 627.736(5) and section
627.736(6), Shands Jacksonville Medical Center, Inc. v. State Farm
Mutual Automobile Insurance Co., 40 Fla. L. Weekly D1447 (Fla.
1st DCA June 22, 2015), is instructive.1 In that case, State Farm sent
requests for information including the discovery of confidential contracts
between the hospital and thirty-seven health insurance entities. State Farm
sought the discovery of these confidential contracts “because they contain[ed]
information regarding negotiated reimbursement rates that Shands agreed to
accept for services and supplies rendered on behalf of each entity’s insureds.
State Farm argue[d] that this information [was] necessary in order for it to
determine if the amounts billed by Shands [were] reasonable.” Id. at
D1447. Shands refused to provide the third party contracts with the medical
insurers because the contracts contained the confidential negotiated discounts
from what it charges other third parties. The court in Shands concluded
that discovery under section 627.736(6) applied “only to the types of
information a healthcare provider is required to provide as delineated in
section 627.736(6).” Id. at D1448. The court explained:

It
seems clear to us, therefore, that the “section” referred to in subsection
(6)(c) is in fact a reference to subsection (6), not the entirety of section
627.736. Subsection (6), unlike subsection (5)(a), specifically provides that a
PIP insurer is entitled to “Discovery of Facts About an Injured Person,” and
subsection (6)(b) delineates the specific types of information (facts) and
documentation to which a PIP insurer is entitled to receive from medical
providers in analyzing the payment of claims. Furthermore, the title to
subsection (6) also indicates that it addresses “Disputes.” Accordingly,
subsection (6)(c) begins with the phrase: “In the event of a dispute regarding
an insurer’s right to discovery of facts under this section . . .,” which
clearly applies to disputes related to an insurer’s attempt to obtain the
information and documentation relating to the treatment and associated costs of
treatment to an injured insured specified in subsection (6).

Thus,
subsection (6)(b) concerns the types of facts and documents to which a PIP
insurer is entitled to assist it in ascertaining the reasonableness of the
treatment provided to its insured and the amount the medical provider charged
for that care. Subsection (5)(a), on the other hand, addresses the factors, or
“types of evidence,” relevant to the reasonableness of a medical provider’s
charges. These factors, however, are implicated when there is a dispute as to
the reasonableness of charges for treatment, not when there is a dispute
concerning an insurer’s attempt to obtain the information it is entitled to so
that it can assess the reasonableness of those charges.

Id.

We agree with the reasoning of Shands that section
627.736(5) is inapplicable, as it does not apply to discovery requests under
section 627.736(6)(b). Although the documents State Farm sought may have been
“relevant and discoverable in the context of litigation over the issue of
reasonableness of charges instituted pursuant to subsection (5)(a), they are
clearly not the types of documents specifically delineated by subsection
(6)(b).” Id.

In summary, we find that the trial court correctly
determined State Farm’s request exceeded the permissible scope of discovery as
allowable under the applicable statute. Accordingly, we affirm.

Affirmed. (STEVENSON and KLINGENSMITH, JJ.,
concur.)

__________________

1In Shands, the First District
certified conflict with our court’s decision in Kaminester, on the
limited issue of whether Shands could be required to produce a designated
corporate representative for deposition, and whether the “discovery methods
provided for in the Florida Rules of Civil Procedure are available to insurers
that institute proceedings pursuant to that statute.” Our decision here does
not implicate that conflict as certified by the First District in Shands.