ARBITRATION AWARD. Pasquale Bochiechio, Esq., from Pasquale V. Bochiechio, P.C. participated in person for the Applicant

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1 American Arbitration Association New York No-Fault Arbitration Tribunal In the Matter of the Arbitration between: Amherst Medical Supply, LLC (Applicant) - and - A. Central Insurance Company (Respondent) AAA Case No Applicant's File No Insurer's Claim File No NAIC No ARBITRATION AWARD I, Gillian Brown, the undersigned arbitrator, designated by the American Arbitration Association pursuant to the Rules for New York State No-Fault Arbitration, adopted pursuant to regulations promulgated by the Superintendent of Insurance, having been duly sworn, and having heard the proofs and allegations of the parties make the following AWARD: Injured Person(s) hereinafter referred to as: EIP. Hearing(s) held on 05/17/2017 Declared closed by the arbitrator on 05/17/2017 Pasquale Bochiechio, Esq., from Pasquale V. Bochiechio, P.C. participated in person for the Applicant Michael Nightingale, Esq., from Nightingale Law, PC participated by telephone for the Respondent The amount claimed in the Arbitration Request, $ , was NOT AMENDED at the oral hearing. Stipulations WERE NOT made by the parties regarding the issues to be determined. Summary of Issues in Dispute The EIP was involved in a motor vehicle accident on 9/7/14. On 10/3/14, she was provided with a lumbosacral orthotic and an interferential stimulator based on a 9/29/14 letter of medical necessity from her treating chiropractor. Reimbursement has been denied based on a peer review by Dr. Craig Horner, DC, prepared on 11/9/ Findings, Conclusions, and Basis Therefor Page 1/6

2 Pursuant to 11 NYCRR (o)(1), the arbitrator shall be the judge of the relevance and materiality of the evidence offered and strict conformity to legal rules of evidence shall not be necessary. The arbitrator may question any witness or party and independently raise any issue that the arbitrator deems relevant to making an award that is consistent with the Insurance Law and Department regulations. This hearing was conducted using documents contained in the ADR Center. Any documents contained in the ADR Center folder for this matter are hereby incorporated into this hearing. I have reviewed all relevant exhibits contained in the ADR Center maintained by the American Arbitration Association. The EIP was involved in a motor vehicle accident on 9/7/14. On 10/3/14, she was provided with a lumbosacral orthotic and an interferential stimulator based on a 9/29/14 letter of medical necessity from her treating chiropractor. Reimbursement has been denied based on a peer review by Dr. Craig Horner, DC, prepared on 11/9/14. On 9/7/14, the EIP was the belted driver of her vehicle when she was involved in a T-bone type collision. The impact was on the right front quarter panel of her vehicle. The airbags did not deploy, and she did not lose consciousness. She was seen at a hospital on the day of the accident, where no fractures were noted after X-rays. She was evaluated, treated and discharged with pain medication, and then days later was seen at an urgent care facility, for her increasing pain. Interestingly, the urgent care physician noted that the EIP's "complaints [were] out of proportion to exam" and that she did not appear to be in discomfort. On 9/12/14, she had an initial examination with a chiropractor. On 9/29/14 he signed a letter of medical necessity for an interferential simulator and a lumbosacral orthotic. The letter of medical necessity stated that the EIP's diagnosis was suspected cervical herniations, lumbar disc herniations, cervical and lumbar segmental dysfunction and cervical and lumbar muscle spasms. The equipment was provided to retard further degeneration, decrease pain, decrease muscle spasms, stabilize spinal segments, and increase the EIP's ability to perform her activities of daily living. Bills appear to have been timely sent and received, and reimbursement has been denied based on the Horner peer review noted above. The insurer bears the burden of proof of proving lack of medical necessity as a defense; the claimant does not have to prove the existence of medical necessity. Fifth Avenue Pain Control Center v. Allstate Ins. Co., 196 Misc.2d 801, 803, (Civ Ct., Queens Co. 2003). To meet its burden, at a minimum, the insurer must establish a factual basis and medical rationale for its asserted lack of medical necessity, which is supported by evidence of the generally accepted medical/professional practices. Beal-Medea Products, Inc. v. GEICO General Ins. Co., 27 Misc.3d 1218(A), 2010 N.Y. Slip Op (U), 2010 WL (Civ. Ct. Kings Co., May 6, 2010). The insurer's denial(s) of the applicant's claim(s) must be based on a peer review, IME report, or other competent medical evidence that sets forth a clear factual basis and a medical rationale for the denial(s). Amaze Medical Supply, Inc. v. Eagle Ins. Co., 2 Misc. 3d 128A (App. Term, Page 2/6

3 2nd & 11th Jud. Dist., 2003); Tahir v. Progressive Cas. Ins. Co., 12 Misc. 3d 657 (NYC Civ. Ct., NY Co., 2006); Healing Hands Chiropractic, P.C. v. Nationwide Assurance Company, 5 Misc. 3d 975 (NYC Civ. Ct., NY Co., 2004). When an insurer uses a peer review as a basis for the denial(s), the peer review report must contain (1) evidence of the applicable generally accepted medical/professional standards, and (2) a statement or statements by the peer reviewer, based upon his or her application of the facts of the case, which set forth the provider's departure from those standards. Acupuncture Prima Care v. State Farm Mut. Auto. Ins. Co., 17 Misc. 3d 1135(A) [Dist. Ct., 1st Dist., Nassau Co., 2007); Nir v. Allstate Ins. Co., 7 Misc. 3d 544 (NYC Civ. Ct., Kings Co., 2005]. I find that the Horner peer review is insufficient on its face to serve as the basis for the denial herein. Dr. Horner discusses what he concludes is a lack of documentary support for the diagnosis, but if there was a dearth of support, the respondent could have requested verification, and it did not do so. He notes that there was no re-evaluation prior to ordering the durable medical equipment. He does not address the fact that the letter of medical necessity specifically states that the cervical herniations were suspected. He does not address the fact that a positive lumbar test showed spinal instability, and he does not address the palliative effect sought as regards the interferential stimulator. Dr. Horner does not meaningfully discuss the EIP's condition, nor does he explain how the provision of these devices diverged from a generally accepted standard of care. I find that the respondent has not met its burden of proving lack of medical necessity, and I therefore find for the claimant. 5. Optional imposition of administrative costs on Applicant. Applicable for arbitration requests filed on and after March 1, I do NOT impose the administrative costs of arbitration to the applicant, in the amount established for the current calendar year by the Designated Organization. 6. I find as follows with regard to the policy issues before me: The policy was not in force on the date of the accident The applicant was excluded under policy conditions or exclusions The applicant violated policy conditions, resulting in exclusion from coverage The applicant was not an "eligible injured person" The conditions for MVAIC eligibility were not met The injured person was not a "qualified person" (under the MVAIC) The applicant's injuries didn't arise out of the "use or operation" of a motor vehicle The respondent is not subject to the jurisdiction of the New York No-Fault arbitration forum Page 3/6

4 Accordingly, the applicant is AWARDED the following: A. Medical From/To Claim Amount Status Amherst Medical Supply, LLC 10/03/14-10/03/14 Awarded: $ $ Total $ Awarded: $ B. The insurer shall also compute and pay the applicant interest as set forth below. (The filing date for this case was 08/31/2015, which is a relevant date only to the extent set forth below.) Applicant is awarded interest pursuant to the no-fault regulations. See generally, 11 NYCRR Interest shall be calculated "at a rate of two percent per month, calculated on a pro rata basis using a 30 day month." 11 NYCRR (a). A claim becomes overdue when it is not paid within 30 days after a proper demand is made for its payment. However, the regulations toll the accrual of interest when an applicant "does not request arbitration or institute a lawsuit within 30 days after the receipt of a denial of claim form or payment of benefits calculated pursuant to Insurance Department regulations." See, 11 NYCRR (c).The Superintendent and the New York Court of Appeals has interpreted this provision to apply regardless of whether the particular denial at issue was timely. LMK Psychological Servs., P.C. v. State Farm Mut. Auto. Ins. Co., 12 N.Y.3d 217 (2009). C. Attorney's Fees The insurer shall also pay the applicant for attorney's fees as set forth below Applicant is awarded statutory attorney fees pursuant to the no-fault regulations. See, 11 NYCRR (s)(2). The award of attorney fees shall be paid by the insurer. 11 NYCRR (e). Accordingly, "the attorney's fee shall be limited as follows: 20 percent of the amount of first-party benefits, plus interest thereon, awarded by the arbitrator or the court, subject to a maximum fee of $1360." Id. However, if the benefits and interest awarded thereon is equal to or less than the respondent's written offer during the conciliation process, then the attorney's fee shall be based upon the provisions of 11 NYCRR (b). Page 4/6

5 D. The respondent shall also pay the applicant forty dollars ($40) to reimburse the applicant for the fee paid to the Designated Organization, unless the fee was previously returned pursuant to an earlier award. This award is in full settlement of all no-fault benefit claims submitted to this arbitrator. State of New York SS : County of Erie I, Gillian Brown, do hereby affirm upon my oath as arbitrator that I am the individual described in and who executed this instrument, which is my award. 06/12/2017 (Dated) Gillian Brown IMPORTANT NOTICE This award is payable within 30 calendar days of the date of transmittal of award to parties. This award is final and binding unless modified or vacated by a master arbitrator. Insurance Department Regulation No. 68 (11 NYCRR ) contains time limits and grounds upon which this award may be appealed to a master arbitrator. An appeal to a master arbitrator must be made within 21 days after the mailing of this award. All insurers have copies of the regulation. Applicants may obtain a copy from the Insurance Department. Page 5/6

6 ELECTRONIC SIGNATURE Document Name: Final Award Form Unique Modria Document ID: 92cad b38f857ed0ed3d1b38e Electronically Signed Your name: Gillian Brown Signed on: 06/12/2017 Page 6/6