A M E R I C A N A R B I T R A T I O N A S S O C I A T I O N NO-FAULT/ACCIDENT CLAIMS AWARD OF DISPUTE RESOLUTION PROFESSIONAL

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1 CASE NO. 18 Z A M E R I C A N A R B I T R A T I O N A S S O C I A T I O N NO-FAULT/ACCIDENT CLAIMS In the Matter of the Arbitration between (Claimant) AAA CASE NO.: 18 Z v. INS. CO. CLAIMS NO.: 30V State Farm Insurance Company DRP NAME: Sergio G. Carro (Respondent) NATURE OF DISPUTE: Eligibility, AWARD OF DISPUTE RESOLUTION PROFESSIONAL I, THE UNDERSIGNED DISPUTE RESOLUTION PROFESSIONAL (DRP), designated by the American Arbitration Association under the Rules for the Arbitration of No-Fault Disputes in the State of New Jersey, adopted pursuant to the 1998 New Jersey Automobile Insurance Cost Reduction Act as governed by N.J.S.A. 39:6A-5, et. seq., and, I have been duly sworn and have considered such proofs and allegations as were submitted by the Parties. The Award is DETERMINED as follows: Injured Person(s) hereinafter referred to as: TW. 1. ORAL HEARING held on February 19, ALL PARTIES APPEARED at the oral hearing(s). ALL PARTIES appeared telephonically. 3. Claims in the Demand for Arbitration were NOT AMENDED at the oral hearing (Amendments, if any, set forth below). STIPULATIONS were made by the parties regarding the issues to be determined (Stipulations, if any, set forth below). After completion of discovery, Respondent stipulated is would make or has already made payment on all outstanding bills in dispute, subject to deductible, co-pay and fee schedule. 4. FINDINGS OF FACTS AND CONCLUSIONS OF LAW: This matter was case managed with twenty-six other demands all presenting identical issues. Each case involved one or more MRI scans pre-authorized by Respondent State Farm but later denied based on several eligibility issues. Specifically, Respondent raised the following concerns:

2 CASE NO. 18 Z Whether Northeast Imaging Center is properly owned, operated and licensed as an MRI facility; 2. Whether Northeast Imaging Center's MRI equipment conforms to acceptable industry standards; 3. Whether Northeast Imaging Center's use of teleradiology conforms to acceptable industry standards for reliable diagnostic use; 4. Whether Dr. Stephen Brownstein's use and operation of teleradiology hardware and software conform to industry standards and professional practice as a radiologist; 5. Whether Dr. Stephen Brownstein has satisfied the minimum regulatory requirements as Medical Director of Northeast Imaging Center; and 6. Whether the marketing practices employed by Sam DeNorchia, Sr. violate any law, code or regulation. After completing its investigation into the aforementioned issues, Respondent agreed to pay the previously approved bills subject to deductible, fee schedule and co-pay. Nevertheless, the Claimant requested an award to determine the issues as they are capable of being raised again by other carriers. Additionally, the discovery was in and of itself lengthy, time consuming, and expensive. Claimant does not want to repeat the process now that discovery has been provided in these cases. As the situation is one that may certainly repeat itself and thereby result in additional litigation or arbitration, I find that Respondent's agreement to make payment does not render the issues moot and, therefore, I will address each of these concerns. With respect to ownership and licensure, the documentation and evidence presented by the parties in this case demonstrate that Northeast Imaging Center has been licensed by the State of New Jersey through the Department of Health and Senior Services since Both Sam DeNorchia, Jr. and Sr. testified at their examinations under oath that 100% of the stock in the facility is owned by Sam DeNorchia, Jr. No evidence of any kind is submitted to suggest that the facility is not properly owned or licensed. Accordingly, I find that the facility is indeed properly licensed and owned. As for the equipment itself, the evidence reveals that Northeast Imaging operates a Philips Picker Outlook MRI machine. The hardware is serviced by trained technicians on a regular basis under a comprehensive service contract. I find that the equipment does indeed conform to accepted industry standards. Respondent presents no evidence to the contrary. The issue of teleradiology and the facility's and Dr. Brownstein's use of the hardware and software is a more complicated issue. Teleradiology is the remote reading of digital image data by a radiologist. In other words, the actual MRI is obtained at the imaging center but the results, the data itself, is read or interpreted by a radiologist at a different

3 CASE NO. 18 Z location. It is defined as a means of electronically transmitting radiographic patient images (data) and consultative text from one location to another. A basic teleradiology system consists of three major components: (1) an image obtaining and sending system; (2) a transmission network; and (3) a receiving/image review station. In these cases, Northeast Imaging Center uses a Philips Picker Outlook MRI machine and hardware located at Northeast Imaging for collection of the image data. Transmission is through fiber optic cable lines provided by Comcast Cable at both the imaging center and Dr. Brownstein's remote location. The receiving/imaging station used by Dr. Brownstein involves a network interface, personal computers, two large plasma screen display monitors, and a hard copy printer device. The issues involved in teleradiology include but are not limited to: the qualifications of the personnel using the equipment; the equipment specifications which include small matrix (the data set should provide a minimum of 512 x 512 matrix size at a minimum 8- bit pixel depth for processing or manipulation with no loss of matrix size or bit depth at display) and large matrix (the data set should allow a minimum of 2.5 lp/mm spatial resolution at a minimum 10-bit pixel depth); acquisition or digitization which involves direct image capture and secondary image capture varying between small and large matrix; compression of data to increase transmission speed including both reversible and irresversible techniques but any methode used must have no reduction in clinically significant diagnostic imaging; transmission; display capabilities; and archiving and retrieval. The American College of Radiology publishes technical standards for teleradiology which are guideline standards as opposed to fixed standard of care guidelines. Nevertheless, the guidelines are significant to understanding the use and implimentation of teleradiology. Dr. Brownstein testified at his examination under oath that both the imaging center's transmitting equipment and his receiving and viewing equipment meet the DICOM standards enunciated by the American College of Radiology. He further testified that his equipment meets or exceeds all industry standards and gave several examples of equivalent teleradiology systems used in hospitals and other critical care settings. He testified that he is proficient in the systems use and demonstrated the systems capability of visualizing data in several different formats. I note that Dr. Brownstein's examination under oath was conducted at his office so that Respondent would have an opportunity to view and inspect the equipment itself. Respondent provides no evidence suggesting that the teleradiology system employed by Northeast Imaging Center and Dr. Brownstein do not comply with all applicbale industry standards. Accordingly, I find that the system installed and used at Northeast Imaging Center and by Dr. Brownstein at the receiving end do indeed comply with industry standards. The next issue raised by Respondent involved Dr. Brownstein's function as medical director of Northeast Imaging Center. The evidence presented demonstrates the Dr. Brownstein is a board-certified radiologist. He assisted in establishing the facility at

4 CASE NO. 18 Z Northeast Imaging Center. He put together the policy and procedure manual. He is available at all times if necessary. He regularly visits the facility. Accordingly, and as Respondent offers no evidence to the contrary, I find that Dr. Brownstein has indeed satisfied the minum regulatory requirements as medical director. Lastly, Respondent raised an issue regarding the marketing practices of Sam DeNorchia, Sr. Respondent raised the concern only after Sam DeNorchia, Jr. testified at his examination under oath that although his father transfered all ownership interest to him, his father still visited the center regularly and performed some marketing functions on a non-pay basis for the center. Of course, Respondent became concerned that there could be illegal kickback schemes or other improper activity although nothing in Sam DeNorchia, Jr.'s testimony indicated any improper activity. In any event, Sam DeNorchia, Sr. appeared for an examination under oath and no improper activity was revealed. In fact, Respondent offers no evidence of any kind to suggest that the voluntary consulting services Sam DeNorchia, Sr. provides for his son is improper in any way whatsoever. The final issue to be determined is one of attorney's fees as the Claimant is a prevailing party in each of these cases. In this regard, I note that Claimant was represented by five attorneys in the various cases heard. One of the attorneys has settled his two claims entirely and is therefore not included here. Of the other four, two have agreed with Respondent to a fee of $1,000 per file. The rationale behind such an arrangement is obvious in that while there was substantial discovery requiring appearances at three examinations under oath and preparation of materials regarding the teleradiology equipment, hardware and software, there are also many files over which the time can be disbursed such that an average fee of $1,000 per file satisfied these attorneys. The two remaining attorneys did not reach a similar agreement with Respondent and, therefore, seek a determination on fees from the DRP. In this regard, I an in receipt of several certifications from Debra Feuerstein, Esq. detailing well over $3,000 in services on each of the files in which she represented the Claimant. Frankly, I find these certifications excessive in that the discovery, while extensive, was conducted only once as each file was identical. The only variant was the number of MRIs performed in each case. Moreover, I also note that Ms. Feuerstein was not involved in the extensive discussions involving discovery and case management. Accordingly I find that $1,000 per file is appropriate. With respect to Nicholas Fano, Esq., who represented Claimant in only two of these matters, I note that Mr. Fano appeared for the first hearing associated with these cases. It was at this initial hearing that the possibility of case managing 27 additional files was raised. Moreover, the Respondent's various discovery requests were addressed at this hearing before any other attorney's cases were folded into the case management. Accordingly, Mr. Fano had to address issues only partially raised in the later hearings. Also, Mr. Fano appeared at more than one hearing. This cannot be said for the other attorneys. Finally, as Mr. Fano represents Claimant in only two of these cases, his efforts cannot reasonably be averaged to $1,000 per file when he arguably expended a similar

5 CASE NO. 18 Z amount of time as the attorneys with seven or ten files. I find therefore, that Mr. Fano's additional involvement over his two files warrants a fee award of $1,750 each. 5. MEDICAL EXPENSE BENEFITS: Not In Issue Provider Amount Claimed Amount Awarded Payable to Explanations of the application of the medical fee schedule, deductibles, co-payments, or other particular calculations of Amounts Awarded, are set forth below. 6. INCOME CONTINUATION BENEFITS: Not In Issue 7. ESSENTIAL SERVICES BENEFITS: Not In Issue 8. DEATH BENEFITS: Not In Issue 9. FUNERAL EXPENSE BENEFITS: Not In Issue 10. I find that the CLAIMANT did prevail, and I award the following COSTS/ATTORNEYS FEES under N.J.S.A. 39:6A-5.2 and INTEREST under N.J.S.A. 39:6A-5h. (A) Other COSTS as follows: (payable to counsel of record for CLAIMANT unless otherwise indicated): $ (B) ATTORNEYS FEES as follows: (payable to counsel of record for CLAIMANT unless otherwise indicated): $1, (C) INTEREST is as follows: waived per the Claimant. $.

6 CASE NO. 18 Z This Award is in FULL SATISFACTION of all Claims submitted to this arbitration. April 23, 2004 Date Sergio G. Carro, Esq.