Niyazi Ermis v. Belair Insurance Company Inc., 2000 ONFSCDRS 188

Neutral Citation: 2000 ONFSCDRS 188

FSCO A98-001468

BETWEEN:

NIYAZI ERMIS Applicant

and

BELAIR INSURANCE COMPANY INC. Insurer

SUPPLEMENTAL DECISION

Before: Fred Sampliner

Heard: December 6, 7, 8, 15 and 20, 1999 at the Offices of the Financial Services Commission of Ontario in Toronto.

Appearances: Frank A. Sabetti for Mr. Ermis Eric K. Grossman for Belair Insurance Company Inc.

Issues:

This decision concerns Mr. Niyazi Ermis' treatment claims. It supplements my June 19, 2000 decision respecting his disability benefits arising out of a January 28, 1997 motor vehicle accident.

The original decision did not deal with the treatment issues because Mr. Ermis did not submit his claims for treatment expenses under the Schedule¹ to Belair until the opening of the hearing, and I decided that his expenses and Belair's claim for repayment could not proceed at that time. I allowed that the parties could reopen the matter.

The issues are:

Is Mr. Ermis entitled to $1,966.76 for his treatment at the Accident Assessment and Treatment Centre Inc.?
Is Mr. Ermis entitled to $1,096 for medical services provided by Dr. S. Bergman?
Is Mr. Ermis entitled to $2,285 for testing provided by BIM Diagnostic Services?
Is Mr. Ermis entitled to $2,300 for his treatment at the Paramedical Rehabilitation Clinic?
Is Mr. Ermis entitled to interest on any overdue benefits?
Is Belair entitled to a repayment?

Result:

Mr. Ermis is entitled to $720 for the cost of acupuncture at the Accident Assessment and Treatment Centre Inc.
Mr. Ermis is entitled to $1,065.60 for the services of Dr. S. Bergman.
Mr. Ermis is entitled to $1,185 for the services of BIM Diagnostic Services.
Mr. Ermis is not entitled to reimbursement for the cost of services of Paramedical Rehabilitation Clinic.
Mr. Ermis is entitled to interest in accordance with section 46 of the Schedule on the amount awarded for Dr. Bergman's services and the Accident Assessment and Treatment Centre Inc., commencing 30 days from December 6, 1999, and for the services of BIM Diagnostic Services commencing 30 days after July 17, 1998.
Belair is not entitled to a repayment

EVIDENCE AND ANALYSIS:

Accident Assessment and Treatment Centre Inc. (Centre):

Mr. Ermis claims $1,966.76 for physiotherapy and acupuncture treatments he received at the Centre from February 17 to April 17, 1997. Dr. S. Bergman, his family physician, referred him for treatment at the Centre, through three treatment plans submitted to Belair.

Belair contends that Dr. Bergman had a conflict of interest in referring him to the Centre, and therefore is not responsible to pay for the services under the provisions of section 38 of the Schedule. A conflict of interest exists in relation to a treatment plan when the services recommended by a health professional yield the person a direct or indirect financial benefit from the service provider.² Health professionals must disclose their conflicts of interest:

38(3) The treatment plan shall include a statement by the member of a health profession who prepared the plan,

(a) disclosing any conflict of interest that he or she has relating to the treatment plan; (emphasis added)

To ensure that the health professional understands the concept at the time of the recommendation, the definition is included in the standard form for treatment plans (OCF-18).

The facts are undisputed in this case. Dr. Bergman testified that he had a conflict of interest because he owned the Centre. He filled out the treatment plans, and failed to disclose his conflict to Belair prior to commencement of Mr. Ermis' treatment. On March 4, 1997 Belair wrote Mr. Ermis that funding for the Centre's treatment was refused on the basis of Dr. Bergman's conflict. Mr. Ermis continued to treat at the Centre, and did not revise the plan or submit an alternative recommendation.

Section 17 of The Schedule imposed a positive obligation on Mr. Ermis to ensure the accuracy of Dr. Bergman's declaration after these expenses were incurred:

(17) If an insured person incurs expenses in respect of which a medical or rehabilitation benefit may be payable without complying with subsection (1), (2) or (3), the insured person shall submit to the insurer an application for payment of the expenses that complies with subsection (2) and (3) within 30 days after incurring the expenses.(emphasis added)

I find that Dr. Bergman did not initially declare his conflicts of interest with the treatment plans under subsection 38(3), nor did Mr. Ermis meet his obligation to revise the plans in compliance with 38(17) after he received notice of the conflict.

Belair contends that Mr. Ermis' failure to resolve Dr. Bergman's conflict of interest automatically excludes him from benefits under subsection 20:

(20) If the insured person does not comply with a notice under subsection (19), the insurer is not required to pay any further expenses for goods or services from which the conflict arises.

The corresponding provision requires that Belair previously approve funding for the Centre's treatment in order for subsection 38(20) to apply:

(19) If, after giving notice under subclause 8(a)(i) or (ii), it comes to the attention of the insurer that a person described in subsection (3) or (4) has a conflict of interest relating to the treatment plan, the insurer may give the insured notice requiring the insured person, within 14 days after receiving the notice, to amend the treatment plan to remove the conflict of interest. (emphasis added)

Again the relevant facts are not in doubt. Belair presented no evidence that it approved Dr. Bergman's treatment recommendations before denying these benefits. Thus, Belair has failed to demonstrate all of the facts necessary for application of the exclusion.³ I see no policy reason to broaden this exclusion to address the gap; nor did Belair argue this point. I find that Mr. Ermis' claims for the Centre's treatment are not excluded under subsection 38(20).

Although the procedure does not directly contemplate this circumstance, the legislature clearly expressed an intent to discourage personal financial gain from treatment recommendations. In my opinion, it is within the arbitrator’s discretion to determine the appropriate consequence where this policy is not complied with and the procedures do not address the circumstance.

In this instance, Dr. Bergman made a false declaration that he had no conflict of interest. Consequently, I find that his opinion concerning treatment is completely unreliable.

The other medical opinions and evidence do not support Mr. Ermis need for a structured treatment program. Dr. Lyndon Mascarenhas, a physiatrist, examined Mr. Ermis for Belair in April 1997. He reported that Mr. Ermis low back flexion and extension were restricted as a result of the accident, but expressed neither approval or disapproval of the Centre's treatment program. In June 1997, Dr. W. J. Reynolds opined that Mr. Ermis acupuncture was reasonable for temporary relief, but he could do exercises at home.

Dr. Reynold’s opinion together with the finding in my original decision that the accident did not significantly contribute to Mr. Ermis physical impairment, convinces me that the Centre’s physiotherapy treatment was not reasonable or necessary. However, Dr. Reynold’s opinion concerning the use of acupuncture for temporary pain relief, persuades me that the 12 sessions were reasonable and necessary. I find that Mr. Ermis is entitled to $720 for the Centre’s services.

Dr. S. Bergman's Services:

Dr. Bergman was Mr. Ermis primary care physician at the time. The bill for his appointments with Mr. Ermis amounts to $1,096.

Mr. Ermis was not eligible for nor did he receive provincial health plan coverage (OHIP) because he was a refugee claimant. He received partial payment for Dr. Bergman's services from a federal health program for claimants awaiting determination of their immigration status. Belair maintains that it is not liable for the remaining balance of the charges.

Subsection 60(2) of the Schedule states that an insurer is not required to pay claims to the extent that benefits are available through other plans or by law. Accident benefit carriers are secondarily liable, but I find no support in the case law or this subsection's language which would absolve Belair of responsibility for the remainder after payments by the federal plan. I reject Belair's position.

The evidence supports Dr. Bergman maintaining regular contact with Mr. Ermis. He testified that he referred Mr. Ermis to eight health practitioners. His billing statement indicates Mr. Ermis had symptoms/conditions of back pain, tendonitis, headaches/tension, dizziness, fatigue and depression throughout the period. Although I cannot read Dr. Bergman's handwritten clinical notes, his testimony suggests he primarily monitored his patient's condition and acted as a referral source to other health providers. On the basis that Mr. Ermis' physical and psychological symptoms appeared interconnected, I find that it was reasonable and necessary for Dr. Bergman to monitor Mr. Ermis' condition and refer him to specialists as a result of the accident.

However, not all 35 appointments are accident-related. Dr. Bergman's statement shows that Mr. Ermis had two visits in July 1997 for gastroenteritis. No evidence indicates that Mr. Ermis had stomach or intestinal problems from the accident. I am not convinced that Mr. Ermis' two July 1997 appointments relate to this accident. After subtracting the two unrelated appointments ($30.40), from the $1,096 statement balance, I find that Mr. Ermis is entitled to$1,065.60 for Dr. Bergman's services.

Back In Motion Diagnostic Services (BIM):

Mr. Ermis did not identify the section of the Schedule under which he claimed $1,665 for the testing and report of BIM. Belair submitted that these expenses fall under section 24 of the Schedule, but do not qualify as benefits.

Belair presented no case law or reasoning in support of its submission, and I reject this position. I find that the costs of BIM’s examinations and reports qualify as benefits within section 24 of the Schedule.⁴

Dr. Bergman referred Mr. Ermis to BIM in July 1997. Dr. Antonio Taverniti, a chiropractor, conducted an examination using extensive testing. Belair paid the full $975 billed for BIM’s July 1997 testing and detailed report.

A year later, Dr. Taverniti and Dr. Bergman strategized about a plan for Mr. Ermis return to work, which resulted in BIM’s second set of testing and a report in July 1998. On the basis of his findings in 1998, Dr. Taverniti concluded that Mr. Ermis was disabled from work and required physical conditioning, massage and acupuncture treatments. Belair paid nothing towards BIM's 1998 bill of $1,665, which represented costs for essentially the same tests and a similar report to the one in 1997.

Belair argues that BIM’s charges for these 1998 tests and report should be the same as in 1997, $975. BIM's 1998 statement shows that the tests increased substantially from the previous year. Three of the tests were $10 more each, but one set of tests more than doubled, from $400 in 1997 to $950 in 1998.

Dr. Taverniti’s testimony centred around the accuracy of his testing to justify his opinion concerning Mr. Ermis disability. He did not explain the substantial increased costs of these tests. Without an explanation to justify the $580 cost increase, I am not prepared to find that this portion of the claim is reasonable.

BIM billed $210 for preparation of the report in 1998, whereas it did not charge for this service in 1997. Belair did not object to the cost of this report. I find that BIM's $210 charge for the report, $975 for testing were reasonable and necessary, and that Mr. Ermis is entitled to $1,185.

Paramedical Rehabilitation Clinic (Clinic):

Mr. Ermis claims $2,300 for physiotherapy/active rehabilitation and chiropractic treatments he received between January 21 and March 29, 1999 at the Clinic. Belair claims that Mr. Ermis is excluded from receiving benefits for this treatment under subsection 38(20).

Dr. Nourali or Ms. Susan Tabibi, the recommending health professionals, are listed on the company letterhead. This infers they might have a conflict of interest, but does not establish the fact. There is also no evidence that Belair gave Mr. Ermis the required notice to remedy a conflict of interest here either. I do not accept that Mr. Ermis is excluded from receiving benefits for the Clinic's services under subsection 38(20).

However, little evidence suggests it was reasonable or necessary that Mr. Ermis receive treatment for his physical injuries in 1998. The September 1998 report of AssessMed found no physical impairment which would significantly affect either his normal daily tasks or work capacity, and deemed him capable of medium physical demands. I rely on Dr. Mascarenhas' July 1997 finding that Mr. Ermis' physical problems had resolved and do not accept Dr. Taverniti's 1998 opinion that Mr. Ermis suffered low/mid-back restrictions and general deconditioning from the accident.

I find that the Clinic's treatment for Mr. Ermis' physical injuries was not reasonable or necessary, and he is not entitled to $2,300.

Interest:

Belair argues that Mr. Ermis is not entitled to interest on his claims for treatment as he did not submit them until the hearing, or alternatively, that interest should run from the commencement of the hearing. Mr. Ermis made no submissions on this issue.

Under section 46 of the Schedule, interest commences 30 days after the insurance company receives a claim. The insured must notify the insurer of their medical and rehabilitation claims,⁵and the insurer should respond within 30 days of the date it receives notice.⁶ Benefits are not overdue unless "the insurer fails to pay the benefit within the time required under this Part."⁷

There is little documentary evidence that Mr. Ermis or his agents advised Belair of the Centre's charges after February 1997. The Centre’s sole documentation is a February 1997 statement, addressed to Mr. Ermis' lawyer. It shows Belair paid $498.62 to the Centre in March 1997, which covered the first eight physiotherapy sessions through February 27, 1997.⁸ Dr. Bergman testified that the Centre sent regular statements to Belair, but no business records support his evidence.

Thus, there is no reliable evidence that Mr. Ermis submitted a formal application for payment or made a claim for the Centre’s treatment until the hearing. I am convinced that after Belair advised Mr. Ermis of its refusal to fund further treatment in March 1997, he did not submit his further expenses.

I find that Mr Ermis is entitled to interest under section 46 of the Schedule 30 days after he submitted the Centre's statement to Belair at the commencement of the December 6, 1999 hearing.

Similarly, I find that Mr. Ermis did not submit Dr. Bergman's statement to Belair until the hearing. Dr. Bergman's evidence that he sent Belair regular statements is not supported by any business records. His September 1999 statement addressed to Mr. Ermis, is almost two and a half years after the conclusion of the services.

As a result of Mr. Ermis' failure to submit the claim until the hearing, I find that Mr. Ermis is entitled to interest on the balance of Dr. Bergman's services under section 46 of the Schedule commencing 30 days after the opening of the hearing.

The July 15, 1998 BIM statement for Mr. Ermis' testing and the report is addressed to Belair. I accept that Belair received notice of the charges on the date it is time-stamped by the Insurer, July 17, 1998. There is no evidence that Belair assessed this claim or specifically responded. I find that the $1,185 amount awarded to Mr. Ermis accrues overdue interest under section 46 of the Schedule 30 days after July 17, 1998.

Repayment:

Belair claims that Mr. Ermis fraudulently misrepresented his pre-accident income, which resulted in overpayment of his disability benefits. I previously ruled that Mr. Ermis applied for benefits based on a second job, but did not earn the claimed income. Belair argues that Mr. Ermis should be ordered to repay the appropriate amount under subsection 47 of the Schedule.

Under subsection 47(3), insurers must serve insureds with notice of a repayment within 12 months that the benefit was paid, except if it results from wilful misrepresentation or fraud. In those cases, subsection 47(4) removes the 12 month requirement.

However, an insured's misconduct resulting in an overpayment does not relieve the insurer's obligation to provide any notice. The notion of fair process dictates that both parties set out the substance of their claims so the other side is put on notice prior to commencement of a hearing on the merits. I agree with Arbitrator Renahan that proper notice of a repayment is a factual question.⁹

Here, Belair did not provide any evidence that it gave Mr. Ermis written notice of its claim for repayment prior to the hearing nor do I have any calculation of the amount of its repayment claim. The company offered no additional evidence or submissions after it requested that this matter be reopened to address its repayment request.

I find that Belair has not provided Mr. Ermis with any notice of the amount claimed for repayment. Consequently, I find that Belair is not entitled to a repayment of Mr. Ermis disability benefits.

EXPENSES:

The parties may request an assessment of their arbitration expenses if they cannot resolve the issue.

October 6, 2000

Fred Sampliner Arbitrator

Date

Neutral Citation: 2000 ONFSCDRS 188

FSCO A98-001468

FINANCIAL SERVICES COMMISSION OF ONTARIO