Staying with the Kentucky theme, that state's Supreme Court held that insurers could not deny claims for PIP medical expenses based on a "paper" medical review. Government Employees Ins. Co. v. Sanders, Case no. 2018 WL 5732087 (Ky. Nov. 1, 2018). In a paean to its Kentucky roots, the court quoted Davy Crockett on raccoon hunting to find that the trial court and attorneys were "barking up the wrong tree."
Kentucky statute requires payment of basic reparations benefits without regard to fault, up to a maximum of $10,000. The statute expresses when insurers may deny benefits, but because it says nothing about denying claims based on review of medical records or even on an exam, the Sanders court held that claims for medical expenses could not be denied based on that review. The Kentucky Supreme Court was careful to identify several other reasons expressed in the statute for denying claims.
The Sanders court held that the statute establishes a "legal presumption" that any medical bill submitted is reasonable, which the court stated also includes a presumption that services were necessary as well. This presumption could be overcome only by an insurer filing an action in circuit court. The court held that if an insurer receives claims that mispresent the reasonableness of or need for medical services, the insurer's only recourse, except in rare circumstances, is to bring an action against the provider.
The claim in Sanders was filed as a class action and certified by the trial court, and is also present in at least one federal case, Thomas v. Allstate Property and Cas. Ins. Co., in the Western District of Kentucky, and leave to add class allegations was recently sought in a state court case against another insurer. No crystal ball is necessary to foresee that more of these class actions will be filed in Kentucky against insurers.
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