Appellate Division Holds Against Payment for Surgical Center

Feb 5, 2019

In a case involving automobile insurance, the Appellate Division recently held that an insurer did not owe payment to an ambulatory surgical center for procedures not listed as reimbursable when performed at a surgical center.  NJM v. Specialty Surgical Center of North Brunswick, et al., - N.J. Super. – (App. Div. 2019).

Claire Fiore and Martino Chizzoniti were NJM insureds who underwent back surgeries at surgical centers following auto accidents.  Following the procedures, each surgical center sought reimbursement from NJM under CPT code 63030.  NJM denied payment asserting that the CPT code charged by the facility had no reimbursement value for a surgical center on the fee schedule.

NJM lost at arbitration but filed an action seeking to vacate each award under N.J.S.A. 2A:23A-13.  The trial court held in favor of NJM and vacated the awards.  The Appellate Division affirmed.

The Appellate Division held that it had jurisdiction to review the trial court’s order under the Act, because the case constituted a “rare circumstance” where public policy mandated an exception to the statutory decree that there is generally no appeal from a trial court under the Act.

Exercising de novo review, the Appellate Division held that the plain language of a regulation prohibiting payment to surgical centers for CPT code 63030 barred reimbursement.  The court noted that the fact that Medicare includes the CPT code does not result in an automatic amendment of the fee schedule; instead it is the Department of Insurance, not Medicare, that amends the fee schedule.