Massachusetts has several laws which govern and direct certain aspects of the insurance industry. This article will briefly discuss the two most useful to the physical medicine provider: Massachusetts General Laws, Chapter 93A and Chapter 176(d). They regulate unfair and deceptive acts and practices within the insurance industry.
These two statutes, for example, govern what constitutes a “reasonable” investigation by the insurer, whether the insurer acted in a timely manner in processing claims/bills, or whether the insurer offered a reasonable settlement in an ongoing matter. A Chapter 176(d) violation is a per se violation of chapter 93A.
Built within Chapter 93A is the availability of double or triple damages (meaning once damages are found a judge may double or triple the amount) and the possibility of costs and attorney fees. This is such a big deal because our civil justice system is neither designed to punish a defendant (that is left to criminal law), nor award attorney fees and costs: known as the American Rule, each party is left to pay their respective costs of litigation, win or lose.
But in our opinion, Chapter 93A is often overused. For example, the insurer conducts a records review that the reviewing doctor certifies as their medical opinion. However, this is one of the worst records reviews you have ever seen! It is fraught with inconsistencies and boarders on incomprehensibility.
Because the insurer both relied on their doctor’s opinion and followed the Personal Injury Protection statute, a court is loathe to find this scenario violates Chapters 176(d) or 93A. Was it unfair for the insurer to utilize the PIP statue, or rely on their doctor’s opinion? In most cases the answer is no.
Chapter 93 is a useful and powerful weapon when used correctly. In its proper form a case will often settle quickly, with the addition of attorney fees and costs. But claimed incorrectly and a case can lose its bite. A Chapter 93A claim can take away from the merits of the case itself.
Of course, discuss with your attorney how best to proceed. But using Chapters 93A and 176(d) correctly should always be part of the discussion.