Can An Insurer Be Precluded from Asserting a 'Medically Excessive' Claim ?
In Central Gen. Hosp. v. Chubb Group (90 NY2d 195 ), the Court of Appeals held that while an insurer could not be precluded from asserting that the allegedly causative event of an injury was not covered by insurance at all, an insurer "might" suffer a preclusion remedy for late notification under Presbyterian Hosp. (supra), and that this preclusion remedy "might" prevent it from asserting that the medical treatment for which payments were sought was "medically excessive." (Central Gen. Hosp. v. Chubb Group, supra, 90 NY2d, at 199, 202.)
In Central Gen. Hosp., the Appellate Division, Second Department, had specifically held the insurer to be precluded from litigating "its asserted defenses," which it deemed to include the insurer's assertion "that the treatments provided were not medically necessary." (Central Gen. Hosp. v. Chubb Group of Ins. Cos., 288 AD2d 406, 407.)
This would appear to indicate that the instant defendant is precluded here from raising what may be characterized as a "defense."
It is notable that the Court of Appeals, although reversing on other grounds, affirmed on this ground, albeit characterizing the insurer's defense to be one of "medically excessive" treatment.
In Presbyterian Hosp., the Appellate Division, First Department, had determined broadly that what was precluded was " 'the insurance company's ability to deny the claim.' " (226 AD2d 260 [internal quotations omitted].)
This, too, would appear to bar the defendant here. (Accord, Presbyterian Hosp. v. Atlanta Cas. Co., 210 AD2d 210 [2d Dept 1994].)