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Everett v. State Farm Indemnity Co.12/31/2002
made the decision to apply the adjusted heating pad bill to plaintiff's deductible, it was in the same position it would have been had it been necessary to make an expenditure of funds to a health care provider or plaintiff himself. It was aware of the accident, that plaintiff was receiving treatment as a result of injuries sustained in the accident, and there may be more bills to follow. Any expectation (or lack of expectation) of repose by State Farm was the same on July 1, 1996, as it would have been had money actually been paid to the provider or plaintiff. Because suit was filed within two years of July 1, 1996, when the expense was approved, the underlying purposes of the statute of limitations was fulfilled. State Farm had security and stability in its affairs, and would have been assured that the case was not tried on the basis of stale evidence.
Requiring the insurance company to actually make an expenditure of funds will result in a statute of limitations determined not only by the timely submission of an expense causally related to the accident, but by the size of the deductible and the size of the bill. Here, plaintiff had a deductible of $250, the minimum required by statute. N.J.S.A. 39:6A-4. Had a bill for $400 been submitted rather than one for $56.03, State Farm no doubt would have applied the fee schedule and sent a check, either to plaintiff or the health care provider, for the balance due after the deductible was exhausted. In that case, there would be no dispute that the check constituted "the last payment of benefits." Here, however, because the first bill was for $56.03, no out-of-pocket payment was made. Accordingly, if we accept defendant's position, different tolling dates would apply depending upon the size of the health care provider's bill. The same result would similarly hold true depending upon the size of the deductible.
The arbitrariness of having the tolling date of the statute of limitations dependent upon the size of the deductible or the size of the bill can be demonstrated by the following example. If an insured with a $2,500 deductible, N.J.S.A. 39:6A-4.3, received intermittent treatment over a four-year period, and was billed by the health care provider at $400 per year, and in the fifth year submitted claims for services totaling $5,000 which were ultimately declined, a complaint challenging the insurance company's action would be barred since the deductible had not been depleted before receipt of the $5,000 claim. No action would have been filed either within two years after plaintiff incurred an expense or within four years of the accident. See N.J.S.A. 39:6A-13.1. Whereas, if the deductible was $250, the first $400 bill would have dissipated the entire deductible requiring an out-of-pocket payment to the health care provider by the insurance company, thereby tolling the statute of limitations for an additional two years with each $400 submission. Under either example the insurance company would have been in the same position vis-a-vis its knowledge of the accident and its ability to defend a lawsuit. Yet, under the former example plaintiff's complaint would have been barred. It is unlikely that the Legislature would have intended such an inconsistent result, permitting the statute of limitations to be tolled for those who can afford a higher premium by purchasing a lower deductible, and not for those insureds who receive a higher deductible in return for paying a lower premium. Such a scheme would not foster the purposes of the statute of limitations, repose for the defendant and the adjudication of fresh claims.
Our dissenting colleague suggests that we have disregarded the "inherently arbitrary nature of statutes of limitations," citing to M
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