Another bomb drops on physician dispensers

Allstate Insurance filed suit against physician dispensing “technology” firms Infinite Strategic Innovations Inc (ISI) and Doctors Medical LLC earlier this week.  This is the second in what may be an-ongoing series of legal actions by the giant insurer, and comes on the heels of a settlement in their earlier suit against dispensing “technology company” Automated Healthcare Solutions.  

While the AHCS suit has been dismissed, I think we can assume Allstate made out quite well in the “dismissal”; Allstate doesn’t move unless they are very confident, and they come with overwhelming force.  Even the most arrogant, litigious, and downright nasty opponents are going to quail in the face of an Allstate lawsuit. While no one’s talking,   it is logical that Allstate would not have allowed the suit to be withdrawn unless they were pretty darn happy with the resolution.

My guess is Doctors Medical’s owner, Tom Mollick, is having a very bad week. And things are not going to get any better for Mollick et al.

From reading the complaint, Allstate is claiming ISI and DM received payments totaling $93,265 for PIP claims in Michigan, and has billed Allstate another $443,751 for other claims.  Allstate wants (most of) their money back, doesn’t want to have to pay most of the pending claims, and wants ISI and DM to agree to stop billing the insurer.

The key parts of the suit include:

  • request for declaration judgment
  • a statement that ISI and DM have no standing to bill as they are not medical providers
  • request for restitution for claims adjusting, administrative, and legal costs
  • assertion that ISI and DM operated “under the umbrella” of Rx Development Associates, Inc.  

There’s a lot more to this, but the net is this.  This is the second in what may well be a series of suits against physician dispensing companies; my guess is Allstate won big in their initial suit against AHCS, and is pursuing Mollick now, and will go after other dispensing companies as well.

As the AHCS suit was withdrawn, we don’t know what the resolution was – and never will.  And more’s the pity, because Allstate may well have solved its problem, but did nothing to address the problem for the rest of the industry.  That’s understandable as it isn’t their lawyers’ job to fix other insurers’ problems.

Nonetheless, it would be…helpful if the result of these legal actions was public knowledge – it would give pause to the other dispensers and their cronies, alert other insurers to the issue, and, over the long term, reduce Michigan auto insurance costs.

What does this mean for you?

Check your payment records, figure out how much you’re paying dispensers and their enablers, and do something about it.

 

One thought on “Another bomb drops on physician dispensers