Judge Katherine Levine
LK Health Products sued to recover for medical supplies provided to its assignor. Insurer GEICO cross-moved for summary judgment based on LK’s failure to show up at an EUO. GEICO explained that its investigation into LK’s business practices raised questions as to the accuracy of its billing and coding practices, among other things. LK sent GEICO a letter as a formal objection to the EUO request. GEICO stated as its initial EUO scheduling letter explained the need for the EUO, it was not required to respond to LK’s objection letter. The court stated the Insurance Department found 11 NYCRR 65-3.5(e) did not require an insurer to justify its EUO requests or include its reasons for requiring the EUO in its notices for the EUO or its denials based on an EUO no-show. The court ruled as no justification for an EUO request was necessary, GEICO was not obligated to reply to LK’s letter refusing to appear at an EUO and requesting that GEICO justify its reason for the EUO. It found LK’s failure to show up for the EUO constituted a violation of a condition precedent to coverage, voiding the contract ab initio. Hence, GEICO was not obligated to pay the claim, LK’s motion was denied, and GEICo’s cross-motion granted.
