The opinion of the court was delivered by: Judge Vanaskie
At issue in this matter is whether Plaintiff Karen Martino may recover first party medical benefits under an automobile policy of insurance for injuries sustained on December 20, 2003, when her vehicle was struck by a Greyhound bus. Plaintiff has brought a common law claim for breach of contract, as well as a statutory and bad faith claim under 42 Pa. Cons. Stat. § 8371, against Defendant Allstate Indemnity Company. Allstate has moved for dismissal of the bad faith claim under Federal Rule of Civil Procedure 12(b)(6). (Dkt. Entry 22.) For the reasons set forth below, Allstate's motion will be denied.
On December 20, 2003, at Greyhound bus struck the vehicle in which Ms. Martino was a passenger. (Am. Compl., Dkt. Entry 19., ¶ 6.) Ms. Martino alleges her injuries include a cervical strain, a lumbosacral strain, a thoracic strain, a large right-sided disc herniation at C5-6 with mass effect upon the cord, a central disc bulge at C4-5, neck and back pain, muscle spasms, radiculopathy, myelopathy and sciatica. (Id. at ¶ 6.) At the time of the accident, Ms. Martino was the beneficiary of an automobile policy of insurance issued by Allstate. (Id. at ¶¶ 4-5.)
Following the accident, Ms. Martino submitted a claim for first party medical benefits to Defendant Allstate Indemnity Co., which began paying for her treatment. (Id. at ¶ 7.) On September 21, 2005, Dr. Pamela Costello performed a C5/6 anterior cervical diskectomy with fusion and plate on Ms. Martino. (Id. at ¶ 8.) In March or 2006, Ms. Martino underwent treatment with Dr. Paul F. Remick. (Id. at ¶ 9.) In May of 2006, she also sought assistance from Drug and Alcohol Treatment Services, Inc. ("DATS") for assistance with prescription pain medication dependence. (Id. at ¶ 10.)
On August 25, 2006, Allstate obtained a peer review report from Dr. Timothy J. Fiorillo, who concluded that none of this treatment was reasonable or necessary. (Id. at ¶¶ 11-12.) Dr. Fiorillo's report first recognized that Ms. Martino was involved in a motor vehicle accident on December 20, 2003, and that "[s]he gave a history of cervical disc surgery in 09/05, due to 'an injury two years prior. . . . " (Dkt. Entry 25-2, at 1.) He concluded that:
Upon review of the available information and based upon a reasonable degree of medical certainty the office visits and referrals rendered by Dr. Paul Remick should NOT be considered reasonable or necessary. The decision is based on the lack of documentation for the above noted MVA [Motor Vehicle Accident]. The subsequent referral to the Drug and Alcohol Treatment Services, Inc. should NOT be considered reasonable or necessary. Likewise, the prescriptions for the various medications should NOT be considered reasonable or necessary. (Dkt. Entry 25-2, at 1.) Relying on this report, Allstate halted payment for Ms. Martino's treatment by Dr. Remick, for treatment by DATS, and for her prescriptions of Suboxone, Alprazolam, Paroxetine, and Topamax (prescribed by Dr. Remick). (Am. Compl., Dkt. Entry 19, at ¶15.)
On July 16, 2007, Ms. Martino saw Dr. John DeLeon, Jr., D.C. (Id. at ¶ 16.) Allstate then obtained a peer review report from Jane L. McBride, DI.C., who concluded:
It is my professional opinion that none of the chiropractic care afforded Ms. Martino can be considered reasonable and necessary . . . . The patient is nearly four years post-MVA. It is my opinion that any soft tissue injuries arising from the incident would resolve prior to the initiation of chiropractic treatment in 2007. There is evidence in the file that prior to seeking treatment with Dr. DeLeon, the patient underwent extensive treatment including physical therapy and surgery to resolve her initial MVA pain complaints. There is no clinical reason as to why the patient would still require chiropractic care nearly four years post-MVA. (Dkt. Entry 25-3, at 4.) Allstate then refused to pay for Dr. DeLeon's care, relying on Dr. McBride's report. (Am. Compl., Dkt. Entry 19, at ¶ 19.)
Ms. Martino filed suit against Allstate in the Lackawanna County Court of Common Pleas on October 3, 2008. (Dkt. Entry 1-2, at 6.)m Ms. Martino alleged she had not exhausted the limits of her insurance policy with Allstate, and that she continued to seek medical care for her injuries sustained in the December 20, 2003 accident. She alleged Allstate breached its obligation under her insurance policy and acted in bad faith in refusing to pay for her medical treatment in connection with the December 20, 2003 accident. Allstate then removed the action to this Court, and on November 5, 2008, moved to dismiss the bad faith claim. After oral argument was conducted on the motion on February 2, 2009, Ms. Martino filed an Amended Complaint. (Dkt. Entry 19.)
Count One of the Amended Complaint alleges a common law breach of contract claim. (Am. Compl., Dkt. Entry 19, at 1.) In refusing to make payments for her medical bills, Allstate is alleged to have breached the terms and conditions of its insurance policy issued to Ms. Martino. (Id. at ¶ 33.) Count Two alleges a bad faith claim under 42 Pa. Cons. Stat. § 8371. Specifically, Ms. Martino alleges that Perspective Consulting, Inc., the peer review organization employed by Allstate, has provided negative and biased peer review reports to Allstate and other insurance companies, and that Allstate acted in bad faith in denying payment for medical treatment and prescriptions that were reasonable and necessary. (Id. at ¶¶ 38-48.)
On February 10, 2009, Allstate filed a Partial Motion to Dismiss, challenging the viability of Plaintiff's Statutory Bad Faith Claim. (Dkt. Entry 22). The Motion is fully briefed and ripe for resolution.
A. Standard for Rule 12(b)(6) Motion ...