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Opinion Date: 08/28/2012
e-Journal Date: 09/17/2012
Full Text Opinion

Practice Area(s):   Insurance

Issues: No-fault benefits; Claim that the plaintiff was "double dipping" from Medicare and the Michigan Assigned Claims Facility (MACF); Effect of the fact plaintiff's accident preceded the Medicare Secondary Payer provision of the Omnibus Budget Reconciliation Act (42 USC § 1395y(b)(2)(a)); 42 CFR § 411.50; The Assigned Claims Facility Statute (MCL 500.3171 et seq.); Applicability of MCL 500.3109(1); O'Donnell v. State Farm Mut. Auto. Ins.; Jarosz v. DAIIE; Crowley v. DAIIE; LeBlanc v. State Farm Mut. Auto. Ins. Co.; Tatum v. Government Employees Ins. Co.; MCL 500.3172
Court: Michigan Court of Appeals (Unpublished)
Case Name: Lee v. Farmers Ins. Exch.
e-Journal Number: 52557
Judge(s): Per Curiam – Ronayne Krause and Borrello; Dissent – Saad

Concluding that the Legislature specifically permitted recipients of assigned-claims no-fault benefits to receive duplicative compensation from Medicare by making the assigned-claims payment structure partially uncoordinated as to Medicare, the court affirmed the trial court's order granting the plaintiff summary disposition. He suffered serious injuries as a passenger in a vehicle involved in an accident in 1978. Because he had no insurance, and no other no-fault insurance applied to him, coverage for his no-fault benefits was assigned to defendant through the MACF. After the accident, plaintiff also received Medicare coverage to pay for his medical expenses. For many years, defendant also paid him amounts equal to his incurred medical expenses as part of his PIP benefits. Defendant recently declined to pay plaintiff for the incurred medical expenses that were already covered by Medicare. He sued to recover these PIP benefits from defendant. According to plaintiff, defendant failed to pay for medical expenses he incurred at a hospital between 4/14/08 and 5/14/08 and expenses he incurred at another hospital from 4/10/09 to 4/22/09 and from 1/7/09 to 1/29/09. He also claimed that defendant failed to pay various other incurred medical expenses in smaller amounts. Defendant did not dispute that plaintiff incurred those medical expenses as a result of the 1978 motor vehicle accident. Rather, defendant argued that all of the bills from those medical treatments were submitted to and paid by Medicare, and plaintiff should not receive a "windfall" of duplicate PIP payments when his medical expenses were already paid. Defendant characterized this as permitting plaintiff to "double-dip" from both Medicare and the MACF. Plaintiff took the position that these medical expenses were allowable no-fault expenses that defendant was obligated to pay under the No-Fault Act, regardless whether his medical bills were paid by Medicare. The trial court held that, as a matter of law, defendant must pay plaintiff the amount of his incurred medical expenses as PIP benefits, notwithstanding his Medicare coverage. The trial court ruled that defendant must pay him $105,191.75 for the medical expenses incurred at the hospitals and facilities, plus interest. Pursuant to MCL 500.3148, the trial court also ordered defendant to pay $49,992.21 for plaintiff's attorney fees and $1,437.17 in costs. Defendant argued that it should no longer pay those PIP benefits, and presumably should never have paid them, because plaintiff's medical expenses covered by Medicare should be subject to offset under MCL 500.3109(1). However, "that statute, and the case law addressing that statute, contemplates a payee receiving benefits pursuant to some kind of purchased no-fault insurance policy." The court noted that it found no published case applying the offset under MCL 500.3109(1) to benefits paid pursuant to an assigned claim. The court concluded that neither the offset reasoning set forth in LeBlanc nor the analysis pertinent to MCL 500.3109(1) applied to this case. MCL 500.3172 specifically applies to PIP benefits payable through assigned claims plans. "Critically, MCL 500.3172(2) states that PIP benefits paid by the assigned claims facility 'shall be reduced to the extent that benefits covering the same loss are available from other sources,' but further states that Medicare is not one of those 'benefit sources.'"

Full Text Opinion

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