First-Party (PIP)

Court/Case No: Wayne County Circuit Court/16-015349-NF

Tried/Argued Before: Judge

Demand: ~ $60,000.00

Verdict: $0 – Motion for Partial Summary Disposition granted

Name of Judge(s): Honorable Martha M. Snow

Keys to the Case:

Plaintiff had a policy with a Michigan No-Fault insurer that stated our Defendant was only responsible for excess medical and excess wage loss payments. However, Plaintiff’s medical insurance was a self-funded ERISA plan. Accordingly, the medical insurer asserted a lien for recoupment on all medical expenses paid, which totaled just shy of $60,000.00. We filed a Motion for Partial Summary Disposition on the lien as the summary plan description did not specifically disavow coverage for injuries arising out of a motor vehicle accident.

Plaintiff strongly argued that the No-Fault policy stated that it is not primary for payment when the medical bills are paid or payable by another medical insurance company. He stated that under Sibley v DAIIE, a Michigan Supreme Court Case from 1988, benefits are not “paid” by the medical insurer when the policy contains a subrogation clause that requires the insured to reimburse the medical insurance company out of a third-party settlement.

We successfully argued that Sibley was not analogous to our case because Plaintiff had a coordinated policy. Therefore, the proper binding law on Michigan courts is Dunn v DAIIE, a Michigan Court of Appeals case from 2002. Under Dunn, when an insured invokes their statutory right to a reduced premium in exchange for coordinated benefits, and opts to use an ERISA plan as their primary medical insurance, the insured must be responsible for the consequences of a subrogation clause contained in that ERISA plan. The court found it illogical to hold an insurer liable for a risk it did not assume.

Judge Snow agreed that Dunn is the controlling law on Michigan trial courts, and ruled that the No-Fault insurer was not responsible for the medical lien asserted by Plaintiff’s ERISA plan.

Defense SW attorney(s) Involved in Case: