Publication

14 June 2022

Michigan Supreme Court Decides: Assignments Still Matter

On June 10, 2022, the Michigan Supreme Court issued a unanimous decision in Mecosta County Medical Center v. Metropolitan Group Insurance Company, a case handled by Miller Johnson’s Med Recovery Group with significant implications for medical providers seeking payment of no-fault claims.

The essence of the Court’s decision:  although providers now enjoy the independent and legal right to make and pursue claims for no-fault benefits, assignments of benefits (AOB) between patients and providers remain very important in protecting that right to payment.

In Mecosta County, the patient signed AOBs of his claims to the providers.  When Metropolitan and State Farm later denied payment, both the providers and the patient filed suit, but in separate courts.  The patient’s case was dismissed and the insurers later used that dismissal to obtain a dismissal of the providers’ lawsuit in the lower court, arguing that the patient dismissal barred the providers’ claims.  On appeal, the Michigan Supreme Court rejected the lower court’s decision.  The Court made it clear that the actions of a patient taken after the AOBs had been given could not bind his providers.  The Court upheld the providers’ claims under the AOBs as valid and compensable, as a result.

Mecosta County serves as reminder to medical providers seeking payment of no-fault claims:  when submitting claims to insurers for payment, best practice remains for the provider’s submission to include not only the billing and supporting medical records, but any AOBs signed by the patient.  Other appellate decisions have held that obtaining the AOB is not enough; the provider must also notify the no-fault carrier that it has obtained an assignment.  Notice of those AOBs to the insurers will limit the effort of insurers to discharge their legal obligations to medical providers by cutting checks directly to patients on provider bills.

If you have questions about this or any other medical reimbursement issue, please contact Joseph Gavin or any one of our provider reimbursement counsel.

View the full opinion here:
https://www.courts.michigan.gov/siteassets/case-documents/uploads/OPINIONS/FINAL/SCT/161628_76_01.pdf