Michigan Supreme Court Allows Full Medical Benefits for Victims Injured Before No-Fault Reforms
Published:
On July 31, 2023, the Michigan Supreme Court decided Andary v. USAA Casualty Insurance Co.. In a 5–2 opinion by Justice Elizabeth Welch, the Court held that two 2019 cost-control rules do not apply to people who were injured before June 11, 2019, and who are drawing PIP benefits under a household auto policy.
Those two rules are the non-Medicare fee schedule in MCL 500.3157(7) and the 56-hour-per-week cap on in-home attendant care by family, household members or people with a prior relationship in MCL 500.3157(10).
When the opinion came down, the Michigan Catastrophic Claims Association had about 15,000 open catastrophic claims from crashes that happened before the overhaul (14,872 of 16,683 open claims, according to contemporaneous reporting of MCCA figures). That is the “nearly 15,000” number that circulated with the decision. It is a claims count, not a finding in the opinion.
If you were hurt after that date, Andary does not lift the new fee schedules. A Michigan car accident lawyer can still help with PIP disputes, provider bills and any third-party claim.
Do You Have a Case?WHY WAS THE MICHIGAN NO-FAULT SYSTEM REVAMPED IN 2019?
Before 2019, every Michigan auto policy had to include unlimited PIP medical benefits: reasonably necessary care, recovery and rehabilitation, including attendant care, with no dollar cap. Providers billed “reasonable” charges. There was no Medicare-based fee schedule.
Michigan premiums were among the highest in the country. Public Acts 21 and 22 of 2019 were sold as a way to cut those rates: let drivers pick a PIP medical limit, and pay providers less. Our No-Fault law page walks through the six PIP choices that took effect July 1, 2020.
The provider-payment cuts and family-care hour cap were written to start later, for treatment rendered after July 1, 2021.
Recommended reading: Your Guide to Understanding Michigan No-Fault Insurance
WHAT WAS THE CASE ABOUT?
The lead plaintiffs were Ellen Andary and Philip Krueger. Andary was catastrophically injured in a December 2014 crash; her benefits were through USAA. Krueger was injured in March 1990 as a passenger in a pickup; his benefits were through Citizens. Both needed around-the-clock care. Family members provided much of it. Eisenhower Center, a rehab provider, joined the suit.
When insurers began applying the 2021 reimbursement cuts, the plaintiffs asked the courts to say the new limits could not change benefits that had already vested. The ACLU of Michigan and others filed friend-of-the-court briefs.
The fight was not mainly about the separate Medicare-comparable cap (often described as about 200% of Medicare for services Medicare prices). Andary focused on two other pieces of MCL 500.3157:
- Non-Medicare services (long-term rehab, much attendant care): for many providers, payment dropped to 55% of the January 1, 2019 charge — a 45% cut — then stepped down further.
- Family / friend attendant care: insurers only had to pay for 56 hours a week from those caregivers. Hours above that had to come from unrelated professional help, if they were paid at all.
The Supreme Court affirmed the Court of Appeals on the core point: applying those two provisions to Andary and Krueger would impair vested contractual rights, and the Legislature did not clearly say to do that. The Court did not strike the 2019 law for people injured later. It also limited how far a provider like Eisenhower Center could press constitutional challenges on behalf of other patients.
Justices Viviano and Zahra dissented in relevant part. They would have applied the amendments more broadly.
Bottom line: if the crash was before June 11, 2019, and benefits flow from a household policy issued under the old statute, Andary says the 55% non-Medicare schedule and the 56-hour family-care cap do not cut those benefits. If the crash was on or after June 11, 2019, those controls still apply, even if the person later chose unlimited PIP.
Recommended reading: Why Michigan Car Accident Victims Need Unlimited PIP Benefits
WHAT IF MY POLICY IS NOT UNLIMITED PIP?
Andary does not pick your PIP limit. For crashes after the reform, medical PIP is whatever the policy selected (MCL 500.3107c): unlimited, $500,000, $250,000, $50,000 (Medicaid path), or no PIP medical (Medicare A and B path). See DIFS.
Unlimited PIP still does not restore pre-2019 provider rates for a post-Andary-date injury. The fee schedule and family-hour cap can apply even on an unlimited policy.
Hospitalization, surgery, rehab and attendant care can blow through $250,000 or $500,000. Medicare is not a substitute for auto PIP on long-term rehab and in-home care. That is why we still tell people to read the PIP options carefully and, in most cases, to keep unlimited medical if they can.
PIP notice is generally due within one year (MCL 500.3145). A third-party lawsuit is usually three years (MCL 600.5805).
CALL AN EXPERIENCED MICHIGAN CAR ACCIDENT ATTORNEY
If you or a loved one was hurt in a crash — especially if attendant care or rehab billing has been cut — we can help sort which rules apply.
Car accident law is complicated, but finding the right Michigan car accident attorney is simple.
Don’t let the legal clock run out. Fill out the form below or call 1-800-CALL-SAM for a free, no-obligation consultation.
Help is just a click away®.
Do You Have a Case?
