Michigan Court of Appeals; Docket #359555; Unpublished
Judges Kelly, Murray, and Swartzle; Per Curiam
Official Michigan Reporter Citation: Not Applicable; Link to Opinion
STATUTORY INDEXING:
Allowable Expenses: Reasonable Charge Requirement [§3107(1)(a)]
Allowable Expenses: Claims by Service Providers [§3107(1)(a)]
Statutory Right of Service Providers to Assert Direct Causes of Action Against Insurers [§3112]
TOPICAL INDEXING:
Medical Provider Standing (Post-Covenant)
SUMMARY:
In this unanimous, unpublished, per curiam decision, the Court of Appeals reversed the trial court’s summary disposition order dismissing Defendant Centria Home Rehabilitation’s (“Centria”) counterclaim against Plaintiff Progressive Michigan Insurance Company (“Progressive”), in which Centria sought the difference between what it billed for treatment rendered to Samantha Calhoun, and what Progressive paid for said treatment. Progressive argued that under McGill v Auto Ass’n of Mich, 207 Mich App 402 (1994) and LaMothe v Auto Club Ins Ass’n, 214 Mich App 577 (1995), Centria’s counterclaim had to be dismissed because “the proper method for challenging the reasonableness of an insurer’s payments to a healthcare provider is through a lawsuit brought by the provider against the insured.” The Court of Appeals held, however, that this case was actually controlled by the recent decision in Centria Home Rehab, LLC v Philadelphia Indemnity Ins Co, ___ Mich App ___ (2023), in which it held that when there is a dispute between a provider and its patient’s insurer over the reasonableness of the provider’s charges, the provider does have standing to pursue the balance directly from the provider, especially if the provider is acting under an assignment, as was the case here.
Samantha Calhoun, Progressive’s insured, was injured in a motor vehicle collision and received attendant care thereafter from Centria. Centria’s charges for the care it provided to Calhoun from February 2017 to June 2021 amounted to $816,184.93, only $582,722.40 of which were paid by Progressive. Progressive then filed suit against Centria in June 2019, alleging that it had overpaid Centria $8,375 for select treatment dates, and Centria, having obtained an assignment of rights from Calhoun, asserted a counterclaim seeking the $233,462.53 balance between what it charged for Calhoun’s treatment from February 2017 to June 2021, and what Progressive actually paid. Progressive then moved for summary disposition, arguing that under McGill and LaMothe, Centria had to pursue the balance from its patient, Calhoun. The trial court agreed and granted summary disposition in Progressive’s favor.
The Court of Appeals reversed the trial court’s summary disposition order, holding that this case was controlled not by McGill and LaMothe, but rather by its recent published decision in Centria. In Centria, the Court held, ‘When a health care provider, acting under an assignment of rights from an insured or under a direct cause of action under MCL 500.3112, seeks to recover the balance due for PIP benefits from an insurer and there is a dispute over the reasonableness of the charges, the health care provider has standing to bring such a claim directly against the insurer.” Thus, Centria could assert its counterclaim against Progressive in this case.
“On appeal, defendant contends that the trial court erred when it granted summary disposition in plaintiff’s favor because the outcome of this case is controlled by Mich Institute of Pain & Headache, PC v State Farm Mutual Auto Ins Co, unpublished per curiam opinion of the Court of Appeals, issued June 24, 2021 (Docket No. 353033). In that case, we concluded that the plaintiff health care provider could maintain a cause of action to seek recovery of the billed difference, distinguishing McGill v Auto Ass’n of Mich, 207 Mich App 402; 526 NW2d 12 (1994), and LaMothe v Auto Club Ins Ass’n, 214 Mich App 577; 543 NW2d 42 (1995). Mich Institute of Pain, unpub op at 3-4. For its part, plaintiff argues that this Court is bound by McGill and LaMothe, both cases in which this Court stated that the proper method for challenging the reasonableness of an insurer’s payments to a health care provider is through a lawsuit brought by the provider against the insured.
For the reasons stated in Centria Home Rehab, LLC v Philadelphia Indemnity Ins Co, ___ Mich App ___; ___ NW2d ___ (2023) (Docket No. 359371), a case that presents the same legal question presented in this case, we reverse the trial court’s order granting summary disposition in plaintiff’s favor. As we stated there: ‘When a health care provider, acting under an assignment of rights from an insured or under a direct cause of action under MCL 500.3112, seeks to recover the balance due for PIP benefits from an insurer and there is a dispute over the reasonableness of the charges, the health care provider has standing to bring such a claim directly against the insurer.’ Centria, ___ Mich App ___, ___; ___ NW2d ___ (2013) (Docket No. 359371), slip op at 10. Accordingly, the trial court erred when it granted plaintiff’s motion for summary disposition.”
