Michigan Court of Appeals; Docket #263835; Unpublished
Judges Jansen, Sawyer, and Bandstra; unanimous; per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion 
STATUTORY INDEXING:
Allowable Expenses for Medical Treatment [3107(1)(a)
Coordination with Other Health and Accident Medical Insurance [3109a]
TOPICAL INDEXING:
Not applicable
CASE SUMMARY:
In this unanimous unpublished per curiam opinion, the Court of Appeals vacated the trial court’s Order in which it partially denied plaintiff’s motion for declaratory judgment, finding that where chiropractic treatment was not covered by the primary health insurer, it was not a treatment subject to coordination of benefits.
The plaintiff in this case is a chiropractor who provided chiropractic services to several patients who had been involved in motor vehicle accidents and who were insured under coordinated no-fault policies with defendant Auto Club Group Insurance Company. When the patients’ primary health insurers denied coverage for chiropractic services, plaintiff billed defendant. Defendant denied the charges, arguing that the insureds are required to seek care through his or her primary health insurer. Plaintiff sued, requesting a declaratory judgment that the patients were not required to seek coverage from the health insurer, because chiropractic care was not covered under their policies. The trial court denied the request, ruling the insureds were required to first treat and seek comparable services through their primary care physicians.
The Court of Appeals reversed, citing its decision in Sprague v Farmers Insurance Exchange, 251 Mich App 260 (2002) [Item No. 2299]. In Sprague, the court held that where services are not required by contract to be provided by the primary health insurer, they are not subject to a coordination of benefits provision in a no-fault policy and are a covered benefit if the services were reasonably necessary. In this case, the patients’ health insurers did not cover chiropractic care. Therefore, the only issue was whether the chiropractic service was an allowable expense. In this regard, the court stated:
“The only factual difference between this case and Sprague is that the current named insureds did not seek any medical care through their health insurance carrier prior to receiving the challenged chiropractic treatment. However, this difference does not affect the interpretation of the defendant’s coordination clause. In Sprague, this Court specifically held that an insured with coordinated benefits is ‘required first to utilize the health care provider for services offered by that health care provider.’ It is undisputed that the health insurance policies of the 46 named insureds at issue in this appeal did not cover chiropractic services. Regardless of whether the insureds first treated with their PCPs or immediately sought uncovered medical treatment, the dispositive question is whether the challenged service was reasonably necessary and, therefore, covered as an ‘allowable expense.’”
The defendant then argued that it is not liable because plaintiff’s patients did not first seek “comparable services or accommodations” from their primary health insurers. In rejecting this argument, the Court of Appeals reasoned that defendant’s policy does not provide a means to determine whether a service is “comparable.” Instead, such a determination would only affect whether the service was reasonably necessary. If the insured person could have obtained comparable treatment, then the uncovered treatment may not have been reasonably necessary. Because such a determination was not made, there was a question of fact whether the chiropractic care was reasonably necessary and, therefore, an allowable expense under MCL 500.3107. In this regard, the court stated:
“In Sprague, this Court specifically held that an insured with coordinated benefits is “required first to utilize the health care provider for services offered by that health care provider.”. . . It is undisputed that the health insurance policies of the 46 named insureds at issue in this appeal did not cover chiropractic services. Regardless of whether the insureds first treated with their PCPs or immediately sought uncovered medical treatment, the dispositive question is whether the challenged service was reasonably necessary and, therefore, covered as an “allowable expense.”
Defendant contends that, even though chiropractic services were not covered by the named insureds’ health insurance policies, those individuals were required to first seek “comparable services or accommodations” from their priory health insurer. Defendant’s no-fault insurance policy provides no test for determining whether an alternate service or accommodation is “comparable.” Furthermore, neither party has presented any case law to assist in the interpretation of this clause. However, we find that such a determination would only affect whether the out-of-network medical treatment was reasonably necessary. If the insured could have procured “comparable services or accommodations” covered by his or her health insurance plan, the uncovered services may not have been “reasonably necessary.” Accordingly, the trial court improperly denied plaintiffs’ motion for declaratory judgment. Defendant was required under its coordinated no-fault policy to reimburse plaintiffs for the insureds’ chiropractic care in the first instance. Of course, a question of fact exists regarding whether these services were reasonably necessary and, therefore, allowable expenses under MCL 500.3107.”
