Michigan Court of Appeals; Docket #272438; Unpublished
Judges Cooper, Cavanagh, and Meter; unanimous; per curiam
Official Michigan Reporter Citation: Not applicable, Link to Opinion 
STATUTORY INDEXING:
Allowable Expenses for Room and Board [3107]
Allowable Expenses: Reasonable Charge Requirement [3107(1)(a)]
TOPICAL INDEXING:
Not applicable
CASE SUMMARY:
In this unanimous unpublished per curiam opinion, the Court of Appeals reversed summary disposition for defendant Farm Bureau, finding that the trial court improperly decided whether the level of care approved by Farm Bureau was reasonable as a matter of law.
Linda Wallace sustained a traumatic brain injury and other serious injuries in a motor vehicle accident that occurred in 1977. In 2001, Wallace was admitted to an in-patient program at the Healing Place. The Healing Place is a dual diagnosis program which provides services to patients with brain injuries and psychiatric disorders. In 2002, Wallace was transitioned to the Healing Place’s apartment program for which the Healing Place charged $500 per day. In 2003, Farm Bureau scheduled three IMEs for Wallace. Based upon the results of the IMEs and the recommendation that Wallace be treated at a program that cost $275 per day, defendant decreased the amount it paid for Wallace’s treatment. Plaintiffs filed this action, alleging breach of contract and requesting declaratory judgment confirming Farm Bureau’s obligation to continue paying no-fault benefits. The trial court granted Farm Bureau summary disposition, finding that the alternative program offered by Farm Bureau was reasonable under Kitchen v State Farm, 202 Mich App 55 (1993) [Item No. 1659].
The Court of Appeals reversed and remanded, finding that summary disposition for Farm Bureau was not appropriate, where the plaintiff failed to show that a challenged expense was reasonable. In so holding, the Court of Appeals first noted that although Kitchen allows insurers to choose the least expensive adequate means for providing necessary care, Kitchen does not allow no-fault insurers to unilaterally determine what care is reasonably necessary. The court then explained that although under Nasser v Auto Club Insurance Association, 435 Mich 33 (1990) [Item No. 1358], a trial court can decide an issue as a matter of law when the plaintiff has established that an expense is reasonable, it does not follow that summary disposition for the defendant is appropriate, where the plaintiff fails to show that an expense is reasonable. In this case, the question of reasonableness should have been decided by a jury. In this regard, the court stated:
“While Kitchen does allow an insurer to choose the least expensive adequate means of providing necessary care, it does not allow an insurer to unilaterally determine what care is reasonably necessary. Even in light of Kitchen, it is clear that inquiry into reasonableness and necessity still must come before any pure cost analysis. . . . The burden of proof of reasonableness lies with the plaintiff. . . . However, this Court also limited the capacity to decide the question as a matter of law to cases where the plaintiff has proved reasonableness: ‘Thus, if it could be “said with certainty” that an expense was both reasonable and necessary, the court could make the decision as a matter of law.’ It does not follow that the trial court is free to decide the issue as a matter of law where a plaintiff has failed to prove reasonableness, or where a defendant has characterized an alternative as reasonable. Where such is the case, a trier of fact must decide what is reasonable. Because the trial court here essentially decided as a matter of law that plaintiff had failed to prove the unreasonableness of defendant’s suggested treatment option, the trial court overstepped its discretion. The question of reasonableness should have gone to a trier of fact. Summary disposition was inappropriate.”
The Court of Appeals further held that a trial court may not decide on summary disposition an issue which will result in a change in the character of care a plaintiff is provided. To hold otherwise, the court explained, would provide no-fault insurers unacceptable discretion to change a patient’s care under the guise of cost-effectiveness. In this regard, the court stated:
“A trial court may not, on a summary disposition motion that will result in a change in the character of care provided to a no-fault claimant, limit its inquiry to the adequacy of a treatment option suggested by the no-fault insurer, relying only on the opinion of one medical examiner, hired by the insurer. If a trial court might do so, the insurer would have far more authority to direct patient care than the No-Fault Act, or even Kitchen, allows. To hold otherwise would give no-fault insurers unacceptable discretion to unilaterally make appreciable changes in the character of a patient’s care under the guise of cost-effectiveness.”
