Michigan Court of Appeals; Docket No. 99691; Unpublished
Judges Kelly, Doctoroff, and Cavanagh; Unanimous
Official Michigan Reporter Citation: Not Applicable; Link to Opinion 
STATUTORY INDEXING:
Coordination with Other Health and Accident Medical Insurance [§3109a]
Coordination with HMO and PPO Coverages [§3109a]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this significant Opinion by Judge Kelly, the Court of Appeals unanimously affirmed summary disposition in plaintiff’s favor in a case where defendant Auto Club claimed plaintiff was required to seek all possible health care through his HMO before being entitled to recover under a coordinated benefits policy with defendant.
Plaintiff belonged to a health maintenance organization insurance plan at the time of his motor vehicle accident. At the same time, his automobile no-fault insurance policy contained a provision for coordination of medical benefits requiring that any sums paid for medical benefits would be reduced by any amount "paid or payable" under any valid health insurance. Plaintiff received treatment at the HMO following his accident, but thereafter sought and received medical treatment from other physicians not part of the HMO. Defendant, after paying some of these medical expenses, discontinued payment and plaintiff sued for payment of these medical benefits. The defendant contended that plaintiff had a duty to pursue medical treatment from his own provider, and that defendant owed no duty to reimburse plaintiff for other medical treatment not covered by his HMO plan. Defendant contended that it would violate contract principles to allow an insured who pays a reduced premium in exchange for coordinated benefits coverage to choose medical treatment not covered under his primary medical coverage. In rejecting this argument, the Court of Appeals held that the no-fault insurance contract, drafted by defendant, stated that medical benefits paid or payable to plaintiff shall be reduced by any amount "paid or payable" under plaintiffs other medical coverage. Since plaintiff’s HMO only covered medical treatment received at the clinic, any other treatment was not covered by his plan, and therefore, was not paid or payable under the plan. The Court of Appeals also rejected defendant's argument that plaintiff was effectively withholding the bargained for consideration of reduced premiums by failing to receive all possible benefits from his HMO. The court held that since §3109a provides that insurers are required to offer coordinated coverage at reduced rates "reasonably related to other health and accident coverage on the insured," defendant could have tailored its reduced premium to match the extent of plaintiff’s limited coverage. The court also held that the primary purpose of §3109a is to reduce duplicative coverage, and since plaintiff cannot recover the medical expenses in question from his HMO, no duplicative coverage or recovery is involved.
Finally, the court rejected defendant's argument that §3109a is analogous to the mandatory provisions of §3109 requiring set off of governmental benefits which has been interpreted to require a claimant to seek all benefits provided by law. The court distinguished the governmental benefits set off language of the statute on the basis that it was mandatory language contained in §3109, whereas §3109a does not contain similar straight forward mandatory language.
Therefore, the lower court holding in favor of plaintiff was affirmed.
