United States Court of Appeals for the 6th Circuit; Docket No. 05-1237; Published
Judges Moore, McKeague, and Polster; unanimous
Official Reporter Citation: Forthcoming, Link to Opinion 
STATUTORY INDEXING:
Not applicable
TOPICAL INDEXING:
Employee Retirement Income Security Act
No-Fault Insurer Claims for Reimbursement: Insurer Unequal Priority Reimbursement
CASE SUMMARY:
In this unanimous published opinion, the United States Court of Appeals, 6th Circuit, held that the where an ERISA employee benefit plan did not specifically exclude coverage for benefits payable under a no-fault policy, but plaintiff’s coordinated no-fault policy specifically excluded payment under a “benefit plan,” the ERISA plan is first in priority for the insured’s medical expenses necessitated by injuries he sustained in a motor vehicle accident.
Jacqueline Bradshaw was seriously injured in a motor vehicle accident. At the time of the accident, Bradshaw had a no-fault insurance policy through Citizens Insurance that provided for coordination of benefits. She was also insured by a self-funded health benefit plan provided by her employer. Citizens brought this action seeking reimbursement for Bradshaw’s medical expenses. The district court granted defendant’s motion for summary judgment, finding that Citizens was first in priority.
On appeal, the court examined the competing policies. Citizens’ policy provides that it “excludes payment of benefits for medical expenses payable by ‘any individual, blanket or group accident or disability insurance, service, benefit, reimbursement, or salary continuance plan (excluding Medicare benefits provided by the federal government).’” According to the court, this policy is ambiguous, as more than one interpretation is possible–that it is secondary to “benefit plans,” or that it is secondary to “an accident or disability benefit plan.” Therefore, the court examined the intent underlying the policy. According to Citizens, its intent is to make its exclusion as broad as possible in order to ensure that its policy is found to be secondary to other medical benefit plans. In contrast, defendant defines itself as a “benefit plan” in its plan document. Defendant also argues that because it is an employee benefit plan covered by the Employee Retirement Income Security Act (ERISA), when there are competing coordination of benefit clauses, its policy language takes precedence. The court disagreed, finding that defendant misinterprets ERISA. Although a plan under ERISA will defeat a plan under any other statute, including the No-Fault Act, this does not mean the ERISA plan will prevail in a priority dispute. Therefore, the court determined that since defendant defines itself as a benefit plan and plaintiff’s policy excludes coverage when there is an available benefit plan, defendant’s plan was first in priority to plaintiff’s plan. In ruling against defendant, the court stated:
“We . . . agree with Citizens’ assertion that MidMichigan is a ‘benefit plan,’ encompassed by the Exclusions clause. MidMichigan defines itself as a benefit plan in its coordination of benefits clause, and the statutory language of the Employee Retirement Income Security Act, ERISA, 29 U.S.C. sec 1001 et seq. refers to the plans it regulates as ‘benefit plans.’ . . .
Having found that the intent underlying the Exclusions provision clearly militates in favor of Citizens’ interpretation, we find that Citizens properly excluded payment of medical benefits for a series of plans, including a ‘benefit plan.’ MidMichigan is such a plan. Because MidMichigan’s plan was in full force at the time of Bradshaw’s injury, and the plan did not expressly disavow coverage for medical benefits otherwise payable under a no-fault policy, we find that MidMichigan is first in priority for payment of Bradshaw’s claims.”
Accordingly, the 6th Circuit reversed the district court’s denial of plaintiff’s motion for summary judgment.
