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American Medical Security, Inc. v Auto Club Insurance Association of Michigan; (COA-PUB, 1/4/2001, RB #2216)


United States 6th Circuit Court of Appeals; Docket Nos. 98-1973 and 99-2110; Published
Judges Daughtrey, Clay, and Russell; January 4
Official Reporter Citation: 238 F.3d 743

Coordination with ERISA Plans[§3109a]
One-Year Back Rule Limitation [§3145(1)]

Employee Retirement Income Security Act (ERISA – 29 USC 1001 Et Seq.)

This published opinion from the United States Sixth Circuit Court of Appeals, written by Judge Clay, dealt with a suit filed by an ERISA health insurance company against a coordinated no-fault insurer seeking reimbursement for medical expenses it paid to an auto accident victim insured under both plans.  The Sixth Circuit Court of Appeals affirmed the trial court’s ruling that the ERISA plan was primary and the no-fault coordinated plan was secondary and in the process, rendered two holdings.

First, the court held that the ERISA plan’s suit for reimbursement was controlled by the one year back rule contained in section 3145 of the statute inasmuch as the ERISA plan was seeking reimbursement under a subrogation theory and was therefore bound by the same rules that apply to the insured person.  In reaching this decision, the court relied upon Titan Insurance Company v Farmers Insurance Exchange [Item No. 2145], and held:

“§3145 applies to reimbursement suits between no-fault insurers.  And so it goes that in this case, where Plaintiff, as a health insurer, is seeking recovery of payments made on behalf of an insured who is also covered by Defendant, as a no-fault insurer, Plaintiff is doing so under a subrogation theory and is therefore subject to the period of limitation in §3145.  This is not a harsh or unreasonable standard to which Plaintiff should be held inasmuch as Plaintiff is an insurance company itself and is presumably well aware of the much-publicized insurance law of this state.”

Second, the court held that the coordinated no-fault insurer was secondary and the coordinated ERISA health insurer was primary because the ERISA plan in this case was not a self-funded ERISA plan.  The court held that the issue of whether the provisions of section 3109a of the Michigan No-Fault Act and the rule in Federal Kemper are preempted by federal law is based upon whether the ERISA plan at issue is a self-funded plan.  It is only self-funded, uninsured ERISA plans that are exempted from the reach of section 3109a of the Michigan no-fault scheme.  In this regard, the court stated:

“Although this Court has not squarely addressed the primacy of coverage issue between a coordinated no-fault policy and an insurance policy purchased by an ERISA plan, we believe that the jurisprudence relating to this issue clearly indicates that §3109a is not preempted under such circumstances....  This same conclusion has been similarly reached in the Michigan federal district courts that have considered the issue....  Moreover, because the ERISA plan at issue here is funded by an insurance policy as opposed to being self-funded, ERISA’s deemer clause will not exempt the plan from §3109a of Michigan’s no-fault law....”

In accordance with the foregoing, the court held that because Michigan’s no-fault law was not preempted under the facts of this case, the district court properly concluded that the ERISA plan was the primary insurer and was not entitled to reimbursement from the coordinated no-fault insurer.

Lansing car accident lawyer Stephen Sinas is the lead editor of the appellate case summaries published on this site regarding the Michigan auto insurance law. To learn more about how Stephen Sinas and how the Sinas Dramis Law Firm can help you if you have been injured in a Michigan auto accident, visit

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