United States District Court, Eastern District of Michigan; Docket No. 95-72351;
Honorable Avern Cohn; Unpublished
Official Federal Reporter Citation: Not applicable; Link to Opinion
In this written Opinion, Judge Cohn resolved a coordination of benefits dispute between an auto no-fault insurance company and an ERISA self-insured health and welfare benefit plan. Under the provisions of the ERISA health plan, if the insured person is eligible for coverage under two separate plans, each containing a coordination of benefits clause, the plan with the longest period of coverage will be primary. The ERISA plan further provided that "two successive plans of the same group will be considered one plan if the person was eligible for coverage under the new plan within 24 hours after the old plan terminated "
In this particular case, the no-fault insurance provided by defendant Titan was issued under two successive no-fault policies. The first was a non-coordinated policy and the second was a coordinated policy. A short time after the first Titan policy went into effect, the insured person became eligible under plaintiffs ERISA plan. The court ruled that the no-fault coverage was the longest coverage, even though the first no-fault policy was uncoordinated and the second was coordinated. The determinative fact was that there was no break in the no-fault insurance coverage issued by Titan Insurance Company, not that one policy was coordinated and the other was not.
In this regard, the court stated,
"The successive plans language explains how the longest coverage rule is to be applied: when a person's coverage continues through two immediate successive, substantially similar plans, the [ERISA plan] will look to the eligibility date of the first plan to determine the length of coverage under that plan. This application governs regardless of whether there was a change in the amount or scope of benefits, the carrier or the type of plan. Thus, the COB provision stresses the continuity, rather than the type, of coverage. The COB provision looks to the date that Titan began providing substantially uninterrupted coverage, rather than the date the last manifestation of that coverage began. Thus, whether the [Titan no-fault] policies are considered a single plan with two successive policies or two successive plans, they provided continuous coverage and are thus treated as one for the dating purposes under the COB provision."
The court also held that the term "group " as used in this ERISA COB provision did not render the provision inapplicable to individually issued no-fault policies. Such a holding would be in conflict with the "common sense interpretation” of the particular language of this policy.