Michigan Supreme Court; Docket No. 58106; Published
Justice Williams; 4-3
Official Michigan Reporter Citation: 404 Mich 477; Link to Opinion
Standards for Deductibility of State and Federal Governmental Benefits [§3109(1)]
Medicaid Benefits [§3109(1)]
General Rule of Priority [§3114(1)]
Exception for Occupants [§3114(4)]
PIP Liens Regarding Out of State Tort Claims [§3116(2)]
In a 4-3 opinion written by Justice Williams, with Justices Levin, Cavanagh and Coleman dissenting in part and concurring in part, the Michigan Supreme Court made three rulings regarding Michigan's no-fault statute:
1. First, the Court analyzed the priority sections of the statute [§3114(1) and (4)] and had to determine which no-fault carrier was responsible for the payment of plaintiff’s PIP benefits. At the time of her accident, the plaintiff and her husband were temporarily residing with plaintiff’s mother while plaintiff’s mother was on vacation. However, plaintiff and her husband had been living in a house trailer which was located on plaintiff’s father-in-law's property about 40 feet from the father-in-law's house and had planned to continue so residing indefinitely. While living in the trailer, plaintiff and her husbahd shared electrical and water services, ate occasional meals together, had the same mailing address, etc. Plaintiff was injured while she was a passenger in her sister's car. Neither plaintiff nor her husband owned a car nor did either of them own any no-fault policies. The question was which of the three no-fault carriers (plaintiff’s father-in-law, plaintiff’s mother, or plaintiff’s sister) were responsible for plaintiff’s no-fault benefits.
2. Second, the Court analyzed whether §3109(1) of the no-fault act applies to Medicaid benefits authorized by the Michigan Social Welfare Act, thus permitting the no-fault carrier to offset such Medicaid benefits against no-fault benefits. After analyzing various sections of the Social Welfare Act, the Court concluded that a person who is entitled to receive no-fault benefits is not statutorily eligible to receive Medicaid benefits as such a person is not "medically indigent" under the definition in the Social Welfare Act. As a result, the Court concluded that Medicaid benefits are not in the nature of §3109(1) benefits and thus any attempted setoff of plaintiff’s Medicaid benefits would not only be unnecessary but absurd since "no benefits" exist to be setoff. In so holding, the Court found it unnecessary to discuss the propriety of a setoff under §3109(1). The Court also expressed no opinion on the validity of setting off other kinds of governmental benefits. All Justices concurred with this portion of the opinion.
3. Third, the Court considered whether §3116 of the no-fault statute permits a no-fault carrier to receive reimbursement out of an insured's subsequent tort recovery for amounts paid by the carrier for PIP benefits.