Michigan Court of Appeals; Docket #317876; Published
Judges Jansen, Talbot, and Servitto; Unanimous; Opinion by Judge Talbot
Official Michigan Reporter Citation: 308 Mich App 389 (2014); Link to Opinion 
The Michigan Supreme Court denied leave to appeal on 5/28/2015; Link to Order
STATUTORY INDEXING:
Service Providers as Payees [§3112]
TOPICAL INDEXING:
Not Applicable
CASE SUMMARY:
In this unanimous published Opinion written by Judge Talbot involving a direct action brought by a health-care provider, the Court of Appeals held that a health-care provider has standing to bring a cause of action under MCL 500.3112 because: 1) the action is filed “for the benefit of” the injured individual; 2) prior appellate cases have held the No-Fault Act creates an independent cause of action for health-care providers; and 3) public policy dictates that health-care providers may directly file actions against no-fault insurers.
Plaintiff, a chiropractic health clinic, directly brought a claim against defendant Auto-Owners for PIP benefits that were not paid. Defendant moved for summary disposition, which the trial court denied. The trial court then entered judgment for plaintiff. On appeal, defendant argued the trial court erred in denying its motion for summary disposition because health-care providers do not have standing to bring a direct action against an insurer under §3112.
The Court of Appeals rejected defendant’s argument. The court noted the issue of whether a health-care provider can bring a claim against an insurer for PIP benefits was previously addressed in Munson Med Ctr v Auto Club Ins Ass’n, 218 Mich App 375 (1996), and Lakeland Neurocare Ctrs v State Farm Mut Auto Ins Co, 250 Mich App 35 (2002). The court said that, in both of these decisions:
“This Court analyzed the plain language of MCL 500.3112 and determined that the plaintiff was entitled to prompt payment because the plaintiff brought a claim for PIP benefits ‘for the benefit of’ the insured when the plaintiff submitted a claim for PIP benefits to the defendant. Therefore, the plaintiff could sue the defendant for enforcement of the penalty interest provision of the no-fault act, which requires an insurer to pay interest if a payment is overdue by more than 30 days. … This Court stated that it was common practice for insurers to reimburse healthcare providers directly, but this was because MCL 500.3112 allows a healthcare provider to receive payment from an insurer.”
The Court of Appeals further held that case precedent supports allowing health-care providers to have standing and directly bring claims against no-fault insurers. The court reasoned:
“The fact that a healthcare provider submits a claim on behalf of an insured individual allows a healthcare provider to sue to enforce the penalty provisions of the no-fault act. Thus, by implication, a healthcare provider may also bring an action for PIP benefits ‘for the benefit of’ an insured individual. Finally, this Court clarified that its decision in Lakeland Neurocare held that a healthcare provider has a direct cause of action to sue an insurer for PIP benefits under the no-fault act. Therefore, Wyoming Chiropractic may bring a claim against Auto-Owners for PIP benefits under the no-fault act.”
In conclusion, the Court of Appeals said public policy further supports allowing a health-care provider to have standing in these actions. The court said:
“Allowing a healthcare provider to bring a cause of action expedites the payment process to the healthcare provider when payment is in dispute. Thus, provider standing meets the goal of prompt reparation for economic losses. Healthcare provider standing also offers a healthcare provider a remedy when an injured individual does not sue an insurer for unpaid PIP benefits, thus preventing inequitable payment structures and promoting prompt reparation.”
Accordingly, the Court of Appeals held the trial court properly denied defendant’s motion for summary disposition.
