DIFS Publishes Bulletin on No-fault Reimbursement Following Andary Decision

The Michigan Department of Insurance and Financial Services (DIFS) issued Bulletin 2022-17-INS Oct. 5 in the matter of payment and billing guidance for no-fault automobile insurers and healthcare providers following an order from the Michigan Supreme Court in the Andary v. USAA lawsuit that effectively reinstated the obligation of auto no-fault insurers to cover benefits for the catastrophically injured as those benefits had been in place prior to June 11, 2019.

The lawsuit was brought by a group of catastrophically patients injured before June 11, 2019, which is prior to passage of changes to Michigan’s auto no-fault law. Auto insurers implemented benefit and payment reductions for all claims including for patients who were injured before the new law took effect. The plaintiffs in Andary sued their insurer to establish that they are entitled to full lifetime no-fault benefits (such as unlimited hours of family attendant care) and claimed the limited reimbursement for medical and other personal injury protection coverage does not apply retroactively.

The bulletin explains the process providers who believe they are due additional reimbursement for claims subject to the Andary decision should follow if a provider believes a reprocessing of a claim is necessary. As outlined in the bulletin, providers are advised to first contact the insurer to request reprocessing of those claims. If a dispute related to a reprocessed claim cannot be resolved directly with the insurer, the provider may contact DIFS for assistance at DIFSComplaints@michigan.gov.

The Michigan Supreme Court also issued a separate order granting USAA’s application for permission to appeal the question of whether the Court of Appeals erred when it:

  • Held that claimants injured before June 11, 2019 are not subject to the reduced reimbursement for care under the new law.
  • Held that application of the new law to claimants injured before June 11, 2019 violates the Contracts Clause of the Michigan Constitution.
  • Remanded the case to the circuit court for discovery to determine if the new law passes constitutional muster.

The MHA is evaluating the DIFS bulletin and have submitted clarifying questions to external legal counsel. Members with questions may contact Laura Appel at the MHA.