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Michigan Supreme Court issues new rules for No-Fault attendant care compensation

October 4, 2012 by Steven M. Gursten

Important attendant care warning on Douglas v. Allstate for family member providers, those recovering attendant care

On July 30, 2012, in Douglas v. Allstate Insurance Company, the Michigan Supreme Court issued new rules for when an auto accident victim’s family member can be compensated for providing attendant care services to the victim.  This decision will have a huge impact for people who currently receive attendant care No-Fault benefits from their auto insurance company, and changes the rules in mid-stream for attendant care lawyers on how submittals must be made.

Attendant care, which is also referred to as nursing care or in other states as the “human prosthesis” for the care and support that others must provide, usually involves assisting an auto accident victim with the basic “activities of daily living” such as eating, bathing, getting dressed, using the bathroom, hygiene and other activities that the victim cannot do after a serious car accident. Very seriously  injured auto accident victims in Michigan receive attendant care as part of their No-Fault PIP or Personal Injury Protection insurance benefits.

In Douglas, the Court addressed:

  • The requirements for proving entitlement to attendant care compensation including causation, the amount and nature of attendant care services, the caregiver’s expectation of compensation and the reasonableness of the price charged for attendant care services.
  • Raising new evidentiary proofs, especially the notion of “contemporaneous documentation,” for proving attendant care submittals.

Although Michigan’s No-Fault Law does not specifically address “attendant care” services by statute, it has existed in this state for nearly 30 years or longer. Michigan auto accident victims are entitled to have their auto insurance companies to pay for certain “allowable expenses” (MCL 500.3107(1)(a)):  “Allowable expenses consisting of all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person’s care, recovery or rehabilitation.”

“Care” has been interpreted by Michigan courts to include “attendant care.”

Requirements for attendant care compensation

In Douglas, the Court explained what an auto accident victim’s family member must show in order to be compensated for providing “attendant care”:

  1. Causation: Attendant care services must be “‘necessitated by [an] injury sustained in a motor vehicle accident …’”
  2. Amount and nature of attendant care services: “[A]n injured person who seeks reimbursement for any attendant care services must prove by a preponderance of the evidence … the amount and nature of the services rendered …”
  3. Expectation of compensation: “[A]n injured person who seeks reimbursement for any attendant care services must prove by a preponderance of the evidence … the caregiver’s expectation of compensation or reimbursement for providing the attendant care …”
  4. Reasonable charge for attendant care services: A caregiver’s charge for having provided attendant care services must be “reasonable.” The Court noted that, when determining whether attendant care charges are reasonable, it is “appropriate for the fact-finder [jury or judge] to consider hourly rates charged by individual caregivers when selling their services (whether to their employers that commercially provide those services or directly to injured persons) …” In other words, “a fact-finder may base the hourly rate for a family member’s provision of attendant care services on what health care agencies compensate their employees …”

Proving the attendant care compensation requirements: ‘Contemporaneous Documentation’

In terms of proving the “amount and nature” of the attendant care services and the caregiver’s expectation of compensation for providing those services, the Douglas Court offered this advice:

“This evidentiary requirement is most easily satisfied when an insured or a caregiver submits itemized statements, bills, contracts, or logs listing the nature of services provided with sufficient detail for the insurer to determine whether they are compensable. Indeed, the best way of proving that a caregiver actually “expected compensation for [her] services” at the time the services were rendered is for the caregiver to document the incurred charges contemporaneously with providing them — whether in a formal bill or in another memorialized statement that logs with specificity the nature and amount of services rendered—and submit that documentation to the insurer within a reasonable amount of time after the services were rendered.”

The Douglas Court warned that “a caregiver’s failure to provide contemporaneous documentary evidence” of the attendant care services that he or she has provided to an auto accident victim “implicates [the caregiver’s] credibility regarding whether the services were actually rendered in the manner documented” and whether the caregiver “actually expected payment for providing those services.”

[Community Guidelines]

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