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No-Fault Act and Statutes

PIP Medical Benefits Coverage Levels

PIP Medical Coverage Levels

The No-Fault PIP medical benefits coverage levels available in Michigan auto insurance policies after July 1, 2020, will determine how much medical care will be covered after a car accident. The levels include: $50,000 for drivers on Medicaid; $250,000; $500,000; unlimited; and an opt-out for drivers on Medicare.

For the first time in the No-Fault law’s more than 40-year existence in Michigan, drivers will have to choose how much No-Fault PIP medical coverage they wish to have to protect their families and themselves should they be injured in a car accident.

These new No-Fault PIP medical benefits coverage levels will be available in auto insurance policies issued or renewed after July 1, 2020.

Prior to July 1, 2020, the No-Fault law required all drivers to carry “unlimited” No-Fault PIP medical benefits.

Provided as part of the “PIP” or “personal protection insurance” or “personal injury protection” insurance portion of your auto insurance policy, the No-Fault PIP medical coverage pays for car accident-related expenses in the event that the driver or anyone else covered by the policy is seriously injured in a car accident.

What No-Fault PIP medical benefits coverage levels are available?

For auto insurance policies issued or renewed after July 1, 2020, the No-Fault PIP medical coverage levels that drivers will have to choose from include the following:

  • $50,000 limit on accident-related medical expenses for drivers who are “enrolled in Medicaid” (MCL 500.3107c(1)(a))
  • $250,000 limit on accident-related medical expenses (MCL 500.3107c(1)(b)
  • $500,000 limit on accident-related medical expenses (MCL 500.3107c(1)(c))
  • Unlimited or no dollar-amount limit on accident-related medical expenses (MCL 500.3107c(1)(d))
  • Medicare/opt-out: Drivers on Medicare who choose to opt-out of No-Fault PIP medical benefits altogether will receive no No-Fault coverage of auto accident-related expenses. (MCL 500.3107d(1))

Importantly, if you have Medicare and you opt out of No-Fault PIP benefits by “elect[ing] to not maintain coverage for personal protection insurance benefits” to cover medical bills after a car accident, then you are choosing to give up your rights to No-Fault medical coverage, presumably relying on Medicare (or another payment source) for your medical coverage. (MCL 500.3107d(1))

To learn more, please check out my blog post “Does Medicare Cover Auto Accident Injuries Under New Law?

What coverage level applies to you?

The amount of No-Fault insurance that you will have available to you if you have been injured in a car accident will depend on the No-Fault PIP medical coverage level that was selected in the auto insurance policy through which you have filed your claim for PIP insurance. (MCL 500.3107c(5))

Importantly, this limitation also applies when the policy in question contains the Medicare opt-out. If the policy through which you are seeking No-Fault PIP medical benefits has opted out of providing No-Fault coverage, then you will not be allowed to claim them under the policy. (MCL 500.3107d(5))

Coverage level determines amount of medical benefits

Generally speaking – and subject to certain exceptions – your accident-related medical bills will be paid up to the coverage level amount in your policy or the policy of your spouse or a relative who lives in your home. (MCL 500.3114(1)) As stated above, the medical coverage level could be: $50,000; $250,000; $500,000; or unlimited.

In the event that you do not have your own auto insurance policy and coverage is not available through a spouse or a relative who lives with you, then you must apply for benefits through the Michigan Assigned Claims Plan where your medical coverage will be capped at $250,000. (MCL 500.3172(7)(a))

What if my medical bills exceed my coverage level?

If your accident-related bills for treatment exceed the No-Fault PIP medical benefits level in the policy through which you are seeking assistance, then No-Fault will cease to pay for your bills.

To obtain payment for your medical bills that exceed the applicable coverage level, you can sue the at-fault driver who caused the accident for your “excess” medical expenses. (MCL 500.3135(3)(c)) This is done by filing a third-party lawsuit for excess economic damages.

Alternatively, you may be able to turn to your private health insurance, Medicaid or Medicare for coverage of your accident-related medical bills. If coverage is not available through any of the sources above, then you may be force to use your personal assets to pay out-of-pocket for your continued medical care.

Can I sue for my medical bills if I opted-out?

Yes. If you selected the Medicare/opt-out option in your No-Fault auto insurance or if the policy through you should be claiming No-Fault benefits includes the Medicare/opt-out, then you can sue the at-fault driver for all of your accident-related medical bills “without limit.” (MCL 500.3135(3)(c))

$50,000 No-Fault PIP medical benefits coverage level

A driver may select the $50,000 No-Fault PIP coverage level only if the following conditions are met:

  • He or she is “enrolled in Medicaid” (MCL 500.3107c(1)(a)(i)); and
  • His or her spouse or relative who lives in the same household has “qualified health coverage,” “is enrolled in Medicaid” or is covered by a No-Fault auto insurance policy. (MCL 500.3107c(1)(a) (ii))

Qualified health coverage” can be either:

  • “[H]ealth or accident coverage” that “does not exclude or limit coverage for injuries related to motor vehicle accidents” and has an “annual deductible” of “$6,000 or less per individual” MCL 500.3107d(7)(b)(i)); or
  • Medicare coverage. (MCL 500.3107d(7)(b)(ii))

Medicare/opt-out of No-Fault PIP medical benefits

A driver may select the Medicare/opt-out of No-Fault medical benefits option only if the following conditions are met:

  • The driver is a “qualified person,” meaning that he or she is covered “under parts A and B of the federal Medicare program.” (MCL 500.3107d(1) and (7)(c))
  • The driver’s spouse or a relative who lives in the same household has “qualified health coverage” or is covered by a No-Fault auto insurance policy. (MCL 500.3107d(1) and (7)(b))

“Qualified health coverage” can be either:

  • “[H]ealth or accident coverage” that “does not exclude or limit coverage for injuries related to motor vehicle accidents” and has an “annual deductible” of “$6,000 or less per individual” (MCL 500.3107d(7)(b)(i)); or
  • Medicare coverage. (MCL 500.3107d(7)(b)(ii))

How do I choose my No-Fault PIP medical benefits coverage level?

A driver’s selection of a particular No-Fault PIP medical benefits coverage level or the Medicare/opt-out must be made on a specific form that has been approved by Michigan’s Insurance Commissioner.

The No-Fault PIP medical coverage levels & Medicare Opt-Out form – a sample of which can be found here – must explain “the benefits and risks associated with each” selection and must “provide a way” for the driver to acknowledge that he or she has “read the form and understands the options available.” (MCL 500.3107c(1) and (2)(a) and (b); 500.3107d(3)(d) and (f))

To make his or her selection, the driver must either mark or sign the paper form or give instructions “in person or telephonically” as to his or her selection. Subsequently, the form must be personally delivered, mailed or e-mailed to the driver. (MCL 500.3107e(1) and (2))

Injured and need a lawyer? Call Michigan Auto Law

If you have been injured in a car accident and you have questions about your legal rights to Michigan No-Fault PIP medical benefits, you can call toll free anytime 24/7 at (800) 777-0028 for a free consultation with one of our experienced auto accident attorneys. You can also get help from an experienced attorney by emailing [email protected] or you can use the chat feature on our website.

PIP Medical Coverage Levels
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