INSURANCE-RELATED COURT CASES
Digested from case reports published online
Michael Andary, conservator and guardian of Ellen Andary; Ronald Krueger, guardian of Philip Krueger; and Moriah, Inc., doing business as Eisenhower Center, brought an action in Ingham Circuit Court against USAA Casualty Insurance Company and Citizens Insurance Company of America, seeking a declaratory judgment that the Michigan legislature’s 2019 amendments to the no-fault act that placed new limitations on in-home family-provided attendant care and the non-Medicare fee schedule could not be applied to limit or change the plaintiffs’ rights to benefits under the policies the insurer had issued to them before the 2019 amendments.
Ellen Andary and Philip Krueger suffered traumatic injuries in automobile accidents before 2019; they had been provided uncapped lifetime medical care covered by personal protection insurance (PIP) benefits under the policies and the no-fault act in effect at the time of their injuries.
In 2019, the legislature significantly overhauled the no-fault act, resulting in large reductions in reimbursable family-provided attendant care hours and reimbursement rates for services that are not covered by Medicare for people who had suffered traumatic injuries because of automobile accidents.
The plaintiffs argued that the retroactive application of the 2019 amendments to them was improper and would also violate their constitutional rights under the contracts clause of the state constitution as well as their due process and equal protection rights.
Additionally the plaintiffs all challenged the prospective application of the 2019 amendments on behalf of future motor vehicle accident victims and medical providers. The insurers moved to dismiss the case, and the trial court granted their motion. The plaintiffs appealed.
The court of appeals affirmed in part, reversed in part, and remanded the case to the circuit court. The Michigan Supreme Court found that the 2019 no-fault amendments did not affect services and care that were already being provided to Andary and Krueger and that had been reimbursable prior to the amendments. Andary’s and Krueger’s rights to the PIP benefits at issue in this case were both contractual and statutory in nature, and the 2019 no-fault amendments did not retroactively modify their vested contractual rights. The plaintiffs’ constitutional challenges to prospective application of the amended statutes were dismissed.
Andary and Krueger v. USAA Casualty Insurance Company—Michigan Supreme Court—July 31, 2023—No. 164772.