Case Name: ADVOCACY ORGANIZATION FOR PATIENTS & PROVIDERS v. AUTO CLUB INSURANCE ASSOCIATION
Court: Michigan Supreme Court
Jurisdiction: Michigan
Decision Date: 2005-03-08
Citations: 472 Mich. 91
Docket Number: Docket No. 124639
Parties: ADVOCACY ORGANIZATION FOR PATIENTS & PROVIDERS v AUTO CLUB INSURANCE ASSOCIATION
Judges: Taylor, C.J., and Corrigan and Markman, JJ., concurred.
Reporter: Michigan Reports
Volume: 472
Pages: 91–107

Head Matter:
ADVOCACY ORGANIZATION FOR PATIENTS & PROVIDERS v AUTO CLUB INSURANCE ASSOCIATION
Docket No. 124639.
Argued November 9, 2004
(Calendar No. 5).
Decided March 8, 2005.
The Advocacy Organization for Patients & Providers, an organization of health-care providers and health-care patients, along with others, brought an action in the Eaton Circuit Court against the Auto Club Insurance Association, a no-fault insurance company, and others, seeking declaratory and injunctive relief on an allegation that the defendants were violating the no-fault act, MCL 500.3101 et seq., by failing to pay the full amount of their insureds’ medical bills as required by MCL 500.3107 and 500.3157 of the act. The plaintiffs asserted that it was unlawful for the defendants to employ review companies to compare the insureds’ providers’ fees to those of other providers in order to determine a reasonable charge, when the defendants were required by statute to compare their insureds’ health-care providers’ fees for services with those providers’ fees for comparable services provided to an uninsured patient to determine a reasonable charge. The plaintiffs moved for summary disposition, and the defendants filed a cross-motion for summary disposition, arguing that a customary fee of a particular provider is not necessarily a reasonable one, and that the defendants were permitted to evaluate a medical invoice for reasonableness as a matter of law. The court, Calvin E. Osterhaven, J., granted the defendants’ motion for summary disposition. The plaintiffs appealed. The Court of Appeals, Markey and Murray, JJ. (Fitzgerald, EJ., concurring), affirmed. 257 Mich App 365 (2003). The Supreme Court granted leave to appeal. 470 Mich 881 (2004).
In a memorandum opinion, signed by Chief Justice Taylor and Justices Corrigan and Markman, and in concurring opinions by Justices Cavanagh (joined by Justice Kelly), Weaver, and Corrigan, the Supreme Court held:
MCL 500.3107(l)(a) requires a no-fault insurer to pay all reasonable charges incurred for reasonably necessary products, services, and accommodations for an injured person’s care, recovery, or rehabilitation. MCL 500.3157 provides that a medical provider may charge a reasonable amount for such products, services, and accommodations but the amount shall not exceed the amount the provider customarily charges for like products, services, and accommodations in cases not involving insurance. In this case the Court of Appeals affirmed the trial court’s ruling that the fact that a medical provider’s charge does not exceed the amount the provider customarily charges in cases not involving insurance does not establish that the charge is reasonable. The Court of Appeals correctly concluded that it is for the trier of fact to determine whether a medical charge, although customary, is reasonable.
Justice Cavanagh, joined by Justice Kelly, concurring, stated that given that the question of reasonableness was not before the lower courts and discovery did not center on the question, he would be apprehensive about sanctioning any method without knowing its full details. The Legislature should address this issue and implement some guidelines, as other no-fault states have done.
Justice Weaver, concurring, fully joined the concurrence of Justice Cavanagh but wrote separately to stress the need for the Court to address the specific procedures to be followed when a justice decides whether to participate in a case. There is a right and an expectation of the people that a justice will participate in every case unless there is a valid publicly known reason why the justice should not participate in a particular case. Const 1963, art 6, § 6 requires justices to give written reasons, accessible to the public, for their decisions whether to participate in a case. MCR 2.003 governs the procedure for the disqualification of Michigan Supreme Court justices.
Justice Corrigan, concurring, wrote separately to note that there is nothing secretive or sinister in the tradition followed by the justices in choosing whether to publish a reason for a decision on recusal. The recusal decisions of the other six members of the Court over the last two years, like Justice Weaver’s 251 pre-2003 recusal decisions, comport with the Constitution and the Michigan Court Rules.
Affirmed.
Justice Young took no part in the decision of this case.
Insurance — No-Fault — Medical Providers — Reasonable Charges.
Although a medical provider may charge a reasonable amount for products, services, and accommodations for an injured person’s care, recovery, or rehabilitation and that amount may not exceed the amount the provider customarily charges for like products,
services, and accommodations in cases not involving no-fault insurance, the fact that the provider’s charge does not exceed that customary amount does not establish that the charge is reasonable; the determination regarding the reasonableness of the amount charged is a question for the trier of fact (MCL 500.3107[l][a], 500.3157).
Sheldon L. Miller, Barbara H. Goldman, and Linda Fausey for the plaintiffs.
Barris Sott Denn & Driker, EC. (by Stephen E. Glazek), for Auto Club Insurance Association.
Garan, Lucow, Miller, EC. (by David N. Campos), for Allstate Insurance Company, Wolverine Mutual Insurance Company, and Secura Insurance Company.
Dykema Gossett ELLC (by Lori McAllister) for Citizens Insurance Company and Auto-Owners Insurance Company.
Willingham & Cote (by Raymond J. Foresman) for Farm Bureau Insurance Company.
Wheeler & Upham, EC. (by Gary A Maximiuk and Jack L. Hoffman), for Farmer’s Insurance Exchange.
Foster Swift Collins & Smith (by Scott L. Mandel) for Frankenmuth Mutual Insurance Company.
Bodman LLP (by Diane L. Akers and James Albert Smith) for State Farm Mutual Automobile Insurance Company.
Howard & Howard Attorneys, EC. (by Eric H. Lipsitt), for Transamerica Insurance Group.
Bodman LLP (by Joseph J. Shannon) for Manageability, Inc.
Lambert, Leser, Cook, Schmidt & Guinta, PC. (by Susan M. Cook), for Medcheck Medical Audit Services.
Nemier, Tolari, Landry, Mazzeo & Johnson P.C. (by David B. Landry and Michelle E. Mathieu) for Recovery Unlimited, Inc.
Zausmer, Kaufman, August & Caldwell, P.C. (by Mark J. Zausmer), for Titan Insurance Company.
Bush, Seyferth & Kethledge, PLLC (by Cheryl A. Bush), for Review Works.
Amici Curiae:
Dykema Gossett PLLC (by Jill M. Wheaton and Joseph Erhardt) for the Michigan Catastrophic Claims Association.
George M. Carr, P.C. (by George M. Carr), for the Property Casualty Insurers Association of America.
Honigman Miller Schwartz and Cohn LLP (by Chris Rossman, Jason Schian Conti, and Cynthia E Reaves) for the Michigan Health and Hospital Association.
Kerr, Russell and Weber, PLC (by Richard D. Weber and Joanne Geha Swanson), for the Michigan State Medical Society.
Gross, Nemeth & Silverman, P.L.C. (by James G. Gross), for the Michigan Chamber of Commerce.
Sinas, Dramis, Brake, Boughton & McIntyre, P.C. (by George T. Sinas and L. Page Graves), for the Coalition Protecting Auto No Fault.

Opinion:
MEMORANDUM Opinion. This declaratory judgment action concerns obligations under the no-fault act, MCL 500.3101 et seq., to pay medical expenses. Plaintiffs are individual medical providers, two guardians of catastrophically injured victims of automobile accidents, and an organization of health-care providers and patients that principally seeks to protect the legal rights of both groups. Defendants are either no-fault insurance companies that have issued policies to Michigan motorists or the review companies employed by one or more of those insurers to review medical bills arising from automobile accidents.
MCL 500.3107(l)(a) requires that an insurer pay "all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person's care, recovery, or rehabilitation." MCL 500.3157 provides that a medical provider "may charge a reasonable amount for the products, services and accommodations rendered. The charge shall not exceed the amount the person or institution customarily charges for like products, services and accommodations in cases not involving insurance."
After a hearing on the parties' respective motions for summary disposition, the trial court ruled that defendants were entitled to review any medical charges and pay only those determined to be reasonable. The trial court further ruled that even though a medical provider's charge does not exceed the amount that provider customarily charges in cases not involving insurance, that fact alone does not establish that the charge is reasonable.
The Court of Appeals affirmed. 257 Mich App 365; 670 NW2d 569 (2003). It ruled that it is for the trier of fact to determine whether a medical charge, albeit "customary," is also reasonable. 257 Mich App 379.
Because we agree with the Court of Appeals resolution of this issue, and the others presented to it, we affirm. MCL 7.302(G)(1).
Taylor, C.J., and Corrigan and Markman, JJ., concurred.