Court Opinion

ID: 9701471
Source: CourtListenerOpinion
Date Created: 2023-08-25 22:20:29.048836+00
Date Added: 2024-06-11T15:05:10.682660
License: Public Domain

Ryan, J.
(dissenting). I am in accord with my Brother Levin’s study of the relationship between §§ 3109(1) and 3109a of our no-fault insurance act1 and the conclusions that follow therefrom. I do not agree, however, with his monolithic treatment of Medicare; a treatment that fails to discriminate between the two programs Medicare comprises and, in my view, precludes a correct result in this case.
Medicare is a 15-year-old federal program subsumed within the structure of the social security system2 and designed to finance certain medical expenses incurred by persons 65 years old and over. It consists of two discrete parts, Parts A and B.3 As will be demonstrated, the disparate character of the parts, especially with respect to the manner in which they are capitalized, compels disparate legal consequences for each.
Part A4 is entitled "Hospital Insurance Benefits for Aged and Disabled”. It "is incorporated within the existing social security patterns. Contributions are universal and mandatory. * * * [Eligibility [is] a right only for persons 65 and over who meet the conditions required for cash social security benefits”.5_
*225As the Washington Supreme Court observed in Witherspoon v St Paul Fire & Marine Ins Co, 86 Wash 2d 641, 645; 548 P2d 302, 305 (1976):
"Part A benefits (hospitalization) are not obtained by-beneficiaries who voluntarily enter into a contract with the federal government. Part A benefits are paid as a result of mandatory payroll or self-employment taxes to those persons 65 and over who meet the conditions for Social Security benefits.” (Emphasis added.)
Accordingly, it has been declared that Part A6 benefits "are in the nature of disbursements made in furtherance of the social welfare objectives of the Federal government”. Rev Rul 70-341, 1970-2 Cum Bull 31. This amounts to " 'social welfare legislation’ ”. Imvris v Michigan Millers Mutual Ins Co, 39 Mich App 406, 410; 198 NW2d 36 (1972). As that term suggests, Part A Medicare comprehends forced participation.
In stark contrast to Part A stands Part B,7 which is entitled, "Supplementary Medical Insurance Benefits for Aged and Disabled”. The pertinent statute states: _
*226"There is hereby established a voluntary insurance program to provide medical insurance benefíts in accordance with the provisions of this part for aged and disabled individuals who elect to enroll under such program, to be ñnanced from premium payments by enrollees together with contributions from funds appropriated by the Federal Government.” 42 USC 1395j (emphasis added).8
And, as further explained,
"Part B, the supplementary medical benefits plan, is voluntary and open to any person aged 65 or over (except nonresident aliens) irrespective of social security status. Premiums are paid on a current basis. Benefit payments under the two plans are made by different administrative 'intermediaries’ (called 'carriers’ under Part B).” H. Somers & A. Somers, Medicare and the Hospitals — Issues and Prospects (Washington, DC: The Brookings Institution, 1967), pp 19-20.
It is apparent, in light of the foregoing, that Part B Medicare in important respects has attributes associated with private medical insurance. Participation is entirely voluntary and benefits are generated, in part, by premiums paid by the participants. I agree with the observation made by the Supreme Court of Washington that "Part B [has] a 'contract’ aspect not present in Part A”. Witherspoon v St Paul Fire & Marine Ins Co, 86 Wash 2d 646; 548 P2d 305. See Black v American Bankers Ins Co, 478 SW2d 434, 439 (Tex, 1972) ("The Medicare insurance program is similar in many respects to hospital insurance programs which are *227sold by many private insurance companies”); Neumann v Transit Casualty Co, 96 Mich App 472; 292 NW2d 555 (1980).
In sum, the salient attributes of "social welfare” insurance — mandatory participation in and funding of a government administered program designed to mitigate the economic disparities of a society — are present in Part A, whereas attributes of private insurance contracts are present in Part B, imparting to it a preponderately private character. The question now is whether this distinction is of any legal significance with respect to the application of §§ 3109(1) and 3109a of the no-fault act9 to Medicare.
Section 3109(1) mandates set-off of all "[b]enefits provided or required to be provided under the laws of any state or the federal government”. Justice Levin believes all Medicare benefits, Part A and Part B, must be set off. This, admittedly, is the result that ensues from a literal reading of the statute. It is well settled, however, that we are not confined to the literal meaning of statutory language in the face of a countervailing legislative intent.10
An aspect of that intent was discerned recently in O’Donnell v State Farm Mutual Automobile Ins Co, 404 Mich 524, 544; 273 NW2d 829 (1979):
*228"The history of § 3109(1) indicates that the Legislature’s intent was to require a set-off of those government benefits that duplicated the no-fault benefits payable because of the accident and thereby reduce or contain the cost of basic insurance.” Id. (emphasis added).
And, as Justice Levin correctly demonstrates, the specific mechanism for the reduction of the cost of basic insurance is § 3109a, which requires the no-fault insurer to charge "appropriately reduced premium rates”. However, although § 3109a serves to coordinate no-fault insurance with "other health and accident coverage on the insured”, whether that coverage is governmental or nongovernmental, with a view to encouraging elimination of overlapping coverage, it does not proscribe overlap between no-fault and private medical insurance. As we found in O’Donnell, § 3109a permits "persons with needs exceeding the benefits provided by no-fault insurance to obtain the extra coverage they [require]”. 404 Mich 550. On the other hand, § 3109(1) does proscribe overlap between no-fault and "government benefits”. The question arises, to what end is the disparate treatment of "government benefits”?
It is apparent that our Legislature intended to eliminate overlapping benefits to the extent the insured must involuntarily participate in the programs creating the overlap. Thus, in the case of no-fault insurance and social security, both mandatory government programs, the insured has no choice but to be the object of overlapping coverage. And since the insured must pay, in one form or another, for the duplicative coverage, he or she, by the confluence of unrelated government programs, is forced to pay for more insurance than circumstances require. This, in my view, is quite clearly the bane § 3109(1) is intended to redress. One *229should be allowed, but not required, to obtain duplicative coverage.
Part B Medicare benefits, to the extent they are the product of voluntary contributions, do not entail the harm § 3109(1) was enacted to avoid, and, therefore, should not be subject to the mandatory set-off of that provision.11
It is important to note, however, that Part B benefits derive from both voluntary and involuntary contributions.
"[T]he supplementary governmental insurance benefit program [Part B] is funded by both premium payments by the enrollees and funds appropriated by the Federal government. 42 USC 1395j. The amount of the premiums paid by the enrollees is calculated to pay for one half of the costs of the program. 42 USC 1395r(b)(2).” Neumann v Transit Casualty Co, 96 Mich App 472, 479.
It follows that only one-half of the benefits provided under Part B, the half attributable to the voluntary monthly premiums of the subscribers,12 can justifiably escape the purview of the mandatory set-off of § 3109(1). Any less set-off would result in a windfall for those subscribers.
This result is in accord with that reached by our Court of Appeals in Neumann v Transit Casualty Co, 96 Mich App 472; 292 NW2d 555 (1980). The result here, however, is the product of statutory construction, not, as in Neumann, the mandate of the Equal Protection Clause.13 Accordingly, I do not reach the constitutional question answered by the Neumann panel.
Because it is unclear under which part and to *230what extent the instant Medicare benefits were paid,14 I would remand to the trial court for a determination of that question and an entry of judgment consistent with this opinion.

 MCL 500.3109 subd (1); MSA 24.13109 subd (1) and MCL 500.3109a; MSA 24.13109(1).

 42 USC 401 et seq.

 ''[T]he Medicare program is a dual structure comprising two separate insurance programs, distinct as to benefits, coverage, financing, and administration”. H. Somers & A. Somers, Medicare and the Hospitals — Issues and Prospects (Washington DC: The Brookings Institution, 1967), p 19.

 42 USC 1395c-1395i-2.

 H. Somers & A. Somers, Medicare and the Hospitals — Issues and *225Prospects (1967), pp 19-20.

 Part A "provides basic protection against the costs of hospital and related posthospital services”. 42 USC 1395c. This includes:
"A semiprivate room (2-4 beds) and all meals, including special diets;
"Routine nursing services;
"Special care units, such as intensive care unit and coronary care unit;
"Drugs furnished by the hospital while you are an inpatient;
"Operating and recovery rooms;
"Rehabilitation services such as physical therapy, occupational therapy, and speech pathology;
"X-ray and other radiology services for diagnosis or treatment;
"Lab tests included in your hospital bill.” United States Dep’t of Health, Education & Welfare, Pub No. SSA 78-10039.

 42 USC 1395j-1395w.

 "[Part B] covers doctors’ medical and surgical services, outpatient hospital services, outpatient physical therapy and speech pathology services, durable medical equipment, services from independent laboratories, ambulance services, home health care, and a number of other health services and supplies.” United States Dep’t of Health, Education & Welfare, Pub No. SSA 76-10037.

 "Sec. 3109. (1) Benefits provided or required to be provided under the laws of any state or the federal government shall be subtracted from the personal protection insurance benefits otherwise payable for the injury.” MCL 500.3109 subd (1); MSA 24.13109 subd (1).
"Sec. 3109a. An insurer providing personal protection insurance benefits shall offer, at appropriately reduced premium rates, deductibles and exclusions reasonably related to other health and accident coverage on the insured.” MCL 500.3109a; MSA 24.13109(1).

 "[T]he proper construction of any statute is for the court. The purpose of the court in interpreting a statute is to give effect to the legislative intent. If there is a conflict, the spirit and purpose of the statute should prevail over its strict letter.” Aikens v Dep’t of Conservation, 387 Mich 495, 499; 198 NW2d 304 (1972). (Citations omitted.)

 As the foregoing implies, I agree with Justice Levin that Part A benefits must be set off from no-fault benefits.

 At this time, the monthly premium is $9.60.

 Nevertheless, it is noteworthy that the predicate for the equal protection analysis was the Neumann panel’s distinction between "purchased governmental benefits” and "ex gratia governmental benefits”, which was found to be "significant”. 96 Mich App 478. The *230former, Part B benefits, were at issue in that case. The Neumann panel, furthermore, was correct in concluding that that distinction followed from the rationale utilized in O’Donnell v State Farm Mutual Automobile Ins Co, 404 Mich 524; 273 NW2d 829 (1979).

 See Chief Justice Coleman’s fn 8.