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Advanced Surgery Center LLC v. Allstate Insurance Co.

United States District Court, E.D. Michigan, Southern Division

October 24, 2017

ADVANCED SURGERY CENTER, LLC, And SOUTHEAST MICHIGAN ANESTHESIA GROUP, PLLC, as Assignees of Terry Minor, Plaintiffs,
v.
ALLSTATE INSURANCE CO., Defendant.

          OPINION AND ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT'S MOTION TO DISMISS [DOC. 2]

          GEORGE CARAM STEEH UNITED STATES DISTRICT JUDGE.

         This is a claim for Michigan No-Fault benefits stemming from a September 16, 2016 motor vehicle collision wherein Terry Minor sustained multiple accidental injuries. Plaintiff Advanced Surgery Center is an ambulatory surgical center that provided the situs for reasonably necessary medical treatment that was rendered to Mr. Minor. Plaintiff Southeast Michigan Anesthesia Group provided anesthesia services for one of the procedures that was performed at Advanced Surgery Center.

         No responsible no-fault insurer could be identified, so plaintiffs initially filed a lawsuit on April 28, 2017 against the Michigan Automobile Insurance Placement Facility (“MAIPF”) to compel it to name a servicing insurer that would act as Mr. Minor's no-fault insurance carrier. This lawsuit was filed in Macomb County Circuit Court and was subsequently voluntarily dismissed after plaintiffs' counsel learned that MAIPF had named Allstate Insurance Company to act as Mr. Minor's insurer. Plaintiffs then filed the present action against defendant Allstate, as the servicing insurer, in Oakland County Circuit Court on July 18, 2017. The complaint alleges two counts: a Personal Injury Protection (“PIP”) claim and breach of contract. Allstate removed the matter to federal court based on diversity jurisdiction. The matter is before the court on Allstate's Rule 12(b)(6) motion to dismiss for failure to state a claim upon which relief can be granted.

         STANDARD FOR SUMMARY JUDGMENT

         Rule 12(b)(6) allows the Court to make an assessment as to whether the plaintiff has stated a claim upon which relief may be granted. Under the Supreme Court's articulation of the Rule 12(b)(6) standard in Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 554-56 (2007), the Court must construe the complaint in favor of the plaintiff, accept the allegations of the complaint as true, and determine whether plaintiff's factual allegations present plausible claims. '''[N]aked assertion[s]' devoid of 'further factual enhancement''' are insufficient to ''state a claim to relief that is plausible on its face''. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 557, 570). To survive a Rule 12(b)(6) motion to dismiss, plaintiff's pleading for relief must provide ''more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.'' D'Ambrosio v. Marino, 747 F.3d 378, 383 (6th Cir. 2014) (quoting Twombly, 550 U.S. at 555) (other citations omitted). Even though the complaint need not contain ''detailed'' factual allegations, its ''factual allegations must be enough to raise a right to relief above the speculative level on the assumption that all the allegations in the complaint are true.'' New Albany Tractor, Inc. v. Louisville Tractor, Inc., 650 F.3d 1046, 1051 (6th Cir. 2011) (citing Twombly, 550 U.S. at 555).

         ANALYSIS

         I. No Statutory Right to Sue No-Fault Insurers for Reimbursement

         The Michigan Supreme Court recently held that healthcare providers do not have a statutory right to sue a No-Fault insurer to recover No-Fault PIP benefits incurred by an injured person. Covenant Med. Ctr., Inc. v. State Farm Mut. Auto. Ins. Co., ___ Mich. ___; 895 N.W.2d 490 (2017). The court specifically limited its holding to whether the No-Fault Act conferred an independent statutory cause of action to healthcare providers, noting that its decision was “not intended to alter an insured's ability to assign his or her right to past or presently due benefits to a healthcare provider.” Id., slip op. at 24 n.40.

         The Michigan Court of Appeals reiterated post-Covenant that “providers have always been able to seek . . . assignment of an injured party's rights to past or presently due benefits . . . .” W. A. Foote Memorial Hosp. v. MACP and MAIPF, Docket No. 333360, (August 31, 2017), slip op. at 19-20. The decision emphasized that it was not intended to alter the ability of the injured person to assign his or her right to pursue an action for medical bills owed to the medical provider that provided the services, in accordance with MCL 500.3134, which only prohibits the assignment of a right to a future benefit.

         To the extent that plaintiffs rely on the No-Fault Act itself to recover under their PIP Claim alleged in Count I, they do not have such a statutory claim. For example, in paragraph 18 of the complaint plaintiffs allege:

Pursuant to MCL 500.3157, Plaintiffs are entitled to recover the outstanding balance for the products, services and/or accommodations to the injured party from Defendant.

MCL 500.3157 provides that a health care provider may charge a reasonable amount for medical services rendered to a person insured by a no-fault insurance carrier and such charges may not exceed the amount customarily charged for like services. Of course this statute, along with the others cited by plaintiffs in Count I, do not provide a basis for recovery, but they do provide the categories of recovery plaintiffs may seek to recover from defendant Allstate.

         In paragraph 24 of the complaint, plaintiffs allege:

Plaintiffs, as assignees of the injured party, are the real parties of interest and as such Plaintiffs have the right to prosecute this action against ...

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