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The White House Services v. Allstate Insurance Co.

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

October 15, 2019

THE WHITE HOUSE SERVICES, (Edwin Broadus), Plaintiff,



         Plaintiff, The White House Services, provides medical services to Edwin Broadus, who sustained catastrophic brain injuries in a motor vehicle collision occurring November 1, 1982. In this action, plaintiff seeks to collect no-fault personal protection insurance benefits from defendant Allstate Insurance under Michigan's No-Fault Automobile Insurance Act (“No-Fault Act” or “Act”) and an automobile insurance policy. Specifically, plaintiff seeks to recover for services provided to Mr. Broadus while he was a resident in a single person apartment from January 21, 2016 through January 31, 2018.

         The matter is presently before the court on defendant's motion for summary judgment. Defendant argues that plaintiff did not provide lawfully rendered services to Mr. Broadus for which it is entitled to Michigan no-fault benefits. Specifically, defendant alleges that plaintiff did not possess the required license to provide adult foster care services in a single apartment setting and therefore its services are not compensable under the No-Fault Act. Oral argument was heard by the court on October 7, 2019.


         The White House Services is owned by Jacquelyn Vaughn. She started operating The White House Services in 2006 by offering geriatric in-home services and then transitioned into offering services for people who suffered traumatic brain injuries in motor vehicle accidents. The White House Services is licensed as an adult foster care home for services provided at 5466 Greenbriar (“Group Home”) and is restricted to having six clients at a time at the home.

         The White House Services also offers a “residential program” for individuals who live offsite. In 2012, the Michigan Department of Human Services Bureau of Children and Adult Licensing (“Department”) undertook an investigation into The White House Services. The investigation focused on the services provided to “Resident A” who lived in one of plaintiff's single person apartments. On April 23, 2012, the Department concluded that adult foster care was being provided to Resident A at the apartment without a license. The Department also found that “Resident A's care plan is directed towards total rehabilitation, full independence and eventual release from the support of the servicing insurance company.” PageID 825. After concluding that Resident A did not require the adult foster care services normally provided by plaintiff's Group Home, the Department directed Ms. Vaughn to form a new entity to service rehabilitative clients who are working toward independent living. This new entity was White House Custom Services, and its purpose was “[t]o clarify the differences [between adult foster care services provided by the Group Home and rehabilitative services provided in the single apartment setting], avoid the appearance of impropriety and maintain services and funds apart from the licensed group home . . . .” PageID 825. The Department required a doctor's statement supporting a high probability for rehabilitation in order for rehabilitative services to be provided in the single apartment setting without a license. Following the investigation, Vaughn established The White House Custom Services as the entity that services “[a]ny future business outside White House Services group home . . . .” PageID 825.

         Vaughn affirmed in her deposition that The White House Services' adult foster care license does not cover the services provided offsite for the residential program. (Vaughn Dep., p. 19). Susan Schmidt is the accountant for The White House Services and The White House Custom Services. Schmidt explained that the two entities file joint tax returns and the accounts receivable for the two entities are commingled. Further, the staff providing the services is shared by the two entities. In their depositions, plaintiff's employees often referred to the two entities generally as “The White House”.

         On January 21, 2016, Edwin Broadus moved into a single resident apartment located at 29700 Citation Circle, Farmington Hills, Michigan (the “Citation Circle Apartment”). The rent for the apartment is included in the per diem rate plaintiff charged for services provided to Broadus. Plaintiff identified employees Dara Ladd and Mia Banks as Broadus' two primary caregivers. Ladd provided services at the Citation Circle Apartment on Mondays through Fridays from 8:00 a.m. to 4:00 p.m. These services included: attending Broadus' medical appointments; preparing meals with food purchased by The White House; administering medications; assisting while out in the community; ensuring someone at The White House is aware of his whereabouts; overseeing dressing and hygiene; assuring his health, safety and well-being; and protecting him against physical harm, humiliation and intimidation. These services were offered and available to Broadus 24 hours a day, seven days a week. Ladd further explained that Broadus spent nights at the Citation Circle Apartment but regularly went to the Group Home during the day, so he could interact with other clients.

         Mia Banks testified she provided services to Broadus on Monday, Wednesday and Friday from 4:00 p.m. to 9:00 p.m. at the Citation Circle Apartment. During her shift she provided the following services: assistance with showering, dressing and hygiene; meal preparation; administering medications; activities such as taking walks and going out in the community; reminding him of activities to be completed; protecting his health, safety and well-being; and making sure someone from The White House always knows of his whereabouts.

         Paulette Boggs is the human resources and account manager for The White House. She confirmed that The White House is always aware of Mr. Broadus' whereabouts, and that services are available to him 24 hours a day, seven days a week. As a rule, caregivers were to provide assistance with: meal preparation; activities of daily living; dressing in proper clothing; development of personal and social skills; and ensuring his health, safety and well-being.

         The caregivers document the services they provide on records that comprise each resident's chart. For Mr. Broadus, these records document the following services: grooming support; administration of medications; preparation of meals; assessments regarding behavior; household chores; and attendance at doctor appointments. Plaintiff produced records titled “Rolling Rehab Recreation, ” which show that caregivers provided “social integration activity” for Mr. Broadus. This includes taking Broadus on outings in the community, so he could work on developing personal and social skills.

         The job description for Care Specialist/Home Health Aide at The White House Services lists the following services provided to clients: medication reminders; escorts to appointments; meal planning and preparation; assistance with bathing, dressing and grooming; running errands; and engaging in physical and mental exercise. Each of these services was provided to Mr. Broadus.

         Plaintiff seeks to recover for services provided to Mr. Broadus while he was a resident at the Citation Circle Apartment from January 21, 2016 through January 31, 2018. Mr. Broadus moved into the Group Home on February 1, 2018 and the parties agree that defendant has paid plaintiff for services provided and billed since that date. Defendant moves for summary judgment, contending that plaintiff is not entitled to reimbursement under the No-Fault Act because it was operating as an unlicensed adult foster care facility and was therefore not lawfully rendering treatment under Michigan's No-Fault Act. Plaintiff responds by arguing that defendant has not offered any proof that The White House Custom Services was required to have a license under the Adult Foster Care Facilities Licensing Act to lawfully provide its services and accommodations to Mr. Broadus in a single apartment setting.

         STANDARD FOR ...

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