December 12, 2012
In the recently unpublished decision of ZCD Transportation, Inc v. State Farm, (Docket #304719, rel’d 11/27/12), the Court of Appeals was asked to revisit a summary disposition ruling in favor of State Farm at the trial court level.
In this case, Arnold Grinblatt was unable to walk before a 2001 motor vehicle accident. Prior to the 2001 accident, he used an Amigo personal mobility vehicle and drove a van fitted with hand controls and a lift. After the accident, he was too weak to get into and out of his van and hired the plaintiff, ZCD Transportation, to provide transportation services. The services rendered by Plaintiff included transportation to and from medical appointments as well as transportation for personal errands. For services rendered, ZCD Transportation charged a fee consisting of three components: (1) a pick-up fee of $35 to come and get the client; (2) a wait-fee of $30 per hour billed in 15 minute increments and (3) mileage. The mileage component was $3 a mile and carried a minimum charge of 10 miles for a one-way trip and 20 miles for a roundtrip, even if the client was not transported 10 miles one way or 20 miles roundtrip. Plaintiff’s use of a medical transportation company was prescribed by a treating physician and related to the subject accident.
The court first examined the difference between “allowable expenses” and “replacement services” as contemplated by the Michigan No-Fault Act and case law interpreting the same.
As defined by MCL 500.3107(1)(c), “replacement services” benefits consist of “ordinary and necessary services in lieu of those that, if he or she had not been injured, an injured person would have performed…” Utilizing that definition, the court held that transportation services which were not directly related to the insured’s medical treatment were “replacement services.” The court justified its holding by noting that Grinblatt did his own pleasure driving before the accident and, but for the accident, would have continued to do so after the accident. Further, ZCD admitted that it provided the service to Grinblatt as a courtesy and did not expect him to pay for it.
Citing Davis v Citizens Ins. Co. of America, 195 Mich App 323, 328 (1992), the Court noted that it had “long been recognized that the cost of transportation and mileage to and from medical appointments are allowable expenses.” However, plaintiff’s charges clearly included a fee even when Grinblatt was not in the vehicle and being transported. For example, the plaintiff billed for picking up Grinblatt and taking him to a doctor’s office and for either waiting for him to obtain his treatment or coming back to get him after his treatment. Because the pick-up and wait-time aspect of the service was actually rendered, and the fees were incurred, the court remanded the case to the circuit court in order to determine if those expenses which were actually rendered and incurred were “reasonable.”
With respect to the minimum mileage charge, this constituted a request for transportation services not actually rendered. The Court found that summary disposition for the defendant was appropriate to the extent plaintiff sought payment for mileage beyond that actually traveled by Grinblatt.
The Court made no comment whatsoever regarding the charge of $3 a mile.
To conclude, this case holds that medical transportation services utilized for non-medical treatment purposes are “replacement services” even when the services of a transportation company are prescribed by a physician. Furthermore, and significantly, this ruling supports the proposition that “minimum mileage” billings from transportation companies are not compensable to the extent that the minimum mileage amount exceeds the mileage actually traveled. Finally, pick-up charges and wait-time charges were found to be compensable so long as the charges for same are “reasonable.”
Garan Lucow Miller, P.C. is pleased to announce, the updated Michigan Automobile No-Fault Manual will be published in early January. Garan Lucow Miller, P.C. is donating a portion of the receipts from the sale of the manual to The Pink Fund.
Below is a picture of Mr. James L. Borin and Ms. Eileen Carty of the Garan Lucow Miller, P.C., Troy Office, presenting a check which represents a portion of the receipts for the sale of the No-Fault Manual for 2012, to Ms. Molly MacDonald, Founder, President, SurThrivor of The Pink Fund.