January 22, 2019
On December 19, 2018, the Macomb County Circuit Court entered an Opinion and Order on appeal deciding what may be one of the first lawsuits in which a medical provider sought payment of the balance of its bills directly from its patient after the provider lost its direct cause of action against the patient’s no-fault insurer.
In Spine Specialists of Michigan v Bozena Debowska, Spine Specialists filed a claim in district court against Debowska asserting that Debowska suffered injuries in a motor vehicle accident and Spine Specialists provided medical services for her. Spine Specialists asserted that Debowska guaranteed she would pay for any charges not covered by insurance. Debowska received services worth $29,840 but her no-fault insurer IDS Property Casualty Insurance Company paid only $8,164.38, the usual and customary amount. A balance bill was left for $21,675.62.
Spine Specialists asserted a breach of contract, unjust enrichment and quantum meruit against Debowska. Debowska then filed a motion for summary disposition arguing that she had signed an assignment of her rights to pursue no-fault benefits to Spine Specialists, and that assignment did not reserve the right for Spine Specialists to seek recourse against Debowska if Spine Specialists direct cause of action against IDS was not successful.
Spine Specialists’ direct cause of action against IDS was, in fact, unsuccessful and Spine Specialists did not appeal the dismissal of its lawsuit against IDS. Instead, Spine Specialists sought payment directly from Debowska. The district court found Debowska had given up all her rights under her assignment, and Spine Specialists did not reserve the right through its contracts with Debowska to sue her when the assignment failed. Spine Specialists appealed.
The Circuit Court agreed that the assignment Debowska provided to Spine Specialists gave Spine Specialists Debowska’s right to recover no-fault benefits from IDS for the services provided by Spine Specialists. The assignment did not, however, obligate Debowska to pay any medical bills not covered by her insurance. Therefore, Spine Specialists’ breach of contract claim failed.
Jami Leach, a shareholder in Garan Lucow Miller, P.C.’s Detroit Office represented Debowska in the District Court. Caryn Ford, a shareholder in Garan Lucow Miller, P.C.’s Detroit Office, represented Debowska in the Circuit Court appeal.