Massachusetts auto insurers may withhold medical payments coverage, or MedPay, when an insured’s primary health plan already paid the same medical expenses.
The Massachusetts Appeals Court upheld Commerce Insurance Co.’s denial of MedPay benefits under language added to the state’s standard automobile insurance policy in 2016.
Noelle Bousquet, who suffered serious injuries in a motor vehicle crash, held a Commerce auto policy with personal injury protection coverage of up to $2,000 for medical expenses incurred by an injured person. She had also purchased optional MedPay coverage with a $25,000 limit. Massachusetts auto insurers must offer motorists the option to buy at least $5,000 in MedPay coverage.
Commerce paid Bousquet $2,000 under the PIP portion of her policy. It declined to pay additional MedPay benefits for medical bills already covered by her health insurer, Fallon Community Health Plan.
Bousquet later sued the driver responsible for the accident. Fallon placed a $13,429.62 lien against any recovery in the liability case for medical costs it had paid.
After Bousquet reached a settlement with the driver, she paid Fallon’s lien from the settlement proceeds. She then sought reimbursement from Commerce through her MedPay coverage. Commerce denied the claim.
Bousquet challenged the denial, arguing that the 2016 wording conflicted with the purpose of MedPay coverage, was confiscatory and exceeded the Massachusetts insurance commissioner’s authority. She also pointed to the pre-2016 standard policy, which allowed duplicate recoveries when health insurance had already paid the same expenses. Lower courts ruled for Commerce. Bousquet appealed.
The Massachusetts Appeals Court affirmed those rulings.
Justice Eric Neyman wrote that the commissioner had authority to approve the restriction because state law requires insurers to offer MedPay but doesn’t require duplicate recovery or bar reasonable limits on the benefit.
The court also rejected Bousquet’s argument that legislative silence showed an intent to permit payment under both health insurance and MedPay. It found no statutory requirement for duplicate recoveries and treated the 2016 wording as a permissible policy decision by the commissioner.
Under the revised MedPay provision, an insured must first submit medical expenses to a health plan. Commerce then determines whether any amount remains payable above the $2,000 PIP benefit.
The policy bars MedPay payments that duplicate amounts already paid for the same bodily injury under another auto policy or a health insurance policy.
That wording changed the Massachusetts standard automobile policy used before 2016. The earlier form allowed duplicate payments even when a health plan had already covered the expenses.
The Massachusetts Division of Insurance also adopted a regulation in 2016 making MedPay secondary to health insurance and PIP benefits.
Bousquet relied on the Massachusetts Supreme Judicial Court’s 2013 decision in Golchin v. Liberty Mutual Insurance Co., where the court allowed recovery under both MedPay and health insurance.
Golchin involved an older policy without a non-duplication or set-off provision. The Supreme Judicial Court found double recovery permissible under that wording, but it also said insurers could ask the Division of Insurance to revise the standard policy.
The Appeals Court found that the 2016 amendment did exactly that. Because the commissioner later approved an explicit non-duplication clause, the court found no conflict between the revised policy and Massachusetts MedPay law.
The ruling leaves the post-2016 structure intact. Health insurance and PIP apply first, with MedPay available for eligible expenses that remain unpaid.
