Does Medicare Cover Auto Accident Injuries in Michigan?

The interaction between Medicare and auto accident injury coverage in Michigan can be complex, involving both federal Medicare rules and the state’s specific no-fault auto insurance laws. For individuals enrolled in Medicare who are injured in a car accident in Michigan, understanding how these systems coordinate is important. This article aims to clarify how these different layers of coverage function together to address medical expenses following an auto accident.

Medicare Coverage for Medical Services

Medicare provides health insurance coverage for individuals aged 65 or older, younger people with certain disabilities, and those with End-Stage Renal Disease. The program is divided into different parts, with Part A and Part B being particularly relevant for medical services following an injury. Medicare Part A, known as Hospital Insurance, generally covers inpatient hospital care, skilled nursing facility care, hospice care, and some home health services. If an auto accident necessitates hospitalization, Medicare Part A can help with costs related to the hospital stay, including room and board, nursing care, and medically necessary supplies.

Medicare Part B, or Medical Insurance, covers a range of outpatient medical services, including doctor visits, preventive services, outpatient care, and durable medical equipment. For injuries sustained in a car accident, Part B may cover services such as diagnostic tests like X-rays, ambulance services, and necessary durable medical equipment, provided these are medically necessary. This includes physical and occupational therapy. Medicare Part B pays 80% of the Medicare-approved amount for these services after the annual deductible is met, with the beneficiary responsible for the remaining 20% coinsurance.

Durable Medical Equipment (DME) covered by Medicare Part B must meet specific criteria: it must be durable, used for a medical reason, primarily for sick or injured individuals, used in the home, and expected to last at least three years. Examples of covered DME include canes, crutches, walkers, wheelchairs, hospital beds, and oxygen equipment. Medicare Part A covers inpatient rehabilitation in a skilled nursing facility or an inpatient rehabilitation facility if medically necessary. Outpatient physical and occupational therapy are covered under Medicare Part B.

Michigan’s Auto No-Fault System

Michigan operates under a no-fault auto insurance system, meaning that if you are injured in a car accident, your own auto insurance policy is generally responsible for paying your medical bills and lost wages, regardless of who caused the crash. This component of auto insurance is known as Personal Injury Protection (PIP). Before July 1, 2020, Michigan law mandated unlimited medical coverage under PIP for all drivers.

Significant changes to Michigan’s no-fault law became effective for policies issued or renewed after July 1, 2020. The reforms introduced various levels of PIP medical coverage, allowing drivers to choose an option that aligns with their needs and budget. These options include retaining unlimited medical coverage, or selecting limited options such as $500,000, $250,000, or $50,000 in coverage. The $50,000 limit is specifically available for drivers enrolled in Medicaid.

Individuals with “qualified health coverage” can exclude or opt out of PIP medical coverage entirely. For Medicare beneficiaries, this means they can choose to opt out of PIP medical benefits if they have Medicare Parts A and B. This reform aimed to reduce auto insurance premiums for Michigan drivers by providing more choices in coverage.

Coordination of Benefits Between Medicare and Auto Insurance

The coordination of benefits between Medicare and auto insurance in Michigan is governed by federal Medicare Secondary Payer (MSP) rules. These rules dictate which insurer pays first (primary payer) and which pays second (secondary payer) when a Medicare beneficiary is injured in an auto accident. Generally, Medicare is considered the secondary payer, meaning it will only pay for services after other insurance, such as auto insurance, has paid its share.

In situations where a Medicare beneficiary has unlimited PIP medical coverage or a sufficient limited PIP policy (e.g., $250,000 or $500,000), the auto insurance policy is the primary payer for accident-related medical expenses up to its chosen limit. Providers are required to bill the auto insurer first in these cases. Once the auto insurance benefits are exhausted, or if the initial claim is denied, Medicare may then step in as the secondary payer to cover remaining medically necessary expenses.

Medicare can become the primary payer when a Medicare beneficiary has opted out of PIP medical coverage under Michigan’s reformed no-fault law. To opt out, the individual must have Medicare Parts A and B, and all household members must also have qualified health coverage or another auto insurance policy with PIP medical benefits. In this circumstance, Medicare will pay for auto accident injuries because there is no primary auto insurance coverage for medical expenses. Qualified health coverage means a health insurance policy that does not limit or exclude auto accident injuries and has a deductible below a certain threshold, or Medicare Parts A and B.

If an individual chooses to purchase a limited PIP medical option, such as $50,000, their auto insurance will pay up to that limit. After this amount is exhausted, Medicare would then become the primary payer for additional medically necessary care. Medical providers must correctly identify the primary payer to avoid billing issues. If Medicare makes a conditional payment because the primary payer has not yet paid, Medicare will later seek reimbursement from the primary payer or from any settlement the beneficiary receives.

Steps After an Auto Accident for Medicare Beneficiaries

For Medicare beneficiaries involved in a Michigan auto accident, taking specific steps can help ensure proper handling of medical claims and coverage. The first action should be to report the accident to your auto insurance company promptly. Michigan’s no-fault law requires filing a claim within one year from the date of the accident to ensure eligibility for benefits. Providing accurate details about the accident, including the date, location, and circumstances, is important for initiating the claim.

After reporting the accident to your auto insurer, notify medical providers about your auto accident claim. When seeking medical treatment, inform hospitals, doctors, and other healthcare professionals that your injuries resulted from a car accident. Provide them with your auto insurance information, including the policy number and claim number, so they can correctly bill the primary insurer. This ensures medical bills are submitted to the appropriate payer first, whether it is your auto insurance or Medicare.

Understanding how your medical bills should be submitted is important. If you have active PIP medical coverage through your auto insurance, your auto insurer is the primary payer, and medical providers should bill them first. If you opted out of PIP medical coverage because you have Medicare, then Medicare would be the primary payer, and bills should be directed to Medicare. Keeping detailed records of all medical appointments, treatments, prescriptions, and related expenses is also recommended.

Documentation such as police reports, insurance claim numbers, and any correspondence from your auto insurance company or Medicare should be kept organized. This documentation is important if there are questions or disputes regarding billing or coverage. If you encounter billing errors or confusion about which insurer is primary, contact your auto insurance company and Medicare directly to clarify the situation. They can provide guidance on correcting billing discrepancies and ensuring your claims are processed according to the coordination of benefits rules.