Jawad a Shah Md Pc v. Auto Club Insurance Association

If this opinion indicates that it is “FOR PUBLICATION,” it is subject to revision until final publication in the Michigan Appeals Reports.

STATE OF MICHIGAN COURT OF APPEALS

JAWAD A. SHAH, M.D., P.C., ALLIANCE UNPUBLISHED ANESTHESIA, PLLC, INSIGHT ANESTHESIA, April 20, 2026 PLLC, and INSIGHT RADIOLOGISTS, P.C., 11:25 AM Plaintiffs-Appellees, v No. 372543 Wayne County Court AUTO CLUB INSURANCE ASSOCIATION, LC No. 24-004685-AV Defendant-Appellant.

Before: RICK, P.J., and YATES and MARIANI, JJ.

PER CURIAM.

This interlocutory appeal, concerning payment of personal protection insurance (PIP) benefits, is before this Court as on leave granted.1 Defendant, Auto Club Insurance Association, challenges the circuit court’s order affirming the district court’s denial of defendant’s motion for partial summary disposition. We reverse and remand.

Defendant provided no-fault PIP coverage to a nonparty insured. In 2021, that insured suffered injuries as a result of a motor vehicle accident, for which she subsequently received treatment; specifically at issue are certain MRI services provided by plaintiffs to the insured. In determining the amount potentially payable for those services, defendant applied the multiple- procedure payment reduction (“MPPR”) Medicare rule, which reduces the payable amount by a certain percentage when multiple procedures are performed during a single patient encounter.

Plaintiffs brought suit in district court, seeking nonreduced payment for their services. Eventually, defendant moved for leave to file a motion for partial summary disposition. As is relevant here, defendant argued that it properly applied the MPPR to determine the amount of PIP benefits

Shah v Auto Club Ins Ass’n, unpublished order of the Court of Appeals, entered January 31, 2025 (Docket No. 372543).

-1- payable to plaintiffs under MCL 500.3157(2) of the no-fault act.2 After a hearing,3 the district court issued a brief order denying defendant’s motion with prejudice.

Defendant then filed a motion for leave to appeal with the circuit court, which the court granted. After briefing and oral argument, the circuit court issued an opinion and order affirming the district court. The circuit court explained that the only question it needed to address was whether insurance companies may use Medicare rules—specifically here, the MPPR—to calculate the amount payable under MCL 500.3157(2). That, in turn, required the court to determine whether the MPPR constituted a “limitation[] unrelated to the rates in the fee schedule” for purposes of the statute’s definition of “Medicare.” MCL 500.3157(15)(f).4 Relying primarily on Central Home Health Care Servs v Progressive Michigan Ins, ___ Mich App ___; ___ NW3d ___ (2024) (Docket No. 364653), the circuit court held that the MPPR’s reduction in payment “occurs after the application of the Medicare fee schedule” and “thus does not affect the rates in the fee schedule.” Accordingly, the circuit court concluded that the MPPR “is a limitation promulgated by Medicare that is unrelated to the rate in the fee schedule and cannot be considered when applying MCL 500.3157(2).” This appeal followed.

MCL 500.3157(2) provides: Subject to subsections (3) to (14), a physician, hospital, clinic, or other person that renders treatment or rehabilitative occupational training to an injured person for an accidental bodily injury covered by personal protection insurance is not eligible for payment or reimbursement under this chapter for more than the following: (a) For treatment or training rendered after July 1, 2021 and before July 2, 2022, 200% of the amount payable to the person for the treatment or training under Medicare.

(b) For treatment or training rendered after July 1, 2022 and before July 2, 2023, 195% of the amount payable to the person for the treatment or training under Medicare.

(c) For treatment or training rendered after July 1, 2023, 190% of the amount payable to the person for the treatment or training under Medicare.

At the hearing, plaintiff’s counsel verbally waived any objection to defendant’s request for leave to file the motion and argued against the motion only on its merits.

The full definition is as follows: “Medicare” means fee for service payments under part A, B, or D of the federal Medicare program established under subchapter XVIII of the social security act, 42 USC 1395 to 1395lll, without regard to the limitations unrelated to the rates in the fee schedule such as limitation or supplemental payments related to utilization, readmissions, recaptures, bad debt adjustments, or sequestration. [MCL 500.3157(15)(f).]

-2- As the circuit court correctly recognized, the dispositive question in this appeal is whether the MPPR is a “limitation[] unrelated to the rates in the fee schedule” for purposes of MCL 500.3157(15)(f), such that it cannot be used in determining the amount payable under MCL 500.3157(2). On September 18, 2025, while the instant appeal was pending, this Court released its decision in Favot v Brown, ___ Mich App ___; ___ NW3d ___ (2025) (Docket Nos. 368733; 368734), which decided that very question. Looking to the plain language of the statute and also drawing heavily on the Central Home decision, Favot concluded that the Medicare rules at issue in that case—which included the MPPR—“are related to the fee schedule” and “affect the amount Medicare would pay for the particular service, meaning they may be considered for purposes of the no-fault act.” Id. at ___; slip op at 5, citing MCL 500.3157(15)(f) and Central Home, ___ Mich App at ___; slip op at 4, 6.

Turning to the instant appeal, we conclude its outcome is governed by Favot, which squarely decided the issue presented—whether the MPPR may be applied in determining the amount of PIP benefits payable by defendant for plaintiffs’ MRI services. Under Favot, the answer is yes, and the lower courts erred in concluding otherwise (although of course, they did not have the benefit of Favot when reaching their conclusions). Favot is precedentially binding, and it controls our disposition here. MCR 7.215(C)(2), (J)(1).

Accordingly, the circuit court’s order affirming the district court’s denial of defendant’s motion for partial summary disposition is reversed, and the case is remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.

/s/ Michelle M. Rick /s/ Christopher P. Yates /s/ Philip P. Mariani

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If this opinion indicates that it is “FOR PUBLICATION,” it is subject to revision until final publication in the Michigan Appeals Reports.

STATE OF MICHIGAN COURT OF APPEALS

JAWAD A. SHAH, M.D., P.C., ALLIANCE UNPUBLISHED ANESTHESIA, PLLC, INSIGHT ANESTHESIA, April 20, 2026 PLLC and INSIGHT RADIOLOGISTS, P.C., 11:25 AM Plaintiffs-Appellees, v No. 372543 Wayne Circuit Court AUTO CLUB INSURANCE ASSOCIATION, LC No. 24-004685-AV Defendant-Appellant.

Before: RICK, P.J., and YATES and MARIANI, JJ.

RICK, P.J. (concurring).

I concur in the result reached by my colleagues. The outcome is required in light of this Court’s recent ruling in Favot v Brown, ___ Mich App ___; ___ NW3d ___ (2025) (Docket Nos. 368733; 368734). I write separately as I believe Favot was wrongly decided. As of the date of the decision in this matter, leave to appeal in Favot remains pending in our Supreme Court.

As I read MCL 500.3157, the provision requires a more precise inquiry into whether a given limitation is part of the rate-setting prices themselves or instead constitutes a post-rate adjustment to reimbursement. While the relevant portions of the statute reference the “amount payable under Medicare,” that amount is necessarily derived from the fee schedule rate, which serves as the baseline for reimbursement. In my opinion, the statute’s separate reference to “rates in the fee schedule” confirms that the Legislature intended to use Medicare rates as a pricing benchmark. Interpreting “amount payable” to include all downstream payment methodologies would expand the statute beyond its text. I believe a proper reading of the statute confines “rate- related” limitations to those intrinsic to the determination of the fee schedule rate and excludes methodologies that operate solely to reduce reimbursement after the fact.

For these reasons, I concur in the majority’s opinion. Although I would not interpret MCL 500.3157 as the Favot Court did, I concur in the result because Favot presently controls.

/s/ Michelle M. Rick

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