Lipton law announces a groundbreaking $10 million verdict against State Farm, for failing to pay a home care provider’s reasonable charges over a 3 year period. Robert Dindoffer of Health Law Partners litigated and tried this case; Lipton Law consulted with Centria and HLP over the past few years to assure that Centria and its quadriplegic patient were cared for.
Announcing a landmark $9.98 million verdict against State Farm (with the Michigan Catastrophic Claims Association supporting it) under the new No-Fault Act. Centria Home Rehabilitation successfully argued that its charges for attendant care services (including HHA, RN, and LPN care) provided to a ventilator-dependent quadriplegic were objectively reasonable. This case pertained to care that has been ongoing since June 2021.
Centria has been delivering round-the-clock care (including RN services) to this patient for many years, predating the new statute. When the new statute was enacted, Centria had to discharge most of its clients, but continued caring for those, like this patient, for whom discharge would have been life-threatening. Beginning in June 2021, shortly before the July 2, 2021 effective date of the fee schedule statute, Centria revised its billing, charging State Farm 200% of the Medicare reimbursable cost rate, a higher rate than previously billed.
Centria defended the higher rate, citing the superior quality of care provided, which the patient attested to during the trial. Because of Centria’s consistent and high-quality care, the patient has remained free of hospitalizations for over seven years, an impressive record given the severity of her injuries.
State Farm initially covered some services but eventually ceased payments. They argued that subsection (7) of the fee schedule statute allowed them to reduce rates to 55% of Centria’s pre-No Fault amendment charges, a rate that was not commercially viable and threatened the patient’s access to essential care by jeopardizing Centria’s business sustainability. Centria obtained a preliminary injunction mandating that State Farm pay the pre-amendment rate while arguing for the higher rate.
Following the Supreme Court’s final decision in Andary, Centria continued to assert that the 200% Medicare rate was objectively reasonable, based on their track record and the quality of care provided.
In the week leading up to the trial, State Farm paid approximately $225,000 in charges. After a four-day jury trial overseen by Judge Kuhnke of Washtenaw County, the jury awarded Centria 100% of its claimed charges plus 100% of the interest claimed: $8.6 million in charges and $1.3 million in interest. Robert Dindoffer of Health Law Partners litigated and tried this case, with Lipton Law consulting with Centria and HLP over the past few years.
Motions for judgment interest and attorney fees under section .3148 will be filed shortly.