Background
The Massachusetts Appeals Court has upheld the provision in the standard Massachusetts automobile policy that prevents an insured from collecting optional medical payments benefits for expenses already paid by health insurance. The ruling confirms that the Commissioner of Insurance acted within the authority granted by state law when approving the nonduplication language introduced in the 2016 standard policy.
Noellen Bousquet suffered significant injuries in a 2018 crash on Interstate 395 after another driver stopped and reversed on the highway. She incurred more than $16,000 in medical expenses. Her Commerce Insurance Company automobile policy paid $2,000 in personal injury protection benefits, and her Fallon Community Health Plan coverage paid the remaining expenses. Bousquet also settled a tort claim against the at-fault driver and reimbursed Fallon for its $13,429.62 statutory lien from the settlement proceeds.
Bousquet had purchased up to $25,000 in optional medical payments, or MedPay, coverage. She sought MedPay benefits for the same medical services after satisfying the health insurer’s lien. Commerce declined because part 6 of the 2016 policy says that no payment will be made when it would duplicate a payment under another automobile policy or a health insurance policy. Bousquet sued for breach of contract, arguing that the exclusion conflicted with the statute requiring insurers to offer MedPay coverage. The District Court entered judgment for Commerce, and the Appellate Division affirmed.
The Court’s Holding
The Appeals Court affirmed. Writing for the panel, Justice Neyman concluded that General Laws chapter 175, section 113C requires automobile insurers to offer at least $5,000 in MedPay coverage but does not dictate every term of that coverage or prohibit reasonable limitations. The statute’s silence about duplicate recovery did not establish a legislative command that an insured must be allowed to collect both health-insurance and MedPay benefits for the same expenses. Filling that gap fell within the commissioner’s policy-making discretion.
The court relied heavily on the Supreme Judicial Court’s 2013 decision in Golchin v. Liberty Mutual Insurance Co. There, an earlier version of the standard policy allowed double recovery because it contained no nonduplication or setoff provision. But Golchin expressly noted that insurers could ask the Division of Insurance to change the policy language. The 2016 revision did exactly that by adding an unambiguous bar against payments duplicating health-insurance benefits. A companion regulation also made MedPay secondary to health-plan and personal injury protection benefits.
The limitation did not make MedPay confiscatory or illusory. It forecloses recovery only for expenses already paid under another policy, leaving coverage with value for people without health insurance and for expenses a health plan does not cover. Although the commissioner’s authority is not unlimited, the court found the provision neither unrealistically narrow nor devoid of substantial economic value. Bousquet’s reimbursement of Fallon’s lien from her tort settlement did not change the dispositive fact that her health insurer had paid the medical expenses covered by the claim.
Key Takeaways
- The 2016 standard Massachusetts automobile policy validly bars MedPay benefits that would duplicate payments already made by an insured’s health plan.
- Section 113C mandates that insurers offer MedPay, but it leaves the Commissioner of Insurance room to approve reasonable limits on the coverage.
- Repaying a health insurer’s statutory lien from a tort settlement does not turn health-insurer-paid bills into unpaid expenses eligible for duplicate MedPay recovery.
- Massachusetts policyholders with comprehensive health coverage should evaluate whether optional MedPay provides meaningful protection for deductibles, exclusions, or other expenses their health plan may not pay.
Why It Matters
The decision settles an important question left after Golchin. Double recovery was possible under the pre-2016 form because the contract did not forbid it; it is no longer available under the revised language merely because the insured later reimburses a health-plan lien. Automobile carriers now have appellate confirmation that the Division-approved coordination regime is consistent with the Legislature’s mandatory-offer statute.
For personal-injury lawyers, the ruling makes benefit coordination and lien analysis especially important when valuing an automobile claim. For policyholders and brokers, it also underscores that MedPay is not automatically a second pool of reimbursement whenever health insurance has paid. Its practical value depends on the insured’s health coverage and on which accident-related expenses remain unpaid.