The Supreme Judicial Court (SJC) recently stated in its
Golchin v. Liberty Mut. Ins. Co., 466 Mass. 156, 166
(2013) Golchin II decision that the optional Medical
Payments (MedPay) coverage on auto insurance "may be approaching
irrelevance in light of the recently enacted 'universal' health
In an era where there is near-universe health insurance coverage in
Massachusetts (and the nation through the Affordable Care Act),
there has been a recent series of cases, Golchin I and
Golchin II, that have attempted to untangle the knot of
how Personal Injury Protection (PIP), MedPay and private health
insurance interact where all three apply, in some cased
simultaneously and, perhaps surprisingly, allowing for a double
recovery for injured parties.
I break down how the medical payments are covered below.
The first $2,000 (PIP applicable): The statute and
case law is clear that the first $2,000 in medical bills are to be
paid by PIP.
Medical bills in excess of $8,000 (MedPay and health insurance
applicable): Once the total medical bills for an injured
party in an incident exceeds $8,000, PIP no longer applies. This
leaves MedPay and health insurance as potential payers of the
excess bills (the following scenarios assume both could apply;
e.g., $25,000 in MedPay coverage and valid health insurance).
It should be noted that all medical bills beyond PIP's initial
$2,000 (for non-ERISA health insurance) and $8,000 (for ERISA
health insurance plans, including MAHealth and Medicare) must be
submitted to the health insurer before MedPay is required to
consider them. This prevents plaintiffs from strategically avoiding
health insurance liens where both MedPay and health insurance may
apply as primary coverage.
Health insurance is secondary to MedPay: If the health insurer
rejects payment of the medical bills due to a "coordination of
benefits provision" in their contract making them secondary to
MedPay, then MedPay must pay for the medical bills up to their
Health insurance and MedPay are primary: Where both health
insurance and MedPay are primary, an injured plaintiff may recover
under both policies above the $8,000 PIP cap, even where that may
result in a double recovery. This is the crux of the Golchin
In Golchin, the plaintiff incurred over $100,000 in
medical bills resulting from an auto incident. PIP had paid $8,000
and was exhausted. Golchin's health insurer had paid over $30,000
for the remaining bills. Golchin then submitted the health
insurer's lien to MedPay for payment under the auto policy, which
The plaintiff brought an action in Superior Court, asking the court
to declare MedPay coverage available to pay the lien; the insurer
argued that the coverage would not apply, as the bills had already
been paid by the health insurance. The court rejected the insurer's
position, holding instead that "the unambiguous language of the
auto policy provides MedPay coverage even where a health insurance
provider has paid medical expenses resulting from injuries
sustained by a claimant in an accident, and there is no
nonduplication provision relating to health insurance. Golchin thus
is entitled to recover the MedPay benefits available under the auto
The SJC did consider the policy implications, stating that they
"acknowledge it is possible that operation of the plain language of
the auto policy, as we have construed it, could result in MedPay
benefits duplicating payments made by a health insurer." However,
the SJC stated the insurance company was not without remedy, since
"it is always open to automobile insurers to petition the Division
of Insurance to change the language of the policy so as to clarify
that it does not require the result of which they complain."
Many insurance companies have since submitted requests to the
Division of Insurance to make changes to their policy language to
change the Golchin outcome going forward. Any such changes would
only impact coverage for auto collisions that occur after they are
Golchin I & II may be seen as an attempt by the SJC to
breathe new life into MedPay coverage, giving the
statutorily-mandated offering some new purpose in light of
universal health care (thus avoiding near-irrelevance). However, in
doing so they are treating MedPay coverage, which is generally
considered a form of indemnity, as "less a contract of indemnity
than a form of investment [like life insurance]."
$2,000 - $7,999 in medical bills paid by PIP (PIP, MedPay and
health insurance applicable): In light of the result in
the Golchin cases, the interaction of all three policies
where PIP has paid between $2,000 and $7,999 in medical bills
becomes more complicated.
Full $8,000 PIP coverage for medical bills: Under G.L. c.
90, § 34A, PIP has mandatory limits of $8,000. PIP will pay up to
the full $8,000 in medical bills where the insured has an ERISA
health insurance plan, including MAHealth and Medicare. This avoids
any potential conflicts with health insurance and MedPay
The Golchin gulch: PIP limited to $2,000 for medical bills not
paid by a health plan
However, where the insured has non-ERISA Health Insurance, PIP
coverage for medical bills is limited to $2,000. PIP will then pay
"any medical expenses 'which will not be paid by a health plan,'"
up to $8,000 (including deductibles, co-pays and lost wages).
MedPay coverage is secondary to PIP where PIP would apply. This is
where things get tricky. Under Golchin I, the SJC
reiterated the holding in Mejia, which found that "only
after PIP benefits have been exhausted or where they are
unavailable does the standard policy provide that MedPay
benefits are due." (emphasis added). This sounds straightforward,
but the SJC then went on to state that "the standard Massachusetts
auto policy therefore contains language expressly precluding the
simultaneous payment of health insurance and MedPay benefits at
least until the $8,000 limit of PIP benefits has been reached."
This is significant, because the SJC cites no specific authority
limiting the simultaneous coverage of health insurance and MedPay
within the $2,000-$7,999 range of PIP payments, as it would hold
applied once PIP was exhausted at $8,000 in Golchin
The Massachusetts Division of Insurance Bulletin 2008-12, which
deals with the coordination of benefits between PIP, MedPay and
health insurance, states in its examples that these claims must
first be submitted to the health insurer and, if they are denied,
are then resubmitted to the auto carrier for payment under PIP or
MedPay. There is no statement on the applicability of simultaneous
coverage in light of the Golchin cases.
Insurance companies have cited the Golchin I language as a basis to
deny MedPay coverage until PIP has paid $8,000. Plaintiffs have
asserted that the holdings of Golchin I & II require MedPay
coverage where PIP is "unavailable," i.e., where Health Insurance
Some insurance companies take a literal reading of the Golchin
I language to mean that MedPay is not available until all
$8,000 of PIP is exhausted. However, this would lead to the
potentially absurd outcome where, if PIP has paid $7,999 (including
deductibles, co-pays, and lost wages) and the medical bills total
$20,000, there would be no MedPay coverage available. If PIP paid
just $1 more (even in lost wages) and capped out at $8,000, there
would be up to $12,000 in MedPay coverage available.
The plaintiff's interpretation of the Golchin cases avoids
this Machiavellian outcome. Under the plaintiff's reading, MedPay
would be owed whenever PIP is "unavailable" (i.e., when health
insurance has paid for a bill), even if PIP is not totally
exhausted at $8,000. The plaintiff would then be able to submit the
bill or explanation of benefits (EOB) for payment under MedPay
after submitting it to the health insurer. Plaintiffs have argued
that the full bill is due under MedPay, while insurers have sought
to limit coverage to the actual amount paid by the health insurer
as stated in the EOB. This avoids the absurdity of significant
MedPay coverage depending on deductibles, co-pays, and/or lost
wages being paid by PIP to reach the $8,000 cap.
Unfortunately, the SJC has not yet made a final determination on
the application of Golchin I & II to this area of
coverage. For now the issue has been left to the lower courts, who
have thus far sided with plaintiffs in their interpretation.
However, expect a future decision to clarify just how MedPay and
health insurance policies interact in light of Golchin I &
II, where PIP has paid between $2,000 and $7,999 but is not
yet completely exhausted at $8,000.
A special thanks to attorney Elliot Beresen of Manelis &
Beresen for answering my questions.