Shirkey bill improving medical compensation law headed to governor

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LANSING, Mich. — The Michigan Senate on Tuesday gave final approval to a bill sponsored by Sen. Mike Shirkey that would help ensure plaintiffs in medical malpractice cases receive proper compensation. The change clarifies this portion of the law for all Michigan residents.

“Insurers and medical providers often reach agreements on payment amounts that differ greatly from expenses that were initially charged. This is a problem that needs to be cleared up in Michigan law,” said Shirkey, R-Clarklake. “This legislation will help ensure accurate compensation. Clearer laws benefit all of us.”

Under current law, medical malpractice plaintiffs can recover amounts charged rather than amounts actually paid for medical expenses — even when the charged amounts are much greater than the paid amounts.

In July, the Michigan Supreme Court upheld this interpretation of current law, but also called for the Legislature to address this issue. Shirkey listened to the suggested improvements and acted.

Senate Bill 1104 was written in response to the court’s request. The bill would ensure that recoverable damages for past medical expenses or rehab service expenses do not exceed actual damages stemming from alleged malpractice, and that only evidence of actual damages shall be admissible at trial for such cases.

The Michigan Health & Hospital Association’s (MHA) Senior Vice President for Advocacy Chris Mitchell said plaintiffs should only be able to recover amounts actually paid.

“The MHA supports Senate Bill 1104 because it eliminates the loophole allowing plaintiffs to recover damages for medical expenses that were never incurred or paid,” Mitchell said. “Passage of this legislation is common sense and helps control the health care costs for all Michigan citizens.”

General Counsel Dyck Van Koevering of the Insurance Institute of Michigan (IIM) agreed.

“This important clarification to statute is supported by IIM to prevent windfall recoveries being paid for damages that were never sustained,” Van Koevering said.

Both the Senate and House of Representatives have approved SB 1104. It now heads to the governor to be signed into law.