Miller v Allstate Affirmed by Michigan Supreme Court Allowing Physical Therapist to Recover No-Fault Benefits Wthout Incorporation Under Michigan's Professional Corporation Act
In May, I commented upon the oral arguments presented to the Michigan Supreme Court in the appeal from the Michigan Court of Appeals decision in the case of Miller v Allstate.
This case raised the issue of whether a physical therapy clinic, incorporated under the Michigan Business Corporation Act, was lawfully rendering services entitling it to reimbursement from its auto-accident injured patient's No-fault insurance carrier.
Allstate Insurance Company argued that a physical therapy clinic-a medical service provider-needed to incorporate under Michigan's Professional Service Corporation Act in order to lawfully render services under Michigan's No-Fault auto-insurance act, even though the physical therapist actually performing the services was a lawfully licensed physical therapist.
The lower courts permitted the claim and the Supreme Court issued its opinion affirming those decisions on July 2, 2008, although not for the same reason the lower courts did.
Essentially, the Supreme Court held that once a corporation, of any sort, files its Articles of Incorporation with the State, it is conclusively determined that the incorporation is lawful--unless the state Attorney General successfully challenges that incorporation in a court proceeding. this conclusion was based on statutory language and the Supreme Court's interpretation of long-standing Michigan law.
I believe the result in this case is correct (although one of the two concurring Justices, Elizabeth Weaver, believes that the Court's tortured logic in reaching the decision was incorrect because of a long-standing battle she has on the Court's Standing decisional process (a topic for some law professor's blog some day))because, as the Court stated, allowing challenges to every corporation in every suit brought by a corporation would affect the very stability of the economy. Every patient would have to verify compliance by every provider with every corporate statute before accepting treatment and whether payment would be made would depend on the creativity of every insurance lawyer in every case when payment decisions were made.
For once, the Supreme Court majority seems to have gotten it right.
Let's see if the Michigan Legislature and the Department of Labor and Economic Growth follow suit and picks up on this decision and clarifies the incorporation requirements as Michael Hamblin of our firm has described on his blog, Michigan Business Lawyer, for peripheral medical and other licensed providers.
Until they do, however, every licensed practitioner and other individuals in Michigan must immediately consult competent health care business lawyers such as my firm, to review their corporate status and to consider re-incorporation as Professional Corporations if permitted and advisable.
HAVE A HAPPY AND SAFE 4TH OF JULY HOLIDAY---AND GOD BLESS AND KEEP OUR TROOPS AND THEIR FAMILIES. LET'S BRING THEM HOME SOON!!!
