Michigan Supreme Court Ruling: The Impact on No-Fault Insurance Claims

The Michigan Supreme Court recently addressed a pivotal issue regarding no-fault insurance claims in the state, delivering a ruling that has significant implications for both insurers and claimants. In a decision announced on April 1, 2025, the court determined that the 2019 amendment to Michigan's no-fault insurance statute, specifically the tolling provision under MCL 500.3145(3), does not apply retroactively to claims that accrued before the amendment's effective date. This decision emerges from the legal case Spine Specialists of Michigan PC v. MemberSelect Insurance Company, which has been closely watched by stakeholders across the insurance industry. The case originated with Jeremy Woods, who was involved in a car accident in January 2017 and subsequently received medical treatment from Spine Specialists of Michigan PC in April and May 2019. Under assignment, Spine Specialists sought reimbursement for their services from MemberSelect, Woods's no-fault insurance provider. However, when MemberSelect declined to pay, a legal battle ensued regarding the statute's interpretation.

At the heart of the dispute was the 'one-year-back rule' embedded in MCL 500.3145. This rule prevents the recovery of Personal Injury Protection (PIP) benefits for any losses incurred more than one year before a suit is filed. Spine Specialists argued that the 2019 amendment—which extends the time for insurers to formally deny claims and consequently tolls the one-year-back period—should apply even to claims made before the amendment became effective. The trial court, Macomb Circuit, granted MemberSelect's motion to dismiss the claims arising before the amendment’s effective date of June 11, 2019, while allowing post-amendment claims to proceed. The Court of Appeals upheld this decision, and the matter was eventually presented to the Michigan Supreme Court to clarify whether the tolling provision was meant to apply retroactively.

The Supreme Court's analysis, led by Chief Justice Elizabeth Clement, focused on the legislative intent behind the statute. The ruling emphasized that PIP benefits accrue when the medical expenses are incurred, not when a claim is denied or filed. Given that Woods's medical expenses were incurred in April and May 2019—preceding the effective date of the amendment—his claims were barred under the original statute. The court also noted that the 2019 amendment introduced new substantive duties for insurers, including the formal denial requirement to halt tolling, which cannot be imposed retroactively without explicit legislative language. Justice Elizabeth Welch concurred with the judgment but expressed reservations about the majority's rationale, referencing the court's 2023 decision in Andary v. USAA Casualty Insurance Co. as a potentially inconsistent legal precedent.

The decision from the Michigan Supreme Court has substantial implications for no-fault insurance claimants and providers. It affirms that the amended statute's protections do not extend to claims that had accrued before June 11, 2019, thus preserving the pre-amendment legal framework for older claims and shielding insurers from increased retroactive liability. For medical providers and claimants pursuing PIP benefits, the ruling underscores the necessity of understanding statutory time limits and the specific timing of claims. As the landscape of Michigan's auto insurance continues to evolve, stakeholders must stay informed on legislative changes and judicial interpretations that affect claim processing and reimbursement strategies. This ruling is a definitive statement on the boundaries of legislative amendments in relation to time-sensitive insurance benefits, ensuring that historical claims maintain their standing under the law as originally enacted.