Washington Case Law Update: Use of “Maximum Medical Improvement” Limitation in PIP Policy Violates Regulation

Attorney Katie Buxman

Use of “Maximum Medical Improvement” Limitation in PIP Policy Violates Regulation

From the Desk of Katie D. BuxmanInsurers operating in Washington are governed by numerous statutes and regulations, including Washington Administrative Code (“WAC”) 284-30-395(1), which contains a list of permissible limitations on PIP benefits.  If an insurer’s policy limits PIP benefits to treatment that is essential to achieving “maximum medical improvement,” will the policy be in violation of WAC 284-30-395(1)? Read on to find out.

Claims Pointer: In this case arising out of an automobile accident, the Washington Supreme Court made it clear that it favors full compensation of medical benefits to injured motorists.  In response to its first certified question, the Court answered that a policy that limits medical benefits to those that only achieve “maximum medical improvement,” violate WAC 284-30-395(1).  For the second question, the Court answered that the term “maximum medical improvement” is not consistent with the definition of “reasonable” or “necessary,” as set out in WAC 284-30-395(1).

Durant v. State Farm, No. 94771-6, Washington Supreme Court (June 7, 2018).

After suffering injuries in a car accident, Plaintiff Bret Durant (“Durant”) sought PIP benefits from his insurer, State Farm Mutual Automobile Insurance Company (“State Farm”).  In turn, State Farm provided Durant with a “coverage letter,” which noted:

The policy provides coverage for reasonable and necessary medical expenses that are incurred within three (3) years of the accident. Medical services must also be essential in achieving maximum medical improvement for the injury you sustained in the accident.

(emphasis added).  Durant sought treatment with a chiropractor.  Four months after the accident, State Farm sent the chiropractor a letter asking if Durant reached maximum medical improvement (“MMI”), and if not, what the target date was for Durant’s...

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