Senate passes Shirkey bill improving malpractice compensation law

LANSING, Mich. — The Michigan Senate has passed 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.

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.

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.

“Charged expenses and what a plaintiff ultimately pays in expenses can vary greatly based upon agreements reached between insurers and medical providers. We need to address Michigan law in this area and clarify it for residents,” said Shirkey, R-Clarklake. “This measure will help ensure plaintiffs are compensated for real damages.”

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.

SB 1104 has been referred to the Michigan House for further consideration.