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Travco Insurance Company v. Crystal Williams

February 25, 2013

TRAVCO INSURANCE COMPANY
v.
CRYSTAL WILLIAMS



The opinion of the court was delivered by: Greene, J.

Travco Insurance Company v. Crystal Williams, Misc. No. 7,

Opinion by Greene, J.

INSURANCE - MOTOR VEHICLE INSURANCE LAW - LIMITATIONS ON RECOVERY OF BENEFITS

Maryland's motor vehicle insurance law includes certain limitations on an insured's recovery of benefits. Md. Code (1996, 2011 Repl. Vol.), § 19-513(e) of the Insurance Article requires that benefits payable under the personal injury protection and uninsured motorist statutes be reduced to the extent that the recipient has recovered un-reimbursed workers' compensation benefits.

Bell, C.J. Harrell Battaglia Greene Adkins Barbera McDonald, JJ.

Opinion by Greene, J.

We have before us questions of law certified by the United States District Court for the District of Maryland pursuant to the Maryland Uniform Certification of Questions of Law Act, Md. Code (1973, 2006 Repl. Vol.), §§ 12-601 to 12-613 of the Courts and Judicial Proceedings Article and Maryland Rule 8-305. The District Court has asked us to determine whether Md. Code (1996, 2011 Repl. Vol.), § 19-513(e) of the Insurance Article (or "§ 19- 513(e)") requires an insurance company to deduct recovered workers' compensation ("WC") benefits from the benefits payable to an insured for uninsured motorist coverage ("UM") and personal injury protection ("PIP") when the insured has not reimbursed its WC provider, the WC provider claims the insured will need to reimburse it from any UM or PIP recovery, and the insured intends to reimburse the WC provider in the future. As an extension of this question, we are asked to determine the appropriate means for resolving a dispute between a PIP or UM insurer and insured regarding a WC provider's subrogation right.*fn1 Finally, we are asked whether § 19-513(e) permits an insurer to reduce its benefits payable for medical bill "write-downs,"*fn2 assuming that the "write-downs" are considered a WC benefit under the applicable WC law.

We shall hold that, under the plain meaning of § 19-513(e), an insured's benefits payable under UM and PIP coverage "shall be reduced" to the extent that the insured recovered benefits under WC and the WC provider has not been reimbursed. Further, we hold that if the applicable WC law treats "write-downs" of medical bills as WC benefits, and the WC benefits have not been reimbursed, then the insurer shall deduct those benefits, calculated as discounts, from its benefits payable to the insured under § 19-513(e).

We adopt the facts of the case as set forth by the District Court in its Certification Order dated June 8, 2012:

[] TravCo Insurance Company ("TravCo") issued to [] Crystal Williams a Maryland personal auto policy, number 978435964 101 1, effective July 28, 2007 to January 28, 2008. The Policy's coverage included UM bodily injury coverage, with limits of $100,000.00 each person, and PIP coverage, with limits of $2,500.00 each person each accident. The policy's UM coverage provided that "any amounts otherwise payable for damages under this coverage shall be reduced by all sums . . . [p]aid because of the 'bodily injury' under . . . [the] worker's compensation law or similar law provided the insurer or self- insurer of worker's compensation benefits has not been reimbursed for amounts paid under the worker's compensation law or similar law." The [P]olicy's PIP coverage similarly provided: "Benefits payable by the Company under the terms of this insurance to or on behalf of an 'injured person' shall be reduced to the extent that benefits therefore are paid, to or on behalf of the 'injured person' under any worker's compensation law of any state or the Federal Government."

At all relevant times, Ms. Williams was employed by the District of Columbia government. On August 2, 2007, Ms. Williams was a passenger in a District of Columbia government's vehicle driven by her supervisor. They were traveling on a work assignment. Their vehicle was rear-ended by an unknown driver. Ms. Williams was stunned by the impact. While she was sitting in the vehicle trying to recover, her supervisor told the other driver to leave the scene. The driver responsible for the accident left and no information about him is known. Ms. Williams was injured in the accident. She missed nine weeks of work and her loss of [] earning capacity was $10,476.00. She incurred $13,096.50 in medical expenses and received a 22% disability rating.*fn1

The medical invoices provided by Ms. Williams to TravCo indicate that her medical providers applied WC "write-downs," totaling at least $3,591.53.

The District of Columbia government's WC third-party administrator asserts a subrogation right in the amount of $11,043.60 against any PIP or UM recovery by Ms. Williams. Ms. Williams intends to reimburse the District of Columbia government, although TravCo disputes her obligation to do so. The amount that Ms. Williams would reimburse the District of Columbia government cannot be determined before the settlement or judgment with TravCo, and Ms. Williams has no funds to reimburse the District of Columbia government out of pocket.

TravCo does not dispute that Ms. Williams' claims fall within the PIP or UM insuring agreements. Nevertheless, disputes regarding the effect of Section ...


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