If you were injured in a work-related car accident in Michigan, you can file a lawsuit for pain and suffering compensation against the at-fault driver (assuming he or she is not a co-worker or your employer).
The Worker’s Comp law’s “exclusive remedy” provision does not prohibit an injured worker from suing a third-party – such as an at-fault driver – for tort liability. (MCL 418.131(1); 418.827(1) and (5))
But, your employer or his or her Worker’s Compensation insurance company may be able to seek monetary reimbursement for what it has paid you in benefits by putting a lien on your recovery for pain and suffering compensation – under certain circumstances. (MCL 418.827(5))
The Michigan Supreme Court in Great American Insurance v. Queen has said that a reimbursement lien is authorized only if the Worker’s Comp benefits are more than a “substitute” for the benefits you would have received under Michigan’s auto No-Fault insurance. The Worker’s Comp benefits must “exceed no-fault benefits in amount or duration” and, if they do, then the lien is limited to reimbursement for the excess amount.
In terms of suing for wage loss benefits after a work-related car accident in Michigan, there has always been the potential for a reimbursement lien because Worker’s Comp wage loss continues “for the duration of the disability” (MCL 418.301(7) and (8)), whereas No-Fault wage loss only continues “during the first 3 years after the date of the accident.” A lien could be used to seek reimbursement for Worker’s Comp wage loss paid after the three-year No-Fault limit had been exhausted.
However, as a result of the new No-Fault law that was enacted in June 2019, there may now be the potential for reimbursement lien based on medical benefits. Prior to 2019, No-Fault was similar to Worker’s Comp because both required “unlimited” medical benefits to the extent they were reasonable and necessary. (MCL 500.3107(1)(a) and 418.315(1))
But now with the new No-Fault PIP medical benefits coverage levels, there is a new potential for Worker’s Comp medical benefits to exceed No-Fault medical in both amount and duration, thus creating the possibility for a reimbursement lien based on medical benefits. Under the new No-Fault PIP medical benefit coverage levels, drivers can choose to retain “unlimited” coverage or they can choose to cap their coverage at $50,000 (for drivers enrolled in Medicaid), $250,000, $500,000, or opt-out completely if they have Medicare. (MCL 500.3107c(1) and 500.3107d(1) and (7)(b) and (c))
In other words, suppose a person has No-Fault medical coverage with a $250,000 limit in his or her auto insurance policy and the person is injured in a work-related car accident. If the person successfully sues the at-fault driver after the car accident in Michigan, then his or her employer’s Worker’s Comp insurance company can file a lien against the pain and suffering recovery to seek reimbursement for Worker’s Comp medical benefits paid in excess of $250,000.
