I. The Benefits

Minn. Stat. § 65B.44, subd.1 states:

Basic economic loss benefits shall provide reimbursement for all loss suffered through injury arising out of the maintenance or use of a motor vehicle . . . consisting of:

$20,000 for medical expense loss arising out of injury to any one person; and

(b) a total of $20,000 for income loss, replacement services loss, funeral expense loss, survivor's economic loss, and survivor's replacement services loss arising out of the injury to any one person.

The Act requires that there be an actual expenditure for medical and most other benefits.2

No-fault benefits do not fall under the Municipal Tort Liability Caps.3 Thus, each injured person is entitled to full no-fault benefits, separate and apart from liability damages paid under the municipal cap.

A. Medical Expenses

The Act details medical expense benefits:

Medical expense benefits shall reimburse all reasonable expenses of necessary medical, surgical, x-ray, optical, dental, chiropractic, and rehabilitative services . . . and all other reasonable transportation expenses incurred in traveling to receive covered medical benefits, hospital, extended care, and nursing services . . . .4

1. Reasonable charges for necessary treatment

a) ‘Managed Care’ banned from no-fault.

There is no formal managed care system in Minnesota No-Fault. Attempts to legislate managed care have failed repeatedly. For a time, insurers attempted to bypass the Act by organizing or hiring various managed care entities to review their bills. In the fall of 2000, Blue Cross/Blue Shield of Minnesota began administering managed care services in certain Illinois Farmers no-fault auto claims. A fairly developed no-fault managed care system appeared to have sprung up overnight.

In 2002, the legislature amended 65b.44, adding:

(b) Notwithstanding any other law to the contrary, a person entitled to basic economic loss benefits under this chapter is entitled to the full medical expense benefits set forth in subdivision 2, and may not receive medical expense benefits that are in any way less than those provided for in subdivision 2, or that involve any preestablished limitations on the benefits. Medical expenses must be reasonable and must be for necessary medical care as provided in subdivision 2. This paragraph shall not be deemed to alter the obligations of an insured or the rights of a reparation obligor as set forth in section 65B.56.

(c) No reparation obligor or health plan company as defined in section 62Q.01, subdivision 4, may enter into or renew any contract that provides, or has the effect of providing, managed care services to no-fault claimants. For the purposes of this section, "managed 4 Minn. Stat. § 65B.44, subd. 2 (2006).

Care services" is defined as any program of medical services that uses health care providers managed, owned, employed by, or under contract with a health plan company.

Any use of preexisting limitations, such as U&C databases, etc., or other attempts at managed care are now banned by the act.

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