May State Farm recover more than $500,000 paid to Plambeck’s
clinics over four years even though all of the patients received the chiropractic services
they requested? We conclude that it may not.
State Farm Automobile Insurance Company got it wrong says the US Sixth Circuit Court of Appeals Rules
The US 6th Circuit Court of Appeals ruled that Michael Plambeck, owner of two chiropractic clinics in Kentucky that treated patients injured in car accidents deserves to keep the money paid by State Farm for the treatment his clinics’ employees provided.
All of Plambeck’s treating chiropractors were licensed to practice in Kentucky. Over the years, thousands of injured people sought treatment from Plambeck’s clinics for injuries arising from car accidents. Some of those patients carried car insurance through State Farm, while many were injured by State Farm policyholders’ negligence.
Because Kentucky law requires it, State Farm’s car insurance policies provide no-fault coverage for injuries resulting from car accidents. Covered individuals may therefore obtain chiropractic treatment under these plans. Even better for the patients, Kentucky law requires State Farm to pay for chiropractic services directly if an insured instructs them to do so. Many patients
did just that, and that is how State Farm came to pay Plambeck’s clinics hundreds of thousands of dollars in medical bills even though State Farm and the clinics had no contractual relationship with each other.
None of the State Farm patients complained about the services they received from these clinics. State Farm’s policyholders received the chiropractic treatment they asked for, and they directed State Farm to make payments to Michael Plambeck’s clinics for these treatments.
State Farm earlier dropped its other unsupported claims of billing for unreasonable and unnecessary care.
In light of that patient directive, the Court found that Kentucky law required State Farm to pay for the services Plambeck’s chiropractic clinics provided.