Traditionally, New Jersey’s no-fault statute was interpreted to allow a plaintiff in a personal injury suit to recover unreimbursed medical expenses that exceeded his PIP coverage. This was not an issue when all policies carried a required $250,000 in PIP coverage. Over the years, however, the state legislature tweaked the PIP requirements, allowing insureds to purchase automobile liability policies with lower PIP limits to combat the rising cost of policy premiums. Today, insureds can designate their health insurer as their primary PIP carrier, or purchase auto policies with PIP coverage as low as $15,000. The courts, however, continued to view any medical expenses exceeding an insured’s PIP coverage recoverable, except where those expenses were paid by a private health insurer.
In March 2019, all that changed when the New Jersey Supreme Court, in Haines v. Taft, ruled that a plaintiff could recover only those medical expenses in excess of $250,000. Thus, under the Haines decision, a plaintiff carrying $15,000 in PIP coverage, would be barred from recovering any medical expenses that fell between $15,000 and the $250,000.
In response to the Supreme Court’s decision, the New Jersey state legislature passed a bill that was subsequently signed into law by Governor Murphy, effectively overturning Haines. The new law, however, allowed for the recovery of any medical expenses exceeding an insured’s PIP coverage, even if those medical bills had been paid by private insurance, thus, allowing for a double recovery. After signing the bill into law, Governor Murphy realized the possibility of a double recovery, and a second bill was quickly enacted and signed into law. The second bill includes the term “unreimbursed” medical expenses, eliminating recovery of any medical bills exceeding no-fault that were paid for by another insurer, except where the insurer has a statutory right to be reimbursed, such as with Medicare.
Thus, the law returns to its pre-Haines status, allowing a plaintiff to recover unreimbursed medical expenses to the extent they exceed the plaintiff’s chosen PIP coverage.