6.3 Part B Medical Payments

What Part B Covers

Part B — Medical Payments Coverage is first-party coverage: it pays the insured's own (and passengers') medical and funeral expenses. Three defining features:

• No-fault within the policy: Part B pays regardless of who caused the accident. Fault is irrelevant.
• Optional: unlike Part A liability, Med Pay is not state-mandated; it is purchased to fill gaps and provide quick payment before fault is sorted out.
• Reasonable and necessary expenses: it pays reasonable charges for necessary medical, surgical, X-ray, dental, ambulance, hospital, professional nursing, prosthetic, and funeral services.

Med Pay coordinates with health insurance and, importantly, can pay the deductibles and copays a health plan leaves behind, making it valuable even for insureds with strong health coverage.

Who Is a Covered Person

Part B uses a broader concept of 'covered person' than the described vehicle alone:

Trap to memorize. The named insured and family members are covered as pedestrians struck by an auto and while riding in any car. A friend or neighbor, however, is covered only while occupying your covered auto — not while walking or in their own vehicle. 'Occupying' means in, upon, getting in, on, out of, or off the vehicle.

Limit Structure and Time Limit

The Part B limit is a per-person amount, commonly $1,000, $2,000, $5,000, or $10,000. The key tested point: the limit applies separately to each injured person, and there is no per-accident cap — unlike split-limit liability.

Worked example. Limit is $5,000 per person. The insured's car carries the insured plus two passengers; all three are hurt with expenses of $4,000, $5,200, and $7,000.

Each person draws on a fresh $5,000; there is no shared accident limit. Note also the time limit: expenses must be incurred within a stated period (typically 3 years) of the accident to be payable. Treatment that begins five years later is not covered even if causally related.

Part B Exclusions

Med Pay does not apply to injuries:

• Sustained while the vehicle is used as a public or livery conveyance (for-hire/taxi) — share-the-expense carpools excepted.
• While occupying a vehicle with fewer than four wheels (motorcycles, mopeds).
• During the course of employment when workers compensation benefits are required or available (no double recovery).
• While occupying a vehicle furnished or available for regular use that is not 'your covered auto' — the company-car trap again.
• Arising from war, nuclear hazard, racing, or while the insured is occupying a residence/premises used as a residence (not an auto).
• To a person using a vehicle without a reasonable belief of being entitled to do so.

Coordination, Subrogation, and Why Med Pay Still Matters

Med Pay pays quickly and without regard to fault, which is its core value: an injured insured does not wait for a liability fight to be resolved before bills are paid. It works alongside other coverages rather than replacing them:

• With health insurance: Med Pay can cover deductibles, copays, and coinsurance the health plan leaves behind, plus services health plans often limit, such as funeral expenses.
• With Part A liability: when a passenger in the insured's car is hurt and the insured is at fault, the passenger may collect under both Part B (no-fault, fast) and Part A (liability, fault-based) — Med Pay frequently advances payment first.
• Subrogation: if Med Pay pays and the insured later recovers from an at-fault third party, the insurer may have a right of reimbursement/subrogation, depending on state law, to prevent the insured from being paid twice for the same expense.

Trap to remember. Med Pay is excess over workers compensation: if an on-the-job auto injury is covered by WC, Part B does not duplicate those benefits. And because Med Pay is per person with no accident cap, a single full carload of injured passengers can produce a Part B payout that far exceeds any one person's limit.

Pedestrian, Occupant, and Coordination Scenarios

Part B Medical Payments is no-fault first-party coverage that pays reasonable and necessary medical and funeral expenses regardless of who caused the accident, within the time limit (usually 3 years from the accident). Two classes of covered persons are tested: (1) the named insured and family members injured while occupying any auto or as pedestrians struck by a motor vehicle, and (2) any other person injured while occupying the insured's covered auto.

So a family member struck by a car while crossing the street is covered under Part B even though no insured vehicle was involved, but a non-family guest is covered only while in the covered auto. Med Pay coordinates with health insurance and with Part C and any state PIP, and the insurer that pays may seek subrogation or reimbursement from a liable third party. Because Med Pay pays quickly without proving fault, it remains valuable even for insureds who also have health coverage, plugging deductibles and covering passengers and pedestrians the health plan may not.