Michigan lawmakers introduce no-fault tweak
New bills in the Michigan Senate aim to address complaints about the state’s 2019 auto no-fault insurance law.
Those changes capped what medical care providers could bill insurance for at 55% of previous rates. It also limited the number of billable hours for at-home care.
The 2019 law has been blamed for severely injured crash survivors losing care and some dying, as well as for care providers going out of business.
Senator Mary Cavanagh (D-Redford) co-sponsored the legislation. She said the new bills would offset some of those unintended consequences.
“We are seeing after 2019 that there are some providers or availability for people that can’t get that afforded care afterwards. After they leave the hospital when they need either that wraparound care services or even in that in-facility,” Cavanagh said.
The bill package comes over two years after the first adjusted fee schedules under the 2019 law took effect.
Since then, crash survivor advocates have religiously gathered at the state Capitol urging lawmakers to act. Republican leadership last legislative session resisted bringing any bills to the floor for a vote, despite a bipartisan coalition.
The 2019 auto no-fault law had been billed as one of the first major bipartisan wins of Governor Gretchen Whitmer’s administration. That’s despite ample evidence its promise of lower insurance costs had not come to fruition.
Cavanagh said despite the concerns, now is the right time to bring forward her legislation.
“Because I do believe acting too soon after the 2019 reform, it wasn’t going to show us the intended consequences as far the affordability but also the unintended consequences,” Cavanagh said.
The senator also noted a desire to await the results of a court challenge to the 2019 law to find out whether its changes would apply retroactively to those injured before the policy was enacted.
The state Supreme Court ruled this summer that it did not.
Advocates welcomed the news. But they say it’s time to help those not covered by the decision, or who may not have been hurt yet.
Maureen Howell is the mother of a catastrophic car crash survivor and an advocate with the group We Can’t Wait.
She said outlining the new rates in the bills helps simplify the process of making sure everyone gets taken care of.
“Having a set fee means there’s no lawsuit necessary. This is what you get paid. And there’s no argument about it. The doctor decides how much care the person needs. And the agencies can do what they need to do and get paid their fee. Families get paid their fee, which is much less than what (an) agency is but it’s fair. And we carry on,” Howell said.
On the insurer’s side of the discussion, its industry group is defending the 2019 law.
In a statement, Insurance Alliance of Michigan executive director Erin McDonough said her organization is carefully reviewing the new bills.
“Auto no-fault reforms have saved Michigan consumers more than $5 billion by cracking down on fraud, reining in rampant overcharging by medical providers and providing consumers more choices. We urge policymakers to carefully review policy proposals with an eye toward how it impacts auto insurance costs and how it impacts Michigan families,” McDonough said.
It’s unclear how soon the legislation could move. But Cavanagh said she hopes it’s by the end of the year.
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