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Could Obamacare Change the Way Michigan’s No-Fault Insurance Works?

Last year, the news was full of stories about how the Affordable Care Act (also called Obamacare) was going to change health care. Experts for and against the law were certain that the health care industry was in for a big shake up. Now that the law is fully in effect, another possible change is on the horizon – this time to Michigan’s No-Fault Insurance law.

Under Michigan’s No-Fault statute, a person’s automobile insurance provider is generally responsible for the costs of medical and rehabilitative treatment resulting from an accident. But when a person has medical insurance too, the No-Fault provider offer a coordinated or excess coverage policy. This less expensive auto insurance option coordinates with the person’s medical insurance, making the health care the first stop for medical providers seeking payment. Anything not covered by the person’s health insurance carries over to the No-Fault provider.

This coordinated coverage is not an option for benefits “provided or required to be provided under the laws of any state or the federal government.” In those cases, like Social Security or Worker’s Compensation benefits, the No-Fault provider sets off the expenses covered by the benefit. The insurance provider has no obligation to pay anything toward the covered expenses.

But does the “individual mandate” within the Affordable Care Act (ACA) – requiring almost everyone to obtain health insurance or pay a penalty – turn private health insurance into a benefit “required to be provided” by the federal government? At least one legal expert believes it does. Nelson P. Miller, No-Fault professor and associate dean of Thomas M. Cooley Law School in Grand Rapids, recently published a Michigan Bar Journal article warning of big changes in No-Fault law as a result of the individual mandate.

Under Professor Miller’s interpretation, the ACA will shift nearly all health care from the coordinated model to the set off model. This will allow No-Fault providers to avoid paying for most medical expenses resulting from car crashes and place more of the burden on the health insurance providers and hospitals.

There others that believe another scenario will take place. They note that Medicare does not get set off in a No-Fault provider’s calculations because the statute does not provide for benefits otherwise available through No-Fault insurance. The courts may draw an analogy between the two laws and exclude ACA medical insurance as well. Or the courts could rule that the consumer’s role in selecting the level of coverage and paying the premiums excludes the coverage from the category of “provided or required to be provided” by law.

With the state of the law in flux, it is more important than ever that accident victims receive cutting edge advice regarding their automobile accident claims. Christensen Law has a team of experts ready to help. If you know someone who suffered from a serious auto accident, have them contact Christensen Law to speak to an experienced no-fault attorney.