Over the last two weeks, the Michigan legislature has rushed to approve no fault reform bills based on the insurance industry’s desire for even more profit. Michigan is already one of the most profitable states for auto insurance companies, and the long term affects of these bills could close treatment facilities and leave our most severely injured motorists without the care they need.
The Michigan House of Representatives is currently considering a bill that would reshape how Michigan treats the victims of car accidents, and cost thousands of jobs in the health care industry. The bill has already passed the senate and is now just one step away from the Governor’s desk.
Under the current law, insurers only pay “reasonable” charges. If hospitals or doctors charge more than the market, then the insurers reduce their reimbursement down to market prices. The insurance companies utilize auditing services that track market prices for every health care service.
Senate Bill 248 sharply reduces what medical providers can charge for their services. Doctors and hospitals will be limited to 150% of what Medicare reimburses, which means they will lose money on every auto accident patient. This will be a sad day for Michigan citizens.
Michigan is the home of some of the best treatment facilities in the nation for brain injury victims. It attracts injured NFL players and veterans from all across the country. In other states, when the insurance money runs out and patients can no longer afford treatment, they are transferred to state-funded Medicaid nursing homes that focus on maintenance rather than recovery. They warehouse their wounded with taxpayer money, while Michigan rehabilitates their wounded with money from our very solvent insurance system. Because Michigan facilities are assured the reasonable cost of their services under the No Fault Insurance act, the doctors and therapists at these extended care facilities can provide top-notch treatment to our most seriously injured citizens and help them reach their best possible outcomes.
But they won’t be able to do that if the no fault reform bills pass. No medical provider can afford to keep their doors open on the rates outlined in the bill. It takes three and four times the Medicare payment to break even for hospitals and doctors. Most providers will simply refuse to see patients relying on their no fault auto insurance for their medical care. Those untreated patients will have to turn to federally subsidized Medicaid HMOs, which could increase taxpayer-funded medical costs.
Amazingly, this money-grab by the insurers is being done with no assurance at all of a meaningful rate reduction. It trades in a priceless lifetime medical benefit worth millions of dollars when you need it, for a paltry $100 reduction for two years. Your representative is considering voting for this, so please CALL YOUR REPRESENTATIVE NOW and ask them to vote no on SB 248 and 259.
David Christensen is an auto accident attorney at Christensen Law in Southfield, Michigan. They represent injured motorists against the insurance companies and help them get the benefits they deserve. If you or someone you know have been seriously injured in a car crash, contact Christensen Law today for a free consultation.