Michigan’s No-Fault automobile provides some of the best quality protections to people injured in car crashes and allows victims to be compensated quickly for medical, rehabilitative, and wage loss expenses. But for the third time in four years, the Michigan House of Representatives is considering a bill to drastically change the law to the consumers’ detriment. There are a lot of things wrong with the proposed bill. Some of the most serious problems are:
Caps on Benefits
The bill limits lifetime benefits on medical and rehabilitative coverage to $10 million dollars, even if more care is medically necessary. The caps are much lower on motorcycle accidents, uninsured victims, and non-residents. Anything above those limits will be paid by the victim, or the taxpayers.
Restrictions on Care & Benefits
The bill also imposes strict cutoffs on medical benefits. It eliminates maintenance care if it doesn’t improve function, excludes treatment for aggravation of pre-existing conditions, and only covers care at the “most appropriate location” regardless of inconvenience to patient, caregiver, or provider. The bill also restricts rehabilitation services, home modifications, and in-home attendant care. These limitations apply to anyone receiving benefits, even if they were injured years ago.
Restrictions on Payments
Doctors and hospitals take a hit under the new bill too. Rather than being paid what they ordinarily charge, providers must accept 125% of the workers’ compensation fee structure, if the insurance company pays within 30 days.
Giving Insurance Companies the Final Word
The bill puts victims’ medical decisions in the hands of insurance companies. Medical providers have to provide records for “utilization review” by the insurer regarding how frequently or how long a treatment should be provided. The companies can unilaterally refuse to pay for treatments they believe are not reasonably necessary. Any objection to non-payment is then reviewed by the insurance department.
Reduced Premium, Benefit Options
The new bill creates “managed care” and “low cost” policy options. But the policies don’t have the quality controls and consumer protections available in standard policies. Drivers chooses a low cost policy loses access to PIP coverage on other vehicles, and is subject to much lower caps on medical and noneconomic benefits. The bill also requires a 10% reduction of all premiums for 24 months, but does nothing to stop the premiums from rising again after 2 years.
On top of all the limits to benefits and payments, the bill also limits consumers’ access to the courts. It takes no-fault suits away from juries, restricts the admissibility of the insurer’s process or policy decisions, and significantly restricts the victim’s access to attorney fees in attendant care disputes.
There’s much more to say about HB 4126. Look for future posts explaining each of these problems in more detail. If you want to protect your access to top-quality automobile insurance, call your representative today and tell him or her that No-Fault reform is no good for Michigan drivers.