Maintain Full Medical Coverage for Auto Accident VictimsThe main feature of the Michigan no-fault plan promised to us by the insurance industry in 1972 was the guarantee of unlimited lifetime medical coverage in exchange for reasonable limitations on the right of victims to sue drunk and careless drivers. The hallmark of our auto no-fault system, full medical coverage, must be maintained without limitations.
“Say No” to Managed CarePatients should maintain the right to select their own medical care providers, including physicians and medical case managers, and where the care would be provided. Trauma can result in lifetime disability, such as a brain injury or spinal cord injury. Patients should have the right to choose providers who are local or regional, and who provide individualized service that meet their needs and expectations. Patients want the right to change their providers as their conditions change and should have the right to choose where they will live based on quality of life decisions, rather than by limited managed care options.
Limit the Application of Fee Schedules and Payment FormulasThe Michigan no-fault statute has always stated that medical service providers who treat auto accident victims should be entitled to reimbursement for all reasonable charges as long as the services where “reasonably necessary.” An insurance company should not be permitted to pay the provider based on a fee schedule, third party contract rates, medical audit payment formulas or other payment indexes. We do support an individualized case management approach to assure that care is needed and that providers follow fair and acceptable accounting practices.
Patient’s Tort Damages Should Not Be Taken Away to Pay Medical Expenses - Reverse the “Dunn Decision”Under Michigan’s no-fault statute, medical expenses are covered by no-fault PIP benefits and are most often coordinated with the patient’s health care insurance. Therefore, what the health insurer does not pay, the coordinated no-fault insurer must pay. However, in a recent Michigan Court of Appeals decision (Dunn v DAIIE) the Court held that a patient who had a coordinated no-fault policy and an ERISA health plan with enforceable subrogation language, could be forced to repay the ERISA health plan out of the patient’s non-economic tort damages without the right to reimbursement from the coordinated no-fault insurer. Thus, the patient was required to pay his own medical expenses even though he had health insurance and no-fault insurance. This is in direct conflict with the essence of our no-fault system under which auto accident victims are entitled to have their medical expenses paid by no-fault insurance plus receive compensation for noneconomic loss and excess work loss in cases of serious injury. Given the fact that no-fault wage loss benefits last only for 36 months, tort damages are very important for the future financial security of seriously injured accident victims. The Dunn decision does great damage to those victims.
Fair Attendant Care ReimbursementPatients and families should have the choice on who will provide temporary or life long attendant care, in cases of severe injury (link to definition). If a family member, friend, or neighbor can be trained to provide the care, they should be entitled to reimbursement that is fair, without limitations placed by caps, formulas, or wage scales.
“Shed Light” on the MCCA FundThe Michigan Catastrophic Claims Association’s board is composed of only insurance industry representatives and meetings are not subject to the “open meetings act.” We propose that this be changed and that the board includes patient and provider representation.
Adopt Meaningful Sanctions When Insurers Do Not Pay BillsThe no-fault statute requires that insurance companies pay medical expenses and other no-fault benefits within 30 days after receiving reasonable proof of the claim. Oftentimes, insurers do not honor this obligation and improperly deny claims. Sometimes, the denial forces the patient or provider to incur substantial expenses to litigate the claim. If litigation results in a judgment against the insurer, the patient or provider who prevails on the claim should also be entitled to recover actual legal costs from the insurer as part of the recoverable no-fault benefits. In addition, if the insurance company is found guilty of “bad faith” in the processing of a no-fault claim, the insurance company should also be responsible for any general damages suffered by the patient or provider as a result of the bad faith denial of the claim. Deny, delay, defend; this is the model of the industry.
Maintain a Threshold Injury Standard That is Fair and BalancedUnder the Michigan no-fault law, only injured persons who have suffered, “Serious impairment of body function, permanent serious disfigurement or death,” can make a tort claim for noneconomic loss damages. The legislature defined “serious impairment of body function” in a 1995 amendment, which has recently been interpreted by the appellate courts in such a way as to disqualify many innocent accident victims who suffer significant bodily injuries. Some of these victims have suffered traumatic brain injuries, but were denied compensation because their injuries did not affect their normal life in a manner that was “serious enough.” As a result of these court decisions, the important balance between guaranteeing payment of medical and wage loss benefits for all victims while insuring the right to recover noneconomic damages for those victims who suffered serious injury as a result of the negligence of careless drivers has been lost. This important balance must be restored.
Adjust RBI Liability LimitsThe RBI liability limits are especially important because they compensate the innocent accident victim for loss of income incurred after the third anniversary date of the accident or during the first three years following the accident in excess of no-fault wage loss benefits. Therefore, the RBI liability limit is crucial to protecting the future financial security of accident victims who suffer a loss of income that is not compensable by no-fault PIP benefits. The mandatory minimum residual bodily injury insurance limits have not changed since limits were established in 1967. This should be adjusted to a realistic present day amount, based on cost of living increases since 1967.
Underinsured/Uninsured Motorist CoveragePersons required to purchase no-fault automobile insurance coverage should have the right to purchase underinsured and uninsured motorist coverage from any insurer authorized to write no-fault insurance in Michigan. Moreover, any insurance policy containing underinsured and/or uninsured motorist benefits should conform to certain uniform standards regarding the substance and conditions of such coverage.