Auto No-Fault Bill Applies Benefit Restrictions to Existing Patients, Grounds for Lawsuit
LANSING – Contrary to the insurance industry’s claims, House Bill 4612 includes retroactive language that will apply significant benefit reductions and restrictions to patients previously injured in an automobile accident – a provision that is inherently unconstitutional.
“Supporters of this bill continue to mislead the public with vague and contradictory statements that it does not apply to existing patients, but HB 4612 clearly subjects previously injured individuals to every limitation included in the bill except for the $1 million cap,” said John Cornack, president of the Coalition Protecting Auto No-Fault (CPAN).
“Not only is this unethical – it’s illegal. And if the legislators that support this bill don’t understand it, they have no business backing it.”
The retroactive clause states:
“THIS SECTION DOES NOT PROHIBIT THE CONTINUED PROVISION OF REASONABLY NECESSARY PRODUCTS, SERVICES, AND ACCOMMODATIONS FOR LOSS OCCURRENCES UNDER POLICIES ISSUED OR RENEWED BEFORE JANUARY 1, 2014. HOWEVER, PAYMENT TO PROVIDERS FOR THOSE PRODUCTS, SERVICES, AND ACCOMMODATIONS ARE SUBJECT TO THE LIMITS IN THIS SECTION AND SECTION 3107C AND THE LIMITATIONS ON CHARGES IN SECTION 3157.” [§3107(5) – pg. 38]
This means those injured in an auto accident before January 1, 2014 will maintain uncapped lifetime coverage, but will be subject to the most restrictive benefit limitations in the bill including the controversial “medically appropriate and medically necessary” language [§3107(1)(a) – pg. 32] that redefines what benefits accident survivors are eligible for. Other reductions and limitations on benefits include:
Limited attendant care provided by families and agencies;
Denial of services that don’t result in “meaningful and lasting improvement in the injured person’s functional status;”
Reduced benefits for motorcycle claims;
Limited non-resident coverage;
Limited reimbursements to health care providers;
Limited rehabilitation benefits; and
Limited home modification benefits.
“Current auto accident survivors bought insurance policies that did not include any of these limitations, and the fact that this bill essentially rewrites those private contacts renders it unconstitutional,” said CPAN Legal Counsel George Sinas. “I will be advising CPAN to file suit.”
The Coalition Protecting Auto No-Fault: The Coalition Protecting Auto No-Fault is a broad-based coalition of consumer advocate groups, lawyers, doctors, hospitals and other health care providers working together to keep Michigan’s model no-fault insurance law intact.