Shirkey: GOP ‘more optimistic than in weeks’ for auto no-fault deal

By: - May 16, 2019 6:00 pm

As negotiations continue between Republican leaders and Gov. Gretchen Whitmer, GOP leaders are finding hope that major changes to the state’s auto no-fault insurance system may become law.

Michigan’s current auto insurance law, the only of its kind in the nation, requires drivers pay for unlimited lifetime medical coverage included in their insurance plans. Republicans and business groups have long argued that this ratchets up costs, and both the state House and Senate have made it a priority to change that in this session.

Senate Majority Leader Mike Shirkey | Senate GOP photo

But Democrats, as well as trial lawyer and health and hospital groups, say allowing drivers to opt out of that medical coverage would only shift costs to Medicaid, leaving drivers in catastrophic accidents without enough coverage to pay for lifelong medical treatment.

Whitmer said Thursday that she opposes any plan that would allow drivers to opt out of that medical coverage called Personal Injury Protection (PIP).

Despite her renewed public opposition, state Senate Majority Leader Mike Shirkey (R-Clarklake) and House Speaker Lee Chatfield (R-Levering) say the governor has given them a reason to expect consensus.

“The governor has finally, with her team, presented some things to us that actually move in a direction … that we can get to a bill signing in the not-too-distant future,” Shirkey told reporters at a joint press conference with Chatfield on Thursday.

Lee Chatfield
Lee Chatfield | Wikimedia Commons

“From Day One, our goal was to do exactly that. And I’m more optimistic today than I have been in the last two weeks that we can accomplish that.”

Shirkey also told reporters that Whitmer’s team has signaled a willingness to negotiate on different PIP options. Without going into detail, Shirkey said he’s seeing “movement toward PIP choice” and reining in medical costs. 

Whitmer spokeswoman Tiffany Brown declined to offer any more details.

“We are pleased that the lines of communication are open among all parties and that talks are progressing,” Brown said. “Discussions are ongoing on how to move forward on auto insurance reform that protects Michigan motorists and provides relief.”

Chatfield and Shirkey say negotiations will continue over the weekend. Republicans have been eager to take action before the Mackinac Policy Conference begins after Memorial Day.

Michigan Capitol | Susan J. Demas

Both the House and Senate adjourned Thursday without taking action on the GOP no-fault plan. The earliest possible date the Senate could take on any no-fault legislation would be Tuesday, but Shirkey said they’re willing to take as long as is necessary.

“Fine wine takes time, my friend. And this is a very fine wine for the people of Michigan,” Shirkey said.

On Wednesday, a House panel opted to swap into the previously Senate-approved SB 1 language from a House bill that offers tiered medical coverage at mandated lower rates. That sets up the House plan for approval in the Senate.

Next week, the House could adopt SB 1, which now contains language the body has already approved. But regardless of which bill moves ahead, the Senate will, at this point, have the final say on anything that reaches Whitmer’s desk.

Whitmer draws a line

Chatfield and Shirkey say they’re not willing to tie a no-fault plan to a potential deal on Whitmer’s 45-cent fuel tax hike that would boost road funding, calling no-fault a “standalone” issue.

The governor has, meanwhile, drawn a hard line of her own.

Whitmer at Spectrum Health
Gov. Gretchen Whitmer at Spectrum Health, May 15, 2019 | Gov. Whitmer photo

After vowing last week to veto both the House and Senate no-fault plans as written, Whitmer visited the Hope Network Neuro Rehabilitation Campus in East Lansing on Thursday morning to “highlight the life-changing work done by medical personnel that could be put in jeopardy by auto insurance legislation that limits important protections for Michigan drivers,” according to her office.

As the Advance reported, Whitmer on Wednesday also toured Spectrum Health in Grand Rapids.

The governor told reporters Thursday that she’s unwilling to support a plan that would allow companies to sell plans with zero PIP coverage — an hard stance that Shirkey called “frustrating.”

The governor did say, however, that she’s open to allowing drivers to select an option of $250,000 or more in personal injury protection.

“Zero coverage is not a real option,” she said, as reported by Crain’s Detroit Business.

“I think everyone needs to buy into the system at a certain level. There is, I think, a lot of talk about different levels and that’s fine, but a complete zero coverage option just shifts the burden onto the taxpayers in a different form, which is Medicaid, and when we do that it undermines all of our Level 1 trauma centers, Level 2 trauma centers and places like this that are doing the critical work of helping people become independent again and get their lives back.”

Dems announce own plan

House Democrats have, meanwhile, unveiled a plan of their own that they said would force insurance companies to slash rates by 40 percent.

House Democrats introduce no-fault legislation
House Minority Leader Christine Greig and members of the Democratic caucus announce their auto insurance plan, May 16, 2019 | House Democrats photo

Democrats said it would bar them from basing rates on non-driving factors such as ZIP code, education level and credit scores, end insurance fraud and “maintain full Personal Injury Protection” coverage for all residents.

Their 76-page substitute for SB 1 was available online late Thursday afternoon.

“This plan doesn’t reduce health care. It protects health care,” said House Minority Leader Christine Greig (D-Farmington Hills).

John Cornack, president of the Coalition Protecting Auto No-Fault (CPAN), praised the plan in a statement.

He said it “offers a viable compromise that will reduce auto insurance premiums without depriving victims of essential care” and would “end discrimination based on non-driving rating factors, hold insurance companies accountable through strong consumer protections, and offers true, guaranteed relief on the cost of insurance.”

House Speaker Lee Chatfield (left) and Rep. Jason Wentworth (right) | Nick Manes

Republicans aren’t taking it seriously, however.

“From what I do know about it, it’s not a real plan. What we passed last week in this House chamber is a real plan,” Chatfield told reporters Thursday.

“You can’t simply put a wizard hat on and wave your wand around the state of Michigan and sprinkle fairy dust and expect that car insurance rates are going to drop.”

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Michael Gerstein
Michael Gerstein

Michael Gerstein is a former Advance reporter covering the Governor's office, criminal justice and the environment.