Auto insurance reform deal speeds up as Whitmer meets with legislative leaders

Gov. Gretchen Whitmer met with all four legislative caucus leaders Tuesday morning to talk over a potential no-fault auto insurance reform deal, which some say could come as soon as this week.

A spokesperson for state Sen. Majority Leader Mike Shirkey (R-Clarklake) told reporters today that such a deal was “days, not weeks” away  — echoing an identical remark made by the senator last week. The Advance learned on Tuesday that the House could see another late-night vote on no-fault legislation as soon as Wednesday evening.

Shirkey spokesperson Amber McCann told the Advance today only that “meetings continue to be productive.”

The two insurance reform bills already passed by the House and Senate, House Bill 4397 and Senate Bill 1, respectively, have already earned the promise of a veto from Gov. Whitmer, who said earlier this month that she’s “not going to sign a bill that preserves a corrupt system where insurance companies are allowed to unfairly discriminate in setting rates.”

Whitmer and other critics of the GOP-passed legislation say that it goes too far in lowering the amount of personal injury protection (PIP) drivers are required to purchase, ignoring other means by which rates could be reduced. Democrats outlined some of those alternatives, which include banning non-driving factors from consideration in rate-setting, in their own plan introduced last week.

Michigan’s auto insurance law is unique in the country in requiring all drivers to purchase lifetime, unlimited medical coverage through their auto insurer.

Despite their disagreements, the governor seems to be warming to negotiation with GOP leadership, with spokesperson Tiffany Brown saying today that “discussions among all parties are ongoing and talks continue to progress” after a weekend spent talking it over behind closed doors.

State House Speaker Lee Chatfield (R-Levering) said through spokesperson Gideon D’Assandro that he’s “glad progress is being made on behalf of Michigan families who are currently paying the highest car insurance rates in the country.”

Significantly less enthused by a possible deal, however, are groups like the Coalition to Protect Auto No-fault (CPAN), which aim to preserve the status quo that mandates auto insurers provide unlimited lifetime medical coverage to those injured in automobile accidents.

CPAN general counsel George Sinas addressed reporters Monday, saying such a deal “takes away people’s rights in order to bring down insurance when that sacrifice is absolutely unnecessary.”

“It’s now time that they do their job of governance, that they use the tools in the toolbox which they inexcusably have refused to use, and make insurance affordable in Michigan, while keeping our medical coverages fully intact,” Sinas said, arguing that mechanisms already exist through which insurers can lower rates without decreasing the amount of medical coverage they provide.

Sinas said any deal that removed the unlimited lifetime insurance requirement would be unacceptable. But he praised Whitmer for her recent call to audit the Michigan Catastrophic Claims Association (MCCA), which collects fees from drivers to fund that coverage.

State Rep. Isaac Robinson (D-Detroit) was at the news conference to support CPAN’s efforts. He’s one of a group of Detroit House Democrats who oppose the Republican plan. Robinson said in a statement earlier this month that “the only guarantee this legislation delivers is more profits for the car insurance companies,” contradicting a handful of his city’s other Democratic legislators who crossed the aisle earlier this month in favor of the GOP bill.

The Michigan Campaign Finance Network (MCFN) released a report last week showing that interest groups on both sides of the issue have spent at least $4.5 million over the past five years lobbying Michigan’s politicians. Of that, around $2.7 was spent in favor of plans like the one currently proposed by Republicans, and $1.8 million by groups who are opposed.

Absent a deal, Quicken Loans billionaire Dan Gilbert intends to launch a ballot initiative with language similar to the proposed Republican plans. That added a layer of urgency to this week’s negotiations, as such an initiative could strip Whitmer and Democrats of much of their leverage.

If Gilbert successfully gathered the 340,047 signatures required, the measure would be put to a simple up-or-down vote in the Legislature. If the Legislature didn’t adopt it, the initiative would go to voters.

Two similar initiatives that would have limited personal injury requirements, Proposals D and C, were defeated in the early 1990s by large margins.

Crain’s Detroit reporter Chad Livengood reported Monday that the Michigan Department of Health and Human Services expects a much larger increase in Medicaid costs than previously predicted by the nonpartisan Senate Fiscal Agency, echoing concerns from groups that oppose the Republican plan that it could massively drive up health care costs.

“Millions and millions of dollars are going to be shifted over to Medicaid, and that means increased taxes for all of us,” said CPAN’s Sinas. “Make no mistake about it, that is going to happen.”