Changes to no-fault auto insurance reforms stall out for legislative session
Wrecked cars displayed at the Meridian Township Fire Department | Susan J. Demas
Proposed changes to Michigan’s no-fault auto insurance reforms have likely hit a dead end for the remainder of the current legislative session after House Speaker Jason Wentworth (R-Farwell) said he did not see a path forward for the legislation.
“I’ve spent an entire year looking at every idea that was proposed and working with our committee on options,” Wentworth said in a statement. “They all either move us back toward the old status quo or put the savings and refund checks for Michigan drivers at risk. At this point, it’s time to move on.”
The Michigan Legislature voted to overhaul Michigan’s no-fault auto insurance laws in 2019, when the state was the only state with a no-fault auto insurance system with unlimited medical benefits and no price controls, with motorists paying some of the highest premiums in the country. Wentworth was a key architect of the legislation.
Critics of the reforms say that price controls on some medical services for catastrophically injured motorists are too strict and have led to rehabilitation services and in-home care services to either close or stop serving auto accident patients.
Under the law passed in 2019, medical providers were required to cut charges by 45% from 2019 levels if the service lacs a Medicare billing code.
Caregivers of former Red Wings defenseman Vladimir Konstantinov, who suffered severe brain injuries in a 1997 limousine crash, recently warned the Legislature that his home care agency could drop him as a client if changes aren’t made, forcing him to enter a nursing home instead.
Tom Judd, president of the Michigan Brain Injury Provider Council, said in a statement that Wentworth is “walking away from the scene of an accident with smoke smoldering and crash victims writhing in need of help.”
“Dozens of lawmakers, on both sides of the aisle, wanted a fair chance to protect these survivors and vote for a narrow and reasonable fix,” Judd said. “Sadly, the Speaker caved to the auto insurance industry lobby, who worked hard to prevent any public hearing on this matter, and declined to give legislators the opportunity to have their voices heard in an up-or-down vote.”
The Insurance Alliance of Michigan released a statement supporting Wentworth’s decision.
“Speaker Wentworth has listened to every side of the debate and sees clearly the 2019 bipartisan auto no-fault reforms are working,” IAM Executive Director Erin McDonough said. “The $400 per-vehicle refunds are helping more than 7 million drivers. The reforms are curbing fraud, reining in rampant overcharging by medical providers and giving Michigan drivers the choice to pick a level of coverage that best fits their budget.”
Gov. Gretchen Whitmer, who signed the bipartisan reforms into law during the 2019 Mackinac Policy Conference, touted the $400 per-vehicle refund checks that Michigan drivers will receive by May 9, totaling approximately $3 billion of surplus funds being returned to motorists.
“Our bipartisan auto insurance reforms have significantly lowered the cost of auto insurance for families. And starting this week, thanks to that reform, Michiganders are getting $400 refund checks per vehicle for every insured driver, putting money in people’s pockets,” Whitmer said. “We will continue working to save Michiganders money so they can pay their bills and put food on the table.”
Sen. Jim Runestad (R-White Lake) said in a speech last week that he has regrets about the reforms.
“I’m now experiencing some remorse about the bill due to our inability here to modify the flawed provisions,” Runestad said. “I believe many of us in this room will experience similar remorse that we sat on our hands while good people who paid for and were promised care may suffer.”
State Rep. Rachel Hood (D-Grand Rapids) said Wentworth’s statement broke a promise made to legislators by his caucus.
“The unwillingness to work on common-sense reform bills is unethical, and it fails our constitutional duties as representatives of the people of Michigan to protect public health,” Hood said. “As a result of the decision to block these bipartisan reforms, countless lives and rehabilitation services have and will be disrupted. Sadly, these negative outcomes could have been easily avoided. By taking this action, the Michigan House GOP has committed itself to ensuring suffering for vulnerable families all across the state.”
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