Michigan’s no-fault insurance reform cut money for rehabilitation services; defenders say they will fight again


LANSING, Michigan – For months, advocates and survivors of catastrophic car accidents fought no-fault auto insurance reform that cut money for some specialized rehabilitation services.

The new law went into effect on July 1, but advocates say the fight is far from over.

No-fault insurance reform aimed to reduce auto insurance costs statewide, but the agreement also cuts funds for rehabilitation services, medical procedures and specialized programs for survivors. serious car accidents.

A new fee schedule that was part of the reform package only covers rehabilitation services that have been assigned codes by the US Centers for Medicare and Medicaid Services. In hospitals, these costs are usually covered by Medicare, which means that the biggest impact is on specialized rehabilitation programs, which often do not take place in hospitals.

Rehabilitation programs for survivors of accidents not covered by Medicare will see a 45 percent reduction in reimbursement from insurance companies under the new fee schedule.

Tom Judd, President of Michigan Brain Injury Provider Council

“The result is going to be patients across the state who are going to have their care interrupted and they are going to be displaced because providers will not be able to maintain their payroll,” said Tom Judd, president of Michigan Brain. Council of Injury Providers. “The programs will start to stop. “

Erin McDonough, executive director of the Insurance Alliance of Michigan, argues the new fee structure is necessary and helps prevent medical providers from overcharging insurance.

WSYM, 2021

“The reasonable scale of medical fees that will take effect on July 2 will reduce overcharging by medical providers, which has gone unchecked for decades and has contributed to the highest auto insurance premiums in the country,” said McDonough in a written statement. “Every long-term care case is different and takes time to resolve. We encourage families who hear from their medical providers that care may end or change – and have not yet contacted their case manager or auto insurance company – to do so as soon as possible. “

Lawyers argue that the new fee schedule is unreasonable.

“We have provided the legislature with ample evidence that the adjusters have said they will not negotiate rates with medical providers,” Judd said. “As long as they take that stance… there’s nothing really to say. They will deny any attempt to negotiate trade deals with suppliers. Families and providers are going to be caught in the middle.

In response to calls from advocates, lawmakers in Lansing proposed legislation this week to create a $ 25 million fund for rehabilitation services that will see significant disruption.

Fund support will be provided on a first come, first served basis, and providers will be required to provide fee information for their services.

State Senator Curtis Hertel Jr.

“The funding is for providers to help them provide care to these families, it is certainly not enough and it is also certainly far too complicated how to get it,” said Senator Curtis Hertel Jr., D -East Lansing.

Hertel explained that he and his Senate colleagues have called for funding to be increased from $ 10 million to $ 25 million so that providers have help over the summer until the legislature resumes in autumn. He said his own legislation, which included a correction to the pricing structure for suppliers so that they could stay in business, had not been successful enough.

He said his own legislation, which included a correction to the pricing structure for suppliers so that they could stay in business, had not been successful enough.

“I think it’s really unfortunate that we’ve missed the deadline and this bill hasn’t even had a hearing at this point and it really shows the power of insurance companies and their lobbyists to. Lansing, ”Hertel said.

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