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As July deadline looms, advocates say auto industry executives refused to discuss no-fault reforms

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Posted at 11:41 PM, May 21, 2021
and last updated 2021-05-21 23:41:19-04

LANSING, Mich. — In a setback for advocates working to fix no-fault reforms, auto insurance industry executives canceled a meeting to discuss new legislation.

The two groups were set to discuss House Bill 4486 and Senate Bill 314 which would fix a 2019 auto insurance law. In the insurance law, legislators included a fee schedule that will take effect July 1, 2021, that takes funding away from specialized rehabilitation services.

The new fee schedule would only cover rehab services that have been assigned codes by the U.S Centers for Medicare and Medicaid Services. In hospitals, those fees are generally covered by Medicare which means the biggest impact is on specialized rehabilitation programs, which often do not take place in hospitals.

Now, with just over a month before the new fee schedule takes effect advocates voiced their disappointment over the canceled meeting.

“It’s extremely frustrating, but not surprising, that the insurance industry couldn’t be bothered to show,” said MBIPC President Tom Judd in a statement. He explained that survivors of catastrophic auto accidents live each day bravely, “Contrast this courage with auto insurance industry representatives, who apparently can’t face the prospect of a civil, focused discussion about the devastating impact this aspect of the law will have on their own consumers and families.”


The Insurance Alliance of Michigan noted in a statement that more than 25 car insurance companies are planning to begin a business in the state after no-fault reforms take effect.

“The more companies we have operating in the state the more competition there will be, which will ultimately lead to lower rates as companies look to attract new customers,” said Erin McDonough who serves as the executive director of IAM.

She argued that the reforms need to take effect.

“Reforms to Michigan’s auto no-fault system are working and we need to let them keep working. They are saving drivers hundreds and thousands of dollars each year. They are cracking down on rampant fraud and giving drivers a choice,” McDonough said in a statement to Fox 47 News. “They are also reining in overcharging and price gouging by greedy medical providers. In April, the Insurance Alliance of Michigan met with Sen. Jim Runestad and we will continue meeting with lawmakers to encourage them to let these bipartisan reforms keep working because they are saving drivers money on their auto insurance.”

Advocates for the two bills in the legislature argue that they would protect survivors of catastrophic auto injuries while not changing any other aspects of the 2019 auto insurance reforms.


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