I don’t know if you’ve read the overview of the proposed No-Fault reform legislation, I did and I was shocked. I was most shocked by:
- The limitations of attendant care and the $200 per month copay the injured person will have to pay.
- The attempt to eliminate the victims legal rights by not allowing a jury trial and by the blatant attempt to prevent victims access to attorneys.
- Allowing insurers the possibility of reimbursing for products and services at the rate of Medicaid. Auto insurers have resources that far surpass Medicaid’s resources, so what happens to the money auto insurers save on paying for services?
- The $150 premium reduction for drivers that is guaranteed for a whole year then can be raised without limit?? Is there anything consumers will gain from this reform?
Here is a brief overview of the proposed No-Fault legislation and what is on the table. For a more in depth explanation of the reform bill that was introduced on April 23, 2013, click here to see the summary written by George Sinas of Sinas Dramis Law Firm.
- Elimination of lifetime care– Currently lifetime medical and rehabilitation coverage is available, the proposed legislation replaces this with a lifetime cap of $1 million. Intensive care services in a hospital can easily reach $350,000 in one day.
- Restricted Benefit Eligibility of products, services or accommodations– Currently eligibility for benefits is defined as ‘all reasonable charges incurred for reasonably necessary products, services and accommodations for an injured person’s care, recovery or rehabilitation.’ The reform legislation further restricts eligibility as follows:
* No coverage for experimental treatment or participation in
research projects.
* Requires benefit to be proven to have lasting positive results.
* No reimbursement for products or services an able-bodied person
would also require. This one is already making vehicle and home
modifications difficult based on the Admire vs Auto Owners
decision.
* No reimbursement for products, services, or accommodations for
the convenience of the individual, care giver or care provider. This
will make it difficult to get a patient lift for someone the care giver
has difficulty transferring.
* Products and services must be provided in the most appropriate
location where the service may, for practical purposes , be safely
and effectively provided.”
- Rehabilitation Benefits Limited limitations are basically for 1 year
unless ‘rehabilitation is reasonably likely to produce significant rehabilitation.’ I would assume it would be up to the insurance company or their representative to decide the definition of ‘significant rehabilitation.’ - Attendant Care benefits to be severely limited.
* In-home attendant care given by family members limited to 56
hours per week (i.e. 8 hours per day) and capped at $15.00 per
hour regardless of level of care provided or whether the family
care provided is licensed or works for a licensed agency.
* In-home attendant care provided by non-family or household
members is limited to 16 hours per day, regardless of the patient’s
needs or the number of people required to render the care. If the
attendant care is needed 24 hours per day, it is only compensable if
family or other household members render care 8 hours per day and
an outside care provider renders care the other 16 hours per day. If
more than 1 care provider is needed at the same time, payment is
available for only 1 care provider. After 30 days of attendant care,
there is a patient copay of $200.00 per month!!
- Home modifications significantly limited with a maximum lifetime benefit of $50,000.00.
- Special transportation vehicles-Modifications to vehicles must be ‘directly necessitated by and related to the injured person’s injuries.’ In addition this transportation benefit is capped at $50,000 one every seven (7) years.
- Medical fee schedules- Creates a medical fee schedule system in 2 ways:
* Limits what providers may charge for services. Language of bill
maybe subject to be interpreted as to limit the provider to the
lowest amount received for services which could possibly mean
reimbursed at Medicaid reimbursement levels. I don’t know how
much you know about Medicaid reimbursement levels but they have
become so low that companies and providers serving Medicaid
clients have actually gone out of business.
- Motorcycle claims- Motorcyclists are only entitled to $250,000 of PIP coverage regardless of how or why the accident happened. That’s less than one day in intensive care.
- Assigned claims- Patients receiving benefits through an Assigned Claims Facility (ACF) are limited to $250,000 of coverage.
- Non-residents-The claim of a non-resident is limited to $50,000, which apparently includes wage loss and replacement services and seems to apply regardless of where the accident happened or if the non-resident was a passenger in a Michigan insured vehicle.
- Payment denials (we’ve all been seeing more of these lately.) Patients or provideres who have had payment of benefits denied can question the insurer’s denial by discussing the issue with a reviewer who ‘an insurer shall designate.’ (I would imagine the insurer is also allowed to pay the designee for the review as well.)
- Attorney fee penalties- Attorney fee penalties against insurers are severely limited. This bill further states ‘evidence of the manner in which an insurer processed the claim for benefits is not admissible at trial of an action to recover benefits under this chapter.’ Whose best interest does this serve?
- Loss of jury trial right- This Bill provides that all questions dealing with ‘whether a charge is reasonable or whether a product, service, or accommodation is medically appropriate and medically necessary is a question of law to be decided by the court’ not a jury. This doesn’t seem constitutional.
- Illusory premium reductions- This Bill requires insurers by the end of 2013, to reduce rates by $150 from what they were charging on January 1, 2013. However insurers can increase rates one year later without limitation.
- Closing of the MCCA- The Bill closes the current MCCA and authorizes opening a new Catastrophic Claims Association that would reimburse insurers for losses between $530,000 and $1,000,000. In doing so, it allows the current MCCA to keep issuing annual premium assessments (we’ll still be paying into the fund) even though it will never have another new patient. When the last patient serviced by the current MCCA dies, all of the money that is then in the MCCA will be transmitted to the new Catastrophic Claims Association, rather than the Michigan rate payers.
- Retroactivity- The Bill provides that virtually all of the reductions in benefits and charges contained in the Bill are retroactive to any claim that occurred prior to the passage of the new Bill.