No-fault auto plan revised, revived in lame duck

Lansing — Republican leaders are taking another run at significantly changing Michigan’s no-fault auto insurance system, reviving a long-stalled push to curb insurance costs by limiting some health care coverage for future crashes.

Draft legislation reviewed by The Detroit News would cap an insurer’s responsibility to pay for family attendant care of an injured relative at 56 hours per week and implement a $400,000 benefit cap for uninsured drivers, pedestrians, bicyclists or other individuals hurt in an auto crash and covered through the state’s “unassigned claims” plan.

Republican leaders have long touted potential no-fault reforms as a way to address high auto insurance rates in Michigan, but scaling back guaranteed protections for catastrophically injured crash survivors has proven politically challenging and critics have questioned cost savings assumptions.

Senate Majority Leader Arlan Meekhof, R-West Olive, is pushing for action this week and “would champion getting some progress on auto no-fault, even if it’s not the entire reform he was hoping for,” said spokeswoman Amber McCann. “His goal is to try to rein in the rising cost that is becoming burdensome for consumers who see increased insurance bills year after year.”

The proposal appeared to gain momentum Tuesday with newfound support from the Michigan Health and Hospital Association. But the larger Coalition Protecting Auto No-Fault was quick to criticize the developing plan, calling it neither balanced nor responsible.

“By capping benefits for those covered by the Assigned Claims Plan, lawmakers would be hurting the most vulnerable auto accident survivors in this state — children and seniors. I just can’t see how anyone would think that is a good idea,” spokesman Josh Hovey said in a statement.

The new no-fault plan is less aggressive than Gov. Rick Snyder’s 2013 proposal to cap personal injury protection at $1 million for all motorists, and it would not limit reimbursement rates for health care providers, as previously proposed. It also differs significantly from legislation approved last year in the GOP-led Senate.

The revised legislation calls for the creation of a “Michigan Automobile Insurance Fraud and Theft Prevention Authority” to identify and combat insurance fraud. Authority activities would be funded by insurance companies and would be exempt from disclosure under the state’s Freedom of Information Act.

Meekhof helped craft the developing deal, but updating earlier bills would first require action in the state House.

Outgoing House Speaker Kevin Cotter, R-Mount Pleasant, and Speaker-elect Tom Leonard, R-Dewitt, have both worked on potential no-fault reforms this session, said Republican spokesman Gideon D’Assandro, who declined to say whether revised legislation could see a quick vote in the last three days of the two-year legislative session.

“Any bill before the House could come up this week,” D’Assandro said.

House Democrats have fought similar proposals and remain steadfastly opposed to no-fault changes, spokeswoman Katie Carey said Tuesday.

Oakland County Republicans could prove key to any deal. Republican County Executive L. Brooks Patterson has vocally opposed past no-fault proposals, but a spokesman said Tuesday evening that Patterson was not available to discuss the revised plan.

“I’m reluctantly supportive, but I may be the only one,” said Rep. Bradford Jacobsen, R-Oxford Township. “If we could see a few tweaks, I think we’ll have some support from Oakland County.”

Patterson has not yet contacted any Oakland County legislators about the revised proposal, said Jacobsen, adding that some colleagues remain concerned with the proposed caps on attendant care and unassigned claims.

For any crashes after June 2017, an insurer would only be required to pay for 56 hours a week of attendant care provided by trained family members of a catastrophically injured auto accident survivor. Critics say those individuals can require 24-hour-a-day care.

“These individuals would much rather be cared for by a trained family member who knows them best and cares about them the most,” Hovey said. “Instead, this bill would force commercial care providers onto accident survivors and their families.”

Jacobsen, who gave the revised proposal a 35 percent to 40 percent chance of passage this week, said he is sympathetic to arguments against changes to assigned claims coverage and attendant care.

“We have to do something to bring down the cost of insurance in the state, and hopefully this will do it,” he said. “There’s no guarantees, but it’s a step in the right direction.”

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