Insurance companies will reap permanent savings of 55% to 64%, while consumers will – at most – save 10% for two years
Who will be cashing in on the proposed medical-provider “fee schedules” contained in the various Republican plans for so-called No Fault insurance “reform”?
Surprise (or maybe not), it will be Michigan’s auto insurance companies, not consumers.
The proposed No Fault insurance “fee schedules” will limit what doctors and hospitals, and other medical providers can charge for treating injured auto accident victims.
As a result, auto insurance companies will permanently slash their No Fault costs on medical services by 55% to 64% percent. This will boost their already high profits (some of the highest in the entire nation) indefinitely.
But unlike insurance company profit margins, what consumers pay for No Fault insurance under No Fault “reform” comes with a very quick expiration date.
With a 10% percent savings for only two years (or $150 savings for one year), consumers will continue to struggle to make ends meet. But what they’re giving up in exchange for this savings of $150 is staggering.
This raises, again, the same questions that consumer advocates, No Fault attorneys, and medical groups have been asked many times with respect to the current – and previous – Republican plans for changing Michigan’s No Fault system:
If the Republicans’ plans for so-called No Fault “reform” are so wonderful for Michigan consumers, then why are Michigan auto insurance companies always the only ones cashing in?
Savings from No Fault fee schedule
Under the plan for so-called No Fault “reform” proposed by House Speaker Jase Bolger (R-63rd District) and House Republicans, consumers would save 10% on their auto insurance premiums for two years.
However, under the same plan, auto insurance companies would reap permanent overall (average) savings of 55% on the price of No Fault medical benefits.
Specifically, under the Bolger/House GOP plan for so-called No Fault “reform,” auto insurance companies will be able to boost profits as a result of the following cost-savings on the following medical services:
- X-Ray: 50% savings
- ER visit: 52% savings
- CT scan: 59% savings
- MRI: 61% savings
Savings from HB 4612/SB 818 fee schedules
Under the plan for so-called No Fault “reform” proposed by Rep. Pete Lund (R-36th District) in House Bill 4612, consumers would save $150 per vehicle on their auto insurance for one year.
Notably, consumers are guaranteed zero savings under Senate Bill 818, which is the proposed so-called No Fault “reform” plan from Sen. John Pappageorge (R-13th District).
However, under the plans in both HB 4612 and SB 818, auto insurance companies would reap permanent overall (average) savings of 64% on the price of No Fault medical benefits.
Specifically, under Rep. Lund’s and Sen. Pappageorge’s bills, auto insurance companies will be able to boost profits as a result of the following cost-savings on the following medical services:
- X-Ray: 60% savings
- ER visit: 62% savings
- CT scan: 67% savings
- MRI: 68% savings
Source: Michigan House Republicans’ Auto Insurance Reform Plan