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Michigan doctors, hospitals call proposed PIP Choice a dangerous dismantling of Michigan No-Fault and too costly for taxpayers

September 13, 2011 by Steven M. Gursten

Michigan State Medical Society pulls no punches in its opposition to Senate Bills 0293 and 0294

The Michigan State Medical Society (MSMS) definitely does not like the idea of dismantling Michigan’s No-Fault auto insurance system — and has now joined the growing chorus of opposition to No-Fault “reform,” such as PIP “choice.”

This is starting to get interesting. Hopefully Michigan residents won’t get completely steamrolled by the auto insurance lobbyists in this giant giveaway to the state’s insurance companies after all.

I know you are reading an auto accident lawyer’s blog. But as I’ve been saying all along, it’s not just No-Fault lawyers and lawyers who are opposing these insurance company sponsored “reforms.” Other voices of opposition to the drastic reductions in No-Fault benefits contemplated by Senate Bills 0293 and 0294 include the the Brain Injury Association of Michigan and the Coalition Protecting Auto No-Fault (CPAN). CPAN is a group of more than 20 medical and consumer organizations devoted to protecting Michigan’s No-Fault system, and the rights of auto accident victims and their medical providers under our No-Fault law.

Now the Michigan State Medical Society, the largest and most powerful organization of Michigan doctors and hospitals, has also blasted these bills pending in the Michigan Senate for being “dangerous” and shifting enormous costs to Michigan taxpayers.

Here is the MSMS’s overall assessment of the Michigan Legislature’s attempt to dismantle our Michigan No-Fault insurance system:

MSMS opposes Senate Bills 293 and 294, sponsored by Sen. Joe Hune (R-Hamburg Twp.), which aim to rewrite Michigan’s automobile insurance laws, effectively repealing our state’s model no-fault insurance system and replacing it with a dangerous system that relies instead on expensive lawsuits, higher health insurance premiums for families, and a cost shift from insurance companies onto the state’s cash-strapped Medicaid system.”

In response to the unsubstantiated claims by Michigan’s auto insurance industry lobbyists that the dismantling of Michigan No-Fault (as proposed in SB 0293 and 0294) will “save Michigan drivers money,” the MSMS said:

There is absolutely no guarantee in this legislation that insurance companies will significantly reduce automobile insurance premiums as a result of this reform. There is absolutely no guarantee that if they do lower the premiums that they will keep them reduced for any significant period of time. While the loss of job and life-saving insurance benefits resulting from this legislation will be permanent, any rate relief that may occur will likely be minimal and temporary.”

Finally, the Michigan State Medical Society drives home the point that, if SB 0293 and 0294 pass, taxpayers will be saddled with the enormously costly burden of paying for the No-Fault benefits (such as medical expenses) that the profit-making Michigan auto insurance companies have deftly weaseled their way out of having to pay:

“Eliminating Michigan’s no-fault insurance laws … will drive up costs on taxpayers with a massive shift from no-fault insurance to Medicaid.

Accident victims’ injuries resulting in medical expenses higher than the limits they have selected would be forced to turn to their health care insurance, Medicaid, causing the financial burden on Michigan taxpayers to skyrocket.

Health insurance premiums paid by job makers and Michigan families would increase while Michigan’s balanced budget will be threatened by staggering hikes in Medicaid reimbursements.

In fact, Colorado recently made the switch from no fault insurance to a lawsuit driven system and the shift to taxpayers was enormous. The state saw a staggering 205% increase in Medicaid costs associated solely with care related to motor vehicle accidents.

Michigan’s “Catastrophic Claims Fund” could not cover the need if the state moves away from No-Fault.”

The objections raised by the MSMS are not new. They have been raised repeatedly since Michigan lawmakers first fell under the spell of the Michigan auto insurance industry’s lobbyists and agreed to sponsor the bills that promise to build ever larger insurance industry profits on the backs of Michigan drivers and taxpayers.

But this is the first time that the MSMS has spoken out on this very important issue.

I hope we follow the doctors’ orders: Preserve Michigan’s Auto No-Fault system for the health and safety of everyone.

Steven Gursten is recognized as one of the nation’s top No-Fault lawyers handling serious auto accident cases and insurance litigation. He writes about the importance of Michigan’s No-Fault law, and is available for comment.

Related information to protect yourself:

Michigan’s insurance industry gets $1 billion raise as drivers face losing No-Fault protections

3 potential cases after a Michigan auto accident

Michigan No-Fault insurance benefits

Michigan Auto Law is the largest law firm exclusively handling car accident, truck accident and motorcycle accident cases throughout the entire state. We have offices in Farmington Hills, Detroit, Ann Arbor, Grand Rapids and Sterling Heights to better serve you. Call (248) 353-7575 for a free consultation with one of our Michigan No-Fault lawyers.

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One Reply to “Michigan doctors, hospitals call proposed PIP Choice a dangerous dismantling of Michigan No-Fault and too costly for taxpayers”

  1. I smell a rat as soon as they advertise to vote yes and talking about choice. But how do we let those whom we know that the ad is misleading? The passage of this bill would be another gift to insurance companies with another mandate. The GOP is against the federal mandate but they want to impose it at the state level. Auto insurance is supposed to be there to cover for all aspects of an auto accident. This type of accident can affect our lives greatly and to have it with a different insurance company is not advantageous to the consumer.
    I never agreed with the mandated auto insurance because it seem to protect the financial institutions instead of the consumer. The financial institution is getting double the benefit. The interest on the loan is supposed to cover the cost of the financial institution’s insurance. Each account is insured.

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