Under proposed Michigan No-Fault “reform” law, payments to doctors and hospitals treating auto accident victims would be capped
This is my fourth blog about the dangerous effects that the proposed HB 4936 will have on the Michigan No-Fault law, and in turn how this is going to hurt all Michigan drivers and the several thousand residents who are seriously injured every year in auto accidents.
Today I want to talk about fee schedules, and how this bill will hurt doctors and hospitals who provide medical care and treatment to auto accident victims, as HB 4936 will likely serve as the framework for future No-Fault “reform” legislation in this state.
According to HB 4936:
o All physicians, hospitals, clinics, and other persons lawfully rendering treatment to a person injured in an auto accident will be paid an amount that does not exceed the current Michigan workers’ compensation fee schedules for medical care.
o There is no exception to this, and thus workers’ compensation fee schedules will apply to all medical care and treatment for auto accident injury victims, regardless of the severity of the personal injuries themselves or the extent of an accident victim’s medical care needs. [?3157(2)]
o The Insurance Commissioner has the authority to make changes to these fee schedules, presumably increasing or decreasing them, and can do so without legislative approval. [?3157(2)]
How doctor fee schedules are really about auto insurance industry profits
Comment: Interestingly, fee schedules is really the meat of this fight. It affects two very powerful special interest groups – the insurance companies and the doctors. Both have strong voices in Lansing. And with fee schedules, these two powerful lobbying groups are now for the first time in direct opposition to one another. Fee schedules in No-fault are at the heart of what the auto insurance companies want, and what the medical community is adamantly against.
I don’t personally believe the current legislature gives a damn about how this legislation affects Michigan residents. They certainly don’t care about how it affects insurance attorneys and trial lawyers.
As with most issues in politics, this is a fight over dollars, not what is best for the common good. The medical associations and hospitals say this will cost thousands of good medical care jobs and lower the quality of care. Some hospitals may lose trauma care certification.
The auto insurance companies see this as a way to further increase profits by $91 to $109 million dollars a year. (see page 21 of the Anderson study)
Ultimately, all this proves that HB 4936, just like SB 293 and SB 294, is intended as a political boondoggle for the state’s auto insurance companies. Although the insurance company lobbyists say this is all about reducing the cost of auto insurance in Michigan, it really is about increasing profits for insurance companies.
Notably, none of the pending bills deal with the biggest cost drivers of auto insurance today – collision and comprehensive coverage. In fact, neither collision nor comprehensive is even mentioned in any of the pending No-Fault legislation, even though the costs of collision and comprehensive are far greater for drivers than whether a doctor charges $20 more for an office visit from an auto accident than he does in workers comp.
But medical provider fee schedules are calculated to boost insurance company profits significantly, and the issue of the “public good” – providing quality medical care to seriously injured auto accident victims – is being ignored.
The other reason we know this is all about increasing profits for insurance companies is because there are no safeguards or protections to prevent auto insurance companies from just continuing to hike up premiums even after they get their way. I wrote a blog about this – and about how there is not one protection or safeguard to hold the insurance companies accountable once they get their way. We’ve been lied to far too many times to just trust that they will do it now.
If the insurance companies really wanted to lower the cost of auto insurance, there are far easier and simpler ways that do not involve taking away valuable insurance protections for the rest of us.
– Steven Gursten is recognized as one of the nation’s top insurance attorneys handling serious auto accident cases. He frequently writes about Michigan No-Fault law and is available for comment.
– Photo courtesy of Creative Commons, by metalmarious
Related information to protect yourself:
Your Michigan No-Fault benefits
Free book: Guide to Michigan No-Fault Law
FAQs – How does the No-Fault Law apply to my car accident?
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 insurance attorneys.