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No Fault medical-provider fee schedules: Do we need them? What are the options?

February 26, 2016 by Steven M. Gursten

Medical fee schedules will preserve No Fault benefits, lower medical costs in auto accident cases, lower insurance prices, get doctors paid and combat fraud

nofault provider fee schedule, image

There’s  a lot of talk about “reforming” Michigan’s auto No Fault insurance system. Many of these ideas are simply give-aways to the already excessively profitable auto insurance industry.

But there is one idea that would do what nearly everyone wants:

Michigan’s No Fault auto insurance system needs a truly fair No Fault medical-provider fee schedule.

By “everyone,” I mean the people who are hurt in automobile accidents and require necessary medical care for their injuries, the people who pay too-high premiums for auto insurance, the doctors and hospitals and medical care providers who treat auto accident victims,  the auto insurance companies, and the lawmakers who have been grappling with Michigan’s No Fault system for the last several years.

Yes, I do have a stake in this.  I practice as a No Fault and auto accident attorney. I’ve seen first-hand the great things that No Fault can do for my clients. I’ve seen the good that No Fault does to protect people. But I’ve also seen the bad.

I believe backing reasonable medical-provider fee schedules will preserve the good and eliminate much of the bad.  Specifically, I believe medical fee schedules in No Fault automobile accident cases will accomplish the following:

  • Preserve and protect the No Fault medical care that automobile accident victims need.
  • Lower auto insurance prices for all Michigan consumers.
  • Reduce No Fault medical-claim costs for reasonable and necessary treatment.
  • Get the doctors and medical providers who treat auto accident victims paid faster and easier, without expensive provider lawsuits (and in most cases without provider attorneys).
  • Remove a lot of the ugliness and PIP fraud, ambulance chasing and personal injury lawyer solicitation that  is becoming more rampant in Michigan from a still small, but growing number of injury lawyers and law firms.

As for what a “truly fair No Fault medical-provider fee schedule” would look like, my hunch is that lawmakers would look to guidance with the medical fee schedules proposed by CPAN last year.

A run-down on proposed No Fault medical fee schedules over the last several years

We’ve seen quite a number of proposed No Fault medical fee schedules in the last several years.  Here’s a quick run-down of both currently pending and previously proposed options that lawmakers have proposed for No Fault medical-provider fee schedules:

  • A medical provider cannot charge more than 125% of the Workers Compensation fee-schedule rates.
  • A medical provider cannot charge more than the Workers Compensation fee-schedule rates.
  • A medical provider cannot charge more than 150% of the Medicare/Medicaid rate.
  • Hospitals cannot charge more than 80% of the hospital’s chargemaster rate.
  • A medical provider cannot charge more than what it is “customarily … paid” for rendering the same medical treatment to non-auto-accident victims.

Last year, I wrote about an experience that finally brought me to start believing that truly reasonable fee schedules are in nearly everyone’s interest.

Based on my own experiences — and that of my auto attorneys — I believe that the time has come.

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