Since 1973, Michigan has been a no-fault state; it is the only state in the nation that covers unlimited lifetime medical benefits for those seriously injured in an auto accident. What does this mean to you, the Michigan resident? It means that if you are seriously injured in an auto accident and need medical treatment, your insurance company must, by law, pay 100% of your medical bills for life. Most states have very limited medical benefits available and the bulk of the medical expense must be paid by the at fault party’s insurance company up to that person’s policy limits. As such, if you were injured in an auto accident and rendered a paraplegic because of the other driver’s negligence, and the at fault party has a $50,000 liability insurance policy, you would receive an award up to the at fault party’s policy limit ($50,000). If you were at fault in the accident, you would receive nothing. In the Michigan no-fault system, you can collect the $50,000 limit from the at-fault party ($0, if you were at fault) plus unlimited medical expenses (hospital bills, medical tests, physical therapy, prescriptions, wheelchairs, home modifications, etc.), for life, regardless of fault.
Naturally, over the years, the insurance industry has lobbied for restrictions to the benefits due our citizens under this law. They usually promise reduced premiums in exchange, but that is never mandated by any proposed change. The insurance companies simply “suggest” that reductions in premiums are possible. In fact, Michigan citizens have voted twice to maintain the country’s best coverage for auto accident victims when previous attempts to limit this coverage were proposed. Once again, there has been a proposal, by a Republican, of course, that a change to Michigan’s Auto No-fault insurance system is necessary. When the Michigan House returns from break on November 9, Republican Representative Jason Sheppard plans to introduce House Bill 5951, which if passed would give auto insurance customers four levels of medical benefits to choose from. One option would still be unlimited lifetime medical benefits; others would purportedly save motorists as much as 30 percent or more in auto insurance premiums. The question is — at what cost? And, as always, can we count on the insurance industry to mandate reduced premiums over the long haul? Of course not.
Research (and common sense) suggests that, if offered a choice, most consumers would purchase the lowest priced option required, especially those on a fixed budget. The result? Thousands of Michiganders would be under-insured because they are focused on the price of insurance and not on the benefits offered for the price charged. Citizens do not fully understand what No Fault is, how No Fault benefits (also known as PIP or Personal Injury Protection benefits) take care of them if they are seriously injured in a motor vehicle accident, with unlimited, necessary lifetime medical coverage if they need it.
Consider this scenario: You purchase the most inexpensive plan because you are on a fixed budget and looking to save money (how many readers does that apply to?). Sheppard would like to replicate the Ohio insurance scheme, because, he says, his district is close to the Ohio border, and the number one complaint he hears is about auto insurance being more expensive in his community than it is a mile south. So, you switch your coverage to the lower priced Ohio-type coverage. As fate would have it, you are involved in a serious crash. You are placed on a ventilator; you undergo numerous surgeries and spend months in physical therapy and rehabilitation. Your child suffered brain damage and your spouse has been rendered a quadriplegic. But, the plan you purchased only provides $5,000 of medical coverage. Suddenly, the issue of how you pay the bills becomes a reality. You go bankrupt and become dependent upon taxpayer assistance, most likely, under the Medicaid program. Your treatment options are then limited to those facilities that accept Medicaid reimbursement instead of being able to be treat anywhere you wish.
I know what you are thinking – it will never happen to you. Well, I am sure Republican Oakland County Executive, L. Brooks Patterson thought the same thing. Mr. Patterson was critically injured in an auto accident in August 2012. He suffered multiple broken bones and was in a coma for 17 days. Today, he often uses a wheelchair as a result of his injuries. His driver was left paralyzed from the accident. Prior to this unfortunate accident, he was like most Republicans, an advocate for a lower-priced system to benefit the insurance companies who contribute to Republican causes. Today, he openly criticizes proposed changes advanced by his fellow Republicans because he now realizes that drastic changes to Michigan’s No-Fault system would not only financially devastate critically injured auto accident victims, but would shift the burden to the taxpayers in the form of Medicaid. It is sad that a Republican politician had to become an injured or disabled citizen to champion the rights of injured or disabled citizens.
While HB5951 might sound good in theory, it does nothing to guarantee any type of meaningful savings on auto insurance for consumers. This bill is sought by insurance companies to reduce the amount of benefits that they will be required to pay a seriously injured person, its sole aim is to increase industry profits. Don’t believe me? Take a look at Sheppard’s donor list; it is predominately corporate, laced with companies that would benefit from a shift of benefits from private insurers to taxpayer funded programs.
Republicans have been attempting to reform this law, for the benefit of insurance carriers, for a long time, despite the fact that the 43 year old law has served Michigan citizens well, is working just fine, except for the fact that insurance companies often wrongfully terminate benefits and force citizens to fight for what they pay for. If the system needs any reform at all, that reform should tackle the issue of premature or totally inappropriate termination of benefits. Reform should benefit Michigan citizens and not the insurance companies. Over time, this kind of reform being contemplated could shift billions of dollars in medical costs from the insurance companies who currently profit from the premiums we pay to the taxpayers who receive no benefit from a limited insurance system except the illusory “promise” of lower auto insurance premiums. The result would be a massive shift to Medicaid.
I have often written that each of us is one “never event” from being a seriously injured accident victim. And, if victimized, a person will, almost instantly change an “anti-justice” view into a “pro-justice” view (i.e. L. Brooks Patterson). Don’t let the Sheppards of the world fool you; comparing Michigan to Ohio is worse than comparing apples to oranges; it is comparing apples to totally rotten apples. These proposed changes to the Michigan no-fault system are a bad deal for Michigan citizens. It is shameless and it must be defeated. Don’t wait until you or a loved one is in a tragic accident, faced with a denied claim and depleted savings. Insurance premiums (apples) are a far better option than a life-long host of medical bills that you can’t afford to pay (rotten apples).
Lawsuit Financial encourages everyone to read the bill in order to fully understand the potential consequences. Help protect Michigan citizens by contacting your State Representative and urge him or her to VOTE NO on this bill if it ever sees the light of day, comes to committee or is put to a vote. Tell Michigan legislators that we have the best automobile insurance system on the planet and to leave Michigan’s no-fault auto law in place, as is. Do a cost-benefit analysis. Don’t cede our state, our country, and our precious civil rights to corporate interests; exercise your constitutional rights of voice to protest and to and vote.
Mark Bello is the CEO and General Counsel of Lawsuit Financial Corporation, a pro-justice lawsuit funding company.
Attorney, certified civil mediator, and award-winning author of the Zachary Blake Betrayal Series. Mark Bello is also a member of the State Bar of Michigan, a sustaining member of the Michigan Association for Justice, and a member of the American Association for Justice.