On Thursday, May 30, Governor Gretchen Whitmer signed into law Senate Bill 1, legislation that radically alters Michigan’s model auto no-fault statute by allowing motorists to purchase different levels of Personal Injury Protection (PIP) coverage (and in some cases do away with PIP coverage altogether). The bill passed the Michigan House by a 94-14 vote and the Michigan Senate by a 34-4 vote on May 24.
How Will the New Auto No-Fault Law Affect Chiropractors and Chiropractic Patients?
Along with providing Michigan drivers a choice in their PIP coverage, proponents of the new law contend that it will ban nondriving factors (credit scores, marital status, zip codes, etc.) in setting insurance rates. It will also phase in a fee schedule on medical providers.
Our partners at the Coalition Protecting Auto No-Fault (CPAN), however, called the bill a “sell-out of Michigan citizens” and a “total gift to the insurance industry.” In a statement after the bill passed the legislature, CPAN President John Cornack said: “As a result of this legislation, thousands of Michigan families will have no choice but to put their family at risk with the low levels of insurance coverages that this legislation now authorizes. Those low-level coverages will be woefully inadequate to provide the necessary medical care that catastrophically injured people, especially children, require in order to have a meaningful quality of life.”
What’s in the New Law?
PIP Choice: Under the bill, Medicare-eligible seniors and those with personal health insurance that covers auto accident injuries would be able to completely opt out of PIP coverage, reducing that portion of their insurance bill by 100 percent. The other PIP coverage levels (and their mandatory reduction for a period of eight years) outlined in the bill include:
Fee Schedule: The fee schedule will begin July 1, 2021, and start at 200 percent of Medicare rates for most chiropractors. This would be followed by reductions to 195 percent of Medicare in 2022 and 190 percent of Medicare in 2023. This would apply not just to future claims, but retroactively to existing claims moving forward.
Important Note: The MAC office has received some calls from members confused about this new fee schedule and its effect on patient care. It must be noted that the fee schedule merely uses Medicare fees to establish the new auto no-fault fee schedule. It does NOT adopt Medicare payment policies (such as only paying for the chiropractic adjustment).
It should also be noted that if you have a patient who is on Medicare who opts out of PIP coverage in favor of his/her Medicare coverage, and is subsequently injured in an auto accident, that patient would be treated as any regular Medicare patient bound by all Medicare payment and other policies. The same is true of a patient who opts out for other eligible health care coverage, such as Blue Cross.
Non-Driving Factors: Proponents of the legislation claim that such factors as gender, marital status, credit scores, homeownership, education level, and occupation will all be banned rating factors under the bill. They also claim that the use of zip codes is also banned, but insurers can still use “territory” as a rating factor, which opponents see as an end run around the prohibition on using zip codes.
The MAC Legal Affairs team and our partners at CPAN continue to examine the exact language in the new law and explore all our options. CPAN is working on a detailed summary. Once it is complete, we will post it on our website, www.chiromi.com. The MAC, as a founding and Executive Committee member of CPAN, will be working diligently on a number of strategies that will include legal, legislative, administrative, media, and grass roots advocacy.
In the meantime, the MAC believes it is important that we contact the members of the Michigan Legislature who voted no on Senate Bill 1. They need a huge thank you for standing tall against the pressure and fighting to protect an open legislative process and, more importantly, to protect consumers and those critically injured in auto accidents. These courageous lawmakers include:
We ask that you please take the time to send all of them personal thank-you letters, as these policy makers will be critical in the weeks and months ahead.
Stay tuned for more information as it becomes available.