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MAC Statement Regarding the Auto No-Fault "Reform" Package

MAC, CPAN Oppose Duggan-Leonard Auto No-Fault “Reform” Package

Caps on Injury Coverage Would Leave Patients Without Care While Forcing Them Into Poverty, Cost State Taxpayers Hundreds of Millions in New Medicaid Expenses 

Yesterday, Detroit Mayor Mike Duggan, Speaker of the House Tom Leonard (R-DeWitt), and House Insurance Committee Chair Rep. Lana Theis (R-Brighton) announced a proposal to slash injury care for Michigan auto accident victims. The proposal calls for allowing motorists to purchase insurance policies that cap care at either $250,000 or $500,000, or continue purchasing lifetime injury coverage. 

The Coalition Protecting Auto No-Fault (CPAN) opposes the proposal. The MAC is a founding and Executive Committee member of CPAN. 

In response to the proposal, CPAN President John Cornack issued the following statement: 

“All stakeholders in the no-fault debate are working on creating a better auto insurance system, but what was proposed today cuts costs on the backs of some of Michigan’s most vulnerable people. People who are paralyzed, people with brain injuries and children whose parents who purchase these bare-minimum policies will all suffer under this proposal because they won’t get the care they need. And to make matters worse, the costs of caring for these accident victims will ultimately result in a cost increase for Michigan taxpayers.” 

Capping coverage will ultimately shift costs away from auto insurance companies and onto the backs of Michigan taxpayers in increased costs to Medicaid. Rather than capping coverage, CPAN favors the approach taken by a bipartisan group of 15 Michigan House of Representatives members last week. Their legislation, known as Fair and Affordable No-Fault Reform, would:

  • rein in medical costs related to auto injuries by setting reasonable fee schedules that are 185 percent of Workers Compensation and set attendant care limits that accommodate the nature of a person’s injury
  • Stop non-driving related factors such as credit score, gender and job title from unfairly impacting auto insurance rates
  • Bring transparency to the Michigan Catastrophic Claims Association by making its rate-making data available to the public
  • Aggressively tackle fraud and claims handling abuse by creating a state fraud authority

CPAN is urging lawmakers to support the comprehensive Fair and Affordable legislation, which maintains lifetime injury coverage for accident survivors while still making significant cost reductions to Michigan’s auto insurance system. 

“We think the Fair and Affordable No-Fault reform package is a better, more responsible solution that makes real and lasting reforms without increasing costs to Michigan taxpayers and without taking away coverage for catastrophic accident victims,” said Cornack.

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