LANSING, Mich. (Michigan News Source) – Patient advocacy groups say that the changes to Michigan’s no-fault auto insurance law that were made in 2019 and the response from the insurance companies has created a crisis that is destroying the lives and futures of Michiganders.

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When the bi-partisan no-fault auto insurance legislation passed the Michigan legislature in May of 2019 with Public Acts 21 and 22, significant changes were made to the state’s No-Fault Act which included fee schedules limiting reimbursement amounts given to rehabilitation centers and in-home caregivers.

According to CPAN, the Coalition Protecting Auto No-Fault, a consumer advocate for auto insurance policyholders, they say that the unparalleled health care for accident victims that the state once had is now gone and “most motorists will be woefully underinsured through PIP (personal injury protection insurance) choices and won’t be able to afford needed rehabilitation or therapy.” They also say that the new fee schedule requires care providers and rehabilitation centers to “slash the rates they charge insurance companies by nearly half.” Prior to the law going in place, there was coverage of 24 hour care for patients who were catastrophically injured in a car accident.

According to Maureen Howell, the mother of an auto accident survivor and Capitol advocate with We Can’t Wait (WCW), an advocate group of more than 8,500 people created for catastrophically injured auto crash survivors, families, providers and friends, the rate decreases have caused more than 100 home care companies, home-care agencies and rehabilitation centers in Michigan to either close their doors or refuse to accept patients using auto no-fault insurance. She also said that WCW knows of at least eight people who have died because of not being able to receive proper care because of the new insurance changes.

With the legislation that was passed in 2019, the legislators drastically slashed the amount of money that rehabilitation centers and in-home caregivers (mostly family members) are able to receive. Reimbursement for in-home attendant care was cut by 45% and so was the money paid for long-term stays in specialized rehab hospitals. The result is that insurance companies are only required to pay caregivers for a 56 hour week even when the job is 24/7 although they have the ability to contract with the family for additional hours.

Many families who are caring for their loved ones in their homes have given up jobs and careers to be able to stay at home. Any care beyond the 56 hours will be paid for by the insurance company and has to come from an agency or third party – someone not living in the same house, who isn’t a friend or relative, or a business associate. It has to be someone who the family doesn’t already know and have a relationship with. A stranger. And between staff shortages, agency shut downs and limited reimbursement from insurers, it’s almost impossible to find that extra care. The Michigan Homecare and Hospice Association says that home care providers all across Michigan have been forced to discharge crash survivors and not accept new patients due to the 45% cut.

Many patient advocates that Michigan News Source has talked to have said that the legislators did not understand what they were voting on and the consequences that the new laws would bring to injured patients and their families as well as people who get injured from auto crashes in the future.

In a blog written by auto accident attorney, Steven M. Gursten, he said that, in addition to no-fault reimbursement rates being pulled out of thin air, the legislators passed the changes to auto no-fault auto insurance as quickly as possible before the public (and some of the legislators) had much of a chance to have a say in the matter. Gursten says in the blog, “Without holding any public hearings or waiting for legislative analyses from the House and/or Senate Fiscal agencies, the full House passed Rep. Hauck’s new bill and sent it to the Senate – the same day. In approximately 30 minutes time, late in the afternoon on Friday, May 24th, the Senate passed Rep. Hauck’s bill – despite the fact that the senators had never previously seen the 112-page bill and the fact that Rep. Hauck’s plan for reducing no-fault auto insurance reimbursement rates was vastly different from the one the Senate had approved two weeks earlier. Six days later, on March 30, 2019, in a highly publicized, media-heavy ceremony at the Mackinac Policy Conference on Mackinac Island, Gov. Whitmer signed Rep. Hauck’s bill into law.”

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Even with the changes that were made to the no-fault auto insurance law, The Daily Mail reports that Michigan still remains one of the costliest states to insure a vehicle. The stated goal of the new no-fault auto insurance legislation, according to the legislators and Governor Whitmer, as well as the insurance companies, was to lower everyone’s insurance premiums. Michiganders even got a $400 rebate in 2022 because the Michigan Catastrophic Claims Association (MCCA) fund had a “surplus.” Michigan law allows drivers to choose various levels of PIP. In addition, drivers can choose unlimited coverage and pay an additional assessment test by the MCCA and placed in a fund to care for those who are catastrophically injured.

According to the MCCA, they reimburse no-fault auto insurance companies for Personal Injury Protection (PIP) medical claims in excess of $600,000 if the survivor had unlimited coverage. That means that the insurance company pays the entire claim under policies providing unlimited lifetime coverage, but is reimbursed by the MCCA for medical costs over $600,000.

Patient advocates say that the rebate checks coming from the MCAA and any discounts being received have all come at the expense of auto accident victims and their families, many of whom can no longer get the care or the reimbursement for the care that no-fault auto insurance companies previously paid for, causing actual death and destruction across the Michigan landscape.

Currently, after a ruling by the Michigan Court of Appeals in August of 2022 regarding no-fault auto insurance law changes in what many call the “Andary case,” patients who suffered catastrophic auto injuries prior to the 2019 are not currently subject to the cost controls in the bill. The patients are supposed to be grandfathered back into getting the coverage they were previously receiving before the law changed in 2019. In a 2-1 ruling, the justices said the cost controls in the bill were unconstitutional and didn’t apply retroactively to crash victims whose accidents occurred before 2019.

The majority opinion said that the cost controls “directly and drastically limit the ability of motor vehicle accident victims to continue to obtain the care they require.”

However, the case from the Michigan Court of Appeals will be headed to another court in March – the Michigan Supreme Court. With more than 8,600 Michiganders receiving long-term care medical benefits from their auto no-fault policies, this is a case that will be closely watched by those families who have loved ones who were injured in auto accidents and have been fighting the insurance companies and elected government officials for years to get the care that their family members desperately need.

George Sinas of the Sinas Dramis Law Firm in Lansing who represented the plaintiffs in the appeals case said in phone interview with the Detroit Free Press, “I do not believe it’s legally appropriate to take patients like these, who had years ago purchased these auto no-fault medical benefit policies, paid hard earned money for that coverage, and that coverage at that time guaranteed them lifetime medical with no caps, I don’t believe it’s appropriate to strip them of those purchased benefits by a subsequently enacted law – and that’s exactly what the Court of Appeals held.”

Lori McAllister, an attorney at Dykema who represented the two auto insurance defendants in the appeals case, did not agree with the decision coming out of the Michigan Court of Appeals. She said in a statement, “The court’s decision invalidates important bipartisan reforms that had started to lower the costs which had rendered coverage unaffordable for many residents, due to widespread fraud and abuse. The defendants intend to appeal the decision and are confident the bipartisan reforms to the no-fault system will ultimately be upheld by the Michigan Supreme Court.”

Even with the decision from the Michigan Court of Appeals coming down on the side of the injured patients and their caregivers, all is not rosy. The level of care and the payments to caregivers still seems to be dictated by the decisions of the insurance companies that the patients are involved with.

The Detroit News reported recently that “some insurers are delaying payment as arguments over what constitutes a new ‘reasonable’ rate drags out in individual court cases.” Howell said about the families not receiving payments for caring for their loved ones, “This is causing real hardships to families taking care of their loved ones who have had to give up their jobs and have depended on these payments. Some have even lost their homes and have moved in with children or elderly family members in a smaller house that is not equipped to take care of their loved ones. A survey that was done by WCW found out that 33% of those surveyed had applied for Medicaid.” Howell said that when that happens, “the family can’t leave the person to go out and work outside so the whole family ends up on public assistance.”

When asked why the insurance companies can legally hold the backpay owed to caregivers, Howell said, “It’s been terrible…Although the Department of Insurance and Financial Services (DIFS) has sent a bulletin requiring insurance companies to quickly repay what is owed to the care providers since July 1, 2021, many companies are still not paying agencies and caregivers. When the insurance company doesn’t pay, it is a civil case, not a criminal case and the patient or caregiver company must hire an attorney and handle this in the courts. So it’s not like you can say, ‘it’s a felony, you can’t do this.’ You have to take them into civil court and have a lawsuit and pay an attorney.”

A source that Michigan News Source reached out to told us that her patient’s insurance company was trying to cajole her into signing a new agreement that she wasn’t interested in and after the phone call with the insurance company, AAA, they sent her a “confirmation” letter with information on it that she never agreed to. It was confirmed by Howell that offers and contracts are being sent out to other caregivers as well to try to set them up with new deals where the insurance companies don’t have to pay as much. Howell also confirmed with Michigan News Source the information in the report from the Detroit News and said that some caregivers and agencies haven’t been paid for a year or more.

Another point that Howell brought up was that while the insurance companies are trying to re-negotiate contracts, they’re telling the caregivers that they reserve the right to retrieve the money should the law change. She also said that that in Northern Lower Michigan and the Upper Peninsula, many cities don’t even have agencies to take care of the severely injured patients and the agencies don’t want to have their health care aides drive 20 miles or more to someone’s house – so patients and caregivers are stuck without any additional outside care.

They are paid for limited hours and still are forced to provide 24/7 care. Howell talked about a woman who recently won her lawsuit against an insurance company. She said the woman was in tears last Thursday after the lawsuit was over. Howell explained, “She was being made homeless. She was losing the home she had been renting, and her landlord was being kind but he had no money. And she and her son have brain injuries. When her son was two, they were in a horrific car accident. A semi hit them head on.”

Not knowing if a payment is coming is a real nightmare for many families who are taking care of their injured loved ones 24/7 in their homes. Howell said about the boy she described above, “That little kid struggles terribly with school and has to have an aide with him at all times. His mom had nothing. His care was going down hill… and with brain injuries, you have to keep on an upward momentum. If you start sliding backwards because you’re not getting appropriate rehabilitation, it’s really hard to regain that lost ground and continue on. It’s really a road block that a lot of these people with brain injuries will never get over… it’s so unfortunate… and unnecessary…I can’t believe that for all these months this has continued on with people having full knowledge of what is happening. At first, no, people didn’t realize the full impact of the law but very shortly afterwards they did..and to let it continue on is just horrible.”

Howell is very familiar with the struggles of these families as she is the mother of an auto accident survivor. Her son, Sam, who was 18 at the time, was in an auto accident on Valentine’s Day in 2005. Sam, a gifted teenager who had won an international science fair and had received thousands of dollars in scholarships had planned to attend Harvard after finishing an accelerated degree program at Michigan State University. However, those hopes were dashed when his car went off a highway, hit a snow bank, went 10 feet in the air and hit a tree. He was in a coma for months and suffered permanent brain damage.

Sam’s condition was able to significantly improve through the no-fault auto insurance payments that covered his rehabilitation. In the beginning, he wasn’t even expected to walk or speak again or eat by himself, but he has been able to make great progress and has even graduated from college. He is now cared for at home by Howell and her husband. She is glad that they are able to take care of their son but says it’s been a long, hard journey and that it still continues to be a journey to this day. She said that when you care for someone 24/7, you don’t get many breaks, holidays or sick time. And there are always ongoing issues to take care of.

Even with the best of care in the best of circumstances with an insurance company living up to their contract, families are always expected to jump through hoops. The families are monitored by everyone who comes to the house to care for their family member – therapists, case managers, etc. – and those people are mandated to report anything they find to be improper. In addition to being watched, the families have to keep meticulous records about their activities including calendars and daily logs as proof to get attendant care benefits.

Linda St. Amant, a member of WCW, who takes care of her son David, says she has to justify what she does to keep her son’s care paid for. She says there is no blank check given. People think she has unlimited funds that she gets but it’s not true. She says there’s a lot of documentation and every month she has to list all of the activities that she was involved with – time doing wound care, meal prep, transporting to doctor’s appointments and more. It all has to be clearly documented in order to get reimbursement for attendant care. She said it’s a lot of work and a full time job itself in addition to the caregiving.

St. Amant says that the changes to the law limiting family caregiving to 56 hours a week has been a really terrible blow to families. She also says that the help outside of the family that the insurance company is willing to pay for cannot often be found, and when it is, it can be inadequate. She said, “When you have traumatic brain injury you just don’t throw random people at your loved one and expect them to do okay…there’s a high level of frustration.”

St. Amant’s son David, who is now 35-years-old, was just a newly-turned 16-years-old in May of 2003 when he had his accident. He got confused in his directions and his family thinks he missed a stop sign when he was T-boned by a driver going about 60 MPH. He was knocked about 150 feet off the road into a cornfield. An off-duty police officer came to his rescue and David was life-flighted to Kalamazoo since there wasn’t a trauma-one facility in the Lansing area. Although he had physical injuries, the main concern was his brain injury. After the hospital could no longer help him, he was transferred to the Mary Free Bed Rehabilitation center, the only place in the state who would take him. He was there for about five months, three months of that in a coma. After staying there, he was transferred home where his mother, Linda, takes care of him. His journey goes on and he continues to do therapy. He recently had a set back with seizures and a fall but he has a good quality of life according to his mom who takes care of him along with the help of her daughter and son-in-law who moved in a little more than ten years ago after Linda’s husband passed away. In addition to getting great care at home, David’s good outcome is also the result of the rehabilitation that he was able to get that was paid for by his no-fault auto insurance.

Click here to read part two in the series.