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What is the MCCA, and why are they sending you a refund check?

The Michigan Catastrophic Claim Association was formed in 1978, meant to help financially support insurance companies covering abnormally large claims
Posted at 7:00 PM, Nov 04, 2021

LANSING, Mich. — Michigan Gov. Gretchen Whitmer and board members from the Michigan Catastrophic Claims Association announced this week that all insured drivers in the state will be receiving a refund check, because of a significant surplus they are currently operating at.

The board in control of the MCCA, of which all insurers in the state are required to be members of, approved refunds to insured drivers in Michigan for the $5 billion dollar surplus they currently have.

READ MORE: Michigan drivers will get insurance refunds

The MCCA was created in 1978 — its goal is to help cover the cost of individual claims that exceed a certain threshold in a year's time.

In 2021 that amount is $600,000. If an individual's claim exceeds that in a 12-month period, then the excess amount will be covered by the MCCA fund, to be issued to the applicable insurance company.

The problem with all of this, advocates say, is that the fund's sole purpose is to make sure there is money in the state system to cover lifelong medical coverage for all of those receiving unlimited personal injury protection (PIP) benefits via a no-fault policy.

"Now, if there is a warranted refund based on an audit, that drivers are owed money because they were overcharged in the past... then certainly they're entitled to that,” said Tom Judd, president of the Michigan Brain Injury Provider's Council.

But, Judd says, “Most care providers are not getting paid on a lot of their bills dating back to July.”

On July 2, the most recent portion of Michigan's no-fault auto reform law went into effect.

Advocates for survivors of catastrophic auto crashes say the new law, in many cases, has made it extremely difficult to find the medical services they need to survive.

Under the new law, any medical service not already covered under our federal Medicare law, which includes in-home caregivers and transportation to medical services, will now only be reimbursed by insurance companies at 55% of what they were back in 2019. The law also caps the number of hours that family members can provide care to just 56 hours a week.

CPAN (Coalition Protecting Auto No Fault) President Devin Hutchings provided the following statement in response to this week's refund announcement:

“Gov. Whitmer and the MCCA are financing refunds by raiding a fund designed to care for survivors of catastrophic auto accidents, even as victims continue to lose care due to Michigan’s government-mandated 45%-cut on care reimbursements. Without a doubt, consumers deserve relief from high premiums charged by auto insurance companies with deep pockets and jaw-dropping profits — but the source of those refunds matter.”

While on the other side of things, Erin McDonough, executive director of the Michigan Insurance Alliance, sent the following statement to FOX 17:

“The Insurance Alliance of Michigan and our members strongly support the Michigan Catastrophic Claims Association’s efforts to put money back into the pockets of Michigan drivers. It’s important for the MCCA board to do its due diligence and land on a refund amount that balances giving insured drivers back the money they deserve while protecting the longevity of a fund that pays for the cost of medical care for Michiganders seriously injured in car accidents.

The fact the MCCA board is even considering this shows reforms passed with bipartisan support by the Legislature and signed into law by Gov. Gretchen Whitmer are working and delivering real savings to drivers across the state. We want to thank lawmakers for staying the course on reform so drivers can continue saving money on their car insurance.”

FOX 17's Coverage of No-Fault Auto Reform Care Crisis
May 17, 2021 — New Law Could Have Devastating Consequences
June 2, 2021 — "We're Paying the Price With Our Lives": FOX 17 Extended Coverage
June 9, 2021 — Hundreds of Survivors Protest at Capitol
June 10, 2021 — Rep. Berman Introduces Bill to Prevent Cuts
June 23, 2021 — Advocates Rally Again at Capitol
June 26, 2021 — House Approves $10M Fund
June 30, 2021 — Advocates Say $25M Isn't Enough
July 7, 2021 — Family Scared to Lose Caregivers
July 23, 2021 — Providers Begin Closing their Doors
Aug. 4, 2021 — Patients Continue to Lose Care
Sept. 24, 2021 — Changes Causing Chaos for Survivors
Sept. 27, 2021 — 'We Can't Wait' ArtPrize Entry Highlights Care Crisis
Oct. 4, 2021 — Protest Outside Business of SML Shirkey
Oct. 14, 2021 — Some Insurers Not Following Intent of Law
Oct. 27, 2021 — Legislators Introduce New Package of Bills

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