LANSING, Mich. — New legislation introduced by House Democrats looks to address concerns related to Michigan’s no-fault auto reform law.
The 10-bill package addresses a number of concerns with the care crisis impacting survivors of catastrophic auto crashes.
It includes new rules for insurance providers and the Michigan Catastrophic Claims Association.
Auto insurers that unreasonably deny a person's claim would be penalized for it under the proposed legislation.
They'd also have to get their rates approved by the state with an 8% profit cap.
Another bill would mandate any MCCA refunds, like the $400 refund checks some drivers have already received to go out within 30 days.
Since the no-fault law took effect on July 1, sponsors of the package say more than 1,500 people have lost out on the care they were promised, 3,000 workers have been laid off and nearly 100 businesses have either had to close or stop serving their clients.
Sponsors also added that the no-fault changes haven't brought any real benefit to Michigan drivers, saying Michigan still has the second-highest rates in the country with the new system.
Here’s a description of the bills in the package outlined in a press release from Rep. Julie M. Rogers:
• House Bill 5996 would address the issue of prohibiting insurers from denying payment if the treatment is “not usually associated” with accepted treatment. Sponsored by Rep. Rogers.
• House Bill 5997 would place penalties on insurance companies that unreasonably deny claims. “Bad Faith Denial.” Sponsored by Rabhi.
• House Bill 5998 would fix the loophole where some court rulings have basically exempted all regulated and licensed businesses (like insurance companies) from Michigan’s Consumer Protection Act. Sponsored by Rabhi
• House Bill 5999 would require the Department of Insurance and Financial Services to post their reports on auto no-fault complaints, billing issues, and utilization review publicly on its website . The reports will include the number of cases per patient. Sponsored by state Rep. Kevin Coleman (D-Westland).
• House Bill 6000 would require auto insurers to get their rates approved by DIFS, with an 8% profit margin cap. Sponsored by state Rep. Rachel Hood (D-Grand Rapids).
• House Bill 6001 would require that when the Michigan Catastrophic Claims Association (MCCA) is statutorily mandated to issue refund payments to consumers, those payments must be issued within 30 days. Sponsored by state Rep. Kelly Breen (D-Novi)
• House Bill 6002 would prohibit insurance companies or the third-party companies that are associated with the insurance company from reviewing administrative appeals. Sponsored by state Rep. Padma Kuppa (D-Troy).
• House Bill 6003 would prohibit insurers from refusing to pay provider bills on the basis that the bill is not in the insurer’s preferred format or on the insurer’s preferred form. Sponsored by state Rep. Regina Weiss (D-Oak Park).
• House Bill 6004 would require the MCCA to disclose actuarial computation used in rate setting. Sponsored by state Rep. Mary Cavanagh (D-Redford).
• House Bill 6005 would prohibit rate discrimination on the basis of any category protected under the Elliott-Larsen Civil Rights Act (marital status, weight, sex, etc.), credit scores or other financial stress measures, and geographical location within Michigan AND require that insurance companies that have affiliate networks or the same parent company offer consumers a quote that is the lowest they would get within the company or network. Sponsored by state Rep. Jewell Jones (D-Inkster)