CPAN Urges Swift Passage of New Legislation Addressing Michigan’s Catastrophic Care Crisis

CPAN Urges Swift Passage of New Legislation Addressing Michigan’s Catastrophic Care Crisis

Bill will help mitigate fee schedule fallout, but more action needed to preserve access to treatment and services for severely injured crash victims

LANSING, Mich. – (Jan. 26, 2022) — CPAN, the consumer protection coalition fighting for fair insurance laws, today called for swift passage of a new bill introduced by State Rep. Phil Green (R-Millington) that would help address the state’s catastrophic care crisis.

CPAN President Devin Hutchings said HB 5698 comes not a moment too soon.

“Families are suffering,” he said. “Small businesses are hanging on by a thread and going deep into the red to protect their patients. The entire post-acute care industry is on the brink of collapse. We are grateful to Rep. Green and all supporters of his bill for standing up for crash victims and the health care heroes who care for them.” 

Although leaders like Senate Majority Leader Mike Shirkey have said they wanted to take a wait-and-see approach before tweaking the 55% cap in catastrophic care that went into effect this past July, the evidence that it has been devastating to crash victims is overwhelming. According to a recent report from the nonprofit health organization MPHI, 1,548 no-fault patients have been discharged by their previous providers and 3,049 Michigan jobs have been eliminated since the new law’s fee schedule went into effect in July 2021. Meanwhile, 140 organizations reported having to significantly reduce services, 96 organizations can’t accept new patients with no-fault insurance funding, and 21 organizations have had to cease operating completely.

The MPHI data comes on top of last month’s report from Poverty Solutions at the University of Michigan, which found that the 55% reimbursement cap had proven to be too “dramatic.” The study’s authors wrote: “Already, reports suggest these fee caps are causing problems for accident victims who were injured prior to the passage of the reform bill, as many providers face budget shortfalls and may be forced to go out of business.”

Meanwhile, the 7,000+ member grassroots group We Can’t Wait has staged several high-profile protests and events to raise awareness of the plight of crash victims, and hundreds of news stories focusing on victims’ loss of care have been published.  

“For months, crash victims have been pleading with lawmakers to fix this mistake,” Hutchings said. “The fact that Rep. Green was able to secure 58 cosponsors from both sides of the aisle speaks to the bipartisan support for protecting survivors. It’s not hyperbole to say their very lives are on the line if they aren’t able to access treatment. We need action now.”

Hutchings urged the Legislature to pass HB 5698 in conjunction with HB 5500, introduced by State Rep. Bob Bezotte (R-Marion Township), which would protect additional services that are necessary for survivors of catastrophic injuries, such as transportation, case management, guardianship, and more.