New report finds that auto insurance reform has led to the discharge of more than 1,500 patients and the loss of more than 3,000 jobs

New report finds that auto insurance reform has led to the discharge of more than 1,500 patients and the loss of more than 3,000 jobs

Hutchings: The promises of reform have not materialized

LANSING, Mich.—(Jan. 11, 2022)— The promises of auto insurance reform have failed to come to pass and there is now more third-party data supporting the conclusion that the 45% cut in reimbursements for catastrophic care has had devastating consequences for survivors and caregivers alike, the president of CPAN said today.

According to a new 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 organizations that participated in the survey represent more than 16,200 employees and more than 16,700 patients. The survey was commissioned by the Brain Injury Association of Michigan, a social impact nonprofit dedicated to improving the lives of those affected by brain injury.

“The data supports the obvious conclusion that no-fault reform has been nothing short of devastating for catastrophic crash survivors,” said Devin Hutchings, CPAN president. “The fear and despair some of our state’s most vulnerable residents are experiencing as a result of the fee schedule cannot be what Gov. Whitmer, Senate Leader Mike Shirkey, or House Speaker Jason Wentworth had in mind when they championed the 2019 reform legislation, but the fact remains that without a fix from lawmakers, thousands of affected patients, families, providers, and frontline medical workers will continue to sink further.”

The MPHI data comes on top of last month’s report from Poverty Solutions at the University of Michigan, which confirmed that state residents are still paying more for car insurance than anyone else in America and the racial and geographical disparities that reform was meant to mitigate continue to this day.

“When the new auto insurance law was signed three years ago, state residents were promised that it would significantly lower premium costs for Michigan drivers without jeopardizing access to care for catastrophically injured survivors of devastating car accidents,” Hutchings said. “However, the promises of auto insurance reform have not materialized. Michigan residents are still paying more for car insurance than anyone in the country, but what’s worse is that the reform measures meant to provide consumer cost relief have instead kicked off a catastrophic care crisis in our state.”

“It’s been beyond heartbreaking to watch this preventable humanitarian crisis unfold,” Hutchings added. “We now have two third-party reports showing that 2019’s reforms aren’t working for wide swaths of the public. We can’t wait any longer to take action.”