We Must Protect Lifetime Injury Coverage
The basic concept of Michigan’ no-fault auto insurance law is to provide timely payment of insurance benefits to auto accident victims regardless of who is at fault for an accident. In exchange for that right, there are certain limits on accident victims’ rights to seek claims against the at-fault driver.
Michigan’s no-fault law is considered a model for the nation because it provides lifetime injury coverage for accident victims. In other words, accident victims are covered for their injuries for as long as those injuries persist.
Why are lifetime injury benefits so important?
Driving in a vehicle is one of the most dangerous activities we undertake each day. A serious auto accident resulting in a hospital stay can quickly add up to hundreds of thousands of dollars.
And anyone suffering catastrophic injuries – such as a traumatic brain injury or spinal cord injury – will likely require ongoing medical care for the remainder of their life. This can amount to millions of dollars in care over the course of a lifetime.
In addition, traditional health insurance and the Affordable Care Act are not designed for catastrophic injuries. Many of the rehabilitation and other therapies necessary to help accident victims recover from their injuries (such helping accident victims relearn how to talk or job retraining) are not fully covered by traditional insurance.
Michigan’s No-Fault System Saves Taxpayer Dollars
Other states place caps on care – some as low as $20,000. This means accident victims quickly run out of coverage for their injuries. Many are forced to pay out of pocket for their care and end up declaring medical bankruptcy. At that point, they are forced onto the Medicaid system.
The last time Michigan lawmakers seriously looked at capping auto insurance benefits in Michigan, a Public Sector Consultants study found that the impact to our state’s Medicaid system “could easily exceed $30 million for long-term care in the first year alone.”
Learn from Colorado’s Example
Perhaps the best example of why it is important to protect lifetime no-fault injury coverage in Michigan is to look at when happened when Colorado switched from a no-fault system to a tort system in 2003.
- Each person in Colorado lost an average of $140,000 in annual benefits, including medical coverage.
- By 2006, their state trauma system lost $175 million dollars.
- Their Medicaid system witnessed a 205 percent cost increase in just three years.
All of this, and Colorado drivers only saved an average of less than $17 per month on their auto insurance bills.