“All options” are on the table as Michigan legislators return to session next week seeking to reform the state’s no-fault auto insurance system and reduce motorist rates that are among the highest in the nation.
House Republicans are leading efforts to change the state’s nationally unique law that guarantees lifetime medical benefits for catastrophic injuries, a task that has proven elusive during GOP Gov. Rick Snyder’s tenure.
They aren’t ruling out a controversial plan to give motorists the option to buy reduced-coverage policies that cap injury benefits. They’re not dismissing set fees for medical care opposed by hospitals, or mandated rate rollbacks opposed by insurers.
“At the end of the day, we have to have rate relief for the citizens of this state, and that means we’ve got to leave all options on the table,” House Speaker Tom Leonard, R-DeWitt, told The Detroit News.
Leonard and Senate Majority Leader Arlan Meekhof of West Olive are both calling auto insurance reform a top priority for 2017 because election-year politics would make a resolution more difficult in 2018.
Snyder has consistently advocated auto insurance reform. GOP officials are also anticipating a bipartisan push from Detroit Mayor Mike Duggan, a Democrat who has decried high rates in his city and is working on a solution behind the scenes.
“I’ve seen few people that are better at building coalitions than he is,” Leonard said of Duggan. “And when I say coalitions, I don’t just mean legislators; I mean outside individuals who understand the need to solve problems facing our state. We’ve got a unique opportunity right now.”
Michigan motorists consistently pay among the highest rates in the nation for mandatory insurance coverage, and rates in Detroit and other urban areas are often higher.
Statewide premiums averaged $1,351 in 2014, the third highest rate in the country, according to the National Association of Insurance Commissioners’ latest report released in January. Insure.com recently pegged Michigan’s full-coverage average premiums as the nation’s highest.
Hospitals and patient advocates say there are ways to control costs but argue Michigan’s unique state law means motorists here get the best form of auto insurance in the country.
“If you’re involved in an accident, everything you would need for yourself or your family is covered. Nowhere else in the country is there a product that does that,” said Chris Mitchell of the Michigan Health and Hospital Association.
“We’ve had people in other states involved in auto accidents who end up bankrupt trying to pay their medical bills, or they end up being put in a nursing home because they don’t have the adequate care they need at home.”
While summer negotiations have not yet produced any actual legislation, reform advocates are optimistic concrete plans will take shape this fall and set the stage for passage.
“I think this is the best chance we’ve had in 30 years for very real change,” said House Insurance Committee Chairwoman Lana Theis, R-Brighton. “People who moved out of Michigan because they needed jobs are moving back because we have jobs for them, and they recognize what the difference is with their cost in insurance.
“It’s crazy expensive. Everybody knows that.”