(Source: MIRS.news, Published 09/29/2022) Michigan drivers will pay back $48 of the $400-per-vehicle refund issued earlier this year after the Michigan Catastrophic Claims Association announced it is changing an assessment because of an anticipated deficit.
The likely hole comes after an August Court of Appeals decision that held two provisions of the 2019 auto insurance law cannot be applied retroactively to those injured prior to the change.
The ruling left the medical fee schedule intact, however, for future medical costs of individuals injured after the change, which led MCCA to reduce the pure premium from $85 to $74 for drivers who purchase unlimited personal injury protection levels on their automobile policies.
“Michigan continues to be a more competitive and cost-effective state to afford auto insurance after years to holding the unenviable No. 1 spot for the highest in the country premium cost," said Wendy Block, vice president of business advocacy and member engagement for the Michigan Chamber of Commerce. "That progress is in jeopardy after activist judges ignored legislative intent and the actual statutory language, and substituted their own interpretation.”
The Insurance Alliance of Michigan said this is the first time the MCCA assessment has increased since a bipartisan group of lawmakers passed and the governor signed into the law the 2019 reforms. The group said the fee "is likely to continue for multiple years" as the MCCA tries to fill the deficit created by the appeals court's ruling in Andary v. USAA Casualty Insurance Company.
"If you pull the string on part of the medical fee schedule, the sweater unravels quickly," said Insurance Alliance Executive Director Erin McDonough in a statement.
Meanwhile, the Michigan Supreme Court agreed to hear oral arguments in March on USAA's and Citizens Insurance Company of America's appeal of the lower court's decision. But, the court denied a request to stay the lower court ruling.
Guardians for Ellen Andary, of East Lansing, and Philip Krueger, of Ann Arbor, filed the suit in Ingham County Circuit Court challenging the limits on what family members are reimbursed for providing attendant care to a catastrophically injured loved one and the fee schedule.
In their appeal application, the insurance companies argue the appeals court that the Legislature "made certain choices" when enacting the no-fault reforms and that the majority "failed in its analysis to uphold the law as written."
"It is not the role of the judiciary to inquire into the wisdom of legislation," the Sept. 7 application from Lansing attorney Lori McAllister reads.
The Michigan Brain Injury Provider Council praised the court's denial of the stay, saying it provided "another breath of hope" for car crash survivors.
"While this case is not yet settled, we hope the insurance industry will follow the law and allow care to be restored for people in need," said MBIPC Executive Director Tom Judd.
"Furthermore, while an eventual ruling by the Court to affirm the decision of the Court of Appeals will bring healing to people injured prior to the 2019 law, a legislative solution is needed for drivers catastrophically injured in a car crash after the enactment of the law, who paid for lifetime benefits of quality care."
