No-fault auto insurance reform push gets revived in lame-duck session

An effort to reform no-fault auto insurance is getting a last-minute revival during the last week of the Michigan Legislature's lame duck session in a bid to cut nation-leading costs, according to a source familiar with the legislation.

Some Michigan House Republicans are attempting to push the bill similar to one backed a year ago by Detroit Mayor Mike Duggan, according to the source.

The Democratic mayor and and House Speaker Tom Leonard, R-DeWitt, unsuccessfully pushed a no-fault auto insurance reform package in 2017 that would have allowed motorists to choose between three levels of personal injury protection, ending a longstanding requirement that all auto policies include unlimited lifetime medical coverage for costly catastrophic injuries.

A draft amendment to Senate legislation would let seniors opt out of personal injury protection, limit family-provided attendant care to 84 hours per week, require a possible rebate for drivers and mandate an audit of the Michigan Catastrophic Claims Association.

The plan also would create a tiered system of medical coverage from which consumers could choose, unlike the current requirement that all drivers received unlimited medical care coverage in the event of a catastrophic accident.

Under the new proposal, consumers could choose between $225,000 for hospital care and $25,000 for post-hospitalization care, or $500,000 of medical care or the existing requirement for unlimited medical care. 

The legislation faces unsure prospects during the last week of the lame-duck session when lawmakers are trying to pass legislation before their terms run out a year's end. But Duggan's overhaul proposal in 2017 was defeated in a 45-63 vote, with opposition from 22 House Republicans and 41 Democrats.

The new plan also prompted immediate opposition.

The substitute bill "will gut protections for Michigan drivers and offers no meaningful rate reduction. This legislation is a wolf in sheep’s clothing — it will simply shift the cost of caring for auto accident victims to taxpayers, leading to a secret tax increase on Michigan families,” said Coalition Protecting No Fault President John Cornack. 

"...We need to have a serious, open, in-depth discussion about the best way to protect benefits while lowering premiums — not backroom deals made under cover of darkness at the last hour."

The proposal is the latest attempt to change no-fault auto insurance rules in Michigan, which is the only state in the country that requires unlimited lifetime medical coverage for all drivers. Michigan is routinely among the nation's most expensive states for auto insurance rates.

The Senate package included creating a new anti-fraud authority, limiting insurer payments on home care for auto accident victims and capping medical coverage for pedestrians or passengers in uninsured vehicles.

Crain's Detroit Business first reported Monday on the no-fault reform draft proposal. 

Quicken Loans founder Dan Gilbert has promised to promote reform efforts during the lame-duck session or in 2019. If such an effort doesn’t succeed, Gilbert has promised to wage a ballot campaign in 2020 for no-fault auto insurance reform to lower costs.

Gov. Rick Snyder hasn’t been able to do so during his eight years in office, blaming the opposition of powerful interest groups in his final interview earlier this month with The Detroit News editorial board.

ithibodeau@detroitnews.com

Twitter: @Ian_Thibodeau