How House, Senate no-fault auto insurance plans compare

Lansing — The Michigan House and Senate have produced contrasting bills that promise to reform Michigan's no-fault auto insurance system and reduce rates for drivers. 

The GOP-led Senate approved its plan on Tuesday, while the Republican-controlled House passed its legislation just after 2 a.m. Thursday. Only one of the plans could go to the desk of Democratic Gov. Gretchen Whitmer, who has promised to veto either proposal if it reaches her without significant changes.

The Senate may decide to pass the House plan. Or it could alter the House bill and send it back to the lower chamber for approval. Senate Majority Leader Mike Shirkey, R-Clarklake, said Thursday he will review the House legislation this weekend before making a decision. 

How the plans compare:

Senate proposal

Personal injury protection: It would end Michigan's unlimited medical benefits mandate. Drivers would have at least three alternative options. They could opt out and have no medical coverage, trusting such coverage to their private or government health insurance plans. They could select $50,000 in personal injury protection that would also cover up to $200,000 for immediate hospital needs or up to $250,000 of personal injury protection. Insurers could still offer plans with unlimited medical coverage, but they may be unlikely to do so because the state would end liability for and eventually dissolve the reinsurance program that helps pay the most expensive claims. 

Savings: At the least, drivers would save an estimated $180 in annual Michigan Catastrophic Claims Association fee reductions. Republicans say the fee, set to rise to $220 in July, would be reduced to roughly $40 when the reinsurance program is effectively closed to future claims. Motorists who choose auto policies with $250,000 in medical coverage could save at least 15% over unlimited plans, according to Sen. Aric Nesbitt, R-Lawton. Residents who opt out of personal injury protection coverage on their auto policies and go with their own health insurance could save up to 46%, Nesbitt estimates. No government agency or independent group has estimated the potential savings. 

Rate rollback: Insurers are not required to roll back insurance rates by any set amount in exchange for the other reforms.

Mandated medical fees: In a bid to control spiraling medical costs, the plan creates a fee schedule for health providers, who could only charge insurers at rates required under worker's compensation. In-home attendant care by family members would be limited to 56 hours per week. 

Insurance prohibitions: It would prohibit insurers from refusing or limiting coverage for consumers based on where they live, but it would not ban pricing based on ZIP code. The proposal would also expand a prohibition on gender discrimination to group policies.

Fee rebate: It would require the Michigan Catastrophic Claims Association to provide a driver rebate, through insurers, if its assets cover more than 120% of liabilities. The MCCA imposes an annual fee passed on to motorists to reimburse insurers for unlimited medical expenses. The association and fee would be phased out over time.

Lawsuit rules: It seeks to curb “attorney lawsuit abuse” with tougher rules that would include prohibiting attorneys from soliciting clients within 30 days of a crash.

House proposal 

Personal injury protection: Drivers would have five options. Like the Senate plan, the House plan would eventually end Michigan's unlimited medical coverage mandate. Drivers could choose unlimited medical coverage, but they could also sell plans with $500,000, $250,000 or $50,000 in personal injury protection. Like the Senate version, consumers with private or government health insurance that covers auto crash injuries could entirely opt out of the medical coverage.

Savings: Drivers would save between $200 and $1,200 on average, according to House GOP leaders, depending on the medical coverage they choose. No government agency or independent group has estimated the potential savings. 

Rate rollback: Unlike the Senate plan, it would require insurers to reduce personal injury protection rates for five years, depending on the level of coverage selected. Within six months, insurers would have to file new premium rates that reflect an average of between 10% and 80% savings on the personal injury protection portion of a policy. The temporary mandate would eventually expire. 

Mandated medical fees: Like the Senate plan, it would create a fee schedule for health providers, who could only charge insurers at rates required under worker's compensation, and in-home attendant care by family members would be limited to 56 hours per week. The House plan would require post-acute brain and spinal injury specialists to have national accreditation to qualify for insurance reimbursement for care provided to injured motorists.

Insurance prohibitions: It would empower the Michigan Department of Insurance and Financial Services to create rules to prohibit using a non-driving factor such as where a person lives by ZIP code if “there is no rational correlation between the factor and insurance losses. It doesn't directly ban a particular practice beyond the Senate's plan.

Fee rebate: Like the Senate plan, it would require the Michigan Catastrophic Claims Association to provide a driver rebate, through insurers, if its assets cover more than 120% of liabilities. The proposal would not phase out the MCCA. But motorists who purchase reduced coverage policies would only pay a portion of the annual fee dedicated to paying down projected deficits, roughly $40. 

Lawsuit rules: Like the Senate plan, it would seek to prevent “attorney lawsuit abuse” with tougher rules that would include prohibiting attorneys from soliciting clients within 30 days of a crash.

joosting@detroitnews.com