Letter: Eliminating no-fault would benefit insurers

The Detroit News

Michigan legislators are making a lot of noise about reforming Michigan’s no-fault auto insurance system. As a representative of the medical provider community, I agree – it’s time to finally put a plan in place that will provide real rate relief for Michigan consumers.

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.

No-fault means that if you’re injured in an automobile accident, the care you need will be covered by your auto insurance. That’s the promise provided by the no-fault system. Breaking that promise means that catastrophically injured people – including children, who may need care for the rest of their lives – will be deprived of essential therapies and rehabilitation.

That loss of care – both for current patients and for anyone injured in a future auto accident – is just one side of the equation. The other is the massive cost shift that would occur if no-fault is eliminated. When insurance companies and their supporters say Michigan residents will save millions of dollars by eliminating no-fault, they’re leaving out key financial variables.

First, your taxes will likely go up. Eliminating no-fault means more people declaring medical bankruptcy, which means more people on the state Medicaid system. The nonpartisan House Fiscal Agency determined that a 2017 bill to overturn no-fault would increase Michigan’s Medicaid costs by $150 million. That cost gets passed on to you, the taxpayer.

Second, your health insurance costs will likely go up. Without no-fault, your health insurer will be responsible for more care associated with auto accidents.

Third, there’s no guarantee your premiums will go down at all. Remember, auto insurance companies are the driving force behind efforts to eliminate no-fault at the Capitol. Do you really think your insurance company wants to save you money? Or do you think they would rather sell you a junk plan, charge you a tiny bit less, and then pass on the costs?

We can reduce auto insurance premiums without depriving accident victims of the care they need by increasing consumer protections. Michigan is currently a "file and use" state, which means insurance companies can set rates with little oversight.

We also need to prohibit insurance companies from using non-driving rating factors like gender to determine your auto insurance rates, implement a strong and well-funded fraud authority, and enact a fair fee schedule for medical providers.

Charles Seigerman, Livonia

Board-certified neuropsychologist