New Insurance Law In Michigan Proves Controversial

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June 3, 2021—A new no-fault auto insurance law in Michigan will allow insurance companies to pay less than 100 percent for customers’ rehabilitation services, the Associated Press reported. 

The legislation was passed in response to Michigan’s highest-in-the nation auto insurance premiums, and gives drivers the option to choose their level of personal injury protection, replacing a state requirement that drivers buy unlimited lifetime coverage.

Beginning July 1, services that Medicare covers will have a 200 percent reimbursement rate, while more specialized services, such as home health care without a Medicare code, will be reimbursed at 55 percent of whatever was charged for the services at the start of 2019.

State Rep. Dave Wozniak told the AP that the result is a win for insurance companies, as people who can’t afford to get care and have a loss of income will switch to Medicaid coverage, leaving the state to foot the bill, rather than insurance companies. 

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