"Access to care continues to be a priority for me and my administration, we will continue to use everything in our toolbox (so) that remains the case."
Gov. Gretchen Whitmer
GRAND RAPIDS — Michigan Gov. Gretchen Whitmer says the $400 per vehicle auto insurance refunds will help families throughout the state, as checks are expected to reach drivers in the coming weeks.
Whitmer, speaking at Grand Rapids Community College Monday afternoon, said the refund checks are made possible by Michigan's 2019 auto insurance reform. The bipartisan insurance changes allowed drivers in Michigan to opt out of the highest coverage bracket if they chose to, opening up more coverage categories at lower prices.
"Hardworking Michiganders deserve laws and policies and investments that make their life easier and make sure that everyone will be successful," Whitmer said.
In November, Whitmer called for the refunds, saying the Michigan Catastrophic Claims Association Fund surplus had grown to $5 billion since the 2019 reforms. Under the state's previous insurance laws, insurance bills for drivers in Michigan contained surcharges designed to support the fund, which has assets of more than $27 billion.
The MCCA announced in December it would issue refunds, with the total amount sent to Michigan drivers being $3 billion. Checks are expected to reach drivers in the coming weeks, and insured drivers aren't required to take any action to receive refunds. Insured motorcycles and recreational vehicles are also covered under the refunds, but cars with "historical vehicle" plates will receive refunds of $80.
Anita Fox, director of the state's Department of Insurance and Financial Services, said drivers who do not receive checks by May 9 should contact their insurance agents to make sure all of their information is accurate.
Concerns over care for crash victims
The MCCA fund provides coverage for those who suffered catastrophic injuries in car crashes. Under the previous insurance laws, crash victims would receive unlimited lifetime medical coverage for injuries suffered during the crash — their auto insurance provider would be responsible for the first $550,000 in treatment, then the rest would be covered by the MCCA fund.
The 2019 reforms gave drivers the option of whether they wanted to continue paying for full MCCA coverage, or opt for less comprehensive and less expensive coverage.
But mandated funding for rehabilitation services for catastrophic crash victims was removed in the 2019 reforms. Under the reforms, which went into effect July 1, 2021, service providers can charge insurance companies a maximum of 55 percent of the costs not covered by Medicare.
Crash victims and caretakers say the new reimbursement cap has resulted in a loss of non-hospital related services, like attendant services, which many crash victims rely on. Attendant services can include assistance for people who have lost some or all of their mobility in auto crashes.
According to a Michigan Public Health Institute survey of organizations providing care to crash victims, more than 3,000 jobs — or 26 percent of total jobs which MPHI received data for — were eliminated by care providers after the reforms went into effect. More than 1,500 patients — around 9 percent of patients cared for by survey takers — had to be discharged.
Of the surveyed organizations, 96 percent said the 55 percent reimbursement cap affected services.
Whitmer and Fox said Monday they're working to ensure crash victims still have access to quality care.
"Access to care continues to be a priority for me and my administration, we will continue to use everything in our toolbox (so) that remains the case," Whitmer said.
She said the 2019 reforms were designed to target Michigan's high insurance rates — the average insurance rate in Michigan was nearly $700 higher in 2018 than the national average insurance rate.
A bill introduced in the Michigan House in January by Rep. Phil Green, R-Millington, would boost the Medicare reimbursement cap to 200 percent and boost the reimbursement cap for Department of Veteran Affairs services to 150 percent. The bill has been referred to the House Committee on Insurance, where it awaits a hearing.