House Republicans pass Michigan no-fault reform with tweaks from Democrats

car accident

House Republicans early Thursday passed legislation to reform Michigan’s no-fault auto insurance system. Similar to the state Senate’s version adopted earlier in the week, the House plan would offer drivers choices in how much personal injury protection coverage to buy. Democratic lawmakers criticized the process, pointing out that the House bill was introduced and adopted in a single session, with no committee hearings or public testimony.

May 21, 2019: Michigan inches toward no-fault deal, as Whitmer remarks add to optimism
May 16, 2019: Republicans and Whitmer move closer to no-fault auto insurance deal
May 14, 2019: Gov. Whitmer, Republicans see path to deal on Michigan auto insurance reform
Update: Michigan governor and Republicans at impasse on auto insurance reform bills

House Republicans passed legislation early Thursday morning to reform Michigan’s no-fault auto insurance system by letting drivers choose to buy different levels of medical benefits.

The 82-page bill, adopted by a 61 to 49 vote, included several elements favored by Democrats that were not part of a separate reform package passed by the GOP-led Senate on Tuesday. Democratic Gov. Gretchen Whitmer had vowed to veto the Senate bill if more consumer protections were not added. It was not immediately clear if she would look more favorably upon the House version.

The House passed its reform bill just after 2 a.m. Thursday. It was first unveiled by Republicans the previous day with no committee hearings or public testimony. House Speaker Lee Chatfield, R-Levering, told reporters the bill had moved quickly because “the votes were there.”

All 58 Republicans supported the House bill, joined by three Democrats: Reps. Sara Cambensy, of Marquette; Karen Whitsett, of Detroit; and Leslie Love, of Detroit.

House Republicans said their plan would save Michigan drivers at least $120 to $1,200 a year, depending on the level of medical coverage they choose.

The House adopted two Democratic-backed bill amendments, offered by Love and Whitsett from the floor, which would:

  • Require state insurance regulators to identify non-driving factors used to determine insurance rates as part of a study Whitmer ordered last month, and then prohibit auto insurers from using them, and
  • Require insurers to reduce premiums on personal injury insurance.

Yet several House Democrats said they still aren’t confident the bill, even with the amendments, guarantee lower rates in the long term, nor prevent insurers from considering non-driving factors in setting rates, a practice they contend amounts to redlining. Democrats also object to the speedy process that culminated in the Thursday vote at the end of a marathon session that had begun the previous day.

The competing Republican House and Senate bills must be reconciled between the two chambers, and may reach a final vote on no-fault reform as soon as next week. If passed, it would then go to Whitmer.

Chatfield, who had made auto insurance reform a top priority, told reporters after the vote he has not yet had conversations with the governor about the language adopted Thursday morning.

But changes to the bill were made with an eye toward gaining Whitmer’s — and Democratic lawmakers’ — support. Chatfield noted on the House floor that several provisions added to the bill, from guaranteed lower rates to the prohibition of non-driving factors such as ZIP codes and credit scores in setting premiums, had come from Democrats.

“We truly felt like we had reached a point where we had delivered on some of the hallmark issues they had requested,” he told reporters after Thursday’s vote.

“There was a real effort to find consensus to ensure this was done in a bipartisan way,” he said. “The last issue that was discussed was the prohibition on insurance companies using non-driving factors for determining rates. And that was a good-faith effort made by House Republicans to bring on our Democratic counterparts. I look forward to continuing those conversations to find out exactly what is needed.”

But House Democratic Leader Christine Greig, D-Farmington Hills, criticized the way Republicans unveiled the legislation. She told reporters after the vote that Chatfield had broken a promise he’d made to work bipartisanly through a special committee that had been formed earlier in the legislative session to tackle the no-fault issue.

Greig pointed to, for instance, the proposed coverage options in the House bill, which “we never even got to that point where we got to be in a room and talk about that,” she said. “There was never a bill before the committee.”

Rep. Donna Lasinski, D-Scio Township, minority vice chairwoman of the House special no-fault committee, said on the House floor the panel had just started to come together for bipartisan policy discussions right before the bill sped to a vote.

“We don’t need rushed legislation,” Lasinski said, shortly before a Democratic-sponsored amendment failed. “We’re doing this for no good reason — just plain old politics. We don’t need to get this done tonight. We need to get this done right.”

While the House bill required cuts to premiums, Democrats said they would have gone further. Most House Democrats supported a plan that would have required a 25 percent cut to a driver’s total car insurance bill for five years, and limiting future rate hikes to the rate of inflation, Greig said.

Republicans pushed back against Democratic complaints.

The House special no-fault committee has taken testimony for months from every group that has a stake in the system, said Rep. Jason Wentworth, R-Clare, on the House floor Thursday morning. The group received thousands of public comments, he said.

“What we came up with lowers our insurance rates for Michigan drivers, in some cases by thousands of dollars, and it strengthens consumer protections,” Wentworth said. “We must put aside political differences, put a stop to partisan talking points, and pass this reform to make a difference for Michigan drivers.”

Nevertheless, Thursday’s vote marks a major advance in an impasse that has stalled progress on state no-fault reform for years. Republicans in the House and Senate, who retained majority in November’s election, said reforming Michigan’s no-fault system to lower the cost of car insurance was among their top priorities this term.

Previous legislative attempts have fallen short of the necessary votes for passage amid disputes about how much money medical providers can charge, what factors insurers considered in setting rates, and how much medical coverage drivers should be forced to buy.

Groups that lobby on behalf of auto insurers, health care providers and trial attorneys — all of whom have significant stakes in the outcome of any reform legislation — along with legislators from both parties, have disagreed on previous legislation.

For better or worse, the bill approved Thursday by the House managed to irritate groups representing both insurance companies and hospitals in Michigan.

The House bill, like the Senate version, would give drivers choice in how much personal injury coverage they can buy. Michigan’s rates are the highest in the country, according to insurance search engine That’s in large part because Michigan is the only state to require all drivers to buy unlimited medical coverage, known as personal injury protection, or PIP.

The House bill would keep the requirement that auto insurers offer unlimited coverage. But it also offers drivers more limited coverage tiers of $500,000; $250,000; and $50,000, with an extra $200,000 for hospital treatment. It also would allow drivers to opt out of buying personal injury coverage on their policies if they have separate public or private health insurance, including Medicare and Medicaid.

The Senate version also offers tiers, but lacked a $500,000 coverage option. The Senate bill also does not require insurers to offer unlimited coverage, but instead merely allows them to do so.

The amendment offered by Love, and approved by the full House, would guarantee drivers lower PIP premiums for five years — ranging from paying no PIP premiums if they opt out, to a 10 percent cut for drivers who elect to keep unlimited coverage.

That, too, differs from the Senate bill, which does not specifically require insurers to provide reduced rates (though Senate Republicans said Tuesday lower rates would be the inevitable result), which was one reason Senate Democrats and Whitmer voiced opposition to that bill.

Once the five-year guaranteed PIP rate reduction ends, the House measure would require the Michigan Department of Insurance and Financial Services to approve auto insurers’ proposed rate increases before they take effect. Currently, state regulators review auto insurance rates after they’re enacted, rather than before, a process known as file-and-use.

That addition apparently did not sit well with an insurance industry group.

“We have serious concerns with the arbitrary rate and regulatory mandates that will be counterproductive to the goal of saving drivers money,” the Insurance Alliance of Michigan, which represents auto insurers, said in a statement after the House vote. The group added that it supports provisions to cap medical costs and offer drivers coverage choices.

PIP coverage is the most expensive part of an auto insurance policy, and covers the cost of treating catastrophic injuries for life.

Currently, Michigan does not limit what hospitals and medical providers can charge for crash victims’ treatment, which means auto insurers typically pay more for services than health insurers do. As a result of rising medical costs and the lack of a cap, Michigan’s costs are, for instance, five times higher than New Jersey’s, the next closest state.

The House, like the Senate, would reimburse medical providers for treatment at set rates based on Michigan’s workers’ compensation system.

“This bill puts a fee schedule on medical procedures and makes the health care providers accountable (by setting) reasonable fees for medical procedures,” Rep. Beau LaFave, R-Iron Mountain, said on the House floor. “Auto no-fault insurance has no fee schedule, and that is part of the reason it costs so much money to get insurance in the state of Michigan.”

The Michigan Health & Hospital Association voiced its distaste for the House bill, saying in a statement after the Thursday morning vote “it’s a sad day in Lansing when legislators are celebrating jamming through a bill on a serious and complex issue under the cover of darkness.”

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Kevin Grand
Thu, 05/09/2019 - 6:58am

It doesn't eliminate the forced MCCA mandate, but overall its a step in the right direction.

The Grammarian
Thu, 05/09/2019 - 7:04am

In fair disclosure, each lawmaker should indicate whether she or he took campaign money from automobile insurance companies. Second, what about the state-imposed fee to cover expenses for drivers who operate vehicles without having insurance? Will that be removed?

Thu, 05/09/2019 - 8:29am

I tink it would be a great idea, to look into those who are VOTING on behalf of the INS. Co., to see what kind of donations they are getting from these companies and make it public.

Thu, 05/09/2019 - 9:17am

Not just insurance companies, MCAA (gouging scum), but medical community and car repair facilities.

Jeffrey Kless
Thu, 05/09/2019 - 3:59pm

And who from the insurance companies wrote the bill!

Thu, 05/09/2019 - 7:32am

Get ready for our auto insurance rates to dubble>>> Any time them republicans pass a bill it cost us more!!!

Thu, 05/09/2019 - 8:27am

Don't know why you target GOP. When non-driving factors are eliminated, like zip code, the insurance cos will have to spread the high claims/costs of some areas to everybody, so our N Mich rates will go up.

Thu, 05/09/2019 - 8:12am

I will give my kudos to the MI Senate R's and MI House R's for at least getting these no-fault reform bills moving! Democrats now need to either get on board and start offering up their own solutions (such as Reps. Love and Whitsett are doing), or they need to get out of the way.

Thu, 05/09/2019 - 8:31am

The majority of the high cost is as stated in the article “Currently, Michigan does not limit what hospitals and medical providers can charge for crash victims’ treatment, which means auto insurers typically pay more for services than health insurers do. As a result of rising medical costs and the lack of a cap, Michigan’s costs are, for instance, five times higher than New Jersey’s, the next closest state.
What assurance that these higher medical charges will not be passed of to the motorist? How do will know this bill isn’t more about passing those costs back on to the motorist?

Thu, 05/09/2019 - 12:58pm

Quote from the above article: "The House, like the Senate, would reimburse medical providers for treatment at set rates based on Michigan’s workers’ compensation system." I believe this would help to address the soaring costs associated with the current system of paying whatever the medical provider asks for. When I review the statements we receive from our health insurance company and Medicare, the medical provider is never reimbursed for the entire amount that they bill for. I'm not sure we can ever reach a point where medical bills truly reflect the cost of service, and insurance reimbursements cover actual costs, but I do know that the lack of checks and balances for the MCCA is absurd.

Thu, 05/09/2019 - 8:48am

Bandaid measures a start but I want total transparency with catastrophic fund. It seems some of choices will leave you with less insurance protection. I would like a little more bipartisan effort it seems the GOP has set this up a little more of Democrats input and how about the Governor too.

Thu, 05/09/2019 - 1:10pm

I've lived (and been covered by auto insurance) in four states, including Michigan. Granted, I have never been involved in an accident where anyone was badly injured, so I can't say for certain how well the various coverage options worked in those other states based on personal experience. But I do know that between the various levels of coverage and my health insurance through my employer, I never felt that I would not be adequately covered. The current system with lifetime coverage through the MCCA and unlimited reimbursement of whatever is billed is ridiculous, lacking any checks and balances. The rates I pay for insurance (including 12 years accident-free, knock on wood) are absurd. It would seem these bills are a step in the right direction, and I welcome the opportunity to reduce or eliminate my PIP coverage.

Steve Losey
Thu, 05/09/2019 - 9:02am

Rates are not going to go down. If anything, rates will go up to give the illusion that what you're already paying is not as bad as it could be.

John Chastain
Thu, 05/09/2019 - 9:06am

Typical republican fix which doesn’t fix anything but gives the appearance of doing so. So you can chose less medical coverage, great. Nothing about the practice of inflating medical costs for auto accident related care. So insurance benefits & the health care industry benefits and the politicians spin it as a win for their constituents, which it isn’t. Yeah, thanks.

Thu, 05/09/2019 - 9:27am

So what will happen to my medical insurance rate, if I opt-out of PIP or have a reduced coverage amount? Let me guess, medical insurance rates will skyrocket now.

Can we just kill off the insurance companies already and just get to guaranteed public health coverage like every other modern society?

Chuck Fellows
Thu, 05/09/2019 - 10:29am

Dear Elected Representatives:

I awoke this morning to a travesty of democracy. Suspend the rules and cram through a piece of legislation that guarantees the preservation of sloth, greed and gluttony, not to mention inept financial management on the part of private business models protected by mandate.

Have you no decency?

Meaningless words that appear to take decisive actions that are much sound and fury changing nothing. That’s not governance. That’s malfeasance. Look up the meaning of that word and compare it to the oath you took accepting your elected position.

Yes, I am very, very angry. I sincerely hope the reports I have read this morning are incorrect since I have not had the opportunity to read the bill as presented. If the reports are true it is the straw that broke the camels back and I will have to work as hard as I can to insure that all who voted for this legislation be removed from office. Elections do have consequences.

Thu, 05/09/2019 - 11:51am

"Suspend the rules and cram through a piece of legislation that guarantees the preservation of sloth, greed and gluttony, not to mention inept financial management on the part of private business models protected by mandate."

I don't disagree with your overall statement, but what "rules" did they suspend to pass this legislation?

James Roberts
Thu, 05/09/2019 - 10:41am

PLease no more whining about the Republicans being in bed with the insurance industry and sticking it to us with "No-Fault Insurance". In 1973 when it became the law, sure Milliken was governor but the Michigan legislature was controlled by the democrats 60 votes to 50 votes and needless to say the lawyers.

middle of the mit
Thu, 05/09/2019 - 7:37pm

Does that change what no fault was supposed to do? NO.

What was no fault supposed to do?


It was supposed to drop the number of court cases in the courts. It was supposed to stop motorists from suing for injuries because they would be suing their own insurance company for injuries.

In other words conservatives both liberal conservatives and conservatives were hoping you wouldn't sue your own insurance company if you got hurt by someone else. Why would you? to only have your rates go up in the event that you did?

Because you were hurt?

But they NOW they want to put price constraints on the doctors and medical facilities but NOT the insurance companies. And then they tell us that the dems are in their pockets too. Favorite search engine how conservatives feel about price constraints when it comes to your health care.

Talk about two face.

When they tell you they are looking out for you, you had better start watching all around you.

Thu, 05/09/2019 - 1:36pm

From the information I have been able to find Medicare will not let you opt out of personal injury coverage on your auto insurance policies . If you are injured in a car accident and have no injury coverage Medicare will not cover your medical bills . I do not understand hoe dropping the unlimited personal injury coverage that costs $180.00 a year will save anybody a thousand dollars a year ?

Thu, 05/09/2019 - 8:46pm

Right! The math just doesn't add up. And by eliminating the use of zip codes to set premiums, those of us living in lower medical cost areas, areas with lower rates of car thefts, and lower density with fewer multiple car accidents, will end up subsidizing the higher cost areas, i.e. southeast Michigan.

William Berry
Thu, 05/09/2019 - 2:15pm

The fact that Michigan auto insurance rates are the highest in the nation says something basic is wrong. How about no more treatment as "No Fault". With "No Fault" we protect the reckless, careless, drunks, phone distraction, people at the expense of the rest of us. I vote for holding each of us responsible for our own habits and behavior. Eliminate "No Fault" and make me accept the consequences of bad behavior!

Fri, 05/10/2019 - 7:54am

Something ain't right when you work 'til 2 am in a 9 to 5 job.

Tue, 06/04/2019 - 10:27pm

Our politicians selling us out to the evil corporate lobbyists again. Both parties are demonic. Our governor and all those that signed this bill should go to jail. May Jesus Christ have mercy on America!