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Michigan Senate votes to revise auto insurance law over Whitmer’s warning

Charges for auto-related medical care have long been a point of contention between health care providers and insurance companies. (File photo)
  • In bipartisan vote, Michigan Senate votes to reverse health care cost controls from 2019 auto insurance overhaul
  • Gov. Gretchen Whitmer opposes the plan, saying it will increase insurance costs for Michigan drivers
  • Bills would increase reimbursement rates for medical providers and allow for more in-home care

LANSING — The Michigan Senate voted Thursday to undo a key reform in a 2019 auto insurance overhaul, despite warnings from Gov. Gretchen Whitmer's administration that the bills would raise costs for motorists.

The 23-14 votes blurred party lines and represent one of the first major public policy disputes between the Democratic governor and legislative leadership since Democrats won full control of the House and Senate in January. 

The two-bill package would increase reimbursement rates for medical providers that care for seriously injured motorists, largely undoing steep cuts to facilities and lifting a 56-hour per-week cap on payments for care provided by family.


"For me, it is about what we can do to ensure that people who are disabled by catastrophic accidents are simply able to live with dignity," said Senate Majority Leader Winnie Brinks, D-Grand Rapids. 

The 2019 law, negotiated by Republican legislative leaders and Whitmer, cut medical provider reimbursement rates as part of a larger attempt to reduce auto insurance premium costs that ranked among the highest in the nation. 

The law also allows drivers to choose lower levels of personal injury protection, providing an alternative to what had been a mandatory lifetime care guarantee.

Michigan premiums are still the fourth highest in the country, according to one recent analysis, but the Whitmer administration warned costs could rise if medical reimbursement rates are increased as proposed.

"Simply put, the broad-brush reimbursement rate increases proposed in these bills would substantially impact auto insurance affordability across the state," Anita Fox, Whitmer's director of the Michigan Department of Insurance and Financial Services, wrote this week in a letter to lawmakers

"To the extent specific additional issues can be identified that impact access to care, a narrower solution addressing such concerns is certainly possible. However, these bills are not narrowly tailored and will swing the pendulum too far."

During Tuesday’s vote, four Republicans joined the majority Democrats in supporting for the proposal, while one Democrat opposed it.

The 2019 law put “lives in jeopardy” by compromising the care of seriously injured motorists, said Sen. John Damoose, R-Harbor Springs. Too many people have been "devastated by unintended consequences of an otherwise well-intentioned law," he said. 

Other Republicans found themselves in an unusual position of agreeing with Whitmer, the Democratic governor. 

"A vote for these bills is a vote for higher car insurance rates in Michigan," said Senate Minority Leader Aric Nesbitt, R-Porter Township. 

The legislation now heads to the Michigan House.

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