Skepticism Greets $10M to Stem Brain Injury Care Rate Cuts
June 28, 2021
By Jon King / firstname.lastname@example.org
A proposed financial patch that passed the Michigan House last week to help plug the expected rate cut for rehabilitation facilities and in-home care providers under the state’s auto insurance law is being eyed warily by many of those whose loved ones depend on that care, including a Howell mother.
The House late Thursday voted 95-13 to spend $10 million to help offset financial losses the care providers will face starting later this week when a 45% reduction in what auto insurers can be billed for post-acute services for people catastrophically injured in crashes will go into effect.
The Republican-led Legislature and Democratic Gov. Gretchen Whitmer slashed the reimbursements as part of a 2019 law to lower drivers’ premiums by containing medical costs and letting them forgo unlimited benefits.
The state aid would be available on a first-come, first-served basis to providers that document a “systemic deficit” due to the limits on charges and a good-faith effort to alter their business practices to adhere to the law. The relief fund would be administered by the Department of Insurance and Financial Services, which would later give legislators an analysis of the impact of the fee reductions and potentially make recommendations.
Some neurological rehab centers have announced they will close due to the cuts and have told residents to find alternative living arrangements. That has loved ones and care providers for those catastrophically injured in auto accidents scared for what the future will mean if they lose the ability to provide the life-giving car in their homes. Among them is Rebecca Bond of Howell, whose son Dillon suffered a severe brain injury after being hit by a car in 2013.
Dillon now requires around-the-clock care from a Registered Nurse (RN) and Certified Nurse Assistant (CNA) that is paid for through the Michigan Catastrophic Claims Association. The nonprofit was created in 1978 by the Michigan Legislature and required vehicle owners to buy unlimited lifetime coverage for medical expenses resulting from motor vehicle accidents.
When the bipartisan reform package was signed into law in 2019, the coverage was no longer mandated in an effort to reduce Michigan’s highest-in-the-nation insurance premiums. At the time of the reform, advocates insisted that those needing long-term care would retain that access.
However, a new fee schedule set to go into effect on Friday will impose a 45% cut in compensation for rehabilitation providers, the practical effect of which Bond says will be the loss of those skilled professionals that help keep her son alive. Bond tells WHMI that the plan to make $10 million available for those providers is better than nothing and will only extend the crisis deadline, not resolve it. “I am happy that they are at least discussing this atrocity, but it is far from a fix. $10 million will not last more than a few weeks to the 6,000 that require 24/7 care. I think by making that money available to first-come-first-serve providers, they are trying to weed out the bad actors, but going about it this way will only cause harm to the survivors depending on that care.”
Whitmer has said she is open to a “narrow way” to address concerns from providers and the people they serve. Senate Majority Leader Mike Shirkey, a Clarklake Republican, has been hesitant to consider changes until after the fee reductions take effect July 2. Bills that would amend or delay the provisions have not advanced out of GOP-led legislative committees, including the Senate Insurance Committee which is chaired by Brighton Township Republican Lana Theis.
For Rebecca Bond, however, the crux of the issue is a broken promise and what appears to be an unconstitutional power grab. “Why is the government intervening on a contract I have with my insurance company? How can the insurance company change the terms of the contract while the claim is open?”
To that very point, Republican State Representative Bob Bezotte of Marion Township would seem to agree. Bezotte was among 73 lawmakers, past and present, who signed a legal brief that questions the constitutionality of the proposed changes. He has also co-sponsored a bill to delay the rate change.
The Michigan Brain Injury Provider Council, a trade group, said it appreciated the House recognizing the pending financial blow to specialized rehabilitation care but said the relief would not be timely enough nor big enough.
“We appreciate the intentions of this lifeline — but unfortunately, the rope isn’t long enough to get everyone safely to shore,” President Tom Judd said in a statement.
The insurance industry has said the fee schedule will rein in “dramatic overcharging” and is the main driver of a significant drop in the per-vehicle fee for unlimited personal protection benefits. It will be $86 starting July 2, down from $220 shortly after the law was signed.
Bond, however, is adamant that this about more than money. This is about what is right and what is wrong, and in her opinion, treating people like her son Dillon in the manner that is being proposed is plainly wrong.
“I was born and raised in Michigan, and I loved even saying I am from Michigan so much, that I relocated back here from Florida in 2008 after my husband was killed in a car accident to begin life again with my two youngest sons. I no longer am proud of that fact; I feel shame, disappointment, and outrage toward our government officials and the lack of compassion for its most vulnerable. We haven't had a good Governor for the last three terms. This is just as bad as the Flint crisis, but it is not getting the same attention.”
The Associated Press contributed to this report.