HOUGHTON - State Rep. Scott Dianda held a town hall meeting in Houghton Tuesday night on a proposed bill that would add restrictions to the state's no-fault auto insurance law.
Dianda, D-Calumet, appeared with representatives from Coalition Protecting Auto No-Fault, a state coalition to preserve the current no-fault system.
The group is acting in response to the proposed House Bill 4612 (H-1), intended to address high insurance premiums. The bill would replace the current lifetime medical and rehabilitation coverage with a lifetime cap of $1 million, among other provisions.
Garrett Neese/Daily Mining Gazette
Panelists are seen at a town hall meeting on proposed changes to Michigan’s no-fault auto insurance law in Houghton Tuesday. From left are Kevin McKinney, legislative consultant for Coalition Protecting Auto No-Fault; State Rep. Scott Dianda, D-Calumet; John Cornack, president of CPAN and the Eisenhower Center; and Martha Levandowski, administrative director for CPAN.
The bill was reported out of the House Insurance Committee in May, but did not get enough support to pass.
Dianda said there have been discussions in Lansing including people for and against the bill on what can be done to reduce fraud and bring rates down. If there is a change, he said, he wants a benefit to consumers beyond the $125-per-vehicle rebate promised in the bill.
"I just want to make sure that when we're dealing with any kind of change, that we're going to have a benefit that's going to take care of the consumer, and that we are going to be guaranteed that if we do change this, that in two years time, I'm not paying that same rate and have half of the coverage," he said.
Tim Rogan of Calumet said Michigan's current system has been instrumental in his recovery from a traumatic brain injury. He opposes the proposed House bill.
"I don't like it," he said. "I used to think that big business always looked out for us. I just feel like we'd be getting less ... the way the money goes, people would be getting no care."
John Cornack, president of CPAN and the Eisenhower Center, said Michigan's no-fault insurance provides the best coverage for people in auto accidents of anywhere in the country.
The system is unique in that someone catastrophically injured will come out of rehab and go on to post-acute care, then back home with attendant help, in which families and loved ones can be paid to help you. In other states, patients would go to a skilled nursing home, he said. The House bill would create more scenarios common to other states, where families go bankrupt and go into the Medicaid system. Cornack said the change would cost taxpayers $30 million annually.
"Michigan does it better, and we should be thankful for that," he said.
Audience member Mike Godby, president of Northern Mutual Insurance Co. in Hancock, said he wasn't advocating for or against the bill. But he said he has seen a tremendous amount of waste in the system, such as people with six-figure salaries being paid to care for loved ones.
"This is one of the most inefficient, expensive systems I've seen in my career," he said. "I moved here from Missouri and my auto insurance doubled."
The largest cost driver is the medical benefits, Godby said, coming from an aggregation of costs that are substantially higher through auto carriers.
A fee schedule for doctors, such as the one in the bill, would help bring costs down, he said.
By and large, most people want to retain the current system with reforms, said Kevin McKinney, legislative consultant for CPAN.
He said they are looking at accountability, such as in family-provided care and cost containment, while retaining affordability. The proposed House bill doesn't have that balance, he said.
"When we start doing the math, and the fact that after one year, they can continue to increase the premium, there's little savings, and you've lost a very significant benefit that a collective group ... has said we want to keep," he said.
Dianda will hold additional meetings today at 1 p.m. in the L'Anse village chambers and at 6:30 p.m. at the Iron County Courthouse in Crystal Falls.
To read the proposed House bill, go to tinyurl.com/n6dcjcj.