Republicans set to relieve insurance industry of No Fault medical burden despite impact on injured
Yesterday, Michigan Republicans announced yet another favor for the insurance industry, and another "life is fine if you have plenty of cash and can afford it" measure: they plan to introduce legislation today to eliminate Michigan's unlimited medical coverage for persons injured in motor vehicle collisions. They tout the savings that will result to motorists, however, with no regulation of the insurance industry's underwriting, you can bet that few savings will materialize, but further enhanced insurance profits will.
Republicans don't bother to explain the subtleties of the changes they are instituting: with fewer people paying for good coverage and more people buying "cheap" no fault medical, the cost of catastrophic injuries will push no fault medical premiums higher and there will be an accelerated impact on taxpayers as they "pick up the tab" for badly injured people.
Meanwhile, people without other health insurance will need to go forego needed treatments, particularly medications and physical therapy. People who are fortunate enough to have other health insurance will find, since the Republican Justices ruled in favor of insurers last week, that any compensation they are due for lost wages, loss of quality of life, or pain and suffering, are instead diverted to pay the health insurers' expenses. This is because while most people are unaware of it, their employer-funded health insurance grants the health plan the right to be fully repaid by any wrongdoer before the injured party receives a dollar. The recent Supreme Court decision holds that ERISA health plans do not even need to contribute to litigation costs or fees: they can stand back and watch the injured person sue, and then demand full payment of any recovery, even if it wipes out the recovery and even if the recovery comes form Uninsured or Underinsured Motorist Coverage purchased by the injury victim. A similar provision applies to medical expenses covered by Medicare or Medicaid.
Let me take a moment to make sure that concept is clear: a drunk runs a stop sign and strikes your 8-year old daughter. She is paralyzed from the neck down. She incurs $600,000.00 in the first two years, with expenses far in excess of $50,000.00 each year, minimum, from now on. The drunk had average of coverage and he pays your daughter $50,000.00 or $100,000.00. You bought excellent UIM coverage that pays her an additional $400,000.00. What will she get to compensate for a crippled lifetime? To pay for all of her lost lifetime income? Nothing. Every dime of coverage on the drunk and every dime of coverage you bought will go to satisfy the lien that benefits your health insurer--who stepped in to pay after the modest no fault medical was exhausted.
With all the tragedy and unfairness in the world, these changes in Michigan's no fault law hardly qualify as this week's cardinal travesty: Nevertheless, if you think that special interests shouldn't be able to do favors for people with money--and yank the rug out from under catastrophically injured innocent victims by duplicitous legislation and judicial rulings--this should offend you. And if you think changes in public policy ought to be transparent and thoroughly debated in public, it should offend you even further.
Oh, by the way, the bill would also install a limitation on the charges medical providers can bill, similar to the workers compensation "schedule." This is probably the one measure in the bill that won't be adopted, since the health care industry has enough money and political pull among Republicans to elimiate this provision. As a result, the primary burden on our economy--the escalating cost of medical care--which is also driving the changes in no fault--will not be addressed or retarded.