U of M’s Poverty Solution’s Policy Brief: “Building on Michigan’s Auto Insurance Reform Law”

The University of Michigan’s Poverty Solutions multidisciplinary initiative published a policy brief in December 2021 highlighting the effects of auto reform and making specific recommendations for legislators. The study found that rates across Michigan are still the highest in the nation (with Detroit’s premium costing 18% of the median income), while finding that “some individuals injured under the unlimited PIP provisions in the prior law are losing access to catastrophic care services that they previously received, an unintended and unfortunate byproduct of the reform law.”

“While the introduction of a medical fee schedule was necessary to control costs and bring down rates for Michigan drivers, the rate cuts for certain services subject to the lower reimbursement rates, such as those provided by long-term care facilities, may have been too dramatic. Already, reports suggest these fee caps are causing problems for accident victims who were injured prior to the passage of the reform bill, as many providers face budget shortfalls and may be forced to go out of business.”

Although the study is based on older data not yet showing another increase in rates in Michigan, it is still an insightful analysis.

Full publication: https://poverty.umich.edu/publications/building-on-michigans-auto-insurance-reform-law/

Download full study: http://sites.fordschool.umich.edu/poverty2021/files/2021/12/PovertySolutions-Auto-Insurance-Reform-PolicyBrief-December2021.pdf