LANSING — A bipartisan group of 73 state legislators and former legislators informed the Michigan Court of Appeals in a “that’s what we said, but it’s not what we meant” legal brief that they oppose retroactive application of no-fault insurance reform.
The amicus brief filed Thursday in an ongoing insurance-related lawsuit, comes just weeks before changes to state law, passed in 2019, are scheduled to go into effect.
After July 1, auto insurance companies will no longer be obligated to pay family members for more than 56 hours per week of care — no matter when the auto insurance claim was filed — and the reimbursement rate for services not covered by Medicare will be cut by 45 percent.
“We do not believe the Legislature intended for (insurance law reforms) to be applied retroactively,” a memo signed by members of the group stated. “Many of us voted on this legislation understanding that (the reforms) would only be applied prospectively.”
Kris Ruckle-Mahon has been arranging care for her daughter, Brittney Ruckle, in their Traverse City home for the past 14 years, following the life-threatening injuries Brittney received in a car crash in 2007.
Brittney, now 23 years old, requires 24-hour care, paid for via an insurance claim filed shortly after the accident, but that is now in jeopardy.
If legislators didn’t know what was in the bill, Ruckle-Mahon said, they shouldn’t have signed it.
“That legislation did say that they were going to cut what they’ll pay for continuing care by 45 percent,” Ruckle-Mahon said. “Maybe they didn’t understand it. I’m not sure how you could sign a bill, on Mackinac Island, in the middle of the night, and not read it first.”
Gov. Gretchen Whitmer signed the bill May 30, 2019 while attending a policy conference on Mackinac Island.
Many of the state’s 7 million licensed drivers cheered the bipartisan change, anticipating lower car insurance premiums once they weren’t forced to carry coverage they not only didn’t want, but that no other state in the country required.
The reform no longer mandates Michigan drivers carry unlimited personal injury protection, but allows drivers to chose between unlimited, $500,00, $250,000, $50,000 or a complete opt-out for those with other insurance.
It bans insurance companies from using “non-driving factors,” such as zip code, credit score, gender, marital status, occupation, education or homeownership to set rates.
The legislative group argues the new reform law contains no specific language giving insurance companies permission to apply the new fee schedules to claims made before 2019 — but the reverse is also true.
The law contains nothing saying they can’t do that. And, they have.
A brain injury rehabilitation clinic and guardians of two auto crash victims filed suit against Citizens Insurance and USAA Casualty Insurance, which was dismissed in November by Ingham County Circuit Court Judge Wanda Stokes.
The case, now with the state’s Court of Appeals, attracted the attention of Representatives Julie Brixie and Andrea Schroeder, who rallied support from other legislatures and former legislators and filed the amicus brief June 3.
Neither Rep. John Roth (R-Traverse City) or Sen. Wayne Schmidt (R-Traverse City) had signed the bill.
A staffer in Schmidt’s Lansing office said the senator preferred to have legislative action on the issue.
Argument 1: “The Legislature did not intend to apply the changes to the No-Fault Act retroactively to individuals injured in motor vehicle accidents before the No-Fault act was amended.”
Argument 2: “Applying the recent changes made to the No-Fault Act retroactively is not consistent with Michigan law because it violates the Contracts Clause of the Michigan Constitution.”
People who’ve been injured in a car accident and receive therapy at home aren’t the only ones who, since the bill’s passage, have been trying to sound the warning about its impact.
Small, mostly locally-owned rehabilitation facilities like The Lighthouse of Traverse City, may be forced to close if the rates they can charge for care are cut by almost half, said Recreational Therapist Jessica Stark.
“We’ve been told we’ve had two years to plan for this but I’d like to know what they expect that plan to be,” Stark said. “Have young people in their 20s go into a nursing home? Don’t put the blame on the families and the facilities when the legislature knew this was a problem and did nothing in two years to fix it.”
The steps of the Capital Building will be the site of a rally and a press conference June 9, beginning at 1 p.m.
Ruckle-Mahan said she and Brittney will be there, along with members of the We Can’t Wait group, formed in April, and who’ve made repeated visits to Lansing to speak with legislators.
“Its not easy for Brittney to do an all-day trip like this but it’s a big day for us,” Ruckle-Mahan said. “This is our third trip to Lansing on this issue — the first one was in September a few months after they passed the bill and it feels like, so far anyway, nothing has changed.”