Insurance Alliance of Michigan issues statement regarding appeal, plans to file amicus brief in support

LANSING – The Insurance Alliance of Michigan released the following statement in response to an appeal filed with the Michigan Supreme Court in a key auto no-fault case known as Andary v USAA and Citizens Insurance.

Last month, the Michigan Court of Appeals ruled on the case, removing a key provision that is keeping medical claims costs and rampant overcharging in check and making auto insurance more affordable in Michigan.

“The appeal filed today by the respective insurance companies involved in the Andary case is intended to ensure the savings Michigan drivers have been experiencing since the 2019 bipartisan reforms took effect can indeed continue,” said Erin McDonough, executive director of the Insurance Alliance of Michigan. “The intent of reforms was to make auto insurance more affordable for Michigan families and small businesses. Three years into reforms, Michigan drivers have saved an estimated $5 billion. The medical fee schedule established by these bipartisan auto no-fault reforms is critical because it reins in overcharging by medical providers and brings fairness, common sense, and transparency to the costs of medical care. The Court of Appeals ruling striking a key portion of the fee schedule threatens to roll back that progress. The Insurance Alliance of Michigan plans to file an amicus brief supporting the appeal in the coming days.”

Long-term care is one of the highest costs to auto insurance and the one most rife with overcharging. With little accountability in the old auto no-fault system, unscrupulous medical providers pushed unnecessary procedures and unchecked billing as a way to significantly overcharge Michiganders and bilk a system with no cost controls. Under the old system, medical providers could charge three, four, and even 10 times more for the same medical procedures.

The Court of Appeals decision did not affect changes made to the law in 2019 that provided more choices for drivers selecting personal injury protection coverage or erode the Medicare-based cost controls.

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IAM is a government affairs and public information association that represents auto, home and business insurance companies and related organizations operating in Michigan. Learn more about IAM and its members on Facebook, Twitter or at www.insurancealliancemichigan.org.