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LEGAL ALERT
New Guidance for Physicians on Michigan’s
Auto No-Fault Reform Fee Caps
BY PATRICK J. HADDAD, ESQ. AND KATHLEEN A. WESTFALL, ESQ.*
In an effort to reduce Michigan’s “highest-in- the-nation” auto insurance premiums, the 2019 Michigan auto no-fault reform legislation adopted widespread changes to Michigan’s no-fault insurance law and the Michigan Insurance Code. The key changes imposed by the legislation included a series of caps on fees for treatment and training services rendered on or after July 2, 2021 to individuals injured in auto accidents. The legislation also introduced new procedures for disputing payments received from insurers for treatment and training services rendered. This article furnishes a high-level update on selected issues for Michigan physicians regarding these changes.
Limits on Fees for Services Rendered
The legislation did not change the legal requirement that physicians and other health care providers may charge only a “reasonable fee” for medical services rendered to an individual injured in an auto accident, and that the charge must not exceed the amount the person customarily charges for like treatment in cases not involving insurance. However, beginning July 2, 2021, the legislation now
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limits the amount physicians and other providers may receive for treatment and other services rendered as follows:
• No more than 200% of the amount payable by Medicare, but not exceeding the average amount charged by the physician or other provider for the treatment or training on January 1, 2019. The “amount payable by Medicare” means the amount payable to participating providers under Medicare Part A or Part B under the fee schedule in effect on March 1 of the service year and for the area in which the service is rendered.
• If Medicare does not provide an amount payable for the treatment or training, then no more than 55% of the physician or other provider’s charge description master (i.e., fee schedule) in effect on January 1, 2019 or if none, 55% of the physician or other provider’s average charge for the service as of January 1, 2019.
The fee caps will be further reduced for treatment and training rendered after July 1, 2022, and again after July 1, 2023, subject to annual adjustments based on the Consumer Price Index for the year
DECEMBER 2021/JANUARY 2022 | WWW.OCMS-MI.ORG