By Elena Durnbaugh and Nick Smith
Posted: August 5, 2023 2:33 PM

Samantha Sesi was a freshman at Michigan State University in 2021 when she got a phone call from her uncle that would change her life.

"There's been an accident," he told her.

Her mom, her dad and her brother were on their way to her brother's hockey game when they were hit head on. Her dad suffered a traumatic brain injury and broke most of the bones in his body. Her mom suffered a spinal cord injury.

"Long story short … they're considered miracles," Sesi said. "But after the fact, it's been really hard … our lives have just completely changed. The parents are supposed to take care of the children, but we've had to kind of step up and become their caregivers. And I would say probably 75 percent of the reason that we had to change our lives so much was because of this, quote, reform that was made to the auto no-fault law."

PA 21 of 2019 and PA 22 of 2019 made sweeping changes to the state's auto no-fault law. Among them were limiting reimbursement for family-provided attendant care to 56 hours per week and capping a health care provider's reimbursement for services not covered by Medicare to 55 percent of the fees charged as of January 1, 2019.

Earlier this week, the Michigan Supreme Court struck down the retroactive component to the 2019 no-fault auto insurance medical fee schedule that limits reimbursements in the system. The case was Andary v. USAA Casualty Insurance (See Gongwer Michigan Report, July 31, 2023).

The court ruled the limitations didn't apply to people injured prior to 2019. But for those like Sesi and her family, the limitations to no-fault are still in effect, and it's crushing them.

The Andary decision was a win for people who were injured prior to the 2019 changes, but that still leaves thousands of people out in the cold, said Stephen Sinas, the president of the Michigan Brian Injury Provider Council and legal counsel for Coalition Protecting Auto No-Fault, an organization that works to preserve Michigan's no-fault auto insurance model.

"While the people covered by Andary are celebrating, the people who were injured after June 11, 2019, have nothing to celebrate until the Legislature takes action to fix these limitations so that they're not so draconian for injured people," he said.

Amid her grief, Sesi had to step into the role of caregiver for her parents and her younger siblings. She had to take on the responsibility of figuring out how to make ends meet and fighting with the insurance company to try to get her mom and dad the care they needed.

"My parents both had 24-hour care. That's what the doctor wrote for them," Sesi said. "The insurance just kind of came back with, 'We'll contract it out to an agency.' There are no agencies left. And then I started getting really upset with one adjuster – we're now on our fourth or fifth adjuster because it's just a mess. No one wants to deal with it. No one wants to take our calls."

The 2019 laws completely changed the system and made it so people who were used to having comprehensive health care coverage were in a limited health care program, Sinas said.

"That has all kinds of effects on the people and our health care economy," he said. "They made very complicated changes to the law and made it even harder to understand and to navigate. And they have created more reasons to litigate. What we need is to simplify issues that go into how providers are paid. We need to look at the limitations that were imposed on various aspects of care and determine better ways to address those issues."

Sesi added that the insurance company doesn't follow through with the things she sends to claims, and it takes months for those claims to get paid.

The fee schedule went into effect in July 2021, causing problems for the approximately 17,000 people receiving care under the prior no-fault law, which assured unlimited coverage for "all reasonable charges" needed to provide care for those catastrophically injured. Providers also said they could no longer afford to provide care for patients due to a lack of funds.

"They fall behind on our attendant care and on our replacement services on our milage," Sesi said. "We're thinking about getting a lawyer just to help our case because it's getting to a point where I'm 21-years-old, and I have high blood pressure and my hair's falling out. It's just getting to a point where I physically can't do it anymore."

The Insurance Alliance of Michigan has defended the importance of the fee-schedule as a key provision to keeping insurance costs down.

"You can't reasonably expect to save Michigan drivers money while obliterating a key cost control measure like the fee schedule. What medical providers charge for services and prescribe for care, above and beyond what's medically necessary, can be controlled and has proven to reduce the cost of auto insurance," Erin McDonough, executive director of the Insurance Alliance of Michigan, said in a statement issued Monday following the Andary decision. "A medical fee schedule for auto insurance, similar to private health insurance, Medicare and Medicaid has been a huge benefit to consumers because it reins in rampant overcharging by medical providers and brings fairness, common sense and transparency to the broken auto no-fault system."

Sesi and her siblings get paid 56 hours a week to care for her mom and 56 hours per week to care for her dad. The rest of the time, they do it for free, balancing school and other jobs to make ends meet. At first, the insurance company wanted to pay them $8.75 per hour because Sesi's siblings were under 18 and living at home. Michigan's minimum wage in 2021 was $9.65 per hour.

"That was a slap in the face," she said. "They finally moved it up to $11, and one of my main points was I can go down the street to get a job at McDonald's for like, $16 an hour and I don't have to help someone wipe themselves. I don't have to help anyone get in the shower. I don't have to cook meals. I don't have to help them out of bed. I don't have to remind them of their medication, organize their drawers, make sure they have clean clothes. It's a lot of work."

Lawmakers are aware that changes are needed, despite the Andary decision.

"It will definitely save lives, but it does not affect … crashes that happened after that law went into effect, and so it's still the law of the land," said Rep. Julie Rogers (D-Kalamazoo), who chairs the House Health Policy Committee.

Rogers said the 56-hour cap on family attendant care, the fee schedule reduction and the utilization review process needed specific legislative fixes.

Rep. Brenda Carter (D-Pontiac), who chairs the House Insurance and Financial Services Committee, said her committee is ready to move forward with no-fault discussions.

"Now, we have the green light to start looking at this in a more holistic manner," she said. "There are a lot of (bills) that are going through committee as we speak, and every single one of them is on the table to be looked at."

Carter hopes to start that work soon as the Legislature returns in the fall.

"We need to address this immediately, now that we know that we've got direction on which way to go," she said. "My personal decision would be to start looking at some of the bills on our agenda that we can look at addressing this and moving things forward."

She said there were several bills that only needed a bit of tweaking before they could be advanced.

"Coming up with nuanced ideas that will work for everybody is critical," Carter said. "And I think we're at that point right now, after speaking to both sides."

Carter said that it was a priority to keep premiums and insurance costs low while still providing people with necessary levels of care. She also said that personal injury protection coverage also needed to be part of the conversation.

"It's not a one-sided solution here … It's going to be whatever is best for Michiganders," she said. "We want to be very strategic and very careful."

In the Senate, Sen. Mary Cavanagh (D-Redford Township), chair of the Senate Finance, Insurance and Consumer Protection Committee, said she expected legislation to be ready for introduction by the end of the month.

"I'm very optimistic on it coming up before the end of the year," she said.

Cavanagh said she believes there has been enough information gathered since 2019 to show the law needs to be changed. The biggest hurdles will be crafting the legislation and getting members who were not part of the Legislature in 2019 up to speed.

Sesi also has gained firsthand knowledge of the problems with the utilization review process as she's fought insurance companies to get her parents the care they need.

Initially, Sesi said her dad was in an intensive care facility in Chicago, but eventually, he was moved to a facility in Okemos. One day, he had a doctor's appointment, but his case manager was late to get to the facility. Sesi didn't know what to do, so she decided to drive her dad to his appointment.

"Then medical transport came, and they were extremely furious that my dad didn't want to go in the car and ride with them, so they took just his wheelchair in the medical van," she said. "The insurance started saying, 'Well, clearly you guys can handle the medical transport, so why do we have to pay for it?' And at that point, that was just to first doctor appointment I had taken him to since her returned home from Chicago."

Sesi also fought with the insurance company for two years to get raised toilets in their home so her parents could use the bathroom more easily.

"It was a whole huge mess," she said.

Although there are instances where insurance companies are presented with claims that should be scrutinized, there are too many cases where people are being denied coverage that they need, Sinas said.

"The boogey man is always if you give people their care back, they're going to have to pay more in their rates," he said. "Perhaps that's true, if (insurance companies) can show us that. But let's also look at other aspects of rates to see how we can save money and still let people get the care they need."

Rogers said there's momentum around policy changes. Her bill on utilization review already has 56 cosponsors.

"That sends a strong message that there's a majority of the House on both sides of the aisle that support that kind of specific reform," she said. "Those are the big pieces … that need immediate attention because of the care crisis, everyday people are losing their care."

Sesi said the laws need to be more specific and the current system is unsustainable.

"We need the laws to be more specific than what they are," she said. "A fair rate to family members and a fair rate to care providers is obviously very different than what the insurance feels is a fair rate when we all know that the insurance is being as cheap as they can and trying to cut corners."

Beyond the immediate issues of the care cap, the fee schedule and utilization review, Rogers said auto insurance affordability needed to be addressed.

"That was really why the 2019 bill was touted, was because of Michigan being the highest in the nation for auto insurance rates," she said. "Another study was released last week saying we're right back up there to number one, so the reforms have not had the consequences that some have claimed. They have not really driven down prices or rates."

Sen. Jeff Irwin (D-Ann Arbor) was one of four Senate Democrats who voted against the final versions of the no-fault legislation in May 2019.

He said the long-term attendant care problems that providers have been speaking to the lawmakers about over the last four years "were pretty obvious" in the legislation as it was being finalized. Irwin called the changes made to attendant care and the fee schedule "a recipe for disaster."

Rogers said she's heard the concerns that removing the restrictions on care coverage would drive insurance rates even higher, but she believes it should be a "both/and" conversation.

"We absolutely need to do things to drive down costs, but I think at the same time, we can balance that with improved care and easing some of these restrictions that were kind of arbitrary," she said.

Rogers said one area she's interested in looking at is how non-driving factors affect insurance rates.

"We're one of the states that continues to use credit scores, for example, and people with lower credit scores unfairly get penalized," she said. "Using non-driving factors has been a tactic to drive up rates, and I think that's an area that we could probably see some reforms."

The Andary decision was a step forward, but there's more to do, Rogers said.

"The work isn't done, and I'm committed to finishing it and helping get people to the care that they need," she said.

The 2019 law did help more people obtain coverage, Cavanagh said, which is one of the positives of the law. She added that "no major legislation is perfect" and requires adjustments over time.

Sesi said she's tired of seeing the changes made to no-fault in 2019 being propped up as a success by Governor Gretchen Whitmer and other politicians.

"Everyone got a $400 check, like, great, thanks for my $400 check. But now these people are dying," she said, referencing the money paid out to Michigan drivers last year from the Michigan Catastrophic Claims Association.

In a statement, Whitmer Press Secretary Stacey LaRouche highlighted the need for the changes in 2019.

"When Governor Whitmer took office, she made auto insurance reform a priority with the goal to lower the cost of auto insurance and protect coverage for drivers who are involved in a crash. Before these reforms, Michigan drivers were paying the highest auto insurance rates in the nation, which created a dangerous situation as many drivers were on the road without insurance," LaRouche said. "People who were injured in auto accidents should rest assured that we will continue to work to ensure they get the medically appropriate care they need, no matter when they were injured."

Carter said that the changes to no-fault were made during her first term in office and that they were made quickly without time to fully understand their consequences. This time, lawmakers have been having conversations about no-fault since the beginning of the term, and she's been providing a report to House Speaker Joe Tate (D-Detroit) on a weekly basis.

"We want to make sure that whatever comes out of this doesn't have the same effect," Carter said. "We want to make sure we get it right…We must make sure that the people of Michigan are not adversely impacted by a decision a second time."

The need for urgency isn't lost on Carter.

"We are moving with lightning speed," she said. "Stay tuned."