Michigan no-fault law changed in 2019

In 2019, the Michigan Legislature amended many portions of the no-fault act.  The no-fault act is the statute in Michigan that governs lawsuits for the recovery of personal insurance protection (PIP) benefits and pain and suffering damages after a car accident.  The 2019 law impacts medical providers in a unique way.

Fee Caps

The new no-fault law puts fee caps on certain services provided by medical providers.  Before the new law, insurance carriers were responsible for reimbursing medical providers for reasonably necessary services for a patient’s care, recovery or rehabilitation.  The only criteria for a medical provider’s treatment cost was that the cost be reasonable and customary.  Now, reimbursement is capped depending on whether the services are compensable by Medicare.

If you are a medical provider, whether you are subject to the reimbursement rates capped at 55% of what you were providing as of January 1, 2019, depends on if the service had a Medicare reimbursement code.  If the service did not have a reimbursement code, then you can only recover 55% of the fee you charged as of January 1, 2019.  If your service was compensable under Medicare, you can be reimbursed for up to 200% of the amount payable under Medicare depending on the date of service (the rates go down each year through 2023).