Michigan is one of the very few states in the United States that gives us the great advantage of providing no-fault benefits to victims injured in automobile accidents. No-fault benefits are paid for by the insurance company and can include reimbursement for lost wages, attendant care, transportation costs to and from medical appointments, and most importantly unlimited lifetime coverage for medical expenses (resulting from a car accident).
Therefore if you suffered a life-long injury, such as a traumatic brain injury or spinal cord injury, as a result of a Michigan automobile accident, the auto insurance company is liable to pay for all medical expenses over your entire lifetime. For those who have suffered such injuries, this is a tremendous benefit as treatment and care can be costly, especially if treatment is provided over a lifetime.
The Michigan Legislature was concerned with putting too much financial stress on an individual insurance company and therefore developed the Michigan Catastrophic Claims Association (MCCA). The MCCA is a private, non-profit association that reimburses insurance companies for medical bills paid out after a qualifying amount. Currently that amount is set at $545,000.00. This means that your insurance company pays your entire claim, but is reimbursed by the MCCA for medical costs over $545,000.00.
Every driver in the state who has an auto insurance policy pays into the MCCA fund through a charge on their auto insurance policy known as the MCCA Assessment Recoupment. The assessment fee is determined by the MCCA. As of July 1, 2015 the assessment amount is $150 per covered vehicle.
Over the years there has been much controversy over the MCCA. In fact, despite receiving several Freedom of Information Act (FOIA) requests, the MCCA has refused to turn its books over to the public and reveal how they determine assessment fees. In addition, there is a common misconception that the fund administered by the MCAA is set up for the benefit of Michigan auto accident victims – consumers who have paid into their insurance policy every year to later become severely injured in an automobile accident and need lifetime care. There is truth to the fact that victims who suffer life-long injuries will need the financial help to receive care. However, due to the discreetness of the MCCA, speculation that the fund is set up for the benefit of the insurance companies who do business in Michigan is a fair assumption.
House Bill 4752 seeks to require the MCCA to disclose more financial information. It is unclear if this bill will pass. With pushes coming from the insurance companies to end unlimited lifetime benefits to consumers injured in a Michigan automobile accident, it seems unfair to decide without public disclosure of the MCCA financials.
At Goodman Acker P.C., we see the results of catastrophic automobile accidents every day. It is our hope that the MCCA will eventually release its books so that the public is knowledgeable as to how the money is spent and whether the premiums paid are adequate.
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