June 28, 2007, Introduced by Rep. Virgil Smith and referred to the Committee on Insurance.
A bill to amend 1956 PA 218, entitled
"The insurance code of 1956,"
by amending section 3107 (MCL 500.3107), as amended by 1991 PA 191,
and by adding section 3107c.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 3107. (1) Except as provided in subsection (2), personal
protection insurance benefits are payable for the following:
(a) Allowable expenses consisting of all reasonable charges
incurred for reasonably necessary products, services and
accommodations for an injured person's care, recovery, or
rehabilitation. Allowable expenses within personal protection
insurance coverage shall not include charges for a hospital room in
excess of a reasonable and customary charge for semiprivate
accommodations except if the injured person requires special or
intensive care, or for funeral and burial expenses in excess of the
amount set forth in the policy which shall not be less than
$1,750.00 or more than $5,000.00. Allowable expenses include, but
are not limited to, charges for case management services by a case
manager selected or approved by the injured person or a person
authorized to act on the injured person's behalf and charges for
home care services as described in section 3107c. If the injured
person, or a person acting on his or her behalf, submits reasonable
proof that products, services, or accommodations are reasonably
necessary for the injured person's care, recovery, or
rehabilitation and the injured person consents to be provided with
the products, services, or accommodations in question, an insurer
shall issue written notification to both the injured person, or a
person acting on his or her behalf, and to the provider of the
products, services, or accommodations in question, that the insurer
will guarantee payment when the products, services, or
accommodations are provided to the injured person. Charges for
products, services, or accommodations are considered incurred under
this section as follows:
(i) When the products, services, or accommodations are provided
to the injured person.
(ii) When the injured person pays or becomes liable or in some
way obligated or conditionally obligated to pay for the products,
services, or accommodations.
(iii) When an insurer gave or should have given a guarantee of
payment under this subdivision.
(b) Work loss consisting of loss of income from work an
injured person would have performed during the first 3 years after
the date of the accident if he or she had not been injured. Work
loss does not include any loss after the date on which the injured
person dies. Because the benefits received from personal protection
insurance for loss of income are not taxable income, the benefits
payable for such loss of income shall be reduced 15% unless the
claimant presents to the insurer in support of his or her claim
reasonable proof of a lower value of the income tax advantage in
his or her case, in which case the lower value shall apply.
Beginning
March 30, 1973 For the period
beginning October 1, 2006
through September 30, 2007, the benefits payable for work loss
sustained in a single 30-day period and the income earned by an
injured person for work during the same period together shall not
exceed
$1,000.00 $4,589.00, which maximum shall apply pro rata to
any
lesser period of work loss. Beginning October 1, 1974 2007,
the
maximum shall be adjusted annually to reflect changes in the cost
of living under rules prescribed by the commissioner but any change
in the maximum shall apply only to benefits arising out of
accidents occurring subsequent to the date of change in the
maximum. Notwithstanding any other provision in this act, work loss
benefits shall not be reduced by amounts paid by the injured
person's employer or paid under a wage continuation plan
established by a collective bargaining agreement.
(c) Expenses not exceeding $20.00 per day, reasonably incurred
in obtaining ordinary and necessary services in lieu of those that,
if he or she had not been injured, an injured person would have
performed during the first 3 years after the date of the accident,
not for income but for the benefit of himself or herself or of his
or her dependent.
(2) A person who is 60 years of age or older and in the event
of an accidental bodily injury would not be eligible to receive
work loss benefits under subsection (1)(b) may waive coverage for
work loss benefits by signing a waiver on a form provided by the
insurer. An insurer shall offer a reduced premium rate to a person
who waives coverage under this subsection for work loss benefits.
Waiver of coverage for work loss benefits applies only to work loss
benefits payable to the person or persons who have signed the
waiver form.
(3) Subject to subsection (1)(a), an insurer shall not issue a
policy or impose any conditions upon the payment of claims that in
any way limits or restricts a person's selection of a provider or
the nature and extent of the treatment or services rendered by a
provider. This prohibition applies regardless of whether an insured
has received a reduced premium rate for deductibles and exclusions
reasonably related to other health and accident coverage on the
insured under section 3109a and regardless of what other health and
accident coverage or benefits cover, or are available to, the
insured.
(4) A provider rendering services to an injured person that
are compensable under subsection (1) is entitled to collect, from
the person's insurer, any balance of the provider's charges that
was not paid by other health and accident coverage or benefits,
even when a portion of the provider's charges were paid to the
provider under a participating agreement or other similar
relationship.
(5) An insurer may review a personal protection insurance
claim to determine the reasonableness of a charge and the
reasonable necessity of a product, service, or accommodation. In
performing a review, an insurer may request or conduct expense
audits provided, however, that an insurer shall not consider or
implement any fee schedules or other reimbursement methodologies
used under any governmental program, private contract, or third
party payor relationship. If an insurer reviews a claim to
determine the reasonableness of a charge or the reasonable
necessity of a product, service, or accommodation, the insurer
shall take into consideration all factors relevant to the
determination, including, but not limited to, all of the following:
(a) The nature, severity, and complexity of the injury and the
treatment or service rendered with respect to the injury.
(b) The skill, training, expertise, and reputation of the
provider rendering the treatment or service.
(c) The charges of other providers rendering similar treatment
or services in the same or similar geographic locality within which
the claimed treatment or service has been rendered.
(d) The facts and circumstances surrounding the treatment or
services rendered.
(6) If an insurer denies all or part of a personal protection
insurance claim based upon the reasonableness of the charge or the
reasonable necessity of the product, service, or accommodation, the
insurer shall fully disclose to the claimant and the claimant's
provider the basis for the denial and all facts, evidence, and data
supporting the insurer's position with respect to the denial and
shall submit this information within 30 days of receiving proof of
the fact and amount of the claim. Failure to provide the disclosure
creates a presumption of an unreasonable delay or refusal of a
claim under section 3148.
(7) If an insurer enters into an agreement with an injured
person or a person authorized to act on his or her behalf
concerning the payment of a personal protection insurance claim,
all of the following apply:
(a) The insurer, prior to paying any agreed upon amount or
undertaking to perform any agreed upon obligation, may seek a full
and final discharge of the insurer's legal obligation to pay the
specific claim that is the subject of the agreement for the period
of time specified in the agreement by obtaining an order from a
court of appropriate jurisdiction finding that the agreement is
fair, reasonable, and appropriate under all the circumstances.
(b) If the claim is one for which the insurer is eligible to
receive indemnification from the catastrophic claims association
because the threshold under section 3104(2) has been exceeded, the
insurer paying the claim or performing an agreed upon obligation
after receiving a court order under subdivision (a) shall receive
full indemnification from the catastrophic claims association for
the total amount paid by the insurer in accordance with the court
order that is in excess of the threshold amounts listed in section
3104(2).
(c) If the agreement involves, in any way, payment for past
services rendered to the injured person by providers whose services
have not yet been fully paid by the injured person or by a person
or entity acting on his or her behalf, then all such providers
shall be given written notice of the agreement before a court order
under subdivision (a) can be entered and shall be given a
reasonable opportunity to appear and protect their respective
interests regarding the agreement.
(d) If the agreement involves, in any way, payment for future
services that may be rendered to the injured person, the insurer
shall send a copy of the court order approving the agreement to all
providers known to the insurer who have rendered services or who
are currently rendering services to the injured person.
(8) All costs of obtaining any order under subsection (7) are
the sole responsibility of the insurer. An insurer's request for an
order under subsection (7) does not limit, qualify, diminish, or
alter the insurer's duty to pay claims under this act, including,
but not limited to, sections 3142 and 3148 concerning the timely
payment of claims. In addition, regardless of whether an insurer
has obtained a court order with respect to an agreement to pay a
claim for allowable expenses under subsection (7), any agreement
negotiated between an insurer and an injured person or his or her
authorized representative concerning the payment of allowable
expenses incurred in the future may periodically be judicially
reviewed in order to ensure that the agreement is fair, reasonable,
and appropriate under all of the circumstances existing at the time
of the review.
Sec. 3107c. (1) As used in section 3107 and this section,
"home care services" includes, but is not limited to, the following
enumerated services or treatment when rendered in a home setting to
an injured person by noncommercial providers for the injured
person's care, recovery, or rehabilitation, regardless of whether
the provider is licensed, certified, or registered or is a relative
or nonrelative of the injured person, except when the services are
otherwise prohibited by law if rendered by persons who are not
licensed, certified, or registered by this state:
(a) Attendant or personal care.
(b) Medical care.
(c) Nursing care.
(d) Assistance with activities of daily living.
(e) Case management.
(f) Physical, occupational, speech, or other therapy.
(g) Monitoring or cuing of the injured person.
(h) On-call assistance.
(i) Nutritional and meal services.
(j) Personal hygiene.
(k) Psychological counseling.
(l) Behavioral management.
(m) Room and board and accommodations if the injured person
would otherwise require institutionalization.
(n) Supervision of others providing services or treatment
described in this subsection.
(2) In determining the reasonableness of charges for home care
services, the following factors may be considered:
(a) The nature and severity of the injury.
(b) The nature and level of disability of the injured person.
(c) The nature and complexity of the service or treatment and
the qualifications and experience of the person rendering the
service or treatment.
(d) The injured person's needs and desires for the service or
treatment.
(e) The benefit and value of the service or treatment to the
injured person.
(f) The commercial rates charged by commercial agencies or
professional providers to render a similar service or treatment.
(g) The wages and fringe benefits paid by commercial agencies
or professional providers to their employees to render a similar
service or treatment.
(h) The actual cost incurred by the provider in rendering the
service or treatment.
(i) The market value of the service or treatment.
(j) The value of the economic opportunity lost by the provider
in rendering the service or treatment, including, but not limited
to, lost business opportunities, lost employment opportunities, and
lost educational opportunities.
(k) Any other relevant factor.
(3) An insurer may require 1 or more of the following in
processing a claim for home care services:
(a) A notarized statement on a form approved by the
commissioner in which the injured person or a person authorized to
act on his or her behalf describes the service for which payment is
sought and affirms, under oath, that the service was provided as
described.
(b) Written verification from a provider knowledgeable about
the claim that the care rendered to the injured person was
reasonably necessary for the injured person's care, recovery, or
rehabilitation.
(c) A written authorization signed by the injured person or a
person authorized to act on his or her behalf permitting the
release, to the insurer, of any medical records relevant to the
claim for home care services.
(4) Neither the making of a request for 1 or more of the
documents described in subsection (3) nor the failure to make a
request for 1 or more of the documents described in subsection (3)
precludes an injured person from seeking judicial enforcement of a
claim for home care services under this act or alters an insurer's
responsibility to pay a claim for home care services under this
act.