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Frank A. Douglass Insurance Agency

Auto insurance reform could impact rural healthcare

Hancock native Shannon Perkins, an auto accident survivor with lasting injuries, is warning that there is a cost to the auto insurance reforms passed in 2019. While lower premiums are a big help to drivers in making ends meet, the higher payments had created a network of medical facilities that made Michigan a leader in treating traumatic brain injuries.

Perkins says that already some of those treatment centers are closing, and that will hurt rural residents the most.

I can tell you that since July 2nd, when the new law went into effect, over 40 facilities have already closed. Locally, in the Upper Peninsula we lost Paradise House. Paradise House was a home for neurological rehabilitation. It was associated with the Eisenhower Center, which is down at University of Michigan in Ann Arbor.

Perkins is also worried about a potential rise in medical bankruptcies related to a new fee schedule. For many costs, insurers are paying out less to accident survivors than before.

Services in these neurological facilities, they cut their rates by 55%, what they’re allowed to charge. If something doesn’t have a Medicare code, that allows the insurance company to now cut the rate by which they used to reimburse by 55 percent. They’re now paying for half a person’s wheelchair ramp.

Perkins herself has been forced to get creative to help pay travel costs for a surgery she will be having soon at the University of Michigan Hospital in Ann Arbor. She says that Medicare and Medicaid often refuse what they consider luxury costs, even basic adjustments such as changing the height of a prosthetic to match a new pair of shoes. For Medicare, Perkins points out that there are copays involved, without the benefit of supplemental insurance plans relied on by the elderly in many cases.

Perkins is advocating for legislation that would seek to plug some of the holes caused by the insurance reform package, and is happy to work with both parties to find solutions.

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