Mid-October Update

DIFS Bulletin addressing reimbursement limitations to certain products, services and accommodations

Katie Tucker, member of CPAN General Counsel

On October 11, 2021, the Director of the Department of Insurance and Financial Services (“DIFS”) issued Bulletin 2021-38-INS addressing the applicability of the reimbursement limitations set forth in MCL 500.3157 to certain products, services and accommodations that constitute “[a]llowable expenses” under MCL 500.3107(1)(a).  Specifically, in the Bulletin, DIFS opined that “[p]roducts, services, and accommodations that are not provided by physicians, hospitals, clinics, or other like persons . . .” are not subject to the reimbursement limitations set forth in MCL 500.3157.   In the Bulletin, DIFS also expressed its view that MCL 500.3157 “governs the amount payable to any persons providing attendant care” services to auto accident survivors.
The Bulletin provided examples of several types of products, services, and accommodations that are, in DIFS’ view, exempt from the “fee caps” in MCL 500.3157, including, but not limited to, the following:
  • Services related to guardianship or conservatorship;
  • Vehicle modifications;
  • Home modifications;
  • Computer equipment and supplies;
  • Generators;
  • Non-emergency medical transportation;
  • Non-prescription drugs;
  • Over-the-counter medical supplies; and
  • Certain case management services
Notably, the list of exempted products, services, and accommodations set forth in the Bulletin is not exhaustive, as DIFS itself acknowledged.  Instead, according to DIFS, the proper inquiry for determining whether a particular product, service or accommodation is subject to the reimbursement limitations set forth in MCL 500.3157 is whether it was “provided by physicians, hospitals, clinics, or other like persons.”
Moreover, in the Bulletin, DIFS explicitly directed no-fault insurers who have applied the reimbursement limitations in MCL 500.3157 to products, services, and accommodations that are exempt (including those listed above) to “re-process” the claim immediately, applying only the “reasonable[ness]” requirement set forth in MCL 500.3107(1)(a).  Further, DIFS instructed providers whose bills have been processed improperly to contact the no-fault insurer at issue to request reconsideration.
In short, DIFS’ Bulletin 2021-38-INS may be used by providers other than “physicians, hospitals, clinics, or other like persons” to assert that the “fee caps” set forth in MCL 500.3157 should not be applied to limit reimbursement by no-fault insurers for the products, services, or accommodations that those providers  render to auto accident survivors.

MPHI ANF Survey Deadline extended until midnight, Monday, October 18

To open the survey, click the link Auto Crash Survivors and Service Providers Survey, or copy https://redcap.mphi.org/surveys/?s=JD9HKLL4HP into your web browser

The deadline for the Critical survey has been extended until midnight, Monday, October 18, 2021.  If you have completed the survey - Thank you!  If you have not - PLEASE DO NOT DELAY.  The information gathered is of great importance to assess the impacts of the July changes to auto no-fault.   If there are questions you can't or don't wish to answer, skip those and continue.  If you have any questions contact Shaohui Zhai, Statistician, PhD.  szhai@mphi.org or 517 324-8354.

DIFS Bulletin reaffirming insurers obligation to pay providers

Katie Tucker, member of CPAN General Counsel

On October 5, 2021, the Director of the Department of Insurance and Financial Services (“DIFS”) issued Bulletin 2021-36-INS to reaffirm the statutory obligation of no-fault insurers to remit payment to providers upon receipt of “reasonable proof” of loss and to express its views regarding common billing disputes arising under the No-Fault Act.  Specifically, in the Bulletin, DIFS addressed disputes involving each of the following 3 topics:  (1) billing format; (2) charge description master or “average amount” documentation; and (3) coding.  With regard to the first, DIFS affirmed that the Insurance Code does not require that providers use a particular billing form (e.g., CMS-1500 or UB-04) and that providers are entitled to timely payment, regardless of the type of form or invoice that they use to submit their charges.  With regard to the second, DIFS opined that an insurer may request that provider supply a copy of its charge description master or the “average amount” it charged on January 1, 2019, but that the insurer remained liable to remit payment upon receipt of the requested documentation in accordance with the timelines set forth in MCL 500.3142.  With regard to the third, DIFS reiterated its expectation that an insurer “engage in a dialogue with [a] provider” regarding its “review” of the provider’s bills and “expedite [processing] bills resubmitted with correct codes.”
Moreover, in this Bulletin, DIFS admonished insurers that any of the following patterns of conduct may constitute a violation of MCL 500.2026 and subject an insurer to an administrative action against it:  
  • Repeatedly refusing to pay claim amounts that are not reasonably in dispute;
  • Insisting on a specific form as the sole basis for refusing payment;
  • Rejecting bills repeatedly without offering assistance to a provider; or
  • Repeated violations of MCL 500.3142
In short, DIFS’ Bulletin 2021-36-INS serves as a warning to no-fault insurers who have been, or continue to, engage in any of the conduct described therein – and as a reminder of their obligations under the No-Fault Act to remit timely payment upon “reasonable proof” of loss.   Further, the Bulletin is reaffirmation of the principle that “zero is not an option” for insurers for reimbursing providers for treatment rendered under the No-Fault Act. Notably, too, the Bulletin makes clear that providers need not use a particular billing form to be eligible for reimbursement for treatment rendered under the Act.

Michigan Medical Billers Association and CPAN Co-Host Auto No-Fault Billing and Payment Seminar

Information and resources to equip your business to develop and implement strategies to get bills paid and tips on how and when to appeal.  The seminar includes breakout discussions and Q&A for:        
  1. Provider Group I:  Larger-scale providers who render treatment that is generally reimbursable under Medicare.                                        

  2. Provider Group II:  Smaller-scale providers who render treatment, including, but not limited to, in-home attendant or nursing care or therapy, that is generally not reimbursable by Medicare.

  3. Provider Group III:  Including but not limited to, physician offices who render treatment including office services (Evaluations and Management[E&M], X-rays, & Procedures, outpatient and inpatient services (E & M & Surgical).

    Register at: https://protectnofault.org/events

Legislative Report

Kevin McKinney - CPAN Legislative Coordinator

Work continues to refine a fee schedule proposal to advance with our current legislative champions in the House and Senate so that hopefully one option can be pushed starting in the House. Additionally, there is a small bi-partisan House workgroup continuing to meet and discussion a few other critical issues that will be introduced in the next few weeks.  More information will be shared once there is final agreement on policy language and sponsorship. The goal for these legislative initiatives is to continue to gain support and get them passed and over to the Senate as soon as possible, despite a rather short legislative calendar for the remaining calendar year.

Please continue to share with your legislators the continued challenges in providing services and the impact on your clients and their families.  Your advocacy, along with others, is making a difference.


Significant Development in Circuit Court Ruling Regarding Fee Schedule Application

George Sinas, CPAN General Counsel

We are very pleased to report that the Genesee County Circuit Court has issued an order in the case of Melrose v Nationwide Mutual Insurance Company finding that the fee schedule limitations of MCL 500.3157 cannot be retroactively applied to persons who purchased policies and were injured before. In that regard, the Order states in pertinent part:
The contractual right of insurance consumers, such as Bethany Melrose, became legally vested when two things happened: (1) the premium was paid; and (2) the party covered by the insurance policy sustained a qualifying injury triggering payment of benefits under the purchased policy . . . . Under the statute that existed when Bethany’s rights vested, she was entitled to services rendered by a physician, hospital, clinic or other person or institution lawfully rendering treatment to an injured person for accidental bodily injury covered by personal protection insurance, and a person or institution providing rehabilitative occupational training following the injury that were allowed to charge reasonable and customary charges without regard to any governmental or third party fee schedule limitations. Bethany’s vested rights should not now be impaired by fee schedule limitations . . . . Where a newly enacted statute or amendment relieves a party of a substantive duty, it should not be retroactively applied. Retroactive application here would relieve Defendant of the duty it had to pay reasonable and customary charges to Bethany’s providers for treatment.
Obviously this is a very significant development that comes at a critically important time. Moreover, it followed another recent Circuit Court opinion from Wayne County in the case of Cools v Home-Owners Insurance Company, wherein Judge David Allen issued a preliminary injunction prohibiting Defendant Auto Owners from enforcing the benefit restrictions under the new No-Fault Act.
Template 7 - Mid-October Update