A study released on Monday showed that the state of Michigan can possibly lower auto insurance premiums without having to amend its no-fault proposal that remains undecided on by the state government.
According to the report from the Citizens Research Council of Michigan, auto insurers pay a larger amount of health care bills in comparison to government-backed schemes such as Medicare and Medicaid, or private insurance firms.
The study suggests that motorists who are injured in a vehicular mishap receive better care from medical facilities in Michigan, as the state offers “expansive and nearly unlimited coverage” to individuals. A total of 11 possible alternatives were listed as possible tools to ameliorate the increasing cost of health benefits, subsequently reducing the cost of auto premiums.
While some of the options may reduce the benefits, the report stated that others may ensure that current benefits retain high quality standards and remain comprehensive and competitive for consumers.
Some of the possible tools listed include assigning a motorist’s health insurer as the primary payer and the auto insurer as the secondary payer when it comes to automobile accidents, and allowing auto insurers to pay the amount typically charged by medical specialists and facilities rather than what they would charge.
The report suggests auto insurers are different from health insurance firms in the sense that they cannot impose co-pays and deductibles on their customers. “Uniquely, Michigan’s auto insurance does not contain cost containment measures related to medical spending and some provisions make it difficult or impossible for auto insurance to initiative such changes on their own,” concluded the study.