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LEGAL ALERT
Michigan Auto No-Fault Reform: Proposed Utilization Review Rules PATRICK J. HADDAD, ESQ. AND KATHLEEN A. WESTFALL, ESQ.
As part of the 2019 Auto No-Fault Reform legislation, the Michigan legislature amended the No-Fault Act to introduce a new "utilization review" system for evaluating claims for treatment, products, services or accommodations rendered by health care providers to individuals injured in auto accidents. "Utilization review" means the initial evaluation by an insurer of the appropriateness of the level and the quality of treatment, products, services, or accommodations provided based on medically accepted standards.
The Auto No-Fault Reform legislation required the Michigan Department of Insurance and Financial Services (the "Department") to issue administrative rules to establish criteria or standards for utilization review that identify utilization of treatment, products, services or accommodations above the usual range of utilization for the treatment, products, services or accommodations based on medically accepted standards. The administrative rules are also required to provide procedures related to: utilization review, including procedures for
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acquiring necessary records, medical bills, and other information concerning the treatment, products, services, or accommodations provided; allowing an insurer to request an
explanation for and requiring a physician, hospital, clinic, or other person to explain the necessity or indication for treatment, products, services, or accommodations provided; and appealing determinations. By rendering any treatment, products, services, or accommodations to injured persons under the No-Fault Act, a health care provider agrees to submit necessary records and other information concerning treatment, products, services, or accommodations provided for utilization review and to comply with any decision of the Department.
On December 16, 2019, the Department issued its proposed Utilization Review rules (the "Proposed Rules") which, iffmalized, would apply to No-Fault medical care provided after July 1, 2020 to an injured person who is insured under a policy of No-Fault automobile insurance. As of February 1, 2020, the Proposed Rules have not yet become effective and remain subject to further revision by the Department, as well as to comment by the public and a public hearing.
The Proposed Rules, if made effective, could significantly impact the manner for which all claims for No-Fault treatment, products, services and accommodations rendered by health care providers are submitted and reimbursed, as well as how disputed claims may be resolved. Physicians and other providers have already begun to identify numerous concerns with the Proposed Rules. One concern is that the Proposed Rules will establish unreasonable and unnecessarily burdensome and costly documentation standards and dispute resolution requirements for all claims for No-Fault services. Another concern is that the Proposed Rules
MARCH/APRIL 2020 I WWWOCMS-MIORG