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Auto no-fault overhaul is GOP’s ‘Holy Grail’

It's Just Politics with Zoe Clark and Rick Pluta

A political controversy in Lansing that just won’t die is back: auto no-fault insurance. There is yet another Republican effort to muscle through an auto no-fault overhaul, this time being led by state House Speaker Jase Bolger.

There’s a lot in this proposal, released just yesterday, but one of the main things is a cap on the state’s currently unlimited medical benefits if you are injured in a crash. Under the Bolger plan, these benefits would top out at $10 million. Other parts of the proposal include limits on hospital fees and payments for in-home care, incentives to avoid litigation, and a guaranteed rate rollback in the first two years of coverage.

Essentially, there is something in this plan for all of the special interests that have a stake in the auto no-fault system – hospitals, insurance companies, trial lawyers – to dislike. But, Bolger says, bring it on.

History does not suggest an easy victory, or a victory altogether. Voters twicerejected auto no-fault overhauls in the early 1990s and numerous attempts to do the same in the state Legislature have failed. A no-fault overhaul, particularly a cap on medical benefits, remains an elusive prize, the GOP's "Holy Grail."

To succeed, Bolger will have to cut his way through a thicket of special interests and address real concerns about what happens to accident victims who could exceed that $10 million limit. And, by no means does Bolger have a majority in the state House on his side. Democrats are still saying “no” to an overhaul and many of Bolger’s fellow Republicans aren’t ready to get behind the plan.

The Republican Oakland County delegation in the state House has followed the lead of their influential county executive, L. Brooks Patterson. Patterson is no fan of Bolger. Patterson was in a very serious car accident in the fall of 2012 that left him injured and his driver paralyzed. Since the accident, Patterson has become one of the state’s foremost advocate for unlimited no-fault medical benefits. This issue has become a battle between the two powerful Republicans – a personal issue.

Many will remember when Patterson, while taping Michigan Public TV’s “Off the Record,” was asked about Bolger, and he pulled a black comb out of his pocket, placed it under his nose, and responded, “Adolf Bolger, you mean?”

It’s hard to count the number of times an auto no-fault overhaul has been tried, only to crash and burn. People may not like their insurance rates, but they also do like not having to worry about who’s going to pay their medical bills if they’re in a serious car crash.

But we may be reaching critical mass on having something done about insurance, whether it’s the Bolger plan or something else. The reason? Detroit.

That’s because a big part of this plan is a stripped-down, low-cost, low-benefit auto policy that would be offered to low-income drivers in places like Detroit, where there are a lot uninsured drivers, and those who do have insurance pay stratospheric premiums. As we’ve talked about before on It’s Just Politics, there is no fixing Detroit – making it a place to attract a larger middle class – without dealing with the cost of insurance.

There will be great rewards waiting for the Republican who can pull off an auto no-fault revamp, especially that elusive benefits cap.

Jase Bolger has his eye on that prize. And, we shouldn’t forget, in the not-too-distant past, the idea of Michigan becoming a right-to-work state was unthinkable. Bolger was the singular legislative player who made that happen when the rest of Lansing’s Republican leadership was lukewarm to the idea.

It appears Bolger is still looking for one more big win.

Zoe Clark is Michigan Public's Political Director. In this role, Clark guides coverage of the state Capitol, elections, and policy debates.
Rick Pluta is Senior Capitol Correspondent for the Michigan Public Radio Network. He has been covering Michigan’s Capitol, government, and politics since 1987.
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