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Providers: $25 million fund to help us survive after no fault law change is a failure

Tracy Samilton
Shara Curry, RN, helps her patient, Kelley Miller, paralyzed from the neck down, take a drink. Miller is now in the hospital because Curry's company wasn't being paid for her care under the state's no fault law changes.

Companies that care for catastrophically injured car crash survivors quickly began going out of business after July 1st last summer.

That's when changes to the state's auto no fault law cut their reimbursements by nearly half.

In response, state legislators set up a $25 million dollar provider fund to help them cover the shortfalls. Provider trade groups said the amount would only help a handful of companies, since it was a fraction of the actual industry-wide shortfall of about $350 million per year.

"This is not a fix. We are crying from the rafters, please, please help us. We can't continue to go the way we're going."
Deanna Cronk, Best Care Nursing Services

But there are other, even more serious problems with the fund, providers said. In short, the money appears to be nearly unobtainable.

Only four companies have applied for the funds so far. None have yet to receive relief. In the same time, nearly 100 companies have gone out of business or stopped accepting auto accident patients.

Jeremy Fellows, CEO of First Light Home Care, said the application requirements are so onerous, the program is virtually useless. His company declined to even try for that reason.

Fellows said the application requires the submission of every invoice that the company sent out since 2019.

Some invoices are sent by mail, he explained, some by email, some by fax, and some via online systems, depending on each insurance company's requirements.

"It is literally impossible to gather every single invoice that we've ever had since 2019. I figured I would have to hire three CPAs," said Fellows, whose company employs about 300 nurses and home care aides. "And it would require them six months to try to generate this information."

By which time, adding in administrative staff time, he figured he'd probably have spent about $500,000 just to apply. That's the upper limit of the amount any one company can request from the fund.

State legislators should stop stalling and using the failed fund as an excuse for not solving the crisis, said Fellows. Statewide, more than 1,500 car crash survivors have lost care because their companies have shut down or had to discharge them for lack of payment.

Many car crash patients who've lost their care have called his company, but he has to turn them away. It's heartbreaking, he said, but he's already losing money on the people the company cares for now, and he can't afford to add more debt.

He doesn't know how much longer it will be before his company has to shut down, too, leaving 100 more people with no care.

"Patients have died because of this," he said. "They're suffering."

Deanna Cronk is Director of Nursing at Best Care Nursing Services, an agency based in Grand Rapids.

Her company is one of the four that is trying to get through the convoluted and time-consuming application process to obtain some relief. She understands why most companies took a look at the program and determined it wasn't doable.

Cronk said in order to be eligible to even apply for relief, the program's rules require the company to go through a process called "utilization review." That's an appeals process to ask the Department of Insurance and Financial Services (DIFS) to decide if an insurance company is not paying the right amount.

The vast majority of these utilization reviews, providers say, are determined in favor of the insurer, because the new law explicitly allows them to pay less than the actual cost of providing care.

"That process (utilization review) appears to take 49 days," said Cronk. "But the reality is, one case we appealed took 102 days. Another took 97 days. That's an extraordinarily long time to wait when the math doesn't work to keep your doors open."

Cronk said after Best Care Nursing Services completed the utilization reviews, filled out the applications and sent the required paperwork, DIFS contacted the company a week later and said more documentation was required.

"This is not a good solution," she said of the program. "It's a hardship to us as a company. We're going to continue to try, because our back is to the wall and we don't have any other choices, but we need a fix and this is not a fix. We are crying from the rafters, please, please help us. We can't continue to go the way we're going."

In a statement, DIFS said:

The law sets forth criteria and standards for providers to meet in order to access the fund, and DIFS’ role is to administer the fund as directed by the Legislature. Anything we can do to expedite the process for providers, we have put in place, including distilling statutory requirements into a checklist and providing guidance to providers about deficiencies in their applications rather than simply rejecting them. We have contracted with outside accounting firms to review complete applications within 21 days or less and DIFS has 7 days to distribute funds after the review is complete.
Department of Insurance and Financial Services

Tracy Samilton covers energy and transportation, including the auto industry and the business response to climate change for Michigan Public. She began her career at Michigan Public as an intern, where she was promptly “bitten by the radio bug,” and never recovered.
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