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The Michigan Supreme Court orders catastrophic injury payments to continue

The Hall of Justice is seen from a distance on a gray day in Lansing.
Carlos Osorio
The Michigan Hall of Justice in Lansing.

A 2019 law rolled back reimbursements for at-home attendant care and rehabilitation clinics.

The Michigan Supreme Court will decide whether changes made to the state’s auto insurance law in 2019 are constitutional. But, in an order issued Thursday, the court said insurance companies must continue paying the pre-2019 benefit levels until the case is decided.

Providers say cuts to benefits were putting them out of business and leaving patients without the care they needed. The constitutional question is whether insurers can reduce those payments after people paid for coverage.

Attorney Mark Granzato said the 2019 law violates the contracts clause of the Michigan Constitution.

“And the contracts clause says, basically, a vested right that exists in contract can’t be altered by legislative action, and that was our major constitutional claim in this case,” he told the Michigan Public Radio Network.

“This is not an ordinary case,” he said. “This is an incredibly important legal issue that effects thousands and thousands of people in Michigan.”

The Michigan Court of Appeals ruled last month that the payment reductions can’t be imposed retroactively to people injured before the 2019 law was enacted without violating the state constitution.

Erin McDonough of the Insurance Alliance of Michigan said the Supreme Court order will damage efforts to bring down the high cost of auto insurance.

“Both before and after the 2019 reforms, insurers have remained liable to pay reasonable and medically necessary care for this injured in auto accidents in Michigan,” she said.

“The issue is not about access to care, but about medical providers demanding an unchecked level of compensation.”

The law was challenged by families, home health care providers and brain injury clinics.

The state Supreme Court scheduled oral arguments to be heard in March of next year.