Businesses caring for victims of severe auto accidents preparing to close after Legislature sides with insurance lobby

More closures expected, leaving seriously injured patients with nowhere to go

BRIGHTON, Mich.—(May 27, 2021)—With just over five weeks to go before reimbursements for specialized rehabilitation care are slashed by 45%, Michigan small businesses that care for victims of catastrophic auto accidents are already announcing that they will be closing their doors—the result of the auto insurance industry’s fierce lobbying against bills that would protect access to care for thousands of victims who require life-saving care.  

Passed as part of auto insurance reform in 2019, the 45% slash in reimbursements goes into effect on July 1. The provision will be devastating to thousands of seriously injured patients who will have nowhere to go for the life-saving care they need—according to a study commissioned by the Michigan Brain Injury Provider Council (MBIPC), eight out of 10 facilities are expecting to close their doors unless a legislative fix is passed.  

“As predicted, we’re seeing the first group of healthcare businesses announce their impending closures due to the slash in reimbursements,” said Tom Judd, president of the MBIPC. “There will certainly be more. This scenario is entirely avoidable—if only our legislative leaders were willing to put vulnerable constituents ahead of the insurance lobby.”

Senate Bill 314, introduced by Senator Curtis Hertel, Jr., of East Lansing, and House Bill 4486, introduced by Rep. Doug Wozniak, of Shelby Township, offer a narrow fix to the fee schedule. The bills would impose a reasonable fee schedule or cap provider reimbursements at their 2019 level instead of gutting the amount that caregivers receive for doing complex, high-intensity work. The legislation would do so without changing any other aspect of auto insurance reform whatsoever.

However, Senate Majority Leader Mike Shirkey and House Speaker Jason Wentworth have indicated they will not give the bills a hearing. Governor Gretchen Whitmer is deferring responsibility to the legislature.

Randal Bruce, co-owner of Aspire Rehabilitation Services Management in Troy, said that he will be ceasing all business operations on June 30. Aspire offers a full range of rehabilitation services including a residential program, where injury survivors get the support they need while they undergo their treatment.  

“It’s devastating to lose the business that you’ve put your blood, sweat and tears into—but it’s even more heartbreaking to know that our patients will have nowhere to go,” Bruce said. “Each of the survivors we serve is like a family member to us. It’s shameful that the Legislature refuses to step in and make this narrow and technical fix that would protect vulnerable survivors.”

John Prosser, vice president and partner at Health Partners Inc., said his business will also be closing down on June 30. The company has been in business for 29 years and has locations in Kalamazoo, Flint, Grand Rapids, Traverse City and Bingham Farms.

“There are very few businesses that can take a 45% pay cut and expect to survive,” Prosser said. “Come July 1, catastrophically injured patients will be getting dropped off at nursing homes and hospitals that are unequipped to deal with their specialized needs. This is a tragedy that lies at the feet of the Michigan Legislature.”

Judd called on the Legislature to take action before it leaves for its summer break.

“Some Michigan leaders have claimed that they want to see ‘data’ before taking action to protect accident victims,” Judd said. “The reality is these ‘data’ points are human beings worthy of ongoing specialized care. Unfortunately, businesses are already closing, and their patients will have nowhere to go. Gov. Whitmer, Speaker Wentworth and Leader Shirkey can’t hide from this issue anymore. They need to take action now and put the needs of accident victims over insurance profits.”