Coordination of Benefits with Michigan No-Fault Auto Insurance

The following information is applicable if you have Personal Injury Protection (PIP) coverage through your auto insurance carrier. Under Michigan auto insurance reform effective July 1, 2020, some will have chosen to waive PIP coverage through auto insurers.

You can see how U-M health plans factor into new PIP coverage options under Michigan auto insurance reform.

If You Have Personal Injury Protection (PIP) Coverage Through Your Auto Insurance Carrier

The University of Michigan sponsored group health plans coordinate benefits under the state of Michigan's coordination of benefits law, including the no-fault law, and other applicable laws.

The basic no-fault auto policy has three parts: Personal Injury Protection (PIP); Property Protection Insurance (PPI) and Residual bodily injury and property damage liability. The PIP portion of your no-fault policy pays for medical costs if you are hurt in a car accident. There are two types of PIP medical coverage: “excess or coordinated coverage” versus “primary or uncoordinated coverage.” How your health plan coordinates with your no-fault policy will depend on whether you are an employee, retiree or enrolled in Medicare Advantage.

Coordination with Health Plans

The university’s self-insured non-ERISA plans include those administered by BCBSM and BCN. The university's self-insured non-ERISA health plans will assume primary liability to provide benefits available under your university plan in accordance with the benefit plan's terms and conditions regardless if you have purchased a coordinated or uncoordinated no-fault automobile policy.

University-sponsored Medicare Advantage plans typically do not coordinate with auto insurance for accident-related injuries. This is due to the Medicare Secondary Payer law requiring Medicare to serve as secondary coverage to other insurers for accident-related medical expenses, including those covered by auto insurance. Coordination of benefits letters are available on your Medicare Advantage health plan’s webpage, or contact customer services using the phone number on the back of your health plan ID card.

Questions?

Please consult with your automobile insurance carrier if you have any questions about the terms of your no-fault policy. The university is unable to answer or respond to any questions you may have regarding your no-fault automobile policy.

The Michigan state legislature initiated auto insurance reform in 2019 to provide financial relief to Michigan drivers. This reform affects the level of personal injury insurance (PIP) you choose for yourself under your auto insurance plan, as well as others covered under your plans.

What is Michigan auto insurance reform?

Public Acts 21 and 22 are amendments to the state of Michigan’s Insurance Code. They were passed by the state legislature in June 2019 and went into effect on July 1, 2020. The amendments are part of the legislature’s effort to make Michigan’s no-fault auto insurance more affordable by giving members options.

How does this affect my auto insurance?

As of July 1, 2020, you have the option to choose your level of PIP, or Personal Protection Insurance, in your auto insurance plan. PIP pays for your medical expenses if you’re injured in an automobile accident. Before Public Acts 21 and 22, PIP was a state-required charge within your policy, and the state required all members to purchase unlimited PIP coverage.

Does my U-M health plan cover medical expenses related to an auto accident?

How your health plan coordinates benefits with your no-fault auto insurance policy depends on the type of medical insurance plan in which you are enrolled.

• University-sponsored health plans for active employees and pre-Medicare retirees generally assume primary responsibility for providing benefits available under the plan, in accordance with the terms of the applicable benefit plan document, regardless of whether you have purchased a coordinated or uncoordinated no-fault automobile policy.
• University-sponsored Medicare Advantage plans typically do not coordinate with auto insurance for accident-related injuries. This is because the Medicare Secondary Payer law requires that Medicare serves as secondary coverage to other insurers for accident-related medical expenses, including those covered by auto insurance.

U-M’s health plans do not cover certain services, such as attendant care, housing and vehicle modifications, and lost wages.

What are my PIP options under Michigan's no-fault auto insurance reform?

You have the option to continue unlimited PIP coverage on your auto insurance policy if you prefer. You may also have the option to purchase different levels of PIP coverage, including waiving PIP coverage altogether, depending on your personal/family situation and whether you and others in your household are enrolled in qualified health coverage, as defined by the law. Your insurance agent can provide more detail about the options available to you and the impact on your auto insurance cost.

Is my health insurance plan through U-M considered qualified health coverage?

Yes. Employees and retirees enrolled in U-M health plans are already covered for medical claims resulting from an automobile accident through these plans. U-M health plans are qualified health coverage as defined by the insurance code. However, U-M health plans do not cover certain services, such as attendant care, housing and vehicle modifications, as well as lost wages.

My auto insurance company has requested a letter stating I have qualified health coverage. Where do I get my letter?

Get a Health Care Plan Verification Letter through Wolverine Access by selecting Employee Self-Service > Benefits > Health Care Plan Verification. Follow the instructions on that page to have your letter created. Turn off pop-up blocker and private browsing prior to opening your Auto Health verification letter. If you are unable to access Wolverine Access to obtain your Health Care Plan Verification Letter please email [email protected] with your request.

If U-M health plans cover my medical expenses related to an auto accident, should I still purchase PIP through my auto insurer?

It depends on your individual situation. Some people have additional disability insurance that may pay for expenses not covered in U-M’s health plans, such as attendant care, housing and vehicle modifications, and lost wages. Talk with your auto insurer about your options. Determine how you would be affected financially if a family member in your household needed excessive medical care after an auto accident.

Where can I find more information about Michigan auto insurance reform?

Go to michigan.gov/autoinsurance for more information.

Drivers may wish to discuss their PIP options with their auto insurance agent.