Voted into effect on Thursday, June 24, 2021, Michigan passed a legislation to give $10 Million to rehabilitation facilities and in-home care providers due to the upcoming rate cuts. These severe cuts are due to the changes in auto insurance policies that go into effect on July 1, 2021.
On that day, auto-insurance companies will have a 45% reduction on what they have to pay for post-acute services by those who have been severely injured in crashes. Furthermore, care provided by family members will be capped at 56 hours each week. This reduction was allegedly put into place to allow for lower drivers’ premiums although it is not clear this will happen. What will happen is there will be catastrophic changes for those who rely on in-home or facility for those people who have been seriously injured in a car accident.
$10 Million Is a Start for Rehabilitation Facilities
Due to the unintended consequences for those who have been reliant on these rehabilitation and in-home care, about 6,000 people are estimated to lose care if their providers are forced to close, which is already happening. The MBIPC recently conducted a survey in Michigan, finding that 86% of post-acute care facilities have very little or no faith that they will be able to remain open after the legislation takes effect.
The $10 Million fund will be available on a “first come, first serve” basis for providers with documentation proving a “systematic deficit” because of the limitations they have in charges. Though it is a step in the right direction, it simply isn’t enough.
Even with the additional funds being offered, many neurological centers are announcing that they will be closing, letting their residents know that they will need to find new caretakers and living arrangements. Though rehabilitation centers do appreciate the help, it isn’t nearly enough to keep all of those whose lives depend on these facilities alive and breathing. Some centers have already let their patients know that starting on July 2nd, they no longer will be able to pay for the costs to keep them alive due to the changes in coverage and reimbursement.
Is It Already Too Late for the $10 Million to Help?
Legislators have planned to use the $10 Million as a gauge to analyze the impact of the new lowered auto-insurance law fees on post-acute rehabilitation centers so they can adjust the amount in the future. But by then, it will be too late- thousands of patients will be left without adequate care, thousands of health care workers will be laid off, and most rehabilitation centers fear they will have to close- even with the help given from the initial $10 Million. Many other providers are not even eligible to apply for this funding. The time delays and the bureaucracy involved to get the funds will make it challenging at best for smaller providers to wait for the funding. Only the largest providers will benefit.
Bills proposed to either amend or delay these provisions have not advanced one way or another. And unfortunately, this is not one of those situations where one can “wait and see what happens”. Not only will health care facilities that specialize in post-acute rehabilitation after car accidents start to die out and close, but the people who depend on the care these places provide may as well.
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