SENATE BILL NO. 1233

November 18, 2020, Introduced by Senators HERTEL, SCHMIDT, VICTORY, DALEY, IRWIN, OUTMAN, LAUWERS, BULLOCK, CHANG, MCMORROW, MCCANN, WOJNO, MACGREGOR, BRINKS, MOSS, ALEXANDER, ZORN, HOLLIER, BAYER and GEISS and referred to the Committee on Insurance and Banking.

"The insurance code of 1956,"

by amending section 3157 (MCL 500.3157), as amended by 2019 PA 21.

the people of the state of michigan enact:

Sec. 3157. (1) Subject to subsections (2) to (14), (15), a physician, hospital, clinic, or other person that lawfully renders treatment to an injured person for an accidental bodily injury covered by personal protection insurance, or a person that provides rehabilitative occupational training following the injury, may charge a reasonable amount for the treatment or training. The charge must not exceed the amount the person customarily charges for like treatment or training in cases that do not involve insurance.

(2) Subject to subsections (3) to (14), (15), a physician, hospital, clinic, or other person that renders treatment or rehabilitative occupational training to an injured person for an accidental bodily injury covered by personal protection insurance is not eligible for payment or reimbursement under this chapter for more than the following:

(a) For treatment or training rendered after July 1, 2021 and before July 2, 2022, 200% of the amount payable to the person for the treatment or training under Medicare.

(b) For treatment or training rendered after July 1, 2022 and before July 2, 2023, 195% of the amount payable to the person for the treatment or training under Medicare.

(c) For treatment or training rendered after July 1, 2023, 190% of the amount payable to the person for the treatment or training under Medicare.

(3) Subject to subsections (5) to (14), (15), a physician, hospital, clinic, or other person identified in subsection (4) that renders treatment or rehabilitative occupational training to an injured person for an accidental bodily injury covered by personal protection insurance is eligible for payment or reimbursement under this chapter of not more than the following:

(a) For treatment or training rendered after July 1, 2021 and before July 2, 2022, 230% of the amount payable to the person for the treatment or training under Medicare.

(b) For treatment or training rendered after July 1, 2022 and before July 2, 2023, 225% of the amount payable to the person for the treatment or training under Medicare.

(c) For treatment or training rendered after July 1, 2023, 220% of the amount payable to the person for the treatment or training under Medicare.

(4) Subject to subsection (5), subsection (3) only applies to a physician, hospital, clinic, or other person if either of the following applies to the person rendering the treatment or training:

(a) On July 1 of the year in which the person renders the treatment or training, the person has 20% or more, but less than 30%, indigent volume determined pursuant to the methodology used by the department of health and human services in determining inpatient medical/surgical factors used in measuring eligibility for Medicaid disproportionate share payments.

(b) The person is a freestanding rehabilitation facility. Each year the director shall designate not more than 2 freestanding rehabilitation facilities to qualify for payments under subsection (3) for that year. As used in this subdivision, "freestanding rehabilitation facility" means an acute care hospital to which all of the following apply:

(i) The hospital has staff with specialized and demonstrated rehabilitation medicine expertise.

(ii) The hospital possesses sophisticated technology and specialized facilities.

(iii) The hospital participates in rehabilitation research and clinical education.

(iv) The hospital assists patients to achieve excellent rehabilitation outcomes.

(v) The hospital coordinates necessary post-discharge services.

(vi) The hospital is accredited by 1 or more third-party, independent organizations focused on quality.

(vii) The hospital serves the rehabilitation needs of catastrophically injured patients in this state.

(viii) The hospital was in existence on May 1, 2019.

(5) To qualify for a payment under subsection (4)(a), a physician, hospital, clinic, or other person shall provide the director with all documents and information requested by the director that the director determines are necessary to allow the director to determine whether the person qualifies. The director shall annually review documents and information provided under this subsection and, if the person qualifies under subsection (4)(a), shall certify the person as qualifying and provide a list of qualifying persons to insurers and other persons that provide the security required under section 3101(1). 3101. A physician, hospital, clinic, or other person that provides 30% or more of its total treatment or training as described under subsection (4)(a) is entitled to receive, instead of an applicable percentage under subsection (3), 250% of the amount payable to the person for the treatment or training under Medicare.

(6) Subject to subsections (7) to (14), (15), a hospital that is a level I or level II trauma center that renders treatment to an injured person for an accidental bodily injury covered by personal protection insurance, if the treatment is for an emergency medical condition and rendered before the patient is stabilized and transferred, is not eligible for payment or reimbursement under this chapter of more than the following:

(a) For treatment rendered after July 1, 2021 and before July 2, 2022, 240% of the amount payable to the hospital for the treatment under Medicare.

(b) For treatment rendered after July 1, 2022 and before July 2, 2023, 235% of the amount payable to the hospital for the treatment under Medicare.

(c) For treatment rendered after July 1, 2023, 230% of the amount payable to the hospital for the treatment under Medicare.

(7) If Medicare does not provide an amount payable for a treatment or rehabilitative occupational training under subsection (2), (3), (5), or (6), and if subsection (12) does not apply, the physician, hospital, clinic, or other person that renders the treatment or training is not eligible for payment or reimbursement under this chapter of more than the following, as applicable:

(a) For a person to which subsection (2) applies, the applicable following percentage of the amount payable for the treatment or training under the person's charge description master in effect on January 1, 2019 or, if the person did not have a charge description master on that date, the applicable following percentage of the average amount the person charged for the treatment on January 1, 2019:

(i) For treatment or training rendered after July 1, 2021 and before July 2, 2022, 55%.

(ii) For treatment or training rendered after July 1, 2022 and before July 2, 2023, 54%.

(iii) For treatment or training rendered after July 1, 2023, 52.5%.

(b) For a person to which subsection (3) applies, the applicable following percentage of the amount payable for the treatment or training under the person's charge description master in effect on January 1, 2019 or, if the person did not have a charge description master on that date, the applicable following percentage of the average amount the person charged for the treatment or training on January 1, 2019:

(i) For treatment or training rendered after July 1, 2021 and before July 2, 2022, 70%.

(ii) For treatment or training rendered after July 1, 2022 and before July 2, 2023, 68%.

(iii) For treatment or training rendered after July 1, 2023, 66.5%.

(c) For a person to which subsection (5) applies, 78% of the amount payable for the treatment or training under the person's charge description master in effect on January 1, 2019 or, if the person did not have a charge description master on that date, 78% of the average amount the person charged for the treatment on January 1, 2019.

(d) For a person to which subsection (6) applies, the applicable following percentage of the amount payable for the treatment under the person's charge description master in effect on January 1, 2019 or, if the person did not have a charge description master on that date, the applicable following percentage of the average amount the person charged for the treatment on January 1, 2019:

(i) For treatment or training rendered after July 1, 2021 and before July 2, 2022, 75%.

(ii) For treatment or training rendered after July 1, 2022 and before July 2, 2023, 73%.

(iii) For treatment or training rendered after July 1, 2023, 71%.

(8) For any change to an amount payable under Medicare as provided in subsection (2), (3), (5), or (6) that occurs after the effective date of the amendatory act that added this subsection, June 11, 2019, the change must be applied to the amount allowed for payment or reimbursement under that subsection. However, an amount allowed for payment or reimbursement under subsection (2), (3), (5), or (6) must not exceed the average amount charged by the physician, hospital, clinic, or other person for the treatment or training on January 1, 2019.

(9) An amount that is to be applied under subsection (7) or (8), that was in effect on January 1, 2019, or an amount that is to be applied under subsection (12) or (13), including any prior adjustments to the amount made under this subsection, must be adjusted annually by the percentage change in the medical care component of the Consumer Price Index for the year preceding the adjustment.

(10) For attendant care rendered in the injured person's home, an insurer is only required to pay benefits for attendant care up to the hourly limitation in section 315 of the worker's disability compensation act of 1969, 1969 PA 317, MCL 418.315. This subsection only applies if the attendant care is provided directly, or indirectly through another person, by any of the following:

(a) An individual who is related to the injured person.

(b) An individual who is domiciled in the household of the injured person.

(11) An insurer may contract to pay benefits for attendant care for more than the hourly limitation under subsection (10).

(12) If Medicare does not provide an amount payable for a treatment or rehabilitative occupational training under subsection (2), (3), (5), or (6), and if the person is a rehabilitation clinic, this subsection applies. An amount allowed for payment or reimbursement under this subsection and subsection (13) must not exceed the lesser of the amount payable under the Michigan auto no-fault rehabilitation clinic fee schedule or the average amount charged by the rehabilitation clinic for the treatment or training on January 1, 2019, unless the treatment or training was not provided by the rehabilitation clinic on January 1, 2019, in which case the Michigan auto no-fault rehabilitation clinic fee schedule must be used to determine the maximum amount payable. A neurological rehabilitation clinic is not entitled to payment or reimbursement for a treatment , training, product, service, or accommodation for residential services, day treatment, or therapy services for individuals with a brain injury or spinal cord injury unless the neurological rehabilitation clinic is accredited by the Commission on Accreditation of Rehabilitation Facilities or a similar an organization recognized by the director for purposes of accreditation, certification, or licensure under this subsection. This subsection accreditation requirement does not apply to a neurological rehabilitation clinic that is in the process of becoming accredited as required under this subsection on July 1, 2021, unless 3 years have passed since the beginning of that process and the neurological rehabilitation clinic is still not accredited. The director may determine that accreditation, certification, or licensure is not required or appropriate for certain treatments or types of rehabilitation clinics. The director may consider relevant factors including, but not limited to, the nature of treatment rendered, geographic location of treatment rendered, and the size of the clinic.

(13) If the rehabilitation clinic fee schedule adopted under this subsection is modified and if the director determines the modified rehabilitation clinic fee schedule meets the standards in this subsection, the director shall by order adopt the modified rehabilitation clinic fee schedule. The rehabilitation clinic fee schedule must meet all of the following requirements:

(a) Be a reasonable approximation to the fee schedule set forth in subsection (2)(a) on January 1, 2019.

(b) Be established based on a survey of rates of rehabilitation clinics including members of the Michigan Brain Injury Provider Council and a majority of this state's rehabilitation clinics accredited in interdisciplinary outpatient medical rehabilitation by the Commission on Accreditation of Rehabilitation Facilities and, from that survey, determine a reasonable approximation by comparing, as of January 1, 2019, the amount payable under Medicare to the average amount rehabilitation clinics charge for the same treatments payable under Medicare, resulting in an equivalency factor, and applying that equivalency factor to average rates for treatments for which Medicare does not provide an amount payable.

(c) Establish the maximum amount payable to rehabilitation clinics for treatment or training rendered after July 1, 2021.

(14) (13) Subsections (2) to (12) (13) do not apply to emergency medical services rendered by an ambulance operation. As used in this subsection:

(a) "Ambulance operation" means that term as defined in section 20902 of the public health code, 1978 PA 368, MCL 333.20902.

(b) "Emergency medical services" means that term as defined in section 20904 of the public health code, 1978 PA 368, MCL 333.20904.

(15) (14) Subsections (2) to (13) (14) apply to treatment or rehabilitative occupational training rendered after July 1, 2021.

(16) (15) As used in this section:

(a) "Charge description master" means a uniform schedule of charges represented by the person as its gross billed charge for a given service or item, regardless of payer type.

(b) "Consumer Price Index" means the most comprehensive index of consumer prices available for this state from the United States Department of Labor, Bureau of Labor Statistics.

(c) "Emergency medical condition" means that term as defined in section 1395dd of the social security act, 42 USC 1395dd.

(d) "Level I or level II trauma center" means a hospital that is verified as a level I or level II trauma center by the American College of Surgeons Committee on Trauma.

(e) "Medicaid" means a program for medical assistance established under subchapter XIX of the social security act, 42 USC 1396 to 1396w-5.

(f) "Medicare" means fee for service payments under part A, B, or D of the federal Medicare program established under subchapter XVIII of the social security act, 42 USC 1395 to 1395lll, without regard to the limitations unrelated to the rates in the fee schedule such as limitation or supplemental payments related to utilization, readmissions, recaptures, bad debt adjustments, or sequestration.

(g) "Neurological rehabilitation clinic" means a person that provides post-acute brain and spinal rehabilitation care."Michigan auto no-fault rehabilitation clinic fee schedule" or "rehabilitation clinic fee schedule" means the Michigan auto no-fault rehabilitation clinic fee schedule copyrighted in 2020 by William R. Buccalo and Margaret J. Kroese.

(h) "Person", as provided in section 114, includes, but is not limited to, an institution.

(i) "Rehabilitation clinic" means a person that provides treatment and is not a hospital.

(j) (i) "Stabilized" means that term as defined in section 1395dd of the social security act, 42 USC 1395dd.

(k) (j) "Transfer" means that term as defined in section 1395dd of the social security act, 42 USC 1395dd.

(l) (k) "Treatment" includes, but is not limited to, products, services, and accommodations.