HOUSE BILL NO. 6280

A bill to amend 1956 PA 218, entitled

"The insurance code of 1956,"

by amending sections 3142 and 3157a (MCL 500.3142 and 500.3157a), section 3142 as amended and section 3157a as added by 2019 PA 21, and by adding section 3155.

the people of the state of michigan enact:

Sec. 3142. (1) Personal protection insurance benefits are payable as loss accrues.

(2) Subject to subsection (3), personal protection insurance benefits are overdue if not paid within 30 days after an insurer receives reasonable proof of the fact and of the amount of loss sustained. Subject to subsection (3), if reasonable proof is not supplied as to the entire claim, the amount any separable amount that is supported by reasonable proof is overdue if not paid within 30 days after the proof is received by the insurer. Subject to subsection (3), any part of the remainder of the claim that is later supported by reasonable proof is overdue if not paid within 30 days after the proof is received by the insurer. For the purpose of calculating the extent to which benefits are overdue, payment must be treated as made on the date a draft or other valid instrument was placed in the United States mail in a properly addressed, postpaid envelope, or, if not so posted, on the date of delivery.

(3) For personal protection insurance benefits under section 3107(1)(a), if a bill for the product, service, accommodations, or training is not provided to the insurer within 90 days after the product, service, accommodations, or training is provided, the insurer has 60 days in addition to the 30 days provided under subsection (2) to pay before the benefits are overdue.

(4) All of the following apply to proof of loss as required by this section:

(a) Exact proof of the fact and the amount of loss sustained is not required for proof of loss to be reasonable. Any definite proof of the fact and the amount of the loss sustained is payable.

(b) Proof of loss does not have to be provided in or using a form required by the insurer. Information provided in any format that shows the fact and the amount of loss sustained is reasonable.

(c) For proof of loss payable under section 3107 that is subject to a reimbursement limitation under section 3157 that requires consideration of a charge description master or, if the provider did not have a charge description master at the relevant time, the provider's average amount charged for the treatment or training rendered, if the charge description master or average amount is not provided with the proof of loss, within 15 days after receiving the proof of loss the insurer shall request that the charge description master or average amount be provided. If an insurer does not make a request under this subdivision, the payment is considered overdue.

(d) For proof of loss payable under section 3107 that is subject to a reimbursement limitation under section 3157 that requires consideration of an amount payable under Medicare, providing a correct code for the treatment provided is not required for the proof of loss to be reasonable.

(5) (4) An All of the following apply to an overdue payment under this section:

(a) The payment bears simple interest at the rate of 12% per annum.

(b) The insurer shall pay an additional amount equal to 5 times any amount that was supported by reasonable proof.

Sec. 3155. (1) Subject to subsection (2) and section 3107(1)(a), an insurer shall pay a reasonable amount for an allowable expense under section 3107(1)(a). Products, services, and accommodations that are allowable expenses under this subsection include, but are not limited to, all of the following:

(a) Services related to guardianship or conservatorship.

(b) Vehicle modifications.

(c) Home modifications.

(d) Computer equipment and supplies.

(e) Generators.

(f) Nonemergency medical transportation.

(g) Nonprescription drugs and over-the-counter medical supplies.

(h) Case management services that are not payable under Medicare.

(2) Section 3157 provides reasonable amounts for allowable expenses that are treatment, products, services, accommodations, and rehabilitative occupational training that are provided by a physician, hospital, clinic, other medical institution, or similar person. Allowable expenses to which section 3157 applies include attendant care.

Sec. 3157a. (1) By rendering any treatment, products, services, or accommodations to 1 or more injured persons for an accidental bodily injury covered by personal protection insurance under this chapter after July 1, 2020, a physician, hospital, clinic, or other person is considered to have agreed to do both of the following:

(a) Submit necessary records and other information concerning treatment, products, services, or accommodations provided for utilization review under this section.

(b) Comply with any decision of the department under this section.

(2) A physician, hospital, clinic, or other person or institution that knowingly submits under this section false or misleading records or other information to an insurer, the association created under section 3104, or the department commits a fraudulent insurance act under section 4503.

(3) The department shall promulgate rules under the administrative procedures act of 1969, 1969 PA 306, MCL 24.201 to 24.328, to do both of the following:

(a) Establish criteria or standards for utilization review that identify utilization of treatment, products, services, or accommodations under this chapter above the usual range of utilization for the treatment, products, services, or accommodations based on medically accepted standards.

(b) Provide procedures related to utilization review, including procedures for all of the following:

(i) Acquiring necessary records, medical bills, and other information concerning the treatment, products, services, or accommodations provided.

(ii) Allowing an insurer to request an explanation for and requiring a physician, hospital, clinic, or other person to explain the necessity or indication for treatment, products, services, or accommodations provided.

(iii) Appealing determinations.

(4) If a physician, hospital, clinic, or other person provides treatment, products, services, or accommodations under this chapter that are not usually associated with, are longer in duration than, are more frequent than, or extend over a greater number of days than the treatment, products, services, or accommodations usually require required for the diagnosis or condition for which the patient is being treated, the insurer or the association created under section 3104 may require the physician, hospital, clinic, or other person to explain the necessity or indication for the treatment, products, services, or accommodations in writing under the procedures provided under subsection (3).

(5) If an insurer or the association created under section 3104 determines that a physician, hospital, clinic, or other person overutilized or otherwise rendered or ordered inappropriate treatment, products, services, or accommodations, or that the cost of the treatment, products, services, or accommodations was inappropriate under this chapter, the physician, hospital, clinic, or other person may appeal the determination to the department under the procedures provided under subsection (3).

(6) It is not necessary that a person involved in a utilization review or an appeal of a utilization review to the department exhaust its administrative remedies before filing a court action regarding the treatment, product, service, or accommodations.

(7) (6) As used in this section, "utilization review" means the initial evaluation by an insurer or the association created under section 3104 of the appropriateness in terms of both the level and the quality of treatment, products, services, or accommodations provided under this chapter based on medically accepted standards.