Medical Costs Driving No-Fault Losses
NU Online News Service, Dec. 3, 11:41 a.m. EST?A four-state study of no-fault system auto injury claims has found escalating medical expenses have driven up accident losses dramatically.[@@]
The report by the Insurance Research Council in Malvern, Pa. found the average loss between 1997 and 2002 increased 122 percent in Colorado, 37 percent in Florida, 60 percent in New York and 2 percent in Michigan.
Colorado dropped no-fault in 2003.
A key difference between the other states and Michigan, the study found, was that injured Michigan residents made far less use of chiropractors, acupuncturists and massage therapists.
More than 33 percent of personal injury protection claimants in Colorado, Florida, and New York went to a chiropractor compared to 13 percent in Michigan, IRC said.
The group's study found that average per visit charges for chiropractors were highest in Florida at $254 compared with $223 in Colorado, $125 in Michigan and $83 in New York.
Average total charged per claimant by chiropractors was $4,804 in Colorado, $4,837 in Florida, $1,522 in Michigan and $1,549 in New York.
The researchers said that Colorado and New York claimants were at least twice as likely to see physical therapists as injury claimants in Florida or Michigan.
In New York, the study said, 22 percent of the auto injury claimants went to alternative professionals such as acupuncturists or massage therapists compared to 18 percent in Colorado, seven percent in Florida and one percent in Michigan.
The study noted that in no-fault states, before a claim can be filed an injury threshold must be passed before a claim can be filed against an at-fault driver. In Michigan, IRC said, such bodily injury claims are restricted to injuries that lead to permanent serious disfigurement, serious impairment of a bodily function or death.
Excluding permanent total disabilities, fatalities and claims with no economic loss, average economic loss for auto claims between 1997 and 2002 rose from $4,976 to $11,037 in Colorado, IRC said.
The increase in Florida was from $6,035 to $8,289 while in New York it grew from $4,547 to $7,258. The uptick in Michigan was from $6,560 to $6,674.
Elizabeth Sprinkel, IRC senior vice president, said in Michigan the majority of bodily injury claims were for severe injuries. "Despite the tort thresholds in the other three no-fault states that were examined, liability payments often were paid to claimants with relatively minor injuries," she said.
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