Michigan Lawmakers Look to Stop ‘Ambulance Chasers’
The Michigan House of Representatives has sent a message to unscrupulous attorneys, doctors and other people looking to make a quick buck off an auto accident: Back off for at least a month.
Yet for now that message is largely symbolic, as the bill to establish a 30-day waiting period for contacting accident victims currently has major loopholes, according to the state’s trial lawyer association.
The House passed a pair of bills to enforce the waiting period— HB 4770 and HB 4771—on Thursday. If signed into law, they would restrict who could access an accident report in the 30 days after a crash and make it a misdemeanor to contact a crash victim in the same time frame to solicit a legal, medical, or other services.
The bill aims to cut down on “ambulance-chasing” attorneys, as well as “runners, cappers and steerers,” from contacting accident victims immediately after a crash.
Some attorneys, along with runners, cappers and steerers, will often lure or entice accident victims to collect services and compensation they may not need.
“Unfortunately, there are a few attorneys and medical professionals that provide unnecessary treatment,” Lori Conarton, spokeswoman for the Michigan Insurance Institute, told Online Auto Insurance News (OAIN). “We support those efforts. Thirty days gives people time to assess, talk and see what coverage that happens to them before they make a rash a decision.”
Proposal could help cut down on insurance fraud
Michigan has had ongoing problems with fraud, related to the state’s Personal Injury Protection (PIP) auto insurance system. PIP pays medical claims quickly to motorists involved in an accident, regardless of fault. Conarton said the PIP system ensures people who have legitimate claims get paid quickly for the services or treatments they need.
“We believe there are unscrupulous attorneys that are contacting these people in a time of stress, and can encourage them to do things that are not in their best interest,” Conarton said. “We hope it cuts down on fraud in the system.”
Michigan has some of the highest auto insurance rates in the country, in large part due to fraud, Conarton said. The high insurance rates have made PIP fraud, and those who commit it, incredibly unpopular. In turn, many private and government organizations strongly support measures that cracks down on runners, cappers and steerers.
Attorneys back bill but express concern
The list of groups wanting to combat fraud includes trial lawyers. The Michigan Association of Justice supports HB 4771, calling it a “much needed” measure. While some lawyers would be adversely affected by the legislation, Michigan Association of Justice spokesman Steve Pontoni said trial lawyers want to show they are “ethical and on the up-and-up.”
Pontoni even called for more stringent regulations for accident reports.
“We don’t love the fact this bill was watered down as much as it was,” Pontoni said in reference to changes made earlier this session. The bill was initially opposed by press and first amendment groups on the grounds it would limit the public’s right to information.
Despite the heavy fines for offenders—$15,000 for the first violation, $30,000 and potential jail time for additional violations—Pontoni said fraudsters could still obtain the accident reports.
“It’s limited,” Pontoni said. “People can claim to be part of the media or a public safety organization and still get the report.”
The House introduced a separate bill to make it a felony to unlawfully access a motor vehicle accident report, but legislators have not passed it.
Still, Pontoni described the bill as a step in the right direction. HB 4771 now goes to the Senate, where it is expected to pass and be sent to Gov. Rick Snyder.