Michigan No-Fault Insurance: 2019 Reform Five Years Later

By Attorney Manny Chahal · Updated 2026 · Reading time: ~7 min

Public Act 21 of 2019 fundamentally reshaped Michigan No-Fault auto insurance. Half a decade later, here is what every Michigan driver — and every accident victim — needs to know about PIP-choice tiers, the medical provider fee schedule, attendant care caps, and the seismic Andary v. USAA ruling that protects pre-reform crash victims.

The Backstory: Why Michigan Changed the Most Generous No-Fault System in America

For 46 years, Michigan stood alone. Every auto policy carried unlimited lifetime medical Personal Injury Protection (PIP) — a guarantee paid for collectively through the Michigan Catastrophic Claims Association (MCCA) per-vehicle assessment. By 2019 that assessment had climbed to $220 per vehicle, premiums were the highest in the nation, and the legislature broke a decades-long stalemate by passing Public Act 21.

The bargain was simple in theory and chaotic in practice: drivers got cheaper premiums and more choice, in exchange for medical providers losing the open-checkbook reimbursement they had relied on since 1973.

What Changed in 2019

The reform replaced unlimited mandatory PIP with a tier system, gave drivers the right to opt out of medical PIP entirely, capped attendant-care fees paid to family providers, and imposed a Medicare-anchored fee schedule on every medical provider that treats auto-crash injuries.

PIP Coverage Tiers Under MCL 500.3107c

The Medicare Opt-Out

If you (the named insured) are enrolled in Medicare Part A and Part B, and your spouse and any resident relatives have qualifying health coverage, you can elect zero PIP medical. Medicare becomes the primary payer for crash-related injuries. This is one of the most aggressively marketed selections — but also one of the most dangerous, because Medicare does not pay for attendant care, home modifications, or many of the long-term services unlimited PIP historically covered.

The 56-Hour Family Attendant Care Cap (MCL 500.3157(10))

Before 2019, a family member who provided 24-hour attendant care to a catastrophically injured loved one could be paid for every hour. The reform capped reimbursement at 56 hours per week — leaving the remaining 112 hours of weekly care unpaid unless a licensed agency steps in (which is almost always more expensive and frequently unavailable).

The Medical Provider Fee Schedule (MCL 500.3157(2)–(7))

For services with a Medicare rate, providers are reimbursed at 200% of Medicare in 2021, declining to 190% by 2023. Services without a Medicare rate (residential traumatic brain injury rehab, post-acute neuro-rehab) are capped at 55% of what the provider charged on January 1, 2019. The cap was devastating to the post-acute industry — nationally recognized Michigan brain-injury rehab facilities closed wings, laid off therapists, and in some cases shuttered entirely.

Andary v. USAA: The Michigan Supreme Court Rewrites Reform

In Andary v. USAA Casualty Insurance Co., 512 Mich 207 (2023), the Michigan Supreme Court ruled 5–2 that the fee schedule and 56-hour family attendant care cap do not apply retroactively to people injured before the June 11, 2019 effective date. That single ruling restored unlimited medical benefits and pre-reform attendant care to thousands of catastrophically injured pre-reform claimants.

What Has Not Changed

• Threshold injury standard (MCL 500.3135). Pain-and-suffering recovery from the at-fault driver still requires death, permanent serious disfigurement, or serious impairment of an important body function.
• Mini-tort property damage limit. $3,000 cap for damage to a vehicle the at-fault driver did not insure.
• 3-year statute of limitations for personal injury auto claims under MCL 600.5805(2).
• 1-year-back rule for PIP medical and wage loss benefits under MCL 500.3145.
• Wage loss at 85% of gross, capped at the statutory maximum, for up to 3 years.

Real-World Premium Impact

Premiums have come down — but unevenly. Drivers who selected Tier 4 (unlimited) saw modest reductions. Drivers who downgraded to $50,000 or opted out saw dramatic savings, but at the cost of catastrophic exposure if they are seriously hurt. Detroit and Wayne County residents continue to pay the highest rates in the state, driven by territorial rating that the reform did not fix.

What This Means If You Have Been Injured

Three questions decide your case in the first 30 days:

1. Which PIP tier applies? If you are catastrophically injured under a $50,000 tier, you will exhaust benefits within weeks, and someone needs to plan for the next phase before you do.
2. Were you injured before June 11, 2019? If yes, Andary protects your unlimited benefits and pre-reform fee structure — and any insurer pretending otherwise is wrong.
3. Which provider can still treat you under the fee schedule? Many of the best post-acute facilities have closed beds. The right referral on day one is the difference between full recovery and a lifetime of unmet need.

Frequently Asked Questions