An effort to repeal state’s no-fault law faces a roadblock


shutterstock_12940978The 37-year-old no-fault law survived despite a repeal attempt on Tuesday at the State Capitol. However, later on the Senate Committee approved some significant changes to be brought about in the law.

Minnesota was witnessing higher insurance premiums and also some evidence of insurance scams and hence the law needed to be dumped. There were more uninsured motorists on road stated Deputy Senate Majority leader Geoff Michel, R – Edina and this could be bomb that was waiting to explode. Talking about repealing the law, the leader asked the members what they were all getting out of this no-fault system.

Michel also went on to state that there were nine states that had no-fault insurance, which was down from 24. He also stated that Minnesota was a high-cost Midwestern island that was surrounded by other states without the no-fault insurance but with lower premiums.

The Consumer Protection Committee and the Senate’s Commerce has voted on Tuesday to temporarily put aside Michel’s proposal after they heard from ambulance service officials and hospital authorities. The panel has instead sent a couple of alternatives to the Senate for further review after endorsing it.

One has come from Sen. Paul Gazelka, R- Brainerd, who also owns an insurance agency, where those that suffered soft-tissue injuries and were treated by physical therapists or chiropractors would limit the benefits to workers’ compensation. Gazelka’s proposal also received backing from the insurance officials and he claimed that his business was not a motive for suggesting these changes. He also mentioned that physical therapy and chiropractic visits represented 69% of the medical costs.

Gazelka also went on to state that there was little accountability on how much was charged or how the process worked. He also acknowledged that this approach that he suggested had fallen short of the more comprehensive reform which he had sought initially. That indeed required further studies he stated.

Sen. Linda Scheid, DFL – Brooklyn Park suggested a raise in benefits for ‘pain and suffering.’ As per her suggestion, the injury will have to result in impairment that was more permanent in nature and should be serious enough to affect some vital bodily function to be fit for a claim.

President of the Minnesota Association for Justice, Jim Carey, has stated that this was a significant change. He also added that this proposal would create a stringent standard for threshold with regard to benefits and might impact innocent people who are injured in accidents, in a negative way.