HomeMy WebLinkAboutResolutions - 2013.08.29 - 20966REPORT August 29 2013
BY: GENERAL GOVERNMENT COMMITTEE - Christine Long, Chairperson
RE: MR #13145 - BOARD OF COMMISSIONERS - SUPPORT FOR FULL FINANCIAL
TRANSPARENCY AND DISCLOSURE OF THE MICHIGAN CATASTROPHIC CLAIMS ASSOCIATION
FUNDS
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen: 0
The General Government Committee, having considered the above titled resolution on August
19, 2013 hereby recommends that the resolution be amended as follows.
MISCELLANEOUS RESOLUTION #13145
BY: Commissioner Bob Hoffman, District #2
IN RE: BOARD OF COMMISSIONERS - SUPPORT FOR FULL -FINANCIAL TRANSPARENCY AND
DISCLOSURE OF THE MICHIGAN CATASTROPHIC CLAIMS ASSOCIATION FUNDS IN THE
CONDUCT OF PUBLIC AFFAIRS
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS the Michigan Catastrophic Claims Association (MCCA), a private non-profit unincorporated
association, was created by the state Legislature in 1978; and
WHEREAS the MCCA was established by Public Act 136 of 1978, which amended the no-fault law by
adding Section 3104 effective July 1, 1978. The Legislature created MCCA because insurance
companies had difficulty obtaining reinsurance for Michigan's automobile no-fault policies, which provided
for unlimited lifetime medical benefits for people who are catastrophically injured in auto accidents; and
WHEREAS under Michigan's No-Fault Law, the MCCA reimburses auto no-fault insurance companies for
each Personal Injury Protection (PIP) medical claim paid in excess of $5300,000: and
WHEREAS all auto insurance companies operating in Michigan are assessed to cover the catastrophic
medical claims occurring in Michigan. Those assessments are generally passed on to auto insurance
policyholders; and
WHEREAS the 2011-2012 assessment was $145.00 per vehicle. The 2012-2013 assessment is currently
$175.00 per vehicle; and
WHEREAS the MCCA assessment will rise to $186.00 per insured vehicle for the period July 1, 2013 to
June 30, 2014; and
WHEREAS the MCCA reports that it paid out $947 million — more than $135 per insured car—in 2012
for claim costs resulting from catastrophic injuries. The majority of these catastrophic claims involves
closed-head and spinal cord injuries, multiple fractures, and back and neck injuries; and
WHEREAS this proposal represents an increase of $11.00 (6%) from the current MCCA charge of
$175.00 and represents $156.44 to cover anticipated new claims, $29.19 to address a $2 billion
estimated deficit related to existing claims, and $0.37 for administrative expenses.
WHEREAS in 2012, the MCCA hacis financial assets in excess of $14 billion.
WHEREAS the MCCA as a fiduciary steward should be held to-thetghest-standards of transparency and
accountability to that-protect the public's interest including:
• Basis and methodolo ofThe-f-u-11414sGies-u-r-e-eri how annual peryehicle assessment rates are
calculated.
• OAddition,a4-oversight through an-amluai-indeper-ideot-a-udit,--with-the-resuits--of-that--audit-betng
reported-te-the-MioNgan-State-House-and-Mich-igan-State-SeRatethe Office of the State Auditor
General to ensure compliance with fiscal regulations, accountability T and transparency under
applicable laws.
4---R-equiTement-that-deoisioris-to-r-a:ise-rate-s-ace-subject-te -the-approvat-of-14e-C-on4mis€,,ioner-of-the
Offjce-ef-Ftnan-eial-and-frisurance-Regulation-and-all-owiN-fot!-the-rejection-of-in-Greases-deemed
to-be-exeessive,
• That tThe MCCA business be conducted at public meetings in compliance with Michigan's "Open
Meetings Act.", subject to exceptions and limitations as set forth in the Act.
• And-that tThe MCCA documents be subject to the requirements of Michigan's Freedom of
Information Act, with reasonable limitations to protect individual privacy and information that
would put members at a competitive disadvantage or threaten the financial wellbeing of the
MCCA fund.
WHEREAS the information contained in MCCA files includes identifiers such as social security
numbers, birthdates and health information that could put the personal privacy rights and identities of
Michigan citizens at K; and
GENERAL GOVERNMENT COMMITTEE: Motion carried on a roll vote with Crawford voting no and
Gershenson and Quarles absent.
WHEREAS laws such as the Health Insurance Portability and Accountability Act or HIPAA have
been put in place to protect of individual's health care priyacy:T full compliance with these protections
should be afforded to individual's concernin information roduced b the MCC& and
WHEREAS the financial wellbeing of the MCCA fund is necessary to_provide long term benefits
for many Michigan citizens who need extensive treatment and rehabilitationi-a-nd.
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners, hereby
supports full disclosure and transparency of the Michigan Catastrophic Claims Association (MCCA)
information and deliberations in the conduct of public affairsdecis•ons provided that adequate provisions
are included to protect the security and privacy of members and rate payers.
BE IT FURTHER RESOLVED that the Oakland County Board of Commissioners hereby supports the
passage of legislation to expand the coverage of the Open Meetings Act and the Freedom of Information
Act to the Michigan Catastrophic Claims Association information and deliberations in the conduct of public
affairsSenate-Bills-4.02-an4-4-0-3- and urges the Michigan Legislature to adopt and Governor Snyder to
sign this legislation.
BE IT FURTHER RESOLVED that the Oakland County Clerk/Register of Deeds is requested to forward
copies of this adopted resolution to Governor Rick Snyder, the Michigan Catastrophic Claims Association
(MCCA) Board of Directors and Executive Director, the Commissioner of Financial and Insurance
Regulation, Oakland County's delegation to the Michigan Legislature, the Michigan Association of
Counties, and Oakland County's lobbyists.
Chairperson, we move the adoption of the foregoing resolution.
BOB HOFFMAN
Chairperson, on behalf of the General Government Committee, I move the acceptance of the
foregoing report.
GENERAL GOVERNMENT COMMITTEE
GENERAL GOVERNMENT COMMITTEE
Motion carried on a roll call vote with Crawford voting no and Gershenson and Quarles absent.
MISCELLANEOUS RESOLUTION # 13145
BY: Commissioner Bob Hoffman, District #2
IN RE: BOARD OF COMMISSIONERS – SUPPORT FOR FULL FINANCIAL
TRANSPARENCY AND DISCLOSURE OF THE MICHIGAN CATASTROPHIC CLAIMS
ASSOCIATION FUNDS
To the Oakland County Board of Commissioners
Chairperson, Ladies and Gentlemen:
WHEREAS the Michigan Catastrophic Claims Association (MCCA), a private non-profit
unincorporated association, was created by the state Legislature in 1978; and
WHEREAS the MCCA was established by Public Act 136 of 1978, which amended the no-fault
law by adding Section 3104 effective July 1, 1978. The Legislature created MCCA because
insurance companies had difficulty obtaining reinsurance for Michigan's automobile no-fault
policies, which provided for unlimited lifetime medical benefits for people who are
catastrophically injured in auto accidents; and
WHEREAS under Michigan's No-Fault Law, the MCCA reimburses auto no-fault insurance
companies for each Personal Injury Protection (PIP) medical claim paid in excess of $500,000;
and
WHEREAS all auto insurance companies operating in Michigan are assessed to cover the
catastrophic medical claims occurring in Michigan. Those assessments are generally passed
on to auto insurance policyholders; and
WHEREAS the 2011-2012 assessment was $145.00 per vehicle. The 2012-2013 assessment is
currently $175.00 per vehicle; and
WHEREAS the MCCA assessment will rise to $186.00 per insured vehicle for the period July 1,
2013 to June 30, 2014; and
WHEREAS the MCCA reports that it paid out $947 million — more than $135 per insured car—
in 2012 for claim costs resulting from catastrophic injuries. The majority of these catastrophic
claims involves closed-head and spinal cord injuries, multiple fractures, and back and neck
injuries; and
WHEREAS this proposal represents an increase of $11.00 (6%) from the current MCCA charge
of $175.00 and represents $156.44 to cover anticipated new claims, $29.19 to address a $2
billion estimated deficit related to existing claims, and $0.37 for administrative expenses.
WHEREAS in 2012, MCCA has financial assets in excess of $14 billion.
WHEREAS MCCA as a fiduciary steward should be held to the highest standards of
transparency and accountability including:
• The full disclosure on how annual per vehicle assessment rates are calculated.
• Additional oversight through an annual independent audit, with the results of that audit
being reported to the Michigan State House and Michigan State Senate
• Requirement that decisions to raise rates are subject to the approval of the
Commissioner of the Office of Financial and Insurance Regulation and allowing for the
rejection of increases deemed to be excessive.
Chairperson, we move the adoption of the foregoing resolution.
j/Cd4Y( Comm ssioner
District #
Com missiore.{
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• That MCCA business be conducted at public meetings in compliance with Michigan's
"Open Meetings Act."
• And that MCCA documents be subject to the requirements of Michigan's Freedom of
Information Act.
NOW THEREFORE BE IT RESOLVED that the Oakland County Board of Commissioners,
hereby supports full disclosure and transparency of Michigan Catastrophic Claims Association
(MCCA) decisions.
BE IT FURTHER RESOLVED that the Oakland County Board of Commissioners hereby
supports the pnqcagip of Sen. atP Pills 102 and 10: And urges the Michigan Legislature to adopt
and Governor Snyder to sign this legislation.
BE IT FURTHER RESOLVED that the Oakland County Clerk/Register of Deeds is requested to
forward copies of this adopted resolution to Governor Rick Snyder, Michigan Catastrophic
Claims Association (MCCA) Board of Directors and Executive Director, the Commissioner of
Financial and Insurance Regulation, Oakland County's delegation to the Michigan Legislature,
the Michigan Association of Counties, and Oakland County's lobbyists.
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Resolution #13145 August 29, 2013
Moved by Long Supported by Quarles the resolution be adopted.
Moved by Long supported by McGillivray the General Government Committee Report be accepted.
A sufficient majority having voted in favor, the report was accepted.
Moved by Long supported by Quarles the resolution be amended to coincided with the recommendation
in the General Government Committee Report.
A sufficient majority having voted in favor, the amendment carried.
Vote on resolution, as amended:
AYES: Long, Matis, McGillivray, Middleton, Quarles, Runestad, Scott, Spisz, Taub, Weipert,
Woodward, Zack, Bosnic, Crawford, Dwyer, Gershenson, Gingell, Gosselin, Hoffman. (19)
NAYS: None. (0)
A sufficient majority having voted in favor, the resolution, as amended, was adopted.
3
STATE OF MICHIGAN)
COUNTY OF OAKLAND)
I, Lisa Brown, Clerk of the County of Oakland, do hereby certify that the foregoing resolution is a true and
accurate copy of a resolution adopted by the Oakland County Board of Commissioners on August 29,
2013, with the original record thereof now remaining in my office.
In Testimony Whereof, I have hereunto set my hand and affixed the seal of the County of Oakland at
Pontiac, Michigan this 29th day of August, 2013.
Lisa Brown, Oakland County