Paralyzed Michigan girl loses 'life-changing' therapy as auto insurer sidesteps payment

Brighton — In December, 6-year-old Annabelle Marsh was moving her head from side to side, steering her electric wheelchair through the winding hallways of a rehabilitation center that faces the same highway where she became paralyzed in a car crash three years earlier.

Annabelle, a quadriplegic, had come to the Oxford Center in Brighton along a US-23 service drive in early 2023 for physical therapy to regain use of the one part of her body she didn't lose control of in a devastating accident — her neck.

In that near-daily routine, Annabelle built core strength that both gave her the ability to move and use her head to steer the wheelchair, while also lessening her dependency on a ventilator that she needs to keep breathing, said her Oxford Center physical therapist, Alicia Hisey.

“She is making life-changing gains,” Hisey said.

She was making gains until mid-January, when the Oxford Center ceased providing therapies to the paralyzed child because her auto insurer, State Farm Insurance, had not paid more than $93,000 of Annabelle's bills. The private physical therapy facility in Brighton could not afford to keep providing free care and didn't think it would be ethical to shoulder the child's family with the debt, Oxford Center CEO Tami Peterson said.

“That’s a crappy decision that I have to make because they won’t pay to take care of this child,” Peterson said.

These are the choices some highly specialized medical providers and home care companies face in Michigan when caring for survivors of horrific car accidents — sustain massive financial losses or turn away the patient.

Sweeping changes to Michigan's no-fault auto insurance law in 2019 upended a payment model that, for decades, virtually guaranteed lifetime medical care for catastrophically injured motorists and made Michigan a national leader in specialized care for spinal cord and brain injuries.

The Michigan Legislature's attempt to reform auto no-fault in a bid to lower the price of car insurance empowered insurers to slash payments to certain medical providers by 45%, effectively cutting off access to care by paying most providers less than what it costs them to care for injured motorists.

In this case, the insurer asserts the law is on its side to limit the physical therapy that health care professionals say is vital for Annabelle to gain some semblance of independence and prevent additional injuries to her fragile frame.

In a statement to The Detroit News, State Farm said Oxford Center "was paid the most the statute allows State Farm to pay."

"With any claim, State Farm seeks to provide our customers all benefits to which they are entitled within the terms of the insurance policy and applicable statutes," the Bloomington, Ill.-based insurer said.

That's a lawyer's way of saying the 2019 law created a shield that limits our financial exposure to paying medical claims.

Critics of the auto insurance industry's tactics argue the rigid interpretation of the law doesn't take into account the fact that each and every driver injured since June 2019 — when the law took effect — has a different set of circumstances.

More:Livengood: Paralyzed child's story shows how Michigan's no fault reforms endanger care

'I can't duplicate what they do'

Annabelle, who turned 6 on Thanksgiving Day, suffered a spinal cord injury on Feb. 4, 2021, after a vehicle t-boned her mom's SUV on US-23 near Brighton during a snowstorm. She was 3 years old when she lost the ability to walk and use her arms.

After months in the hospital, Annabelle's long-term care collided with the new law, which set rates for home health care services at 55% of what a provider charged in 2019.

AdvisaCare, one of Michigan's largest home health care firms, took on Annabelle's case, providing round-the-clock care that includes a registered nurse to operate the ventilator that the girl needs to breathe. AdvisaCare is suing State Farm in federal court for more than $1.3 million in unpaid bills associated with the true cost of Annabelle's care.

"They're fighting tooth and nail ... standing on their position that they can cut reimbursement rates in half, which is putting (Annabelle), obviously, in a pretty tough spot," said Stephen Hulst, a Grand Rapids attorney representing AdvisaCare. "They're driving at whatever they can do to pay less."

Hulst is handling a slow-moving federal court lawsuit that attempts to get AdvisaCare paid rates that actually cover the cost of caring for a high-need patient like Annabelle after the Michigan Supreme Court restored higher payments for medical providers that care for drivers injured before June 2019.

"It's care crisis 2.0," Hulst said.

One-on-one home health care is just one strand of the Gordian knot of keeping a quadriplegic on a ventilator alive, preventing further injuries and giving them some semblance of independence.

Stretching, bracing and functionally positioning a paralyzed body can help prevent contractures, bone deformities and, in the case of Annabelle, prevent an onslaught of scoliosis, Hisey said.

Annabelle came to Oxford Center almost every weekday for two-hour physical therapy sessions, Hisey said, gaining strength in her neck to put her head to work.

"She can now drive her own power wheelchair ... up and down our hallways because she has the head control to start having some of that independence back," Hisey said.

This kind of specialized treatment is lost in a state law that took a one-size-fits-all approach to the highly complex care of Michiganians trapped in bodies they can't control who, in many cases, have no voice.

It's also what families in the crisis of caring for a catastrophically injured loved one depend upon.

“I can’t duplicate what they do over there at home,” said Brandi Marsh, Annbelle's 35-year-old single mother of two.

In the nearly two months since the physical therapy ended, Annabelle has started to regress, her mother said.

Brandi Marsh had hoped the therapy would give her daughter the head strength to be able to attend public school in a special education program, with the assistance of aides.

“She’s lost a lot of her stamina,” Marsh said.

The girl also lost interaction with people outside of her family. Annabelle, her older brother and mother live with her grandfather in Milford — an especially isolating life.

“She misses it. She doesn’t understand," Brandi Marsh said. "She’s come to grips that she can’t go to school like other kids. But she’s asking, 'Why can’t I go to Oxford?'”

Unanswered calls

Years have now passed as Michigan lawmakers assess the harm they've done to the lives of badly injured drivers whose access to long-term medical care has been stymied by state law.

The 2019 law imposed a 45% cut on any medical service that didn't have a billing code in the bureaucracy that is Medicare. Lawmakers used the federal health insurance safety net for seniors to anchor fixed prices for services to lower the financial liability of insurers and, in theory, lower the car insurance premiums of drivers.

But Medicare doesn't pay for a home health aide to help you get to the bathroom, get dressed or feed you in the unfortunate event that you become paralyzed from the neck down and can no longer use your appendages.

And in Michigan, three people a day suffer life-altering injuries in a car crash, resulting in the need for personal care for the rest of their lives.

"You've got new people, like Annabelle, injured every day, and it's not sustainable for them," Hulst said.

To this day, no one in Lansing can actually say what the 45% rate cut was based on.

“Even the people on the insurance side acknowledge that 45% was a random number that was thrown at the wall and stuck like spaghetti,” said state Rep. Julie Rogers, D-Kalamazoo.

The law has left a stain on the walls of the state Capitol since July 2021, when the pay cuts formally went into effect and home health care companies were forced to either take on massive losses caring for these Michiganians or drop them, forcing some to move from bed-to-bed in different nursing homes and hospitals.

Adding to the madness, Oxford Center's Peterson said there's no consistency in which claims insurers pay.

"We can have State Farm pay one time and the next time they won’t," she said. "Same with AAA.”

“State Farm will not work with us — at least answer our calls,” Peterson added. “The girl deserves this care — they bought the insurance.”

When asked specifically about the billing dispute over Annabelle's care, State Farm said in a statement, "Due to our company privacy policy, we can't speak to the specifics of any individual customer claim."

'We've got to do something'

Advocates for injured drivers — from lobbyists to small business owners to mothers of injured children — have spent more than four years trying to convince lawmakers to undo the damage they have done.

The Michigan Supreme Court ruled anyone injured before June 10, 2019, is exempt from the cuts in payments to their caregivers because it effectively changed a contract they had in place for years, decades in many cases.

But anyone injured after that date — like 6-year-old Annabelle Marsh — has been left to navigate an insurance system that is designed to mitigate losses for insurance companies.

Frustrations are mounting among some Democratic lawmakers who have been pushing their leadership for the past year to take action. The Democratic-controlled Senate passed legislation in October that would establish a payment schedule for medical providers that the companies say would be economically sustainable for this small, but important, subset of the health care sector.

“We’ve got to do something,” said Rep. Kelly Breen, D-Novi. “It’s not Annabelle’s fault that this happened to her."

Lawmakers like Breen and Rogers don't buy counterarguments from some of their colleagues that tinkering with payments to medical providers to back up the lifetime coverage promise of Michigan auto no-fault will cause monthly premiums to soar.

“I keep hearing that rates are going down, but I haven't met anyone whose rates have been lowered," Breen said.

With the House currently in a 54-54 tie but Democrats effectively remaining in charge until two special elections can be held in April, there's a sentiment that fixing no-fault could unite the two parties.

There are multiple Republican lawmakers who were in office in 2019 who have publicly said they never intended to rip away access to health care for badly injured motorists.

House Speaker Joe Tate, D-Detroit, acknowledged in a recent interview that the 2019 law "is not perfect policy" and that access to care "has been a challenge." But, like other lawmakers, Tate is concerned tinkering with payments to medical providers might cause car insurance premiums to go up.

"I think we have to look at how are we continuing to find ways to keep costs down but obviously access to care ... at a very high level, we have to make sure that's there," Tate told The Detroit News. "... It's a very complicated issue."

The biggest impediment to passing the Senate bill in the House may be a provision that increases Medicare-based payments to hospitals, doctors and specialists that typically are the first line of care for an injured motorist.

Some lawmakers have explored just cutting the hospitals out of the legislation and focus on boosting pay rates for home health care providers like AdvisaCare and physical therapy facilities like Oxford Center in order to meet the needs of motorists with the worst injuries.

The Michigan Health & Hospital Association, a powerful lobbying group in Lansing, has pushed back on that idea, arguing their members need financial stability, too, in order to maintain Level 1 trauma centers — the specialized emergency rooms that handle the worst of the worst in car crash survivors.

The 2019 law subjected hospitals to Medicare-based payment rates that included cuts in 2020 and 2021 — right when the pandemic and global inflation took a big bite out of the bottom line.

“Everything is not only more expensive but much more expensive,” said Laura Appel, executive vice president of government relations and public policy for the hospital association.

While Lansing remains in a standoff, advocates of injured motorists argue there are real lives hanging in the balance.

“It makes me look like the bad person because I can’t keep giving this girl the care she deserves," said Peterson, the Oxford Center founder, who had to cut off Annabelle's care in mid-January. “She’s a precious little girl who deserves better.”

clivengood@detroitnews.com