The Facts - Myths vs. Facts
A few things you ought to know about mandatory medical coverage and your Colorado auto insurance
MYTH: Most states require motorists to buy auto insurance medical coverage.
FACT: Not true. Many consumers have other health insurance coverage and may not need to buy additional medical coverage as a part of their auto insurance policy. In most states consumers get to choose whether they want to buy this additional medical coverage. That number is increasing as states move away from high-cost mandates (see the chart below.) And in the states where mandates remain, they are far lower than those proposed in the Colorado legislature. Some members of the legislature want to let the special interests line their pockets with your money!
Mandated Medical Payments Coverage (Med Pay) under Auto Insurance*
| States that allow consumers to choose coverage | 28 (up from 26 in 2000) |
| States that require $1,000 - $5,000 | 7 |
| States that require $5,001 - $10,000 | 1 |
| States that require $10,001 - $30,000 | 2 |
| States that require more than $30,000 | 1 |
| No-fault states requiring Personal Injury coverage | 12 |
*Includes District of Columbia
MYTH: Big hospitals claim they are going broke due to the change in Colorado's car insurance system.
FACT: False. Colorado hospitals report record profits and are building lavish new facilities. The real reason they are complaining is that hospitals get to charge auto insurers and the uninsured more money for treating injuries than health insurers. That’s because health insurers negotiate low reimbursement rates with medical providers; auto insurers aren’t able to do that. Now that health insurance covers many auto accident injuries, this can quickly add up to a difference of ten of thousands of dollars for providers and hospitals. CSS believes the hospital’s profits speak for themselves.
MYTH: Colorado auto insurance rates have increased (or not decreased much) since the state changed to a new auto insurance system in July 2003, according to some politicians and special interests.
FACT: Absolutely false! The majority of auto insurance consumers have seen their car insurance premiums plummet by more than 32 percent on average since July 2003 (view rate charts). Of course, if individuals bought a new car or added a teen driver, had an accident that was their fault, or purchased more coverage, they may not have seen those decreases. However, if the state had not moved to our current auto insurance system in 2003, and the old system (called “no-fault”) was still in place, rates would not have dropped and instead would have continued to rise.
MYTH: All drivers should see the same level of savings.
FACT: Colorado consumers today have more control over what they pay for auto insurance, because they can choose what they need. However, some legislators want to change that and take away your right to choose. They want to force you to buy more coverage—even if you don’t need it.
Premiums depend largely on where you live, what kind of cars you drive and your family’s personal driving records. Colorado drivers are still required to buy liability coverage to pay for medical bills and property damage when they cause an accident—but you get to decide how much additional health and liability insurance you need to purchase based on your own personal insurance and financial situations. CSS believes you can make better decisions about your financial needs than the politicians and special interests.