injured workers support network submission the review of self- · entry 2.1 is there an appropriate...

InjuredWorkersSupportNetwork 10December2015

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Injured Workers Support Network Submission The Review of Self-Insurers Licensing Framework.

TheInjuredWorkersSupportNetworkwelcomestheopportunitytoprovideasubmission

regardingtheReviewofselfInsurersLicensingFramework.

Setupin2011,TheInjuredWorkersSupportNetworkisanot-for-profitorganisationwhose

primepurposeistoassistinjuredworkerstryingtonavigatetheadversarialNSWWorkersCompensationsystemasadministeredbyNSWGovernment.

OpeningStatement:TheInjuredWorkersSupportNetworkacknowledgesthattherearesignificantdiscrepanciesbetween the 53 Self-Insurers within the NSW Workers Compensation system and anyanalysiswe can provide is hindered by these discrepancies. Someutilise existingworkerscompensationinsurersthroughcontract,othersaregroupedtogetherandinherentlyformasixth insurer within the mainstream system. Others still may be totally independent orgroupedinalooseaffiliationlicense.

OurmembershiphasprovideduswithanecdotalevidencethatSelf-Insurersposesarangeofpracticesbuttherearesomeconstantthemesinourmember’sexamples.Thefirstisalackofacknowledgementoftheinjuredworkersrights.ThisexiststoagreaterextentthanintheiCareclusterofinsurers(thoughwewouldnotsuggestthatiCareisbestpracticeeither).Thesecondisaninattentiontotherequirementfortheseself-insuredemployeestoprovidesuitableduties.The third is the inappropriate and unprofessional use of work capacity assessments anddecision.ThepictureformedthroughconversationswithourmembersisSelf-InsurerscarryagreateremphasisoncostreductionsthantheiCareinsurers.Thisemphasisisconstantlyreflectedingreaterdelaysforapprovalsoftreatment, largernumbersofrefusalsfortreatment, largernumbers of claims that are denied and greater rates of terminations 6 months afterreceivingtheoriginalworkerscompensationclaim.This identifies to the Injured Workers Support Network that the financial strain of Self-Insuranceistoogreatforcompaniestocarryasindividualentitiesseparatefromthelargerworkerscompensationsystem.The Injured Workers Support Network notes that we have not been able to locateindependentreviewsoftheeffectivenessofSelf-Insurerstoachieverehabilitationofinjuredworkers.


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InjuredWorkersSupportNetworkresponsetoquestions.STAGE11.1 To what extent are the requirements of the self-insurance licensing frameworkproportionatetoanyrisksposedbySelf-Insurersaboveandbeyondthoseposedbyotheremployers?Islicensingappropriate?TheInjuredWorkersSupportNetworkbelievesthatthemainriskoftheSelf-Insurershaveaboveandbeyondthoseposedbyotheremployersistheinherentconflictofinterest.Ourmembers have highlighted through examples of liability approvals and return to workdecisions that Self-Insurers are disingenuous in their decisions and in some cases willcategorically reject certain types of claims without reviewing evidence objectively. “Inhouse”decisionsseemtofavourtheemployertoamuchgreaterextentthanthosemadebyinsurers.These decisions appear to be aimed at a policy of cost reduction above and beyond theenforcementoftheappropriatelegislativeandregulativeframework.Licensingcanbeappropriate,howeverunderthecurrentsystemtoomanyemployeesriskbecominginjuredworkerswithoutcompensation.1.2 What should the government’s objectives and expectations be in relation to self-insurance?Howdoesthisdiffertocurrentpractices?

The Injured Workers Support Network believes that the government’s objectives andexpectationsshouldbefocusedonthecorrectapplicationofthelegislativerightsofinjuredworkers in providing timely and appropriate levels of medical intervention to enableworkers to recover from their injury, adequate compensation for injured workers andreturning injured workers back to work safely. Too often it seems that Self-Insurers aremore interested in keeping claim costs low and forcing injured workers to leave theircurrentposition.

1.3 Whatisthevalueofself-insurancetoanemployer?The Injured Workers Support Network believes that the value of self-insurance to anemployerisoneofself-interest.Thatofreducingclaimscostsandhidingthesafetyriskstheemployerposestotheirworkers.TheInjuredWorkersSupportNetworkisawareofonlyoneSelf-Insurerwhohasutiliseditsprocesses to identify emerging risks to its workers.We are further aware of otherswhohavenomechanismforidentifyingandmanagingsafetyriskstoworkers.Thecapacitytodoso has been highlighted to the Injured Workers Support Network as a value of Self-Insurance.AsthisvalueisnotbeingextractedbySelf-Insurersitisevidentthatcost,ratherthancareorsafety is thedrivingforceforobtainingSelf-Insurancestatus.Thisapplicationevidentlydisadvantagesinjuredworkers.


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1.4 Whataretheintrinsiccostsofbeingself-insured?The Injured Workers Support Network has seen many people who were productiveemployeesof theiremployerhave to leaveemployment thereby taking their trainingandknowledge with them. To compound this, many of those injured workers then find itdifficulttogainemploymentagainandenduponsocialsecuritybenefits.1.5 How does an employer demonstrate its senior executive’s commitment to self-insuranceandachievingbetteroutcomesfortheirinjuredworkers?TheInjuredWorkersSupportNetworkhashadverylimitedevidencethatseniorexecutiveswithin Self-Insured companies have any knowledge, understanding or commitment toachieving better outcomes for their injured workers with one exception. This exception,fromaseniorofficerwithinonesmallerSelf-InsurerspoketotheInjuredWorkersSupportNetwork coordinator about their organisations attempts to provide better outcomes toinjuredworkersbutthat thiscommitmentwashamperedbythe2012 legislativechanges,counteringpreviousattemptsbytheirorganisationtoprovidewhattheyconsideredtobeappropriatelyindividualisedsupporttotheiremployees.The Injured Workers Support Network is also aware that in other larger Self-Insuredcompanies the discussions regarding workers compensation occurs in conjunction withdiscussionsonfinancialliabilities.Thisisparticularlytrueofboardandexecutivemeetings.Anydiscussionofbetteroutcomesforinjuredworkersoccursatadepartmentallevelornotatallinthesecompanies.


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STAGE2

Entry2.1 Is there an appropriate minimum number of employees or another entry-levelrequirementthatanapplicantshouldhaveinordertobeeligibleandguaranteebeingabletoperformasaself-insurer?Ifso,pleaseexplainwhy.

GiventhissystemiscurrentlyinplaceTheInjuredWorkersSupportNetworkfirmlybelievesthat the requirements to become a Self-Insurer should be further tightened to provideevidencethattheself-insurercanguaranteeagreater levelofsupportfor injuredworkersthatwhichisbeingcurrentlyprovidedbythegeneralscheme.

The capacity to show evidence of this should come before any minimum number ofemployees.

2.2Whatfeedbackdoyouhaveabouttheeffectivenessandefficiencyofthelicensingentryrequirements?

The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestion.

2.3Whatwoulddefineaself-insurerasahighperformer?

TheInjuredWorkersSupportNetworkbelievesthatthedefinitionofahighperformingself-insurer should be centred on injuredworkers receiving treatment and returning toworksafelyataqualityaboveandbeyondthatwhichisprovidedbythegeneralscheme.

2.4 What impact would a shorter or longer renewal period have on Self-Insurers, theiremployeesandthebroadersystem?Whatshouldbethemaximumtermofalicence?The InjuredWorkers SupportNetworkbelievesa shorter renewalperiodwouldprovideagreatercapacityforoversightandinterventionoftheSelf-Insurersthatcurrentlyexists.2.5Whatwouldbe the impactof implementinganopen-ended licence renewalperiod inNSW?The InjuredWorkers Support Network does not support an open-ended licence renewalperiod, as this would decrease the capacity for oversight of Self-Insurers. The InjuredWorkersSupportNetworkbelievesanopenended licence renewalperiodwouldcreateasituationthat licencecancelationswouldbeharder toobtainandwhenthatoccurredtheimpact on injured workers would be substantially harder than a closed-ended licencerenewalperiod.


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Financial2.6Whatwouldbethebenefitsofgreatertransparencyaroundthecalculationanduseoflicencefeesandlevies?The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestion.

ClaimsManagement2.7Whatregulatorychangestoclaimsmanagementlicencerequirementsshouldbemadeto incentivise better injury prevention and return to work outcomes? Please state thechangeandimpact.The Injured Workers Support Network believes that regulatory changes to claimsmanagementlicenserequirementsshouldnotbetheimpetusforinjurypreventionasthisisreallyadisguisedwayofsayingclaimcostreduction.Betterinjurypreventionshouldnotbebasedaroundthecostofclaimsbutontheneedsoftheworkers.TheInjuredWorkersSupportNetworkdoesconsidertheissuesaroundallowingworkerstoreturn toworkasamajorproblem.Toooften, the InjuredWorkers SupportNetworkhasbeentoldofcaseswhereself-insuredemployersprotestthattherearenoadequatesuitableduties available for injuredworkers when they are ready to return on suitable duties orhours.Thisisdespitethatfactthattheseemployersmayhaveaplethoraofdifferentdutiesovermultiplelocationsthatcouldbeconsidered.TheInjuredWorkersSupportNetworkhasseenthisespecially inthefinanceandretailareaswherecompaniesareunwillingtoallowpeople to return to work unless it is at the injured workers current location, duties andhours.Insomecases,especiallyinclaimsforbullyingandharassment,employersrefusetoallowthepersonwhomadetheclaimtoworkinthesameregionevenafterthepersonhasreturnedtofullduties.Withreferencetotheabove,theInjuredWorkersSupportNetworkbelieves:That licence requirements should include open reporting of return to work, injurypreventionstatisticsandtheprovisionofsuitableduties.ThatSelf-Insurers shouldprovidea suitabledutiespolicy includinga listof suitabledutiesbasedonemployeepositionprofilesandapolicyfortrainingtoensureinjuredworkerscanbeassistedtobroadentheircapacitytofulfilawiderrangeofsuitableduties.2.8 What indicators or risk factors should SIRA use to measure claims managementperformance?

The InjuredWorkers SupportNetworkbelieves thatpurely financial risk factorsmeasuresarenotadequate for themeasurementofperformanceas they ignore thehumansideoftheissue.Abroaderapproachtoclaimsmanagementneedstobeadopted.


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These would include a qualitative approach including but not exclusively: Meeting andexceeding time frames for approvals for items such as medical treatment and claimapprovals;providingsuitableduties to injuredworkers;andactual return toworkstatsvsreturntojobmarketstats.

2.9WhatwouldbetheimpactoflimitingclaimsmanagementauditstothoseSelf-Insurersthatexhibitlesserperformance?

The InjuredWorkersSupportNetworkbelieves that limitingclaimsmanagementaudits tolesserperformance isnotpreventative.Limitingtheclaimsmanagementauditasdescribewould permit injured workers to suffer during themovement by the Self-Insurer from ahigherperformertoalesserperformerwithoutopportunityforearlyrectification.

2.10HowshouldSIRApromotebestpracticeand/orinnovationinclaimsmanagementtodeliverbetterreturntoworkoutcomes?TheInjuredWorkersSupportNetworkbelievesthatanybestpracticeand/orinnovationinclaims management need to be based on providing injured workers with better healthrecovery,adaptiontoinjury/disabilityandreturntoworkoutcomesinthatorder.Assuch,The Injured Workers Support Network feels that Self-Insurers need to ensure that allpossible scenarios for encouraging workers to return to work in a timely, durable andmeaningfulwayneedstobeexplored.Thismayevenentailactionssuchasmovingworkersto nearby alternate locations, restricting information leakage to frontline managers andreviewingjob-shareandparttimearrangementswhiletheworkerisinjured.WorkplaceHealthandSafety2.11 Do any factors make Self-Insurers a greater risk to maintaining a safe workplacecomparedwithotheremployers?Pleasedescribeanyrelevantfactorsandhowtheycouldbemitigated.

The InjuredWorkers Support Network has previously identified that Self-Insurers have agreater emphasis on cost reduction than the general scheme insurers. This emphasis onplacingcostsabovehealthofinjuredworkersandworkersingeneral.

Utilising a “better outcome“ entry requirement (i.e greater access to services, lengthiermedicalcaretailsect..)toobtainaSelf-Insurancelicencewouldmitigatesomeofthisrisk.

AnecdotalevidencereceivedbyTheInjuredWorkersSupportNetworksuggeststhatwithinsomeSelf-Insuredworkplacesthereisacultureofnotreportinginjuriesasworkrelateddueto the stigma that is associated. Some workers have reported that they do not reportinjuries for fear of being “pigeonholed”or evendismissed. This is especially relevant forthosesufferingfrompsychologicalinjuriesi.e.stress,anxiety,bullyingandharassment.

Asculture is topdowndrivenbehaviour,The InjuredWorkersSupportNetwork feels thatseniormanagementneedtoshowleadershiponthisissueandensurethatinjuredworkersdonothavetheircareerhamperedbymakingaclaim.


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2.12AreOHSMSauditsimprovingWHSoutcomes?Howmightthisbeimproved?


2.13HowshouldhighWHSperformancebedefined?The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestion.

2.14Whatother indicatororcomplianceactivities(suchasprosecutionsor infringements)could be considered to determine and manage WHS performance throughout a licenceterm?

Aspointedoutpreviouslyinthissubmission:TheInjuredWorkersSupportNetworkbelievesa broader range of indicators and compliance activities need to be considered. Theoutcomes of the performances audits should be made public –this would improvecomplianceandprevention.


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STAGE3

Financial3.1Thecurrent retentionamounts for reinsuranceare$100,000 to$1,000,000perevent.Shouldtheexcessforreinsurancebeincreased?Ifso,towhatdollaramount?


3.2Should thesecurityamountcontinue tobedeterminedas150percentof thecentralestimate(orforwardcentralestimateifgreater)orshouldemployersbeallowedtoadoptaprudentialmarginbaseduponaprobabilityofadequacy?The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestion.

ClaimsManagement3.3Towhatextentaretherepotentialconflictsofinterestwhereanorganisationisboththeinsurerandtheemployer?

Thepotentialforaconflictofinterestinthismodelisextremelyhigh.TheInjuredWorkersSupportNetworkhasseenmanyinstanceswhereaself-insuredcompanyhasdeniedliabilityevenafterinsurmountablemedicalevidencehasbeenpresented,thecompanybullyingtheinjuredworker to go to the companies general practitioner only and denying the injuredworkers rights to see their own GP, company return to work coordinators acting as therehabilitationprovider,haspushedemployeestoreturntoworkbeforetheinjuredworkeris ready by badgering doctors and/or the claimant, doctors being directed by claimsmanagers and return to work coordinators to change workcover medical certificates,personal,private,medicalinformationleakingfromtheclaimmanagertothereturntoworkcoordinator to the line manager, and using information secured under the claim usedagainstinjuredworkerstoendtheiremploymentorcurtailtheircareeradvancement.

3.4Whatevidence is thereof issuesassociatedwith theprivacyof claimant information?Howcouldtheseissuesbeaddressed?

Asper above, The InjuredWorkers SupportNetworkhasbeen toldofmany timeswhereinformation has “leaked” from the claims manager all the way down to a line managercostingpeopletheirjobsandfuturecareers.Specifically,wehavebeentoldoftimeswheninformation provided to the claims manager has led to companies “medically retiring”injuredworkerswhiletheyarewaitingfororstillreceivingtreatmentforaninjury,ahumanresourcesinvestigator“accidentallyfindinginformation”aboutaninjuredworkerspreviouspsychological historywhile they have been investigating a bullying and harassment claimwiththatworker,andinjuredworkersbeingadvisedtheywillneverbepromotedduetotheclaimforworkerscompensationtheylodged.Manyofthetimes,physicalproximitytootherinterestedpartiesmaybetoblame,whichsuggestthesolutioncouldbeaseasyasrequiringseparate physical locations for those handling theworkers compensation claims to other


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management. Return to work coordinators being kept to the same privacy standards asotherrehabilitationprovidersmayalsohelp.

3.5Whatevidenceisthereofaconflictofinterestwhereanemployerisalsotheinsurerinrelationtotheappointmentofindependentmedicalexaminers?Howshouldanyconflictbemanaged?

TheInjuredWorkersSupportNetworkbelievesthereisnodifferenceinthisaspectbetweenself-insured and the rest of the system, IME’s rely on being paid andwill often give theresultsthecompanythatispayingthemwants.

Whatshouldbeofmoreinterestistheprevalenceofself-insurersinsistingonreferring(insomecircumstancesphysicallytaking)injuredworkerstothecompanypaiddoctorandtheninsistingonthatcompanydoctorbecomingtheNominatedTreatingDoctor.

3.6 What should SIRA’s claims management compliance monitoring and enforcementactivitieslooklikeandhowdotheydifferfromyourexperiences?

The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestionduetoourlackofinformationandexperienceintheRegulatorsclaimsmanagementcompliancemonitoringandenforcementactivities.

3.7 How could the claims management audit tool be improved to deliver improvedassessmentonthecomplianceofcasemanagementpracticesandtoimproveperformance?

The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestion

3.8What regulatoryactionshouldbe takento improveclaimsmanagementpracticesandreturntoworkoutcomes?

The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestionbeyondtheanswerspreviouslyprovidedinthissubmission.

3.9Whatbenefitsandcostswouldbecreated ifanemployerthatceasestobea licensedself-insurerwasabletopassonitslong-tailliabilitiestotheNominalInsurer?The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestion.WorkplaceHealthandSafety3.10 How could OHS management system (OHSMS) audits be changed to improve theireffectivenessinliftingWHSperformance?The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswer this question due to our lack of information and experience in the Regulators &WorkSafeNSWOHSmanagementsystems.


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Collectionandprovisionofinformation3.11DothecurrentrequirementssurroundingprovisionandqualityofdatatotheregulatorenableSIRAtoadequatelymonitorself-insurerclaimsmanagementandWHSperformance?

The InjuredWorkers Support Network believes the currently publicly available data doesnotprovideenoughinformationonreturntoworkvsreturntothejobmarkettomakeanadequateassessmentonthesuccessratesofself-insurers(orthewholesystem).Thequalityofinformationprovidedisnotcomprehensive.Informationondelayedtreatments,medicaltreatmentapprovals,numbersofsuitabledutiesprovided,terminations,investigations(andcostsofinvestigations)areanumberofareaswheregreaterpubliclyavailableinformationwouldincreaseclaimsmanagementandWHSperformance.

3.12Howcouldtransparencyofperformancedatabeimprovedandshoulditbeimproved?

The InjuredWorkers Support Network does not believe it is in a position to adequatelyanswerthisquestionbeyondthecommentsmadeatquestion3.11.


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STAGE4

4.1What impact does self-insurance have on the broader NSW system and the NominalInsurer?TheexclusionofSelf-Insurers fromthebroader insuranceschemehasasignificant impactonthelevelofserviceprovidedtoinjuredworkersbythebroaderNSWsystem.Themarchofintegrationthatself-insurersareleadingthroughtheexternalservicesprovidedtoinjuredworkers (such as company doctors, rehab providers, physiotherapists etc..) is seen aspermeatingthebroadersystem.Thisincludessomecompaniesattemptingtoestablishtheirownparallelmedicalsupportsystem-preventingtheinjuredworkerfrommakingaclaim(autilisation of provisions of the Comcare system in companies not eligible for Comcarelicencing).Self-InsurersalsomaketheNSWworkerscompensationsystemineffecttwo-tieredwiththeservice provision to injuredworkerswithin Self-Insurers visibly less than thosewithin theNominalInsurer.4.2 Is thereanyevidenceofadverseoutcomes fromSelf-Insurersnot reportingsignificantmatterstotheregulator?Howcouldtheserisksbemitigated?TheInjuredWorkersSupportNetworkisunawareifreportsreceivedfrommembersarenotreportedtotheregulator.Oursubmissionhasidentifiedseveralflawsinthesystembasedon the feedback from our members regarding adverse outcomes though and, given thenumberofreportsreceivedwewouldbedoubtfulthatSelf-Insurershavereportedthesameorsimilarmatterstotheregulator.4.3 What other policy options should be considered by the NSW State Government toimprove the workers compensation system in the context of the self-insurance licensingarrangements?

Aswithouropeningstatement,theInjuredWorkersSupportNetworkbelievesstronglythattheentryrequirementsforSelf-Insurersneedstobetightenedandentryshouldberelatedtoacommitmenttoprovidesupportandserviceswhichareaboveandbeyondthosewhichareprovidedbythegeneralinsurancescheme.

DatacollectedbySelf-Insurers,excludingpersonal informationon injuredworkers, shouldbecomprehensiveandpubliclyavailable.

Self-Insurers need to provide the regulator with a suitable duties policy that identifiessuitableduties forallpositionstheircompaniesencompassandamechanismforensuringinjured workers can be trained to expand the potential suitable duties which can beassignedtothem.

injured workers support network submission the review of self- · entry 2.1 is there an appropriate...

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