WORKERS COMPENSATION DIVISION INDUSTRY REFERENCE GROUP REPORT

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1 WORKERS COMPENSATION DIVISION INDUSTRY REFERENCE GROUP REPORT February/March 2009 Amendments to Workers Compensation Legislation The Workers Compensation Legislation Amendment (Benefits) Act 2008 introduced amendments to the Workers Compensation Act The amendments included changes: to death benefits enabling the introduction of an optional alternative premium calculation method for large employers. The amendments to death benefits included: increasing the lump sum death benefit to $425,000 the lump sum benefit to be paid to a worker s estate where the deceased leaves no dependants weekly payments to a dependant are not reduced because of partial dependency (however, partial dependency may still be taken into account when apportioning the lump sum between multiple dependants). These reforms are retrospective and apply to deaths that occur on or after 24 October 2007, and are as a result of workplace injuries that occurred on or after 30 June These reforms do not apply to death benefit entitlements under the Workers Compensation (Dust Diseases) Act 1942 or for injuries that occurred before 30 June The Workers Compensation Legislation Amendment (Benefits) Act 2008 also included changes required for WorkCover to obtain a bank guarantee or other security from large employers that enter an alternative premium arrangement. This is a necessary and important step towards the introduction within the WorkCover Scheme of the proposed alternative premium calculation method based on retro-paid loss (burning cost) arrangements. Work is currently being undertaken to have the necessary regulations, procedures and internal infrastructure in place by 30 June Large Employer Premium Reform As part of its premium reform program, WorkCover is consulting industry on the introduction of an optional alternative premium calculation model. Once implemented, large employers will potentially be able to choose between the conventional premium calculation method or an alternative method, based on retro-paid loss arrangements. WorkCover is currently finalising the alternative premium model, with a view to commencing the new arrangements from 30 June

2 Benefits Guide The Benefits Guide was updated in December 2008 to incorporate the amendments to death benefits and is available on the WorkCover website. The guide consolidates all the statutory workers compensation benefits (including weekly incapacity payments; permanent impairment lump sums; death benefits; and medical and related payments) into one document and provides a historical record of the amounts payable from WorkCover Scheme Agent Contracts In 2008 the Department of Commerce issued a Request For Proposals (RFP) to Scheme agents to provide workers compensation claims and policy services for the WorkCover Scheme for a five-year contract term. The RFP process has been delayed and as a result, the current contract with Scheme Agents has been extended for one year from 1 January Rehabilitation Provider Framework The new Approval Framework for Workplace Rehabilitation providers has been in operation since July There are 107 providers approved to deliver workplace rehabilitation in NSW. These providers are required to adhere to a new set of conditions and principles. The principles of workplace rehabilitation focus on professional practices such as: timely and cost effective intervention that delivers return to work outcomes sound communication to engage all who can assist the worker to return to work evidence-based decisions. Providers are required to undertake an annual self evaluation of their compliance with these conditions and principles. In addition, WorkCover has commenced onsite evaluations of providers adherence to these standards. There will be 30 onsite evaluations conducted throughout 2009, with reviews of the remaining approved providers to be completed over the next two years. Engaging General Practitioners WorkCover is implementing a range of strategies to assist General Practitioners (GPs) increase their awareness of injury management and return to work practices, as well as the requirements of the workers compensation system. The program will provide GPs with easier access to information through: clinical training modules on evidence-based treatment strategies which will be available on-line and through face-to-face presentations the WorkCover website a General Practitioner information package. 2

3 Training will also be available to other stakeholders, including rehabilitation providers, return to work coordinators and insurers to assist them to interact more effectively with GPs. The education and clinical training modules are being piloted in February for wider implementation throughout Psychologists and Counsellors Framework WorkCover intends to introduce a framework for psychological and counseling treatment services. A consultation paper outlining the features of the proposed model was released for comment on 15 December These features are: approval process for suitable practitioners promotion of evidence-based practices promotion of measurable outcomes by service providers administrative arrangements for communication between insurers, workplace rehabilitation providers, employers and service providers common understanding of reasonably necessary treatment regulation of fees peer support for service providers through a network of independent consultants complaints management education of insurers / scheme agents / nominated treating doctor / workplace rehabilitation providers / service providers. The consultation paper is available on WorkCover s website and submissions are being accepted until 23 February Return to Work Coordination The Return To Work (RTW) Coordination project is being implemented in two phases. In Phase One, which is now complete, the primary purpose of the project was to align the NSW system for appointing, monitoring and reviewing RTW coordinator trainers with the system in Victoria and Queensland. The Phase One outcomes included: a revised introductory training package for RTW coordinators new requirements for RTW coordinator trainers in line with Victoria and Queensland. Phase Two, which is currently in development, aims to enhance the opportunities for RTW coordinators to update their skills and knowledge. It also involves the updating of the advanced training package for RTW coordinators. 3

4 Claims Management Guidelines WorkCover, in consultation with representatives of workers, employers, insurers and the legal and medical profession, has revised the following claims management guidelines: WorkCover Guidelines for Claiming Compensation Benefits WorkCover Guidelines on Independent Medical Examinations and Reports The Guidelines have been reviewed to correct errors and anomalies that have been identified during their use since the implementation of the dispute prevention and resolution reforms in November The key areas that have been clarified in the Guidelines for Claiming Compensation Benefits are: provisional liability claim liability permanent impairment claims. Revisions to the Guidelines on Independent Medical Examinations and Reports include: ensuring referrals to doctors specify the questions requiring a response referring such questions to the worker s doctor in the first instance providing timely and adequate advice to workers about the examination. Permanent Impairment Guidelines The third edition of the WorkCover Guides for the Evaluation of Permanent Impairment has been gazetted and comes into affect for all assessments conducted on and after 1 February The new edition includes changes to the Spine and Lower Extremity chapters, as well as amendments to the Introduction. Investigations Panel The Investigations Panel Project has recently been completed. The aim of the project was to establish a Private Investigator Panel to facilitate the engagement of private investigators by WorkCover s Fraud Investigation and Claims Branches. The Investigations Panel will be used mainly for fraud investigation tasks. The Private Investigation companies will be instructed to undertake tasks on WorkCover s behalf such as factual investigations and mercantile agency activities. 4

5 Wage Audit Services Tender WorkCover is conducting a tender to establish a new three-year contract with a panel of auditors, whose duties will be to undertake wage audits on workers compensation policies as directed by WorkCover. The new contract will involve a panel of between 10 and 12 auditors with appropriate experience and geographic representation. A supporting framework, as well as performance measures and tools will be included to enhance service delivery from the wage auditors for the benefit of employers, Scheme Agents and the Scheme. WorkCover will allocate all Scheme audits to panel members. Scheme Agents will continue to be responsible for the processing of the audit report and validation and payment of audit costs. The new arrangements will commence from 1 July 2009 and ensure that the services provided are commercially competitive and encourage high standards through ongoing review and improvement of audit techniques. 18 February

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