ACC admits 44 per cent of reviewed elective surgery decisions were wrong

ACC has said that too many ACC decisions rejecting elective surgery have been “overturned on review”, after being declined due to the injury apparently displaying substantial aspects of degeneration.

The report of a review on ACC elective decision making is here [PDF].

What ACC should have said was that too many more claimants have been handed down incorrect decisions in the first place and there are many more that could have been overturned had the claimants bothered to go to review.

About 10,000 fewer elective surgery ACC claims were paid than the same period the previous year. Between July 2010 and March 2011 an average of 44 per cent of surgery decisions were overturned at review – meaning they shouldn’t have been made in the first place. Of those that had their request for surgery declined, 53 per cent believed ACC had not provided a clear explanation as to why they were declined.

That doesn’t sound all that good.

ACC maintains it was applying the legislation strictly. In reality it was using the review process to determine tough decisions –and riding roughshod over those who didn’t review decisions they disagree with.

This is not strict application of legislation, its blatantly incorrect application of legislation in attempts to control spending on elective surgery. So spending controls on elective surgery are administered by a hope that few would go to review, and those that did go to review have the decision upheld due to dodgy medical opinions that would say the medical condition was caused by degeneration. All at a cost of several thousand dollar for each review.

About 800 claimants apply to review ACC decisions each month. In recent times 4000 people have complained to the NZ Herald about elective surgery review alone. In the year to March, millions of dollars were spent defending ACC decisions that should never have been made in the first place – but could have gone to things like, well… elective surgery, perhaps.

When a case goes to review, ACC should really be revisiting the decision in line with s65 of the ACC Act to see if it should be overturned before review. It appears that this is not being done at all.

ACC appears to be, in the words of Beattie J, too quick to “ seize on that identified state of affairs ( i.e. degeneration) and use it as a reason for declinature".

And he should know, he presides over cases that are upheld at review that go to Court. Overall, around 40 percent are overturned. In fact, as an example, in October last year, of 25 decisions 10 were overturned, meaning ACC and its subsidiary, Disputes Resolution Services, each make many incorrect decisions that are not rectified for some months - even years - later.

Anyone got any info on this?

If a person is getting ACC, and ACC decided that, as that person could work 30 hours a week they were no longer entitled to ACC, they’d be removed from the scheme.

So what if that person gets assessed by Work and Income as not being fit for work for 15 hours a week . He is eligible for the Invalids Benefit. The person goes on the Invalids benefit, and because WINZ has said he can’t work, he appeals the ACC decision that says he could ( at least, appeals the decision regarding accident related injuries. But he loses, because ACC’s doctors say he can work 30 hours a week, even though WINZ doctors say he can’t.

And what does this say about the ACC review process? The problem is that it is pretty hard to get information on these transfers as ACC has no details on what their former claimants end up, and WINZ have few details on where their Invalids beneficiaries were prior to going on an Invalids Benefit. This could be because many are initially transferred to the Invalids Benefit from the Sickness Benefit with no reference to having recently come off ACC.

I wonder how many people have been in this situation during the past five years? And how many are now being quickly transferred to Sickness Benefits to get assessed for part time work?

Biker did not make it home after protesting ACC levy increase

Ha, this is funny. Bikers were protesting how it is so unfair that their ACC levies are going up. Guess what one did on the way home?

He hit a car, fell off his bike, and got a suspected broken leg.

He will get ACC. Perhaps he should have taken his car, rather than being a good advertisement for why bikers should get higher ACC levies.

ACC: I was right

Well, that didn't take long. Earlier this week I predicted that the ACC workers account will be open to competition.

The Government has just announced that the ACC workers account is to be opened to competition.

ACT media release is here. Hopefully this sort of thing will be minimised.

Kicking the tyres on ACC - secret plans to charge all claimants $100 excess

National is planning to reduce costs on ACC, but some of the suggestions are those that even insurance companies would never do. Like charging all claimants an excess with no option for recovery.ACC calls such moves " kicking the tyres".

Just isolating motor vehicle accidents where pedestrians were injured, stats show that most drivers were not at fault. An excess should only be charged when the system is an at fault scheme, and one has a choice of paying premiums. ACC does not look at who is at fault in an accident. The reason this is important is because if a person has, say, a motor vehicle accident, is not at fault, and makes an insurance claim, he can attempt to recover his excess through the other party's insurance company, or directly through the disputes tribunal or courts, often with the assistance of his insurance company.

Now, I have spent 13 years working for ACC and settling claims for various insurance companies so I know a little how they work. To ACC,as fault is irrelevant, recovering an excess for the injured is also irrelevant. But ACC also has used to have a system called experience rating, with employers rated based on their employees' work injuries - the more injuries in a certain industry, the higher premiums that industry bore. Back then, if an employer disputes that an ACC injury happened at their workplace, it can challenge their premium increase as well as the experience rating through an ACC review panel. It's a good system if administered properly.

So if a person was driving a company car while working, got hit by an identified third party who admitted fault, his company would be able to recover his car insurance excess, thus maintaining premium level. But, under this proposal, if he got injured and needed ACC treatment, he'd have to pay an excess and he will also have to pay extra premiums due to aggregate actions from similar drivers. And the more he earns the more he pays. He has no choice. His employer will have increased ACC premiums even though the accident was not his employee's fault.

That's why I am amazed an excess was even suggested, because it won't happen, and neither should it unless ACC reintroduces experience rating( which Nick Smith is supportive of,BTW), but with an at-fault component. I see an opening up of the Work Account to competition again.

Labour ignored its fiscal responsibilities

One of the things an incoming government needs to know is the state of the books. As per the Public Finance Act, the pre-election fiscal update is supposed to advise any items where decisions have been made that that affect the fiscal position. With regard to the ACC it is clear that the Government knew of the approximate blowout of the ACC non-earners account in May, with confirmed figures in August - before the election was called.

Craig Foss: What advice has the Minister received on the accuracy of a statement made by the Hon David Parker in respect of the non-earners account blowout not being in the Pre-election Economic and Fiscal Update, where he says: “Papers show that Ministers acted appropriately throughout, as the money needed had not been quantified until the election period.”?

Hon Dr NICK SMITH: The money needed was clearly identified in a report to the former Minister on 14 August, based on a PricewaterhouseCoopers valuation. A further 60-page technical report was completed by the ACC on 22 August, which confirmed those figures. The election was not called until 12 September, and the Pre-election Economic and Fiscal Update closing-off date was 8 September, after the previous Government had that information.

So Labour made a decision not to decide to do anything about this problem well before the Prefu deadline. As it was a decision, that decision should have been indicated in the Prefu.

We also find that the previous government have been irresponsible in Housing, with $2 billion required to address the deferred maintenance of State houses including their update to an appropriate standard.

Guess who the Minister of Housing was - none other than Maryan Street, the ACC minister and a former board member of Housing New Zealand.

What did Maryan Street actually achieve as a minister other than sleeping with the PMs chief press secretary and creating a mess while collecting a ministerial salary and perks?

Cullen knew

When former ACC Minister Maryan Street wrote to Michael Cullen in October advising him of an expected shortfall in the ACC non earners account, she told Cullen something that he already knew - that the ACC non earners account needed $1b more over the next three years, and it could run out of money by March. ACC have known much of this for some time but hadn't officially quantified it.

The non earners account has always been an issue for Governments. Cullen knew the extent of the problem at least two months before Street wrote to him but chose to do nothing about it. It may not have been under "active consideration" but the Government certainly appeared to have known the extent of the problem and what the Treasury had recommended -but chose not to make a decision on it.

Ms Street provided the official papers to the Herald, including the August 14 report from ACC that detailed an estimated shortfall of over $900 million over the next three years. The figures were actually estimated out for five years, taking the shortfall to $1.5 billion.

Street only wrote to Cullen in October to confirm what he already knew. Cullen did nothing for two months before prefu. That is disgraceful fiscal irresponsibility. No wonder Treasury officials are irate at the previous administration as the non earners account was under active consideration for some time by Treasury officials.

But the Government preferred to deny and delay. All workers and the country will pay for this - through increased levies to beef up the blown out earners account, and through taxation to the non-earners account.

ACC

We all know now that Labour has been hiding a $1b shortfall in the ACC non earners account, which deals with claims from people like children, students and the elderly.The excuse was that Cabinet hadn't made a decision on what to do about it. The reality is that Cabinet decided not to make a decision on it to hide the shortfall, claiming that they didn't have time.

Yet the Government had time to announce retail bank deposit guarantees, constituting a $150 billion liability, without a Cabinet decision during their campaign launch. Yet they told officials not to include the ACC figures in the PREFU and officials I have spoken with today are furious about this dishonesty. And Labour wanted to lower ACC levies knowing full well it had been hiding a blowout in the non earners account for six months purely because Cabinet refused to make a decision on it.

John Key has announced a Ministerial inquiry - the first proper inquiry on anything since 1999. Former ACC minister Maryan Street, who knew about a shortfall since May, is not talking to anyone, she's not the Labour spokesperson anymore. She won't reveal how much of the shortfall she knew in May. How convenient. An OIA request has already been sent to ACC as ACC will not reveal what they told to whom about this. Another thing for the Ombudsman to follow up on in 20 working days.

I'm actually wondering if policies like student allowance announced during the election campaign were announced at this time purely because the Government had just engineered the ACC shortfall so it would not be revealed until after the election when it would be National's responsibility to find out later and clean up the mess.

ACC's $250 gift to staff

I'm not sure what the fuss is over the ACC's $250 Activa cards each staff member gets. Apparently there are guidelines set by Southern Cross Healthcare as to what they are used for, despite claims that they are used for botox and manicures.

National thinks they are a waste of money - yet it works out about 68c per day per employee, which is the equivalent of the time it takes to go down the lift and light your cigarette for smoko break.

Other employers I have worked for provide free eye tests once a year and $200 towards healthcare costs. When I worked for a certain university newspaper, such benefits were paid for by students.

Of course such "perks" reduce absenteeism. And if you are off work just 10 hours or so fewer due to these benefits, costs are covered.