Urgent action required by NSW lawmakers to fix flaw that unfairly favours CTP insurers over injured road-users

*The contents in this blog relates to legislation in New South Wales.

The Personal Injury Commission, established in 2020, is a purpose-built forum for the determination of disputes between CTP insurers and injured road-users in New South Wales.

A recent, and now infamous, decision by a Review Panel of the Personal Injury Commission in the matter of Obeid v AAI Ltd t/as AAMI [2022] NSWPICMP 76 (“Obeid”) has identified a legislative flaw that renders the Personal Injury Commission powerless to determine disputes about medical and related treatment expenses where those expenses have not yet been “incurred” – so-called disputes concerning “future” medical and related treatment expenses.

The circumstances of Mr Obeid’s case are both ubiquitous and uncontroversial.  Mr Obeid was injured in a motor accident in March 2020. The insurer accepted that Mr Obeid had suffered a non-minor injury and that it was liable to make payments of (relevantly) statutory medical and related treatment expenses for or on his behalf, in accordance with provisions of the Motor Accident Injuries Act 2017 (the “MAI Act”).

Mr Obeid’s treating specialist recommended that he have an arthroscopy and rotator cuff repair of his right shoulder, and his pain specialist recommended a pain management program which included diagnostic lumbar facet joint block and caudal epidural block.

AAMI denied the treatment that had been recommended by Mr Obeid’s treating doctors, both initially and again following internal review.

Following the denial for that treatment, Mr Obeid filed Applications at the Personal Injury Commission for it to determine whether AAMI was required to fund that treatment in spite of its decision.

The Medical Assessor at first instance found that Mr Obeid’s need for the treatment was not related to the injuries caused by the accident, and as such, AAMI was not required to fund it.  Mr Obeid filed an application for review of that decision, and his application was referred to a Review Panel for determination.

Instead of determining the dispute that had been referred to it, the Review Panel found that the relevant provisions of the Motor Accident Injuries Act 2017 did not give it the power to determine a dispute that concerned medical or related treatment that had not yet been provided to an injured person, and for which a liability to pay, had not yet been incurred.

The effect of the legislative oversight identified by this decision is to deny injured road-users in New South Wales any recourse to challenge insurer decisions declining funding for treatment, unless it has either been paid for, or a liability to pay for, that treatment has been incurred.

Evidently, when the treatment is expensive, such as surgery, many injured claimants will be prevented from having their requests for that treatment fairly adjudicated by an independent and impartial forum that was specifically designed for that purpose, simply because they are unable to pay for it.

Perhaps more concerning, the Personal Injury Commission is at present dealing with all disputes concerning “future” medical and treatment expenses across New South Wales that are currently before it by relying on the decision in Obeid to dismiss those applications.

In many cases, those disputes were filed at the Personal Injury Commission up to 12 months before the decision in Obeid was made.  This means that injured claimants who have been waiting for the Personal Injury Commission to determine their disputes about treatment, and who had a reasonable expectation that their disputes would be fairly heard and determined, are now being told that their applications are dismissed.

The legality of the Personal Injury Commission’s decision to deal with disputes in this way is yet to be tested.

If it was the intention of the New South Wales legislature to give unfettered power to insurers to deny access to treatment to injured claimants in New South Wales for their accident-related injuries, then it has succeeded.

If, conversely, this was not its intention, then its drafting oversight requires immediate rectification to prevent injured claimants in New South Wales either missing out on treatment they need, or having to pay for treatment that may otherwise have been supported by a compulsory insurance scheme that was created specifically for that purpose.

If you or someone you know has been affected, turn to Turner Freeman for advice.  Please contact our team today on 13 43 63.