SIRA commences audits of weekly payments to injured workers and directs icare to take action
On 27 February 2020 SIRA was notified by icare that errors have been detected in weekly payment calculations in a sample of closed Nominal Insurer workers compensation claims. The errors were found during an icare risk discovery review in 2019. The review, which excluded the Treasury Managed Fund, was designed to test the extent to which the initial Pre-Injury Average Weekly Earnings (PIAWE) calculation was correct from 2012-2018.
The scope and results of the review as advised by icare as follows:
- approximately 3,000 claim files were reviewed;
- where there was sufficient information on file to recalculate PIAWE, approximately one quarter of the claims were potentially underpaid, at least initially, and a similar proportion were potentially overpaid;
- in instances where weekly payments were incorrect, premium calculations for experience-rated medium to large businesses may also be incorrect.
Legislative reforms implemented in 2019 simplified the calculation of PIAWE and the risk review did not cover more recent or open claims. The 2019 reforms implemented last year were in response to reviews and stakeholder concern about the complexity of PIAWE.
SIRA directions to icare
SIRA has instructed icare to take swift action to fully quantify the scale of this issue and is requiring icare to repay any underpaid workers.
SIRA has directed icare to produce a Review and Remediation Plan by 13 March 2020 setting out:
- details on when the full extent of the problem will be known;
- a proposed approach and timeframe for repaying any workers who have been underpaid statutory benefit entitlements, and all employers that subsequently paid a higher premium than appropriate;
- a proposed approach to communicating with affected injured workers and employers;
- details of efforts review existing claims to ensure the problem is not continuing; and,
- a risk assessment audit for NSW government agency workers compensation and government property insurance scheme managed by icare, known as the Treasury Managed Fund.
SIRA has confirmed icare is responsible for repaying any injured workers impacted by the error in calculating weekly benefits, and for associated remediation costs.
Advice for injured workers
At this stage, injured workers and employers who believe they may have been impacted by an error in PIAWE do not need to do anything. SIRA has required that icare's Review and Remediation Plan includes identifying and communicating with customers impacted by any error in payments.
However, any injured worker who is concerned they may have been impacted by this issue is welcome to visit the SIRA website for more information and register their details for further communication over the coming months. They can also call SIRA on 13 10 50.
Any injured worker with a specific complaint or concerns about weekly payments should contact WIRO on 13 94 76.
Employers who wish to receive further updates can also register their details.
SIRA audits and requirements
SIRA officers, with the support of EY, are already undertaking Nominal Insurer claims file reviews as part of the 21-point Action Plan following the 2019 SIRA Compliance and Performance Review of the Nominal Insurer (icare). SIRA is providing icare daily feedback on files where potential problems are identified.
SIRA will also undertake an urgent focussed audit of Nominal Insurer claims investigating the PIAWE matter.
In addition, SIRA has launched a review of weekly payment calculations across other insurers.
SIRA is also working with the Workers Compensation Independent Review Officer (WIRO) and the Workers Compensation Commission (WCC) to assess the extent to which complaints managed by the WIRO and disputes resolved by the WCC may have already fixed PIAWE weekly payment errors.
SIRA has previously issued guidance to all workers compensation insurers about how to approach any overpayments to injured workers and this guidance is available on the SIRA website.
SIRA requires all insurers who charge employers premiums to provide an avenue for review of premiums charged and to report regularly to SIRA on these reviews, in accordance with the SIRA Market Practice and Premiums Guidelines (May 2018 version) also available on the SIRA website.
Further information about this matter is available on the SIRA website.
Workers compensation open data
SIRA has released November 2019 data to the Workers Compensation portal.
The open data portal is a self-service visual analytics tool that is designed to make it easier to view scheme performance data over time and is another way that SIRA is improving transparency and accountability in the Workers Compensation scheme.
The open data portal has been built with the input and support of WIRO, the Workers Compensation Commission, and a range of other stakeholders and commentators.
We continue to make enhancements as a result of stakeholder feedback with further releases forecast in the coming months.
The open data portal is an example of the NSW Government’s Open Data Policy improving community access to information.
Case manager resources for Recover at work assist for small business
The Recover at work assist for small business program commenced in June 2019 as a 12 month pilot to help small employers overcome any financial pressure when providing suitable work to help their worker recover at work after a work-related injury or illness.
Two new resources have been designed to assist insurer case managers understand and promote the program:
- Fact sheet for insurer case managers
- Frequently asked questions
Should you have any questions about this program, please email firstname.lastname@example.org
Review of the work-related hearing loss in the NSW workers compensation system
SIRA is conducting a review into services to support people with hearing loss arising out of employment (work-related hearing loss) in the NSW workers compensation system. The review will allow for a systematic approach to understand concerns from across the sector including the experience of injured workers.
Key insights from this review
- there is a lack of awareness of entitlements for work related hearing loss
- the claims pathway is complex and can lead to delays in hearing aid provision
- hearing aids can be effective and promote participation
- fees orders, hearing aid costs and inclusions should be reviewed and
- there is evidence of close working relationships between some audiologists and legal firms.
SIRA thanks all respondents who took the time to make a submission to the Work-related hearing loss in the NSW workers compensation system consultation. We received a total of 26 submissions from a range of stakeholder groups including individuals, hearing service providers, peak body groups, insurers and legal providers. You can view the 17 non-confidential submissions on our consultations page.
A review of the research evidence relating to the assessment and treatment of occupational noise-induced hearing loss was conducted by the John Walsh Centre for Rehabilitation Research. You can read this report on our website.
The perspective of workers with a work-related hearing loss claim was explored in a series of interviews conducted by the Social Research Centre, an independent social research agency commissioned by SIRA. You can read this report on our website.
SIRA is currently developing a plan that ensures the system works efficiently and effectively, simplifies the process for making a claim for work-related hearing loss and delivers good claimant experience and outcomes.
At the same time, in response to submissions to the review, the Workers Compensation Independent Review Officer will further consider the Independent Legal Assistance and Review Service (ILARS) Hearing Aid Claims Policy, in consultation with SIRA, legal practitioners and other interested parties.
IPART review of home building compensation
The home building compensation scheme (formerly known as home warranty insurance) is being reviewed by the Independent Pricing and Regulatory Tribunal (IPART). The Minister for Customer Service has approved the final terms of reference for the review, which are now available on IPART’s website. The terms of reference ask IPART to review the efficiency and effectiveness of the home building compensation fund in protecting consumers who are currently covered under the scheme.
IPART will publish an ‘issues paper’ for public consultation in March 2020. For more information or to subscribe for updates about the review, go to the IPART website.
New guidance on the Seacare scheme
Seacare is a national scheme of occupational health and safety (OHS), rehabilitation and workers compensation arrangements which applies to defined seafaring employees and – in relation to OHS – defined third parties. Operators in the maritime industry may be subject to the Seacare scheme in relation to some journeys and from time to time, while otherwise being subject to the workers’ compensation scheme.
The scheme is overseen by the Seafarers Safety, Rehabilitation and Compensation Authority (Seacare Authority). Under the Seafarers Rehabilitation and Compensation Act 1992 (Seafarers Act) employers of persons that fall within the scope of the Seafarers Act are required to have appropriate workers compensation insurance coverage under the Seafarers Act and provide details of this insurance to the Seacare Authority. Employers may also be subject to other statutory obligations including reporting ship berths to the Seacare Authority and paying a levy on those berths each quarter. It is important to note that the levy supports a safety net fund to ensure payment of compensation entitlements to injured workers.
To assist stakeholders in better understanding the coverage provisions of the Seafarers Act the Seacare Authority has published guidance information on coverage under the Seafarers Act. The Seacare Authority website provides further information about the scheme and current matters.
Employer/operators or other stakeholders are also welcome to contact the Seacare helpdesk on (02) 6275 0070 or via email at email@example.com for assistance in understanding the requirements to hold Seafarers Act insurance or obligations to report current Seafarers Act insurance to the Seacare Authority.