WorkCover weekly payments and the amendments to the act

We are now many months down the road from the changes to the WorkCover legislation relating to the restriction to limit weekly payments beyond 130 weeks to workers who not only have ‘no capacity for work’, but also to require a 21% whole person impairment or greater if the 130 week period commences after 31 March 2024.

We are now seeing the full effects of these changes as more and more workers reach the 130 week mark after that date.

So what have the effects of be changed to the legislation been?

Significant increase in weekly payment terminations

The legislative changes are having their intended impact, which is to significantly reduce the amount of injured workers that can claim weekly payments after they have received 130 weeks of payments from WorkCover.

Many believe this legislative change has been unfair on many injured workers who genuinely cannot return to work in any capacity due to their work injuries.

For example, most lower back injuries are not going to result in an impairment greater than 10% and at the higher end, 20%.  There are many injured workers with severe back injuries that are not going to be assessed at greater than 20% whole person impairment, and as such, their weekly payments will be terminated at 130 weeks, even if WorkCover doctors agree that the worker will never return to work again.

Significant uncertainty when an injury is not ‘stable’

One issue that has become very apparent has been the lack of clarity on how injuries that have not stabilized should be dealt with.

At the present time, there are numerous workers stuck in a situation where their WorkCover insurer has made a decision to terminate weekly payments, while providing an opinion that the worker’s condition is not stable, but in their opinion will not reach 21% whole person impairment once the condition is stable.

Workers are very reasonably questioning how, if their condition is not stable, a WorkCover insurer can determine whole person impairment and negatively impact their claim.

We are acting for a number of clients stuck in a situation where weekly payments have been or will shortly be terminated, but the WorkCover insurer will not arrange any further medical exams or refer the matter to the Medical Panel for a final determination of impairment as they state it is not possible for them to do so, due to the instability of the injury.

Workers are then left with the option of appealing the termination of their weekly payments to the Workplace Injury Commission (WIC), which in turn could only either refer the matter to the Medical Panel, or allow the injured worker to proceed to court. If the matter went to court, it is highly likely that WorkCover’s lawyers would refer the matter from court to the Medical Panel.

If the matter is referred to the Medical Panel by WIC or a Court, then it would be up to the Medical Panel to decide whether they could provide an opinion that the medical condition is stable, and if not, whether they would be able to provide an interim impairment assessment, or an opinion that once the condition has stabilized, whether it would reach 21% whole person impairment or not. Our feeling is that the Medical Panel would not provide an estimate of impairment if the condition is not stable.

Injured workers in these circumstances are left with a great deal of uncertainty in terms of their rights and ability to challenge an interim decision to cease weekly payments.

We understand that WorkCover is still considering how to work through these matters, but at this time there is no clear solution.

Risks in impairment benefit claims

The changes in relation to weekly payments have also had a flow on effect to some impairment claims.

This is only applicable to psychological injury claims. In physical injury claims, to obtain an impairment benefit a whole person impairment of either 5% or 10% is required, depending upon the exact nature of the injury. This would mean that if someone with a physical injury is assessed at 21% or higher for the purposes of weekly payments, then they will both receive an impairment benefit, and if they satisfy the work capacity component of the test, also be entitled to ongoing weekly payments.

The situation is different for workers with a psychological injury, where the threshold to obtain an impairment benefit is 30%. We have recently consulted with a worker who sustained a severe psychological injury and has been assessed as having a 25% whole person impairment.

For this worker, the assessment of 25% means that they are going to remain on weekly payments. However, based on a 25% impairment, there is no entitlement to an impairment benefit as they need to reach the 30% threshold.

Our advice to our client in this situation was that they would need to carefully weigh whether it was advisable to dispute the 25% whole person impairment by referring the matter to the Medical Panel, as there would be both a potential benefit and a potential risk in doing so, as follows:

If the impairment was reassessed by the Medical Panel at 30% or greater then the client would receive both ongoing weekly payments and an impairment benefit lump sum of around $110,000.

The second scenario for this client was that they were assessed by the Medical Panel at somewhere between 21% and 29% whole person impairment, which would have meant staying on weekly payments, but no entitlement to an impairment benefit (this would represent no change in the client’s current entitlement situation).

The third and worst-case scenario for this client would have been if the Medical Panel assessed whole person impairment at 20% or less, which would result in both no impairment benefit being payable and the termination of the client’s weekly payments on the basis that they did not have a 21% or greater whole person impairment.

Our client weighed up these factors and has elected to (at least at this time) not pursue an impairment claim, as they did not wish to put their weekly payment entitlement at risk.

Delays at the Medical Panel

As the primary way to resolve a dispute where someone’s weekly payments are terminated on the basis of whole person impairment, the Medical Panel appointment dates have blown out significantly.

This means longer wait times for all injured workers that need matters determined by the Medical Panel, whether they relate to termination of weekly payments or other matters.

Conclusion

How the legislative changes to weekly payments are dealt with for injuries that are not stable is still a matter of significant debate within the WorkCover industry in Victoria. At this time, there is no easy or one size fits all answer for injured workers.

These matters can be complex and may put at risk other benefits, such as impairment, benefits, or common law claims.