Section 59A Workers Compensation Act 1987, where degree of permanent impairment has not reached MMI

Section 59A of the Workers Compensation Act 1987 limits the payment of compensation for treatment, service or assistance to a period of 12 months after a claim for compensation is made or 12 months after weekly payments of compensation cease.  Existing claims (claim for compensation in respect of an injury made before 1 October 2012) where the permanent impairment is greater than 20% WPI are exempt from the operation of section 59A.  Seriously injured workers (permanent impairment greater than 30% WPI) are also exempt from the operation of section 59A.

In a recent decision of BlueScope Steel Limited v Jovanovski [2015] NSWWCC PD 44, a presidential member of the Workers Compensation Commission (WCC) considered whether an existing claim where the permanent impairment resulting from the injury has not been assessed, is exempt from the operation of section 59A for the payment of medical expenses. 

Determination of this issue led to the consideration of arbitrators’ power to decide whether a worker suffers permanent impairment where an Approved Medical Specialist (AMS) was not satisfied the degree of permanent impairment was fully ascertainable.

Facts & proceedings before the arbitrator

The worker suffered a right inguinal hernia on 25 February 2011 in the course of his employment after pushing a large trolley filled with scrap metal.  He was also diagnosed with a large hydrocele on the right.  The worker’s IME assessed him with 3% WPI as a result of the right inguinal hernia.  In 2012, an AMS diagnosed the worker suffered bilateral inguinal hernias and a traumatic right hydrocele as a result of the work incident on 25 February 2011, but did not consider the injury had reached maximum medical improvement and therefore did not assess permanent impairment.  The AMS expected the impairment to stabilise following repair of both the hernias and cure of the hydrocele. 

The Commission determined the permanent impairment resulting from the injury was not fully ascertainable.  The parties were permitted to restore proceedings when the worker attained maximum medical improvement. 

In the meantime, the worker sought approval for the surgery recommended by the AMS.  The employer disputed the claim for the proposed surgery.  A second set of proceedings were commenced seeking payment for the proposed surgery.

On 4 March 2014, another AMS provided a non-binding opinion that the proposed treatment for the right hernia and the hydrocele (the left hernia injury was not pressed) was reasonably necessary as a result of the work injury.  However, the employer maintained the dispute.

The arbitrator determined section 59A did not apply to this worker because he was a seriously injured worker defined by section 32A of the 1987 Act.  She arrived at this decision as she was satisfied the worker’s injury had resulted in permanent impairment based on his IME report.  In addition, the degree of permanent impairment was not assessed because an AMS had declined to make an assessment as the degree of permanent impairment was not fully ascertainable. 

Appeal

On appeal, the parties agreed the claim was governed by clause 28 of Part 2 of Schedule 8 of the Workers Compensation Regulation 2010 as it involved an existing claim and the appeal proceeded on that basis.  The claim on the basis of ‘seriously injured worker’ was not pursued.

Where an existing claim is concerned, section 59A does not operate in respect of an injury where the permanent impairment is greater than 20% WPI.  According to clause 28(2) a worker’s injury is considered to have resulted in permanent impairment greater than 20% only if the injury has resulted in permanent impairment, and

• the degree of permanent impairment has been assessed to be greater than 20%; or
• an assessment of the degree of permanent impairment is pending and has not been made because an AMS has declined to make the assessment on the basis that maximum medical improvement has not been reached and the degree of permanent impairment is not fully ascertainable; or
• the insurer is satisfied that the degree of permanent impairment is likely to be greater than 20%.

For clause 28(2) to be applicable, the worker’s injury should be found to have resulted in permanent impairment.  The Deputy President ruled the arbitrator had jurisdiction to determine whether a worker’s injury has resulted in permanent impairment based on the evidence before the Commission and this is not required to be determined by an AMS.  The Deputy President stated clause 28 did not require this issue to be referred for assessment by an AMS before a finding or determination is made by an arbitrator.  He considered the AMS is only required by the legislation to assess the degree of permanent impairment of an injured worker and until then the Commission may not award compensation for permanent impairment.  The issue before the Commission did not involve permanent impairment compensation.  It was confined to medical expenses for the proposed treatment.

In conclusion the Deputy President held, in the absence of a valid medical assessment certificate (MAC) by an AMS finding no permanent impairment, the arbitrator was empowered to determine whether a permanent impairment exists.  He found it was open to the arbitrator to accept the opinion of the worker’s IME to determine whether the worker’s injury has resulted in permanent impairment.

Thereafter, considering the MAC by the AMS in the 2012 proceedings, he was satisfied the worker’s injury had not reached maximum medical improvement and therefore the permanent impairment was not fully ascertainable.

In summary, there was no issue the matter involved an existing claim.  The Deputy President concluded it was open to the Arbitrator to find the injury resulted in permanent impairment, but the extent of permanent impairment was not assessable as the worker had not reached maximum medical improvement.  Further, by operation of Part 2 of Schedule 8, the Deputy President found the worker’s claim was an existing claim and, applying clause 28, he found it was exempt from the operation of section 59A.

The Deputy President observed similarities between the definition of ‘seriously injured worker’ under section 32A of the 1987 Act and clause 28(2), but stated they were not identical.

Implications

The decision opens the doors for arbitrators to determine whether a worker’s injury has resulted in permanent impairment without referral of the issue to an AMS. 

Workers who initially made a claim for compensation prior to 1 October 2012, whose injury is not fully ascertainable for assessment of permanent impairment could bring claims for future medical expenses despite not being in receipt of any weekly payments. 

The above findings do not apply to any claim relating to an injury, where the claim for compensation was made on or after 1 October 2012, but this does not stop workers claiming medical expenses in similar circumstances on the basis he/she is a seriously injured worker.