Insurer can require excessive medical assessments.

August 22, 2011, Kitchener, Ontario

Posted by: Robert Deutschmann, Personal Injury Lawyer

A recent editorial article by Alan Shanoff in the Toronto Sun highlights some issues with respect to the conduct of accident benefit insurers when they require excessive assessments to determine whether a recommended treatment plan is reasonable and necessary. 



Put auto insurers under a microscope
Being injured in a car accident isn’t something to which anyone looks forward.
Aside from the pain and suffering from the injuries, there’s the potential loss of earnings.
But, no worries, we have no-fault income replacement benefits in Ontario.
And, of course, an insurance company would never act in anything other than good faith in administering those benefits. Or would they?
Let’s look at the case of Everliston Cowans, who was injured in April 2007.
Cowans earned about $50,000 in the year prior to his accident. Under our generous, no-fault benefits, this was reduced by almost one-half for the first two years after the accident.
At that time his insurance company, Motors Insurance Corporation, terminated his income replacement payments, even though Cowans continued to suffer from chronic pain and was limited in his ability to work.
The insurer said he no longer qualified for the income replacement.
But according to Financial Services Commission of Ontario arbitrator John Wilson, in a decision released late last year, it reached this conclusion based on a “patently flawed assessment process.” How did it happen?
Motors retained Health Impact Multidisciplinary Centres (HIMC) to obtain assessment reports on Cowans’ ability to return to work.
HIMC then arranged for assessments by a psychiatrist, a physiatrist, a kineticist and a labour market analyst.
Motors cancelled Cowans’ income replacement based on the reports, without giving them “close scrutiny” or analyzing their “conclusions in a critical manner.”
Worse, the main report relied on was critically flawed and at the time Motors made its determination, it had “credible information” casting doubt on its recommendations.
Cowans eventually had his income benefits reinstated so can we rest easy and move on?
No. It isn’t that simple. You see, some of the evidence at the arbitration is so astounding it cries out for a public inquiry.
The psychiatrist who was part of the assessment team testified. His prime occupation was conducting psychiatric assessments, mainly for car insurers. He testified his assessment of Cowans was one of up to 45 to 50 he might conduct in a month. His projected income from assessments was “in the range of some $600,000 per year.”
The arbitrator referred to the psychiatrist’s “obvious dependence on the insurer’s goodwill for his lucrative assessment business” and concluded that whether the doctor was “biased or prejudiced or not, I find it tests credulity to believe that an assessment mill such as described … could ever generate meaningful results.”
Given the number of assessments per week, the time permitted to review voluminous documentation, assess the insured and write a report would have been “at most four hours from start to finish.”
The Ontario government has set up a task force to investigate car insurance fraud. No doubt some people engage in insurance fraud. We’ve all read about staged accidents as a prime example of such fraud, although how prevalent they are remains to be seen.
I’m not saying the practices of assessment mills are equivalent to fraud — they aren’t.
But shouldn’t we have a task force to inquire into questionable insurance company practices? How many use the services of assessment mills? How many insureds have had their benefits wrongly cut off due to assessments conducted by assessment mills or experts beholden to insurance companies?
Remember, the evidence in this one case by one doctor is that he alone conducted up to 45 to 50 assessments per month. How many doctors or experts have similar practices or depend on an insurer’s goodwill for their lucrative business?
Even if some, or many, of their reports are accurate, there’s certainly an appearance of a conflict and a perception of a lack of fairness.
How much money do insurers spend/waste in their attempts to cut off their insureds’ benefits?
It would be instructive to know how much Motors paid Health Impact Multidisciplinary Centres for the four experts’ reports.
It’s time we put the car insurance industry under a microscope.
Posted under Personal Injury, Car Accidents, Chronic Pain, Pain and Suffering, Treatment

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Deutschmann Law serves South-Western Ontario with offices in Kitchener-Waterloo, Cambridge, Woodstock, Brantford, Stratford and Ayr. The law practice of Robert Deutschmann focuses almost exclusively in personal injury and disability insurance matters. For more information, please visit or call us toll-free at 1-866-414-4878.

The opinions expressed here, while intended to provide useful information, should not be interpreted as legal recommendations or advice.

Practice Areas

  1. Car accidents
  2. Motorcycle accidents
  3. Automobile accident benefits
  4. Catastrophic injury
  5. Brain or Head injury
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  5. Fractures or broken bone injury
  6. Pedestrian accidents
  7. Chronic pain
  8. Truck accidents
  9. Amputation and disfigurement
  10. Fibromyalgia
  11. Nursing Home Fatality Claims

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