June 19, 2011, Kitchener, Ontario
Posted by: Robert Deutschmann, Personal Injury Lawyer
Alan Shanoff, columnist in the Toronto Sun, outlines a number of concerns regarding the changes that could happen with the Catastrophic Impairment designation for people in a car accident. A recent court decision has called into question a well established method for determining catastrophic impairment after a car accident. Further, a recent provincial panel has made a number of controversial recommendations. All this seems to be an attempt to reduce the number of people designated as catastrophically impaired after a serious car accident.
Column dated June 19, 2011:
People injured in motor vehicle accidents are placed into one of three categories when determining rights to no-fault medical and rehabilitation services.
Those who have suffered minor injuries, non-minor injuries and catastrophic impairment.
Those in the minor injury category are entitled to reimbursement up to $3,500 in medical and rehabilitation services.
Those in the non-minor injury category are entitled to reimbursement up to $50,000.
Those in the catastrophic impairment category are entitled to reimbursement up to $1 million.
The $50,000 and $1 million figures are doubled if optional insurance is purchased, but very few people do.
Prostheses, wheelchairs, assistance devices, attendant care, housekeeping services, medication expenses, home modifications and other costs all come out of the no-fault limits, so it’s easy to exhaust them, particularly in cases not deemed catastrophic.
Here’s the problem: Injured people and their insurance companies often disagree on whether injuries qualify as catastrophic.
If your insurer places you in the wrong category, you can run out of benefits and be unable to afford necessary medical, rehabilitation or other services.
The problem has been worsened by two developments.
First, last year an Ontario court made it harder to qualify for the catastrophic impairment category.
The case involved a man who required amputation of his left leg below the knee due to a motor vehicle accident.
Due to cysts on his stump, he often uses a walker or wheelchair rather than a prosthesis. He suffers pain in his shoulders, lower and upper back and right hip. With a prosthesis he can walk well only on flat surfaces. He lost his job and suffers from depression.
Yet he didn’t meet the requirements of catastrophic impairment — and has exhausted his benefits — due to a judge’s interpretation of the definition. That’s because the judge refused to combine the physical and psychological impairments in assessing whether the injuries met the definition of catastrophic impairment. This was contrary to a 2004 decision and is under appeal.
The second development relates to a report by a panel of experts to the Financial Services Commission of Ontario. FSCO is responsible for the regulation of car insurance in Ontario. FSCO asked this panel to review the definition of catastrophic impairment.
The panel’s proposals would make the determination of a catastrophic impairment more complex and harder to achieve. That can only result in more litigation dealing with disputes. Worse, we’ll have more vulnerable, catastrophically-injured accident victims unable to receive medical and rehabilitation services they require.
The problem with the panel’s proposals starts with its members. Two of eight are or have been consultants to the Insurance Bureau of Canada. Two others have received research grants from the insurance industry.
Couldn’t FSCO find experts without conflicts of interest?
Only six of eight members agreed an individual injured in a traffic accident who becomes paraplegic or quadriplegic is catastrophically impaired. I think that tells us everything we need to know about the panel’s work. Their report should be scrapped.
Is there a need to revise the definition of catastrophic impairment which has been in place for over 10 years? The only way to find out is to undertake a study of accident victims to determine the adequacy of no-fault benefits for the seriously and catastrophically injured.
How many accident victims have been designated in each category?
How often do victims run out of medical or rehabilitation benefits?
Are we providing adequate relief for the seriously injured?
What medical and rehabilitation services does the $50,000 limit, or $1 million limit, buy?
We may want to adjust the definition of catastrophic impairment, depending on the answers.
Those wanting to restrict the definition of catastrophic impairment must understand such a designation doesn’t result in a cheque for $1 million being issued to accident victims. Each victim must demonstrate the need and reasonableness of every expenditure.
Catastrophic accident victims deserve our compassion, not complex technical rules.