Tuesday, November 25, 2014

Insurance model 'scandalously dishonest,' says FAIR

As debate over Bill 15 continues at Queen’s Park, one accident victims’ group is advocating that the Colorado Model of Assessors be adopted.

“The Colorado Model of Assessors just might move Ontario’s insurance industry from a scandalously dishonest and bullying business model to a more functioning system,” says Rhona DesRoches, the board chair for the fair association of victims for accident insurance reform (FAIR). “If you reward Ontario’s insurers existing bad behaviour by making it less costly to behave badly we will not be further ahead and the life of accident victims will be even more stressful and harmful.”

Describing the Colorado model as a “highly successful and cost saving program,” DesRoches has been at the sharp edge of the sword slamming Bill 15 for what her association describes as the first step towards insurers becoming less accountable and less willing to honour contracts with auto accident victims.

“While we are sure that is not the legislator’s intent, it certainly will be the result of passing Bill 15,” says DesRoches. “Insurers will be less likely to stand behind their contracts and victims will be further victimized and marginalized without fair access to our courts – everything Ontario’s insurers need to increase profits.”

DesRoches specifically took aim at testimony from an Aviva representative who recently spoke at the Bill 15 hearings.

“Legislators heard from the Aviva representative at the hearings on Bill 15. Most shocking is the fact that any insurer is paying out such substantial sums for defending against claims, 44 million dollars in just 2013 alone,” says DesRoches. “This is just one insurance company paying an average of $7,719.30 in legal defence costs per claim - well above the average amount paid to claimants in 2013.

“So is there a cure for this dysfunctional and bullying insurance system we have? We don’t know but we think that holding insurers accountable when claims are wrongfully denied and cleaning up the medical opinions (on which the denial is based) would be a positive first step.”

DesRoches cited an HCDB (Health Claims Data Base) report where insurers paid out an average of $4,745 ($3,934 - $5,557) to injured MVA victims in 2013.

“The amount paid to victims in the first 6 months of 2014 was a mere $1,790 per claim,” she says, “meaning that the legal defence costs are now four times as much as the value of what a claimant gets from their insurer.”

The Colorado Model

The Colorado model was created in 1996 in response to what that state saw as a perception that the claims process was biased.

The new program – under Colorado’s no fault law – provides the exclusive mechanism for resolving disputes over the reasonableness, necessity and relatedness of treatment following MVAs. The program (the Personal Injury Protection [PIP] Examination Program) makes available a group of licensed health care providers, experienced in the treatment of MVA issues and actively engaged in clinical practice, who have not earned more than half their income or spent more than half their professional time performing IMEs, to examine patients when a dispute with the insurance company arises.

When a dispute arises and an examination is requested, a list of five qualified practitioners in the same specialty as the treating doctor whose opinion or bills are disputed is prepared and within five days of the request sent to the party disputing the claim (usually the insurance company, but maybe the patient in the case that there was a dispute over an earlier IME). If neither side can agree on one person from the list to conduct the examination, the insurer and the patient each strike two names and the remaining practitioner performs the examination.

The examiner is required to address in a written report the issues in dispute, and the insurer is required to pay the benefits if the examiner agrees with the previous treatment rendered or with the medical conclusions of the treating doctor. If either party is dissatisfied with the findings, that party may request and pay for a second IME under the same procedures of selection.

In this case, the conclusions of two of the three practitioners (the two examiners and the treating provider) are binding, and the examiner must physically examine the patient and review the records, which must be supplied by the insurance company; and the patient may augment the records as necessary.

The requesting party is obligated to pay the examiner’s fees, DesRoches points out.

The whole process is designed to be completed within 45 days of when the insurer initially disputes the claim.

The problem with Bill 15 – and will only encourage insurers to dispute more claims, says Desroches – is that the Prejudgment Interest will be reduced to 1.3 per cent.

“There needs to be more accountability, not less,” she says. “Without anything to discourage them, insurers will be incentivized to systematically deny claims through the use of partisan medical reports prepared by their preferred medico-legal ‘expert’ assessors to deflate a claim.

“All because, for some unknown reason, it’s generally believed that honest and unbiased medical assessments of accident victims is a bad thing,” says DesRoches.

Source: http://www.insurancebusiness.ca/news/insurance-model-scandalously-dishonest-says-fair-185489.aspx?p=3

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