ACC claims process and residual levies need a review
The issues faced by ACC over the past year or so have largely focused on the inappropriate acts of a few members of staff and the board. Some longer term issues also need addressing. Two of the major issues are how ACC handles claims and how unfunded claims made before 1999 are funded.
A fairly hands off approach from ACC has been at the heart of the claims process problem. There has been a lack of direct support and accountability with automatic processing of all claims. ACC’s failure to seek information from the employer has been a problem - acceptance decisions can be made based only on employee information and a doctor’s certificate (often the employee’s own personal doctor), following which the employer is bound to follow through a very time consuming onerous process.
Poor investigative procedures allow claims to be accepted without proof of validity and evidence of the physical injury or incapacity. An accurate diagnosis is needed. On acceptance of claims by ACC, there is often little/no consideration regarding other issues that could be contributing to the claim, such as outside personal pursuits of the claimant.
A more thorough process is needed.
The residual claims issue dates back to ACC claims that occurred prior to 1999. The ACC website explains the issue:
“Prior to 1999, ACC levies covered only the claims costs that were actually paid out during the year. As a consequence, ACC built up long-term liabilities for claims that were not matched by investment reserves.
The residual portion of levies was established to build investment reserves to match these existing liabilities by 30 June 2019.”
The problem is that the residual levy is not spread evenly across all sectors; rather sectors considered to be ‘high risk’ cop a larger proportion of the levy. This creates a fairness issue when the firm paying the levy may not have even existed when the claims they are covering were lodged.
Essentially some firms are getting punished for the poor safety record of firms from decades ago who often did not even use the same processes. They are paying twice - by paying for safe modern equipment to reduce the risks of injury and for the ambulance at the bottom of the cliff for less responsible firms of yesteryear. Surely a more even spread of the cost would be preferable.
An ACC levy consultation was conducted in 2010/11 and the NZMEA recommended the following six points:
1. Development of a productive, professional working relationship with ACC.
2. All companies be assigned an account manager per employer with regular reviews established, for example every six or 12 months, being action and outcome based.
3. Role clarity regarding account managers, case managers and treatment providers including definition of how these roles will work collaboratively with employers.
4. Improvement in the quality of investigations; movement away from automatic claim acceptance.
5. Improved case/claim management and strengthened rehabilitation process.
6. Dispute resolution process more clearly defined and implemented.
These still hold true and would be a starting point for a review of how ACC operates.