If as a result of injury at work you have sustained a permanent impairment, the Workers Compensation Act allows for an injured worker to claim a lump sum amount of compensation for that impairment.
This lump sum amount is in addition to payment of weekly compensation and medical expenses.
If you obtain a lump sum amount for permanent impairment, this does not prevent you from continuing to receive payments of weekly compensation and payments of medical expenses in accordance with the Act.
A threshold of at least 11% whole person impairment must be reached to obtain the lump sum compensation for physical injury and 15% whole person impairment for psychological injury.
WHAT IS PERMANENT IMPAIRMENT?
Permanent impairment can be defined as an injury which impairs the physical and/or mental ability of a worker. The degree of permanent impairment that results from an injury is to be assessed by reference to the NSW Compensation Guidelines for Evaluation of Permanent Impairment (1 April 2016).
Permanent impairment is calculated by a medical specialist trained in the use of the guidelines for the evaluation of permanent impairment. Assessing permanent impairment involves the medical assessor undertaking a clinical assessment of the injured worker as they present on the day of assessment. The assessment takes into account the injured workers history and all available relevant medical information to determine: -
- Whether the condition has reached maximum medical improvement (MMI).
- Whether the injury has resulted in an impairment.
- Whether that impairment is permanent.
- Whether that degree of permanent impairment results from the injury.
- Whether any proportion of that permanent impairment is due to any pre-existing injury, condition, or abnormality.
The medical assessors then follow the guidelines outlined in the Evaluation of Permanent Impairment to obtain a percentage whole person impairment. The percentage of whole person impairment that results from the injury must be determined using the tables, graphs and methodology outlined in the guidelines.
WHAT IS WHOLE PERSON IMPAIRMENT?
The method for assessing permanent impairment is for the medical assessor to clinically assess the injured worker and review their history, as well as all relevant medical information to determine a percentage whole person impairment that arises from the injury.
In determining this whole person impairment the medical assessors must use the NSW Workers Compensation Guidelines for the evaluation of permanent impairment.
These guidelines set out in detail tables and methods for evaluating the percentage whole person impairment, the doctor uses these guidelines to make an assessment of the percentage whole person impairment. This includes all of the injuries sustained in the accident.
Physical injuries and psychological injuries cannot be combined to increase the whole person impairment.
The only compensable injury is the primary injury.
For example, if a worker sustains an injury to his low back and then has a secondary psychological injury due to the pain and loss of enjoyment of life as a consequence of the back injury, the only compensable injury is the primary physical injury to the back. The assessor is not allowed to include an assessment of whole person impairment for the psychiatric injury as well as this is a secondary injury.
HOW DO I MAKE A CLAIM FOR WHOLE PERSON IMPAIRMENT?
You need to consult an expert Accredited Specialist in Personal Injury Law to make a claim for whole person impairment compensation.
The lawyer will arrange for you to be medically examined by a medical specialist who is trained in assessing impairment using the guidelines. Your treating specialist cannot make an assessment as they are usually not trained in the guidelines.
To obtain lump sum compensation for permanent impairment you must be able to establish the following: -
- Your condition must be stable. This means that there is unlikely to be any improvement or deterioration in the future. This usually occurs around 1 year following the injury. This is known as reaching maximum medical improvement (MMI).
- You need to be assessed by a medico-legal doctor who is approved by WorkCover to assess the percentage whole person impairment.
- The percentage whole person impairment will be determined by the medical assessor who will rely on the examination with you and all relevant medical reports including any x-rays and scans.
- The doctor must follow the guidelines for the assessment of permanent impairment. The guidelines tell the doctor what percentage impairment should be allowed in the circumstances of your injury.
- For example, an injury to the lumbar spine is determined by having regard to categories of impairment. Category 1 is 0%, where there are no signs of injury. Category 2 is 5-8% impairment where there are some signs of injury but no neurological involvement. Category 3 is 10-13% whole person impairment where there are signs of injury and also findings of neurological symptoms on examination. Category 4 is 20-24% whole person impairment where fusion surgery has been undertaken.
Once an assessment of whole person impairment has been obtained, then a claim can be made to the workers' compensation insurer.
WHAT IS THE PROCESS FOR OBTAINING LUMP SUM COMPENSATION FOR IMPAIRMENT?
Once your lawyer has arranged for a medical assessment of whole person impairment then your lawyer will make a claim on your behalf for whole person impairment. They will do this by completing a permanent impairment claim form. The claim form together with the medical report you rely upon is sent to the workers’ compensation insurer.
The insurer then has a period of 2 months in which to investigate the claim. During that 2 month period the insurer may arrange for you to be examined by their own medical assessor to obtain their own assessment of whole person impairment.
Within the 2 month period, the insurer must determine whether they agree and accept the level of whole person impairment as outlined in the permanent impairment claim or whether the claim is disputed.
If the insurance company disputes the level of whole person impairment, then your lawyer is required to make an application to the Workers Compensation Commission to appoint an independent doctor to assess the level of whole person impairment.
After receiving all relevant medical evidence, the Workers Compensation Commission will arrange for you to be examined by an independent medical assessor. The independent medical assessor will examine you, read the relevant medical records, and make an assessment of the percentage whole person impairment in accordance with the guidelines for the evaluation of permanent impairment.
The independent doctors’ assessment of whole person impairment is final and binding on all parties.
The independent doctors’ assessment can be appealed to a medical appeal panel if the assessor has made an error of law.
To obtain lump sum compensation for physical injuries, the assessment of whole person impairment must be 11% or greater
To obtain lump sum compensation for psychological injury, the assessment of whole person impairment must be 15% or greater.
HOW MUCH LUMP SUM COMPENSATION IS PAYABLE?
The amount of lump sum compensation payable for claims made on or after 19 June 2012 is set out in the table below:-
For injuries sustained after 5 August 2015, the amount payable for lump sum compensation has increased as per the table below: -
IS THE PERCENTAGE OF WHOLE PERSON IMPAIRMENT ASSESSMENT IMPORTANT FOR ME TO CONTINUE TO RECEIVE WEEKLY PAYMENTS?
Yes. The level of whole person impairment is very important in respect of the following:-
- How long you are entitled to receive weekly compensation payments.
- How long you are entitled to receive medical expenses.
- Whether or not you are entitled to pursue a claim in negligence against your employer, known as a Work Injury Damages claim.
Assessment of whole person impairment of 10% or less:
If the assessment of whole person impairment is 10% or less, then the maximum period for which you can receive weekly payments of compensation is 5 years. Medical expenses will also stop 2 years after either the date the claim was made, or 2 years after the last date on which you received weekly payments of compensation, whichever is later.
Assessment of whole person impairment between 11-20%:
If the assessment of whole person impairment is 11-20%, then the maximum period for which you can receive weekly payments of compensation is 5 years. Medical expenses will also stop 5 years after either the date the claim was made, or 2 years after the last date on which you received weekly payments of compensation, whichever is later.
Assessment of whole person impairment of 21% or greater:
If the assessment of whole person impairment is 21% or greater, then you are entitled to receive weekly payments until 12 months after your retirement age subject to the insurer conducting a work capacity decision every 2 years to assess your capacity to work.
Your medical expenses are payable for life.
Assessment of whole person impairment of 31% or more:
If the assessment of whole person impairment is 31% or greater, then you are entitled to receive weekly payments of compensation until 12 months after your Commonwealth statutory retirement age and you are entitled to receive medical expenses for life.
ONLY ONE CLAIM FOR WHOLE PERSON IMPAIRMENT
The Workers Compensation Act allows an injured worker to only make one claim for permanent impairment compensation that results from any injury. After making that one claim you cannot return and claim an increase in lump sum compensation should your condition deteriorate in the future.
The timing of when to make the lump sum claim for whole person impairment is therefore crucial. If you make a claim for whole person impairment too early and the assessment of whole person impairment is for example, less than 10%, you will not receive any lump sum compensation and weekly payments will be limited to a maximum of 5 years and medical expenses for 2 years thereafter.
If say further surgery was required and the whole person impairment was really 25%, then not only would you receive a large lump sum amount of compensation for whole person impairment but you may be able to receive weekly payments until retirement age and medical expenses for life.
The timing and the assessment of whole person impairment is therefore now critical in determining both the amount of lump sum compensation and for how long you are entitled to receive weekly payments and medical expenses.
DOES THE WHOLE PERSON IMPAIRMENT ASSESSMENT AFFECT ANY CLAIM FOR NELIGENCE AGAINST MY EMPLOYER?
Yes, the assessment of whole person impairment is also very important if the injury was sustained as a result of the negligence of your employer. You may be entitled to pursue a claim for negligence against your employer, known as a Work Injury Damages claim.
You can only make such a claim if you have a whole person impairment of 15% or greater. Please see our articles on Work Injury Damages.
Matthew Garling – Garling and Co Lawyers 2016
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About Matthew Garling.
Matthew Garling, Founder of Garling & Co is a NSW Law Society Accredited Specialist in Personal Injury Law. He specialises in compensation law and has acted on behalf of thousands of injured people in work accidents, motor vehicle accidents and negligence cases over the last 20 years.