Home / Regulatory & Government / icare data shows ‘deteriorating performance’
11 June 2019
Performance data shows a major deterioration in the NSW workers’ compensation scheme, a former principal actuarial adviser to the State Insurance Regulatory Authority (SIRA) says.
Peter McCarthy, who has worked with EY, Zurich, FAI and QBE in a 40-year career, says insight articles published by government-owned insurer icare show a claims performance deterioration and a jump in private hospital costs that is almost double the increase in health insurance premiums.
“When medical costs increase so much, then return to work and weekly payments will have deteriorated significantly and there will be a follow-on to much higher statutory lump sums and common law over time,” he said. “This is very bad news for employers who pay premiums and a poor social outcome for injured workers.”
Mr McCarthy says it appears reported claim numbers increased 10-12% last year and there has been a major slowdown in the speed at which claimants are receiving weekly compensation.
Insight articles published by icare highlight quarterly data from independent actuaries Finity, and include information back to 2015.
icare says overall claims and claims that receive weekly benefits have remained relatively stable, while an increase in psychological claims is a trend “across the board”, not just in the state scheme.
“The issue of rising medical costs in NSW, particularly for private hospital services, is a key focus area,” a spokeswoman told insuranceNEWS.com.au. “Due to regulated medical expenses in NSW, costs can be much higher in NSW compared to other states for similar services.”
SIRA has called for public submissions – closing on Friday – to an independent review of the workers’ compensation arrangements managed by icare.
The compliance and performance review will be released later in the year.