Brokers say “systemic shortcomings in claims management” have created problems in the NSW workers’ compensation scheme that are not addressed by the government’s proposed reforms.

The National Insurance Brokers Association warns poor practices still plague the program for private sector employees, despite state insurer icare introducing a new claims management model in 2021.

Reviews, including by icare, have found issues with the timeliness, consistency and quality of claims handling by external agents contracted under the 2021 model.

Problems include delays in decision-making, inadequate communication with injured workers and employers, and inconsistent application of injury management policies, NIBA says in a submission to a state upper house committee reviewing the government’s proposed reforms.

“These systemic issues not only increase claim costs but also undermine return to work outcomes, ultimately impacting both workers and the employers who fund the scheme through rising premiums.”

NIBA says the planned overhaul of workplace injury laws “while well intentioned, fails to address the underlying systemic drivers of the scheme’s deteriorating financial position. It is NIBA’s view that the primary causes of the scheme’s deterioration lie not in the design of benefits or liability thresholds alone, but in systemic shortcomings in claims management by [claims services providers] and the increasing acceptance of claims with limited or no clear employment nexus.

“We submit that without targeted reform in these areas, the proposed legislative changes risk treating symptoms rather than the root causes of the crisis the scheme now finds itself in.”

NIBA urges the government to undertake an independent review of claims management and claims services providers.

The broking body also recommends improving access to diagnostic and treatment services, and exploring ways to encourage employer investment in injury prevention measures.