Unfortunately, most of what has been printed has been solely focused on the concerns of injured workers or the viewpoint of those at the WSIB. The challenges faced by the employer community has not been sufficiently addressed.
In a recent Q&A, with Anna Aceto-Guerin, president Clear Path Employer Services, we discussed the controversy and offer employers’ perspective on the issue.
Q: In his Toronto Star editorial titled “Ontario’s worker compensation system is under attack,” former WSIB chair Odoardo Di Santo stated that claim denials have increased 50 percent and benefit payments have been reduced by $631 million. The WSIB responded in a piece titled “Support for Ontario’s injured workers is stronger than ever,” declaring that the decrease is due to fewer workplace accidents and more effective Return-To-Work (RTW) strategies. What is your perspective?
A: Clear Path has noticed a modest increase in initial entitlement denials over the past five years, but not a 50 percent increase. We have definitely noticed the WSIB’s focus on RTW, which it has been aggressively promoting since the change from the former Labour Market Re-Entry (LMR) program to the current Work Reintegration (WR) program. If long-term wage benefits are down, perhaps it is due to the fact that the entire point of the WR program is to return workers to employment and to avoid long-term claims.
Q: Mr. Di Santo suggests that the primary focus of the WSIB these days is cost containment and working to reduce its unfunded liability. He says this is being done by reducing benefits to injured workers without enough focus on the “revenue side” and believes employers should be paying more into the system. What are your thoughts?
A: We take issue with Mr. Di Santo’s claim that the WSIB has not been focused on increasing revenue from employers over the past five years. Here are six specific things that employers have had to manage:
- Premium rates have steadily increased for employers (some industries are hit much higher than others)
- WSIB has significantly decreased the NEER Expected Cost Factors for employers. Once you lower the expected cost, your rebate gets smaller and this also dramatically increases the chance you will hit a surcharge faster. Expected costs drive both sides of this calculation.
- Move to a 4 year NEER window (from a 3 year) with little actual warning of implementation, essentially increasing their liability by 33 percent
- Reserve factor tables are changing regularly now over the review year, which rarely happened in the past. This essentially changes the “multiplier” being used to determine the reserves and calculate future claim costs. Typically we saw Reserve factor tables lock in after the preliminary table was issued. Now we have seen changes as late as August in the review year for claims that are 4 years old. This increases costs and the employer has no way to impact those costs so late in the game.
- Approvals for SIEF cost relief are now becoming a rarity, we estimate approvals are given less than 50% as often as in the past. The program provides cost relief for employers who have employed a worker with a previous disability or pre-existing condition. It reduces the amount the employer is financially responsible for but does not decrease the benefits to the worker. It may have been given out too generously in the past as a way of “pacifying” employers, but now it is increasingly difficult to acquire.
- Penalties for not meeting re-employment obligations and for non-cooperation with RTW have jumped significantly. If an employer was able to accommodate an injured worker for a while, but is no longer able to do so, they will be threatened with a penalty.
Q. There is much controversy over a proposed WSIB policy that could impact the long-term benefits of an injured worker with a pre-existing condition. There are accusations that the WSIB is already implementing this policy “illegally.” Have you noticed this?
A: No, we have not seen implementation of this draft policy and would be curious to see the specific decisions they are pointing to. Typically a policy number needs to be quoted in a decision (or at least the language of the policy would be included).
We have seen some cases where a NEL (Non-Economic Loss) award has been redetermined because medical evidence has come to the file that indicates a pre-existing condition. I think this is fully valid. If the worker has a pre-existing condition, part of the permanent impairment (PI) can be attributable to that pre-existing condition and the costs to the employer should reflect this.
One benefit of these decisions is that Clear Path has had some success obtaining SIEF cost relief in cases where the NEL was reduced due to the identification of a pre-existing condition, which is half the battle when requesting SIEF.
Q: Can you help us understand a bit more about this proposed policy?
A: The draft policy regarding pre-existing conditions seems very similar to the Aggravation Basis policy. Under the Aggravation policy, If an incident has aggravated a worker’s pre-existing condition, then the period of disability would be contained to the ACUTE period. If the recovery goes beyond the acute period, the WSIB would attempt to determine when the “normal” healing time for work related impairment typically have ended and then how much is attributable to the pre-existing condition.
This draft policy states that “If the pre-existing condition is degenerative in nature and is impacting the worker’s ongoing level of impairment, then WSIB benefits continue until clinical evidence is presented that the worker is at the point he/she would have been if the workplace injury had not occurred.”
By identifying that a pre-existing condition may affect recovery the WSIB is essentially putting a marker in the sand, and then trying to determine the effect of that pre-existing condition or impairment on the recovery period. How long would that recovery have been without the pre-existing condition? You can’t just say that a worker would be at the same point whether they had a pre-existing condition or not, you are now acknowledging that the pre-existing has to impacted recovery.
It looks like this will be a complicated policy to implement. You’re getting into an area that is very “foggy.” Typically many injured workers won’t have the “baseline” medical evidence of where they were prior to the injury. The WSIB won’t have a comparator of the worker’s status before the incident on which to base its decisions, they will have to rely a doctor’s best guess.
Q: What is Clear Path’s perspective on changes at the WSIB?
A: I believe that most employers we know would find the suggestion that the system is pro-employer as “laughable.” Perhaps our perspective is biased, but we would suggest that over the past 10 years the system seems to be more worker-friendly, not less.
The employers’ experience has often been frustrating, with little information being shared and little notice of big changes (that have a significant impact on employers and are implemented in a way that is punitive, such as reserve factors being changed at the last moment.)
That being said, the WSIB has made some strides in becoming a more fair and modern organization in recent years:
- They have worked hard to improve their customer service
- Implemented eService options
- Allowed employers to retrieve their NEER and monthly cost statements online
- Allow us to send emails to Board employees (not possible in the past)
Structural changes at the WSIB have been a mixed bag for employers. In the past, they used to have a dedicated case manager that likely understood your company and might come out and see your workplace or facility. Now there is a team approach with multiple people on your claims. It can be frustrating to explain the story over and over again.
Ultimately, the WSIB continues to be an expensive and often confusing system for employers. The NEER program alone is excessively complicated and results in different results for small employers vs large ones.
Q: Where can people learn more?
A: We encourage anyone involved in WSIB claims management to participate in one of our upcoming learning sessions, which will increase your knowledge and give you practical strategies to deploy in your workplace.
You can also learn more on our website here.
- The basics of the WSIB’s NEER system - September 29, 2017
- Summarizing WSIB’s proposed Rate Framework, part 3 - August 25, 2017
- Summarizing WSIB’s proposed Rate Framework, part 2 - July 28, 2017
