Industry experts get together to discuss ways of travelling the rocky road to rehab

  • Andy Cook, editor, Insurance Times

  • Chris Dickson, head of healthcare services, Bupa

  • Elaine Chapman, partner, large loss and technical claims team, Weightman Vizards

  • David Williams, casualty insurance manager, AXA Insurance

  • Mary Menjou, projects manager and solicitor, NHS LA

  • David Grimley, technical claims manager, St Paul International,

  • Richard Foster, partner and head of the healthcare department, Weightman Vizards,

  • Trevor Harrison, technical manager, MIB

  • Kulbir Kang, head of technical claims, Zurich Commercial

    What is rehabilitation?

    Chris Dickson: It's about working with people to enable them to continue with their life as it was or, in the case of more catastrophic injuries, to allow them to fulfil their life as much as possible.

    David Williams: We need to look beyond the financial benefit to the insurer and to what we can do to improve the quality of an individual's life, and basically speed things along towards the return to full participation, whether that's back into full employment or half-employment.

    We think things tend to be a bit black and white; people only think about rehabilitation when we're talking about a very, very large claim, and I think that's one of the problems with changing people's attitudes generally. If we can get rehab to be thought about on every incident, then we stand more chance of getting the big saving that people talk about.

    Richard Foster: I'd say [rehabiliation is] proactive claims handling by a compensator at an early stage, by offering rehabilitation in order to enable the injured claimant to reach his or her full potential in terms of recovery.

    Trevor Harrison: Rehab involves various specialties. So there'll be the physio, there'll be occupational therapy, housing and others. So I think it's a balance depending on the type of case you're handling and whether it can be cost-effective at the end of the day.

    The benefits are great but the scale of uptake is low. Why?

    Chris Dickson: A number of studies have been done to look at effectiveness and have found it difficult to give any clear insight into the costs of a rehabilitation programme. People are wary of opening this sort of can of worms - to pay large amounts of money without knowing what the outcome's going to be.

    Elaine Chapman: The culture of litigation is a problem. And the difficulty is for insurers because very often they're not brought on board until very late in the process. By the time they are, it may often be too late.

    The other problem is that the services that are provided across the country by the NHS are also variable. There are some very good services available, certainly in the aftermath after an accident, so it is not in the insurer's interest to remove people from that type of environment.

    David Williams: There's a lot of talk about cost effectiveness and it is very difficult to prove. We believe fundamentally that rehab will reduce our claims costs and pay for itself, but you try doing a business case.

    Do success fees encourage rehabilitation?

    David Williams: I just cannot see how success fees can encourage rehabilitation. Maybe the ABI code of practice needs to be revisited and maybe we should not pussyfoot around trying to please all interested parties. If you're talking rehabilitation, it should be about the good of the injured party. I think the code of practice should be enforced rather than being voluntary.

    Claimants' solicitors may view things differently because of the extent of the liability problem. I'm not saying you should not get the buy-in of all stakeholders, but it needs to be a bit harder, a bit firmer. We should encourage rehab a bit more. We all say positive things about rehab, there's lots of commitment to it, but very little action.

    Mary Menjou: The NHS is in a slightly different position, we're a bit behind the insurers in terms of considering all this.

    The slight advantage we may have is that we can access people who've had adverse incidents in a hospital. That's the way that we would hope to establish some sort of dialogue. But we anticipate great difficulty in measuring outcome. We can monitor that only in relation to what we believe may or may not have been saved, and the other information is simply qualitative. So we're hoping to learn from insurers.

    The NHS is committed to proactivity, mediation and earlier settlement. Some trusts are good at notifying the NHS LA and that provides an early trigger. But it's hugely variable. Some trusts have a lot of money in risk management, others have less of a priority in risk management, so it's part of the NHS LA's remit to try to bring this together and to encourage risk management. This means even the low value claims are dealt with by the NHS LA. We are planning a pilot to assess the scope and the problems involved with rehabilitation. We aim to use about five claims management firms and about 100 cases.

    David Grimley: I wish I could share Mary's optimism. We started a pilot last year on soft tissue type injury. Unfortunately, we haven't so far got a result, but it may be easier to justify on larger cases. Essentially, we've got to make a leap of faith. If we have a situation where we can sort out liability, so we are able to identify the people very early on who would benefit by a programme of rehabilitation, then that works. The one where you've got to wait two or three years before liability is determined is often too late, the process has already gone too far down the line.

    Richard Foster: I think the starting point from the NHS clients' and also the taxpayers' point of view is that healthcare is free at the point of access. But it's in the financial interest of insurers to take on the burden and also a very good public relations exercise for them in terms of what society expects.

    There is an image factor too. The insurance industry hasn't always had a very good image in terms of how it deals with claims and here's a very good way in which they can say: "Look, we're on your side, we want to do what's right for society."

    And it's rather strange. It seems to me that if you damage a car, the insurance industry is very keen to get the thing repaired as quickly as possible. If you have a fire it is very keen to repair the house as soon as possible, but for the very seriously damaged person, things are very different.

    Richard Foster: There are two things. First, the ABI and the IUA should a lead on this. You've got to get in there early. There's no alternative but to work outside the litigation process. The other way of funding rehabilitation is by way of an interim payment within the litigation process. There's a problem there - it's usually too late. And if the court makes an interim payment of damages intended for rehabilitation, you can't force that claimant to use it.

    Trevor Harrison: The MIB is a compensator, not an insurer. We have no control over reporting procedures. If you're an employers' liability insurer, you've got a policyholder with whom you have some influence. If it's a serious accident, hopefully they will report it to you promptly. So, you can influence that employer to alter the workplace and do a number of things that would benefit that employee.

    We have no control. We have to wait for the claim to come to us and very often it'll be six, 12 or 18 months after the event. What rehabilitation would be useful at that point in time? It's difficult to identify those cases where it would be beneficial. We then have to start resolving the liability question because until that's resolved, even if we were to pay for some form of rehabilitation that would be useful, we can't do it on an ex gratia basis. Any payment like that would be considered by the compensation recovery unit as fair game. We'd also be responsible for the hospital charges, so our hands are tied to a certain extent. We have to get that liability aspect sorted. Also, the courts could adjust the damages where recommended rehabilitation is not undertaken, that might focus the mind a little bit.

    Kulbir Kang: Insurers perhaps do need to take a leap of faith. I don't think they can do it alone, only some aspects of the claims process are within our remit and our responsibility. We need to look wider. Over the past two, three ,or even four years insurers have made a lot of progress. But we need to look at the legal profession, we need to look at our customers and we need to look at the wider expectations of society. How we mobilise all the resources is the biggest challenge. Whether that's something for the government or maybe it's something for the ABI to take on board. The lack of trust between claimant, lawyer and insurers plays a significant part. Insurers need to be a lot more proactive and I think this is where we need to work with our customers in terms of understanding and encouraging early notification of these cases, because that's the only way that we can really stand any chance of proactively management. Average notification periods do cause us significant difficulties.

    Elaine Chapman: I think you cmnvince the board by battering them I think over a period of time. We actually took a slightly different approach. When we first started on this route, a lot of the focus was on rehabilitation for catastrophic injury. We decided to look at the volume claims. When you have more of a standardised approach, you can perhaps look at developing a cost benefit analysis around that - by looking at your own internal data. So we shifted the focus from the top end high value/low volume cases to the high volume/relatively low value cases.

    Chris Dickson: I have a person working for me from New Zealand who used to work with the Accident Compensation Corporation, and they get round the problem by having no-fault compensation and then being able to treat people without having to prove any liability. People can enter a treatment process and, what's more, a managed treatment process, at a much earlier stage in their condition. And again they've got evidence that that produces better recoveries than you see elsewhere.

    All our claims run through a system and the system can flag up certain problems to it, and we have a back pain team that specifically looks at people who have had more than a certain number of treatments for back pain that indicated it's not getting better straight away. We're also running a pilot with one particular company where we speak to all their people who've had motor accidents, to establish whether they had had an injury and then make sure they are receiving the appropriate care, and again the notification's almost immediate.

    It's key that you do a pre-treatment assessment that needs to cover a variety of things. It's not just about medical and physical conditions it's also about the psychological beliefs. There's no point in spending a lot of money on someone who's not interested.

    Elaine Chapman: There needs to be more partnering between the NHS and the insurers. There is a lack of communication, we just really don't know what's out there in different parts of the country, and there's an onus on all parties to try to find that out before going into these costly packages, because as a number of people have said today, there are excellent primary care facilities across the country, so let's use them.

    David Williams: There are some possibilities on the horizon that can help. Currently the DWP is looking at revising employers' liability, and we should be able to make more process on employer's liability claims. If we can move to a no-fault system, which is one of the industry's proposals, while there is concern that that on the basis of it will increase costs as well as reducing the legal expenses, we can start off on rehab much earlier. Currently if somebody reports a claim we have a situation where we'd like to immediately see whether or not the injury is a suitable one for the treatment. How's that going to be paid for?

    Even if we as an insurance company overall feel that getting involved in offering rehab will save us money, we do have resistance from the insurers. If you are going to pay some costs before liability is established, is that going to be regarded as an employer's liability claim, which is then going to affect their premium a year down the line?

    And with the current big increases that we've already got on relatively claim-free cases, there is a really, really big concern. So I think if we can move to a no-fault system, forget about arguing about liability and look at the nature of the injury, then nobody's going to lose out by getting back to work earlier.

    We've tried to, for instance, offer a form of workplace accident private medical cover. If you bundle that with an employer's liability (EL) cover, then when somebody is injured at work it's not a conflict of interest with the defending EL insurer. It's a case of the employer having been wise enough to buy an additional benefit for his employees. One of the problems we're trying to get covered is cost. But all we're trying to do there is to find ways around this accusation of conflict of interest, when really what we want is appropriate medical treatment as early as possible for injured parties.

    Andy Cook: And you're talking about conflicts of interest with the NHS?

    David Williams: No, just more a case of it being viewed, certainly by a claimant's solicitor, as being an attempt to reduce the payment to their client.

    Andy Cook: And have you tried this premier care package or have you talked to anybody about offering an additional sort of rehab cover?

    David Williams: Yes, very much so, I mean we've got PPP within the AXA group, so that does give us a big advantage. But we've been more successful on problem cases where, if they didn't do something, then they would have difficulty getting cover or their

    EL bill was going to get to a level that really just wasn't tenable. So, while we do see it as a possible benefit, we've been more successful in selling it as `this is the only way going forward'.

    Most private medical providers have road traffic accident cover, so the idea of stripping out elements of cover is not new, it's just a case of trying to find what's appropriate and getting the right price.

    Andy Cook: Have you got the sophistication in-house to be able to cross-sell or to bring the two parts of the business together?

    David Williams: We're working on it.

    Mary Menjou: Hopefully it will be in the middle area, as it were. The claims worth in excess of £100,000, but certainly not those like cerebral palsy, which is simply not amenable to rehabilitation.

    David Grimley: The truth of the matter is that, despite whatever the NHS' hopes and aspirations, it doesn't have the resources. There are not sufficient trained physiotherapists in the country, by quite a considerable amount.

    If you want a big hit, what I would do is I would put something into the Health and Safety at Work Act which required employers to provide rehabilitation facilities for all their employees in respect of minor injury or disease and to provide that as an employee benefit which takes the liability question-mark out, and you make that a compulsory requirement

    Richard Foster: To make any real impact you have to get government involved. At the end of the day this whole thing's being paid for by us all, either as taxpayers or premium payers. And to make any real impact there's got to be a partnership between the insurance industry, the government and the NHS, and that covers not just rehabilitation but also the future care regime as well.

    Too often now the government tries to use the insurance industry as a stealth tax-raising mechanism to claw back what should be the government's duty. That has to stop.

    There must be a radical reappraisal of how you approach rehabilitation. As David was saying, the government does not have the money to fund the NHS to achieve what it wants to achieve. The only way it can do it is by passing it on to the private sector.

    No-fault. Can't afford it. To me, it's a non-starter. There's a public interest point there - the public have a right to have an inquiry into a serious accident and that it needs court mechanism for that to establish liability.

    Trevor Harrison: Maybe attach add-ons to policies to make people personally responsible for their own health. There are already sports policies, where, if you play football and you're injured, you get access to physiotherapy.

    Why not extend motor policies to include that sort of additional benefit? It's also that we have difficulties with paying solicitors. They have a duty to obtain core damages for their client, which puts them in a dilemma.

    If their client is to undertake rehabilitation, there could be massive benefits to that individual on a personal basis. But, equally, it could mean that their pot at the end of the day is substantially reduced.

    What does a solicitor tell his client? He gives them the options and, human nature being as it is, starts seeing pound signs.

    I think the only way forward really is to take out the litigation system altogether.

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