Transition To The New Statutory Accident Benefits Schedule – Effective September 1, 2010

The Financial Services Commission of Ontario has now issued Bulletin A – 04/10 the Transition Bulletin) addressing the transition rules for pre September 1, 1010 accident benefit claims under the Statutory Accident Benefits Schedule – Effective September 1, 2010.

The purpose of the Transition Bulletin is to provide much needed clarification of the transition rules set forth in Section 2 of the New SABS and by Ontario Regulation 35/10 the transition legislation).  It does not address the transitional provisions which provide optional benefits on existing policies until they are terminated or renewed.  In relation to these transitional provisions appropriate inquiries will have to be made as to the renewal date of the applicable policy in order to determine whether optional benefits are available, even if they had not been initially purchased.

The New SABS Ontario Regulation 34/10) will apply to all “New accidents” which are defined as “automobile accidents that occur on or after September 1, 2010”, while “Old accidents” are defined as “automobile accidents occurring on or after November 1, 1996 and before September 1, 2010”.   Benefit claims relating to new accidents are to be made using the revised accident benefit claim forms that are yet to be published.

The purpose of the transition legislation is to specify those provisions of the Old SABS Ontario Regulation 403/96, as amended) that will continue to apply to Old accidents, and likewise identify those provisions of the Old SABS that will cease to apply, in which event we will have to look to the comparable provisions of the New SABS.

The general rule appears to be that in relation to Old accidents, the Old SABS will continue to govern the calculation of benefit entitlement amounts, while the New SABS will govern most claims processing and most calculations of amounts payable to establish benefit entitlements.  However there appear to be a number of exceptions to the general rule with the result that the full scope of the substantive and procedural transition provisions are not readily discernible from a reading of the transition legislation.

The transition legislation highlights various provisions of the Old SABS that will cease to apply after August 31, 2010, specifically:

1. Section 24, dealing with the cost of examinations;
2. Part X, Procedures for Claiming Benefits, Sections 31 to 51, inclusive;
3. Part XI, Designated Assessment Centers, Sections 52 to 54, inclusive;
4. Part XII, Responsibility to Obtain Treatment, Participate in Rehabilitation and Seek Employment, Sections 55 to 56, inclusive;
5. Part XIII, Interaction with Other Systems, Sections 57 to 60, inclusive; and
6. Part XIV, Miscellaneous, Sections 65 to 70, inclusive.

The transition legislation does not specifically provide that the corresponding provisions of the New SABS apply to these provisions, but that is implied.  It also provides that no amount referred to in this regulation referring to the Old SABS) shall be paid after August 31, 2010, but shall generally be paid under the New SABS.  The word “amount” is not defined so as to distinguish between procedural costs or substantive amounts that might otherwise be payable, although the context suggests that it only relates to the former.

Finally, the transition legislation lists 12 actions which can no longer take place on or after September 1, 2010, in respect of Old accidents including:

1. The delivery of a disability certificate for the purpose of Section 20, 35 or 37;
2. The delivery of a notice to an insurer under Subsection 321) of a person’s intention to apply for a benefit;
3. A request under clause 371)a) made by an insurer;
4. The delivery of a treatment confirmation form for the purpose of Section 37.1 or 37.2;
5. The delivery by an insurer of a notice for the purpose of Section 37.3;
6. The delivery of a treatment plan for the purpose of Section 38;
7. The delivery by an insurer of a notice for the purpose of Section 38.1;
8. The delivery of an application under Section 38.2 for approval of an assessment or examination;
9. The delivery under Section 39 of an assessment of attendant care needs;
10. The delivery by an insurer of a notice for the purpose of Section 395);
11. The delivery of an application under Section 40 for a determination of whether an impairment sustained by an insured person is a catastrophic impairment; and
12. The discovery by an insurer of any notice requiring an insured person to be examined under Section 42.

The transition legislation provides that these 12 listed actions are to be taken under the corresponding provisions under the New SABS.  Unfortunately no table of concordance is yet available.

As can be seen the transition legislation provides, in relation to Old accidents, for a blending of the Old SABS with the New SABS and the purpose of the transition bulletin is to provide much needed clarification.

The Transition Bulletin, by way of example, identifies those provisions of the Old SABS that continue to govern the calculation of benefit entitlement amounts in relation to Old accidents, namely:

1. Income replacement benefits will continue to be calculated at 80% of net income;
2. Coverage limits $100,000.00 for medical/rehabilitation benefits) will continue to be governed by the Old SABS;
3. Entitlement to caregiver, housekeeping and home maintenance benefits will continue to be governed by the Old SABS example, impairment need not be catastrophic);
4. Attendant care benefits will continue to be based on the hourly rates that were in effect on the date of the accident;
5. The rules in Section 37)e) and Section 38) of the New SABS concerning incurred expenses will not apply to Old accidents;
6. The “minor injury” definition, Minor Injury Guideline and the $3,500.00 medical and rehabilitation limit referred to in the new SABS will not apply to Old accidents; and
7. For the purposes of old accidents, references to the Minor Injury Guideline and the New SABS will be deemed to be references to the Pre-approved Framework Guidelines under the Old SABS.

However in relation to Old accidents, the New SABS will govern most claims processing and most calculations of amounts payable to establish benefit entitlements.  As of September 1, 2010, as a general rule, the New SABS will govern claims processing relating to Old accidents and the determination of amounts payable by insurers on account of expenses paid to establish benefit entitlements arising out of old accidents.  By way of example, the Transition Bulletin notes the following:

1. The accident benefit claim forms that are currently in use will no longer be approved.  Only the revised forms will be approved;
2. An Application for Determination of Catastrophic Impairment must be prepared by a physician or by a physician or neuropsychologist if the impairment is only a brain impairment;
3. An Assessment of Attendant Care Needs must be completed by an occupational therapist or a registered nurse;
4. Interest on amounts that become overdue on or after September 1, 2010, in respect to Old accidents, will accrue at the New SABS rate of 1% per month and be compounded monthly;
5. Sections 251) 3) 4) and 5) of the New SABS will govern amounts payable by insurers on account of fees invoiced on or after September 1, 2010, in relation to a) Pre-approved Framework Guideline services; b) preparation of disability certificates, assessments of attendant care needs, applications for determination of catastrophic Impairment and future care and related plans; and c) reviewing and approving treatment and assessment plans, assessments and examinations.  Specifically, the new $2,000.00 limit on fees for assessments and examinations applies whether the services were rendered before or after September 1, 2010
6. A revised Treatment and Assessment Plan form will replace the existing Treatment Plan and Request for Approval of an Assessment or Examination effective September 1, 2010.  Section 38 of the New SABS will govern the processing of the new Treatment and Assessment Plan.  For Old accidents, reference in Section 38 of the New SABS to the Minor Injury Guideline will be deemed to be references to the Pre-approved Framework Guidelines under the Old SABS;
7. A claimant who qualifies for two or more of the income replacement, non-earner or caregiver benefits, and who makes an election after September 1, 2010, cannot change his or her choice later on, except in limited circumstances;
8. Section 42.1 of the Old SABS concerning rebuttal assessments does not apply after August 31, 2010;
9. The rules in the Old SABS requiring Section 42 insurer examinations with every denial of certain benefits will not apply to denials made on or after September 1, 2010; and
10. For any WAD I or WAD II injury claim that results from an old accident, the revised Treatment Confirmation Form will replace the existing OCF-23 effective September 1, 2010.  Claims processing will be governed by the New SABS, but the existing Pre-approved Framework Guidelines will continue to apply.

Finally, the Transition Bulletin notes various exceptions to the general rule concerning the applicability of the New SABS to claims processing for Old accidents and the determination of amounts payable for expenses paid to establish benefit entitlements arising out of Old accidents.  By way of example, the Bulletin notes the following:

1. Interest on amounts that become overdue before September 1, 2010, in respect to Old accidents, will accrue at the old SABS rate of 2% per month and be compounded monthly both before and after September 1, 2010;
2. The requirements in Subsections 152) – 5) of the New SABS for insurer delivery of periodic benefit statements, will not apply to Old accidents;
3. Section 185) of the New SABS, which deems the cost of conducting examinations and assessments and preparing reports to be included in medical/rehabilitation coverage limits, will not apply to Old accidents; and
4. Section 252) of the New SABS, concerning amounts payable for in-home assessments and examinations for minor injuries, will not apply to Old accidents.

Commentary

Although the Transition Bulletin provided much needed clarification, some of the transition provisions are worthy of note.

In relation to the applicable rate of interest on overdue amounts, it appears to be focused on when an amount becomes “payable” and not necessarily when an expense is incurred.  Depending on the nature of the benefit in dispute, this will require different calculations.  For example, an overdue income replacement benefit that was payable prior to September 1, 2010, would attract interest at the 2% per month rate, whereas an IRB benefit that was not payable until on or after September 1, 2010, would only attract interest of the 1% per month rate.  Where IRB benefits are outstanding and overlap the September 1, 2010 date, different calculations will have to be completed.

It is also important to highlight that for amounts payable by insurers on account of fees, payable under Sections 251)3)4) and 5 the relevant date appears to be the date of invoice and not whether the services were rendered before or after September 1, 2010.  It can be expected that Plaintiff’s counsel will encourage healthcare providers to promptly ensure that invoices for services are rendered before September 1, 2010.   Likewise  for  insurers, in relation to insurer medical assessments they should be demanding prompt invoicing for assessments conducted prior to September 1, 2010 or they will be limited to the $2,000.00 cap for such reports.

This is a brief overview of the legislation, and is not intended to be relied on as legal advice.

Nigel Gilby is a partner and injury lawyer in the London, Ontario law firm of Lerners LLP.  Nigel specializes in assisting people injured in car accidents, accident benefits cases, catastrophic injuries, brain injuries, slips and falls, off-road vehicle accidents, boating accidents and other serious personal injury cases.  He has been recognized by LEXPERT and the Law Society of Upper Canada as a specialist in Civil Litigation. Nigel has been selected by his peers to appear in the “Best Lawyers in Canada” publication since its inception. See Nigel’s professional biography for more information about his work in the area of personal injury law or contact him at 519.640.6328 or by email at ngilby@lerners.ca.

Marinus Lamers is an injury lawyer in the London, Ontario law firm of Lerners LLP.  Marinus’ personal injury practice includes assisting people injured in motor vehicle accidents, accident benefit cases, spinal cord injuries, orthopaedic injuries, injuries as a result of defective products, off-road vehicle accidents, boating accidents and other serious injury cases.  See Marinus’ professional biography for more information about his work in the area of personal injury law or contact him at 519.640.6387 or by email at mlamers@lerners.ca.