"State Farm accepted the opinions of its medical advisors to support its routine denials of benefits"

Jazey and State Farm  [+]  Arbitration, 2014-12-09, Reg 403/96.

Final Decision

 

FSCO 4330

Result:

1.         Mr. Jazey is entitled to attendant care benefits in the amount of $4,027.21 for attendant care services provided by Lauralee Bushan-Jazey and Dianne Jazey from October 20, 2009 to December 31, 2009.

2.         Mr. Jazey is entitled to receive the following medical and rehabilitation benefits pursuant to the Schedule:

a.       $15,931.90 for purchase and installation of a hot tub, pursuant to an OCF-18 prepared by Elizabeth Fox, dated January 24, 2011;

b.      $1,500.64 and ongoing incurred sums for massage therapy pursuant to an OCF-18 dated February 14, 2012, prepared by Amy Buffone, subject to a deduction for Mr. Jazey’s wife’s workplace extended heath benefit plan;

c.       $1,008.70 representing the outstanding balance for psychological counseling, pursuant to an OCF-18 dated November 30, 2011, prepared by Dr. Jeffery McKillop; and

d.      $38,176.10 for occupational therapy treatment and the current cost of ergonomic equipment pursuant to an OCF-18 dated May 26, 2011, and prepared by Nancy Gowan, OT.

3.         Mr. Jazey is entitled to interest for the overdue payment of benefits pursuant to s. 46(2) of the Schedule.

4.         State Farm is liable to pay a special award in the amount of $32,852.07, pursuant to s. 282(10) of the Insurance Act because it unreasonably withheld or delayed payments to Mr. Jazey.

5.         State Farm is liable to pay Mr. Jazey’s expenses in respect of this arbitration.

State Farm denied Ms. Gowan’s treatment plan for the occupational therapy and ergonomic equipment on July 1, 2011.  In its documentation, State Farm provided a report by Ms. Leslie Hisey, an occupational therapist who had conducted an Insurer’s examination to determine the reasonableness of Ms. Gowan’s occupational therapy and ergonomic treatment plan.  The evidence indicated that that Ms. Hisey reviewed an incomplete list of medical records and apparently spent slightly over an hour undertaking her assessment.[7]  In her conclusion, she stated that there is little medical evidence to confirm the etiology (the cause) of any motor vehicle accident-related neurological impairments.  She opined that she needed greater confirmation of any link between the accident and the alleged impairments.  However, State Farm did not bring Ms. Hisey as a witness to elucidate about what information she felt was lacking.

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Mr. Jazey requests that State Farm be liable to pay a special award pursuant to section 282(10) of the Insurance Act because State Farm unreasonably withheld or delayed payments to Mr. Jazey.

Section 282(10) of the Insurance Act states:

Special Award

If the arbitrator finds that an insurer has unreasonably withheld or delayed payments, the arbitrator, in addition to awarding the benefits and interest to which an insured person is entitled under the Statutory Accident Benefits Schedule, shall award a lump sum of up to 50% of the amount to which the person was entitled at the time of the award together with interest on all amounts then owing to the insured (including unpaid interest) at the rate of 2 per cent per month, compounded monthly, from the time the benefits first became payable under the Schedule.

Pursuant to section 282(10) of the Insurance Act, I find that State Farm has unreasonably withheld or delayed payments to Mr. Jazey in denying treatments and withholding payments; State Farm accepted the opinions of its medical advisors to support its routine denials of benefits; and it should have been aware that these denials would cause Mr. Jazey undue stress and financial hardship and reduce the opportunity for him to recover from his injuries. 

In paragraphs 203 to 221 and Schedules C and D of Mr. Jazey’s closing submissions, Mr. Jazey has detailed the particulars of his claim for a special award in the amount of $131,408.27, representing 50% of the benefits and interest to which he claims entitlement.

State Farm vigorously opposes Mr. Jazey’s entitlement to a special award.  State Farm submits that Mr. Jazey “has failed to provide any records or evidence outlining the professional attendant care services provided by the CCAC for the period that the Applicant (Mr. Jazey) required attendant care.  This information would provide a professional perspective in detail what attendant care was required, the specified period for which attendant care was required, and what ongoing attendant care may be required.”

State Farm also “submits that the evidence led by the Applicant provides no definitive insight into what services, if any, were required in addition to those professional services provided by the CCAC.”

Considering all the relevant factors in this matter, I agree with Mr. Jazey’s contention that State Farm has acted unreasonably and Mr. Jazey is entitled to a special award.

The Insurance Act states that an Arbitrator shall award a lump sum of up to 50% of the amount to which the person was entitled, etc.  It does not set a quantum but leaves it to the Arbitrator to determine whether that amount should be one dollar or the maximum of 50%.  In this matter, because State Farm has provided some benefits to Mr. Jazey and Mr. Jazey has been able to return to his self-employment, albeit to a limited degree compared to his pre-accident ability, and Mr. Jazey has failed to provide some specific documentation to State Farm, I am fixing the special award at 25% of the amount to which he claims entitlement.

I hereby order that State Farm shall pay a lump sum to Mr. Jazey of 25% of the amount to which he is entitled, which amount shall be $32,852.07.

Source: http://www.fairassociation.ca/