Insurer does not act in good faith - benefits and special award approved - Alvarez and Unica

December 05, 2017, Kitchener, Ontario

Posted by: Robert Deutschmann, Personal Injury Lawyer

Alvarez and Unica

Decision Date: October 13, 2017
Heard Before: Adjudicator Lynda Tanaka

ENTITLEMENT TO BENEFITS: the laissez-faire approach Unica followed does not constitute adjusting the file in good faith or constitutes acting reasonably; insurer unreasonable; benefits approved; special award made

Oscar Alvarez was injured in a car accident on November 19, 2014. He was speeding on the highway when a cube van in front of him came to an abrupt stop.  When he put on the brakes, the front of his vehicle turned into the passing lane to his left, which was the one closest to the guardrail.  A vehicle in that lane, also travelling in excess of the speed limit, hit his vehicle on the driver’s side, sending his vehicle into a spin across the six lanes of traffic to his right.  He finally stopped in a ditch, with damage to the passenger side of the vehicle. The other vehicle spun left into the divided median.  Mr. Alvarez testified that the driver’s side air bag deployed with a huge noise, hitting his head on the left side and particularly his left ear.  When he reported the accident to Unica, he complained of neck pain and an earache.

He sought SABs from Unica but when they were unable to resolve their disputes through mediation Mr. Alvarez applied for mediation at FSCO.

Issues:

1. Is Mr. Alvarez entitled to receive a medical benefit in the outstanding amount of $848.72 for chiropractic treatment, massage and physiotherapy per an OCF-18 dated December 8, 2014?
2. Is Mr. Alvarez entitled to attendant care benefits at the rate of $397.02 per month from November 20, 2014 to November 19, 2016, based on a Form 1 dated March 4, 2015?
3. Is Mr. Alvarez entitled to payments for the cost of examinations:
   1. for services:
      1. $2,109.36 – OCF-18 dated February 9, 2015 for psychological assessment;
      2. $2,130.00 – OCF-18 dated January 13, 2015 for neurological assessment;
      3. $2,104.00 – OCF-18 dated December 12, 2014 for in-home attendant care assessment; and
      4. $2,130.00 – OCF-18 dated December 12, 2014 for physiatry assessment; and
   2. $2,000.00 for an  OCF-18 dated January 19, 2015 for psychological assessment?
4. Is Unica liable to pay a special award because it unreasonably withheld or delayed payments to Mr. Alvarez?
5. Is Mr. Alvarez entitled to interest for the overdue payment of benefits?

Result:

1. Mr. Alvarez is entitled to receive a medical benefit in the amount of $848.72 for chiropractic treatment, massage and physiotherapy provided per an OCF-18 dated December 8, 2014.
2. Mr. Alvarez is not entitled to attendant care benefits at the rate of $397.02 per month from November 20, 2014 to November 19, 2016.
3. Mr. Alvarez is entitled to payments for the cost of examinations claimed and described below:
   1. for services:
      1. $2,109.36 – OCF-18 dated February 9, 2015 for psychological assessment;
      2. $2,130.00 – OCF-18 dated January 13, 2015 for neurological assessment;
      3. $2,104.00 – OCF-18 dated December 12, 2014 for in-home attendant care assessment; and
      4. $2,130.00 – OCF-18 dated December 12, 2014 for physiatry assessment; and
   2. $2,000.00 for an OCF-18 dated January 19, 2015 for psychological assessment.
4. Mr. Alvarez is entitled to a special award in the amount of $5,000.00.
5. Mr. Alvarez is entitled to interest on any outstanding amounts.

For all benefits, the onus of proof is with Mr. Alvarez to establish that the injury falls within the scope of coverage and he is entitled to the benefits claimed.

Mr. Alvarez did not and does not currently have a family doctor, because he is unable to find a family practice with a doctor who is fluent in Spanish and accepting new patients.  He did not go to the hospital after the accident, and says he has not seen a treating physician since the accident other than at a walk-in clinic or hospital for colds and similar illnesses.  At the time of the accident, he was the sole income earner for his pregnant wife and toddler, living in a basement apartment.  He worked freelance as a grip or electrician, hired on an as-needed basis in the film industry for an hourly rate, and he continues to do so.  He usually works 20 days per month, and his shifts are 12 to 16 hours, depending on the filming schedule.  He is required to set up lighting for film shoots, which involves bending and lifting.  Due to the injuries he suffered in the accident, he is still not able to consistently do all the work required in his job, and he gets help from his co-workers, albeit with some hesitation.  Mr. Alvarez testified that if he does not work a certain number of hours, he will lose his job.  Until mid-2015, he did not have any workplace health benefits.

Mr. Alvarez was able to find a legal representative who speaks Spanish and who submitted his OCF-1 Application for Accident Benefits dated November 24, 2014.  In the OCF-1, Mr. Alvarez listed the injuries to his body and psychological injuries as follows: headache, dizziness, tinnitus, neck pain, TMJ pain/locking/clicking, weakness, fatigue, stress, anxiety, flashbacks, panic attacks, depressed mood, coping difficulties, driving/passenger phobia, anger, frustration, poor sleep, nightmares. He took one week off work following the accident.

Mr. Alvarez was assessed and treated at hospital and the physician completed the OCF-3 on December 8, 2014, listing injuries as follows: headache, noise effects on inner ear, sprain and strain of joints and ligaments of other unspecified parts of neck, cervicalgia, contusion of shoulder and upper arm (right), disorders of initiating and maintaining sleep (insomnias), phobic anxiety disorders and nervousness. An OCF-18 treatment and assessment plan on December 8, 2014 was submitted by the physician indicating that the injury was not predominantly a minor injury.  The proposed treatment had the goals of pain reduction, increased range of motion, and increase in strength to allow a return to activities of normal living and pre-accident work activities.  It identified no pre-existing disease, condition or injury that could affect Mr. Alvarez’s response to treatment, and indicated that the injuries were affecting Mr. Alvarez’s ability to carry on his employment and normal life—specifically, Mr. Alvarez “gets affected by any type of noise (from quiet to very loud). Head/neck rotation.”  It also noted that a psychological referral was appropriate.

Unica approved $2,200.00 in treatment, and obtained an independent assessment in response to this OCF-18 conducted on January 27, 2015, a little over two months after the accident.  This report noted that Mr. Alvarez suffered immediate left-sided neck pain and hearing loss with ringing in his left ear at the time of the accident, consistent with the records generated at the time of the accident. At the assessment, Mr. Alvarez reported sub-occipital headaches exacerbated by movements and phonosensitivity, as well as beeping and muffled hearing in his left ear from the impact of the airbag.  He reported suffering neck pain for three weeks after the accident, and by January 27 he had stiffness but no pain, though prolonged static postures aggravated his neck stiffness.  He complained of constant lower back pain aggravated by prolonged static postures, bending forward and lifting from floor to waist level.  During the physical examination, Mr. Alvarez complained of beeping or “foggy” hearing in the left ear.  The report concluded that from a musculoskeletal perspective the injuries fell within the Minor Injury Guideline, and that the OCF-18 was neither reasonable nor necessary.

No independent assessment was obtained with respect to the impairments of Mr. Alvarez’s hearing, nor did Unica request that IE provide recommendations concerning the hearing impairment.

On December 14, 2014, a further OCF-18 was submitted for approval for completion of a Form 1, (attendant care assessment) in the amount of $2,014.40.  Another OCF-18 was submitted on December 12, 2014 requesting a physiatry assessment to determine the extent of any measurable impairment, residual dysfunction and disability, while providing recommendation for a safe and cost-effective return to pre-accident level of function. On January 13, 2015, an OCF-18 was submitted requesting a neurological assessment, to evaluate neurologic injuries regarding headaches, persistent headaches, dizziness, nausea, memory loss, cognitive difficulty associated with head injuries, and numbness. Unica did not refer these OCF-18s to independent assessors, but denied them.

Dr. KK, Ph.D., C. Psych., submitted an OCF-18 on January 19, 2015 for a mental health assessment for an adjustment disorder.  In his clinical screening examination, and he set out the results in extensive “Additional notes” to the OCF-18, and concluded a provisional diagnosis of adjustment disorder with anxiety and depression, and a specific phobia of automobile anxiety.  A longer document entitled “Psychological Assessment” dated January 26, 2014 , and a further OCF-18 was submitted by Dr. KK on February 9, 2015 for a full psychological assessment, based on the previous screening and information.

Unica obtained an assessment by psychologist in response to the OCF-18 dated January 19, 2015 by Dr. KK, conducted one year later. During this assessment, Mr. Alvarez revealed that in April 2015 he had attempted suicide, less than three months after Unica had refused to approve the examinations proposed in three OCF-18s. There was testing to identify both malingering and acute clinical syndromes.  The tests revealed results on the Anxiety scale that “just reached the clinical threshold”. Despite this the report concluded that Mr. Alvarez exhibited “mild accident related psychological symptoms…below the threshold required for a DSM-5 psychological diagnosis or removal from the Minor Injury Guideline”, and concluded that the psychological assessment proposed in the OCF-18 was not reasonable and necessary.  Mr. Alvarez met the criteria for a “minor injury” from a psychological perspective, because he could access the supplementary goods and services for psychosocial issues under the MIG.  The psychological symptoms suffered by Mr. Alvarez were caused by the accident.  Finally, the report concluded that, since Mr. Alvarez had not attended any form of psychological intervention since the accident, it was not possible to comment on whether further treatment was reasonable or necessary, but the psychologist treatment was not reasonable or necessary at this juncture.

No explanation was given for Unica’s one-year delay in obtaining the independent assessment with respect to the psychological assessment.  Unica did not arrange for any assessment by a physiatrist or other medical doctor. Relying on the independent assessments of Unica did not approve any of the OCF-18s referred to above.  Mr. Alvarez did not find the physical treatment he received very helpful.  He attended about five times (essentially, once a month after the accident) and then stopped.  He still has approved funds available to him for treatment under the MIG, since Unica approved $2,200.00 in January, 2015.

In February 2017, Mr. Alvarez was assessed by a neurologist a physiatrist who provided a Physiatry Report dated February 2, 2017.  Neither doctor testified, nor were responding reports or assessments by any medical doctor provided by Unica.  Therefore, their conclusions were unchallenged by evidence. Mr. Alvarez was diagnosed with post-traumatic headache associated with Cough Headache, and recommended an MRI and a nerve block, or alternatively medication, to ease the headache pain. He was also diagnosed with myofascial injuries of the middle back paraspinal muscles and cervical spine paraspinal muscles, cervicogenic headache, post-traumatic insomnia, psychological problems (anxiety) and chronic pain syndrome.  The exam also reported that, as is frequently seen in chronic pain patients, the pain is complicated by the insomnia and stress problems, which are barriers to recovery. 

Mr. Alvarez incurred the cost of an Occupational Therapy In-Home Assessment and Form 1, despite Unica’s refusal to fund it.  The assessment was done, and the report was dated March 4, 2015, almost four months after the accident. The assessment concluded that Mr. Alvarez should be provided with attendant care in the amount of $397.02 monthly.  She reported that he did not have the funds to pay the provider and she recommended that the services of a Personal Support Worker be provided by the Insurer immediately.  She was of the opinion that his physical impairments would be exacerbated and his recovery time prolonged should he not receive the reasonable and necessary attendant care services outlined.  She also noted that he would benefit from a psychological evaluation to address his concerns with memory, anxiety and low mood.  Since sitting caused pain, she recommended a back-support cushion.

Unica refused to provide attendant care because Mr. Alvarez was deemed to fall within the MIG.  No in-home assessment was done by anyone retained by Unica.

Unica resisted approving the remainder of this treatment plan because Mr. Alvarez had not used all the approved treatment.  Unica had no family doctor’s records to corroborate the ongoing nature of the impairments, nor an OHIP summary.  The submission was that if Mr. Alvarez was well enough to go back to work and to function without the need of a family doctor, then clearly, he was recovering from his injuries and the treatment plan was not reasonable or necessary. The Arbitrator accepeted Mr. Alvarez’s evidence of his injuries and ongoing impairments, despite the lack of corroboration in a family doctor’s records or OHIP summary.  There is sufficient consistent reporting of the injuries in the evidence, including the log notes of the adjusters working for Unica, in the forms filed from time to time for benefit claims, and in the reporting of the assessors from the date of the accident to February 2017 to provide that corroboration.

The Arbitrator noted that this is the first treatment plan submitted, and the total amount was less than the MIG cap.  The treatment plan was submitted within three weeks of the accident.  At the time of the refusal to approve, Unica had no way of knowing how much treatment would be used. The justification is after-the-fact, and the Arbitrator was satisfied that Mr. Alvarez has given a credible explanation for why he did not go for more treatment, given his job and family responsibilities at the time.  He has now returned to treatment; therefore, this treatment plan was reasonable and necessary and that Unica should have approved it in its entirety.

Is Mr. Alvarez entitled to attendant care benefits at the rate of $397.02 per month from November 20, 2014 to November 19, 2016 based on a Form 1 dated March 4, 2015?

This claim is for a modest amount and reflects meal preparation assistance.  Before the accident, Mr. Alvarez was healthy and working very long shifts 20 days a month, and his wife was not.  She made most meals, but he made some too (as is the usual case in a family with a toddler, and mother expecting another child), and shared responsibilities for the home.  In March 2015, when the Form 1 was done, the new baby had arrived, and, with Mr. Alvarez’s injuries, the Form 1 analysis of his function indicated that he was challenged to provide support to his wife in the way that he would have been able to without the accident.  His back and neck hurt, his head hurt and he couldn’t hear properly as a result of the accident.  He was sensitive to noise (in a household with a baby and toddler) and he angered easily.  Even if he was able to sleep when the children slept, he awoke because of the pain.  He was nervous in a car, and he had to keep working to support his family.  His wife’s parents came to visit and share some of the workload.  They and his wife provided the attendant care.  Sometime in the month following this assessment, he suffered a mental health crisis.

Unica relies on what it says are inconsistencies in Mr. Alvarez’s evidence as to the amount of meal preparation provided in the Form 1, compared to what meal preparation Mr. Alvarez in fact did before the accident.  There is no responding assessment of Mr. Alvarez’s attendant care needs provided by Unica.  The Arbitrator accepted the analysis of the occupational therapist as to Mr. Alvarez’s needs.  The Arbitrator was not persuaded that the discrepancies as to meal preparation before and after the accident matter, since they could easily be reflective of changing circumstances, materially impacted by Mr. Alvarez’s injuries.

Unica’s position is that, since Mr. Alvarez’s injuries fall within the MIG, there is no attendant care benefit.  Unica says that there is no medical diagnosis of a condition that would bring him out of the MIG, so there is no compelling medical evidence to support taking Mr. Alvarez out of the MIG.  Unica’s position is that since Mr. Alvarez did not seek a family doctor’s help, there is nothing it could do; an applicant is entitled to determine his own health care needs.  But Unica is the more experienced and knowledgeable party of the two; consumer protection is the underlying principle for interpretation of entitlement to accident benefits.  Unica had notice of the head injury from the side air bag.  On receipt of the Form 1 and the notification there were ongoing complaints, Unica had an obligation to review medical reports with a view to re-assessing whether or not, in the context of all the information it had, the injuries had been properly assessed and fell within the MIG.

With respect to the psychological impairments, on the basis of Mr. Alvarez’s evidence, the statements recorded in Mr. Salerno’s report on his anxiety, and the analysis in the rport the Arbitrator found that Mr. Alvarez’s psychological impairments continue to take him out of the MIG.  The Arbitrator rejected the conclusions of the IE which should have given weight to Mr. Alvarez’s complaints of nervousness in a motor vehicle, such as his pressing his foot on an imaginary brake pedal, holding onto the seat belt, and “back-seat driving” as indices of ongoing adjustment issues that were still bothering him over one year after the accident.  Unica also cannot rely on the report when it withheld important information from him about Mr. Alvarez’s injuries, including the head injury due to the side air bag.

The Arbitrator rejected Unica’s arguments and found that Mr. Alvarez’s injuries fall outside the MIG, and he is eligible for attendant care benefits.  His injuries are outside the MIG on the basis of his head injury that interfered in his hearing, his chronic pain and his psychological impairments which, even on Mr. Salerno’s very conservative approach, meet the threshold of an anxiety disorder.  The Arbitrator conlcuded his injuries have been outside the MIG since the accident. Even if Mr. Alvarez is entitled to attendant care, Unica’s position is that it was not incurred within the meaning of the Schedule, and the amount could not be determined in accordance with the provisions of section 19(3)4.  Mr. Alvarez relies on section 3(8) of the Schedule, which provides that if an arbitrator finds that an expense was not incurred because the insurer unreasonably withheld or delayed payment of a benefit, the arbitrator may, for the purpose of determining an insured person’s entitlement to the benefit, deem the expense to have been incurred.  On receipt of the attendant care Form 1, Unica did not send its own assessor to determine if attendant care was required.  Unica simply refused to contemplate any benefits because of its position on the MIG.  The Arbitrator found that Unica did not follow a reasonable course of action in that it ignored the failure to address the hearing impairment in any substantive way.  Unica was unreasonable in not securing its own assessment of the attendant care needs.

Unica also relied on section 19(3)4, which provides that where the attendant care is provided by someone other than a person who does so in the course of employment, occupation or profession, the amount of the attendant care shall not exceed the amount of the economic loss sustained by the attendant care provider during the period while, and as a direct result of, providing the attendant care.  In this case, the attendant care was provided by Mr. Alvarez’s wife and in-laws.  However, there is no evidence to support a quantification in accordance with section 19(3)4.  The Arbitrator found that Mr. Alvarez cannot receive the attendant care benefits, because even though he established entitlement to them and they were incurred within the meaning of the Schedule, they were not quantifiable.

The Arbitrator also found that the neurological assessment was reasonable and necessary when Mr. Alvarez suffered from hearing impairment for an extended period.  The Arbitrator found that the physiatry assessment was reasonable and necessary for the musculoskeletal injuries which now cause Mr. Alvarez chronic pain, and that the attendant care assessment was also reasonable and necessary in all the circumstances.

Is Unica liable to pay a special award because it unreasonably withheld or delayed payments to Mr. Alvarez?

Unica submitted that, while it may have been wrong, it had not unreasonably withheld benefits or payment of benefits.  It said it was not imprudent or inflexible in adjusting the claim.  It also relied on Mr. Alvarez’s failure to provide particulars of any special award claim except for the attendant care benefit, and Mr. Alvarez’s failure to go to a family doctor or seek psychological treatment for his injuries.

The Arbitrator found that the attendant care claim only fails because of the lack of evidence respecting quantum, finding that, even with the failure to identify particulars of the special award claim related to the other benefit claims, there is jurisdiction to make a special award on all the evidence.

Unica was not only wrong about the analysis of the injuries in relation to the MIG, but its persistent “no” to requests for funding for assessments resulted (as it was warned) in exacerbating Mr. Alvarez’s injuries to the point where he now suffers from chronic pain.  The Form 1 for attendant care was submitted.  That assessment clearly identified ongoing musculoskeletal impairments.  A reasonable insurer would have considered the additional information and sent it on to for an addendum report.  A reasonable insurer would have noted the ongoing problems with hearing, even four months after the accident, and would have reconsidered its refusal of the neurologist’s assessment.

Unica failed to respond promptly to reasonable requests for approval of examinations, and waited an unreasonable period to arrange its own assessment with respect to the psychological assessment.  It failed to arrange an assessment (or even an addendum) based on new information provided in the Form 1 and in the 2017 reports concerning chronic pain.

Unica has the institutional knowledge developed in the senior levels of its adjusters to flag the potential that untreated or poorly treated injuries can lead to chronic pain.  There is little evidence that Unica’s adjusters grappled in any way. The Arbitrator did not accept that the laissez-faire approach Unica followed constitutes adjusting the file in good faith or constitutes acting reasonably.  The result was an unreasonable delay in assessing and treating Mr. Alvarez’s injuries because the benefits claimed were denied.

The Arbitrator found that Unica has unreasonably delayed payment of benefits, and that a special award is appropriate.  Mr. Alvarez calculated the total monetary amount of the claim at $20,760.56, including the attendant care claim and interest.  Unica calculated the claim based solely on attendant care at $6,022.85—$397 per month for one year plus interest.  The special award is to be no more than 50% of the amount to which the person was entitled at the time of the award, together with interest on all amounts then owing including unpaid interest.  Since the attendant care claim was not approved but the remaining claims have been, the special award is based on the net amount of $20,760.56 less $6,022.85.  Unica’s failings are not the most egregious, but an award is appropriate to inspire more careful attention on its part to claims like this one.  The special award is fixed at $5,000.00.

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