Working Within the New SABs after September 2010

Summary:

The new Statutory Accident Benefits (SABs) are slated to come into effect on September 1, 2010. The new SABs represent a significant cut in the benefits available to injured parties. In some cases, perhaps as high as 30 to 40% of cases, the $100,000.00 med rehab limit will be reduced to $3,500.00. In addition there are numerous limitations and eliminations of benefits that will significantly alter the landscape, shifting much of the funding for future medical and rehabilitation services from the Accident Benefit side of the auto claim to the tort. This will effectively leave those involved in a car accident, suffering serious injury, but with no tort claim, with a drastic reduction in available medical benefits.

The regulations, forms and Guidelines are currently in development. It is expected that there will be some additional changes although likely minor and that the draft regulations as presented will go forward by September 1, 2010. The new SABs, like the old SABs, are an ongoing, evolving beast that will take its shape through the current development of the regulations and guidelines and later through mediation, arbitration and judicial process.

For the purpose of transitioning to the new SABs, the current auto policies that terminate after September 1, 2010 will continue, for the most part, on the same terms and conditions as contracted but will shift to the new SABs regime when renewed after that date. Existing Accident benefit claims will have a more complicated transition process.

Bottom Line:

If you are hurt in a car accident in Ontario you will be paying the same amount of money for less medical and rehabilitation coverage. Those that are at fault and suffering serious injury will be most vulnerable. You should closely review the optional coverages and consider all your policies (group benefits, LTD, critical illness) to determine whether you have enough coverage for medical and rehabilitation services and also income replacement benefits in the event of a car accident.

Accident Benefit changes summary:

• Reduction of medical and rehabilitation benefits from $100,000.00 to $50,000.00. In some cases this will be reduced to $3,500.00 under the Minor Injury Guideline.
• The development of the Minor Injury Guideline to replace the Pre Authorized Framework for minor injuries. These will include WAD I and WAD II injuries but the minor injury definition also references things like partial ligament tears and “clinically associated sequelae”.
• Assessments will be capped at $2,000.00. This amount will be deducted from the available med/rehab benefits.
• Rebuttal reports have been eliminated.
• The insurer is no longer required to pay for Future Care reports. (s.25(5))
• Catastrophic Assessments can only be “conducted” by a physician or, in the case of brain injury, a neuropsychologist. (s.45(2))
• The definition for Catastrophic Impairment now includes a single limb amputee. (s.3(2))
• Form 1 assessments may only be completed by a Registered Nurse or Occupational Therapist. (s.42(1))
• Attendant Care benefits have been reduced for non CAT cases to $36,000.00 over 2 years
• CAT assessment under Whole Person Impairment or Marked impairment can be held before two years if brain injury involved and unlikely to cease to be catastrophic. (s.3(5))
• The definition of medical and rehabilitation services has been modified to include other services “of a medical nature”. (s.15(1))
• Income Replacement Benefits – the maximum remains at $400.00 and is based on 70% of gross income. (s.7)
• The insurer must now pay for an accounting report up to a maximum of $2,500.00 (s.7)
• Caregiver benefits have been eliminated in non Catastrophic cases and replaced with an option.
• Where the insured has selected one weekly benefit then that election cannot be changed unless the person is later deemed Catastrophically impaired. (s.35)
• The interest rate on overdue accident benefits has been reduced from 2% to 1% compounded monthly. (s.51)
• Housekeeping expenses have been eliminated in non CAT cases unless an option is purchased. (s.23)
• Treatment and Assessment plan forms combined for only one approval process instead of initial approval of assessment and treatment plan later. (s.38)
• The insurer is now provided up to 10 business days to respond to a treatment plan. (s.38)
• Where the insured is receiving goods and services under the MIG, the insurer’s denial without assessment is final and not subject to review. (s.38)
• A definition for “incurred expense” which requires the insured to receive the goods or services, paid or promise to pay the expense and the recipient of the payment provide the goods or services as part of their regular occupation or suffered an economic loss to provide the goods or service (s.3(7)(e))

Tort changes

• Elimination of all deductibles in fatality cases ($30,000.00 and $15,000.00).
• Option to reduce the $30,000.00 deductible down to $20,000.00 and the FLA deductible from $15,000.00 to $10,000.00.