Strang v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT HELD AT HUNTLY Decision No. 90 /99 IN THE MATTER of The Accident Rehabilitation and Compensation Insurance Act 1992 AND IN THE MATTER of an Appeal pursuant to Section 91 of the Act BETWEEN JOHN STRANG DCA 467/98 Appellant AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARD on the 25th day of February 1999 APPEARANCES: Mr J Strang in person Mr M B Mccarthy, counsel for respondent RESERVED JUDGMENT OF JUDGE M J BEATTIE The issue in this appeal is whether the appellant is entitled to reimbursent for private hospital treatment costs pursuant to the Accident Compensation (Specialists Costs) Regulations 1990. N Background On 7 July 1991 the appellant suffered personal injury by accident whilst lifting a trailer draw bar. The injury suffered by the appellant was a left direct inguinal hernia. That injury was identified by Dr D J Gudex who was the specialist to whom the appellant had been referred by his GP. It was Dr Gudex's advice that at some time in the future, when that hernia became more obvious, he would require surgery. The appellant duly sought cover for that personal injury and cover was granted to him on 31 January 1992. It is to be noted that the appellant sought no benefit or entitlements in respect of that cover at that time and his making the claim was simply to register the necessity for an operation at some stage of the future. In 1998 the appellant consulted Dr Campbell in Hamilton and it was discovered that he had a right inguinal hernia in addition to the left. It seems as though the appellant had medical insurance and shortly after that diagnosis he was admitted to a private hospital where surgery was carried out on both hernias on 4 June 1998. It seems as though the appellant was of the belief that both hernias would be covered by his private medical insurance, but subsequent to the surgery he was advised that that insurer would not accept responsibility for the left hernia, it being a pre-existing condition. The appellant thereupon sought a contribution from the respondent for half the cost of his operation, being for the left hernia for which he had been granted cover. The appellant's claim was considered by the respondent who advised by letter dated 28 July 1998 that payment of a share of those specialist's costs could not be made as the respondent had not given prior approval to that surgical procedure before it was undertaken and that that was a necessary pre-requisite for the obtaining of payment for such costs. The appellant sought a review of that decision and the Review Officer ruled that having regard to the provisions of Regulation 11(1) of the Accident Compensation (Specialists Costs) Regulations 1990, which stated that prior approval was essential and that such approval had not been obtained, then the Corporation had no discretion to approve payment after the event, no matter how reasonable that request may be. The Review Officer confirmed the Corporation's decision. Relevant statutory and regulatory provisions Section 27 Treatment and physical rehabilitation (1) The Corporation shall contribute to the cost of any treatment... (in this section called a purchased service) in respect of personal injury that is covered by this Act - (a) To the extent required or permitted by regulations made under this Act; b) Pursuant to an agreement, contract or arrangement entered into under section 29A of this Act. The appropriate regulations covering the payment of specialists' costs is the Accident Compensation (Specialists Costs) Regulations (No.2) 1990. Regulation 11 states: 11. Conditions applying to payments for surgical procedures - (1) The Corporation shall not make any payment in respect of any procedure specified in Part II of the Schedule to these regulations unless- (a) The treatment is provided- (i) In a licensed hospital; or ii) In the case of items marked in the Schedule with an asterisk(*), in the registered specialist's rooms; and b) The prior approval of the Corporation to the performance of the procedure has been obtained. Submissions Mr Strang submitted that he believed that his case called for a relaxation from the rigid application of Regulation 11. He said that when he obtained his cover in 1991 he was not made aware of the need for any prior approval to be obtained and the respondent was aware that he would require surgery at some stage in the future. He went on to state that he did in fact have an unrelated surgical procedure on 28 May and then followed the operation for his hernias on 4 June and he said that in any event he did not have the opportunity of seeking consent. Finally he said that having received advice from the respondent in January 1992 that he had been granted cover, he did not believe that he was required to do anything else. Mr Mccarthy, counsel for the respondent, submitted that the provisions of the Act and the relevant Regulations were clear and that the respondent was not given any discretion to make payment, no matter how deserving the claimant may be, when the provisions of the Act or Regulations were not complied with. Counsel submitted that a decision of the High Court in ARCIC v Walsh 1 BACK 250 confirms the fact that the Regulations do not import any discretion. Decision The facts of this matter are quite clear and there is no dispute that the appellant did not seek the prior approval of the respondent before undergoing his operation on 4 June 1998. The circumstances which surround his claim for cover and then of course the years intervening before surgery was necessary, make this a somewhat unusual situation, particularly as the appellant's original cover was granted under the 1982 Act. However the fact of the matter is that under the transitional provisions of the 1992 Act the appellant's entitlements are covered by that Act and section 27 makes it clear that the respondent can only make payments in respect of physical rehabilitation which are authorised by the Act or regulations made under it. There can be no dispute that Regulation 11 of the Specialists Costs Regulations requires the prior approval of the Corporation before any such costs are eligible for payment. I find the wording of the Act and Regulations makes it clear that there is no room to read into them some residual discretion to be given to the respondent in a "deserving" case. Indeed the rigidity of the Regulations was confirmed by His Honour Justice Salmon in the decision of ARCIC v Walsh (supra). In that case the claimant suffered personal injury by accident when a fish bone became lodged in his throat. His doctor filled out a claim for cover and referred him to a private hospital where an operation was carried out almost immediately. The facts of the case indicate that the operation was one where an emergency situation had arisen and in the District Court the learned District Court Judge had ruled that Regulation 11 must be read as if it begin with the words "except in the case of personal injury that is an emergency". In the High Court Justice Salmon considered that the words of the Regulation were quite clear and plain and that there was no basis for implying any additional wording such as was implied by the District Court decision. His Honour ruled that the plain words indicated that prior approval had to be obtained, no matter what. The law is clear and regrettably the appellant in this case cannot avail himself of the entitlement to payment of specialist's costs because of his failure to obtain prior approval. This appeal is therefore dismissed. DATED at Wellington this 12 day of April 1999 MJ Beattie District Court Judge