In the recent Financial Services Commission of Ontario (FSCO) decision Augustin v. Unifund (FSCO A12-000452, November 13, 2013), Arbitrator Sapin discusses what is considered a “medical reason” sufficient enough for an Insurer to deny a benefit under the Minor Injury Guideline (MIG) and request that an Insured attend an Insurer’s Examination under Section 44 of the Statutory Accident Benefits Schedule (SABS).
In that case, the Insured was injured in a motor vehicle accident on July 2, 2011. She applied under the SABS for medical benefits from her Insurer, Unifund. The Insured submitted an OCF-18 to Unifund in the amount of $2,934.90 dated July 4, 2011, on the basis of her practitioner’s opinion that her injuries fell outside the Minor Injury Guideline (MIG).
In response to same, Unifund wanted to send the Insured to an Insurer’s Examination (IE) to determine if her injuries came within the MIG. Unifund sent the Insured an Explanation of Benefits which stated:
Based on our review of the medical documentation provided to date, we require an assessment by an independent medical assessor, in order to determine if your impairment is predominantly a minor injury as described in the Minor Injury Guideline. Please see the Notice of Examination for further details.
The Insured refused to attend the IE, and Unifund denied her claim for medical treatment on the basis that she was “non-compliant.” In the ensuing Arbitration proceedings, Unifund brought a motion for a determination that the Insured was precluded by s. 55.2 of the SABS from disputing her claims through the dispute resolution process.
Unifund’s position was that on a plain reading of s. 55.2, the Insured must attend an IE once notified in accordance with s. 44. If she does not attend, she is precluded from commencing a mediation proceeding under s. 280 of the Insurance Act, and is prevented from disputing any of: 1) the adequacy of the IE notice; 2) whether the IE is reasonably necessary; or 3) the denial of benefits.
However, Arbitrator Sapin disagreed and found that Unifund’s IE notices were not “in accordance with” the Regulation and therefore Unifund could not rely on the Insured’s non-attendance. Unifund’s notices did not comply with the requirements of either s. 38 or 44 of the SABS.
Arbitrator Sapin noted that under s. 38(9) of the SABS, if the Insurer “. . . believes that the Minor Injury Guideline applies to the Insured person’s impairment, the notice under subsection (8) must so advise the person.” Under s. 38(11), if the Insurer fails to give notice in accordance with subsection 38(8), the Insurer is prohibited from taking the position that the MIG applies and must pay for the goods and services claimed in the treatment plan.
Arbitrator Sapin found that the explanation provided by Unifund did not comply with Section 38(8) or (9) of the SABS because it did not state that Unifund “believes” the MIG applies, or why. Nor did it state the “medical reasons” and all of the other reasons why the Insurer considered any goods or services, or the proposed costs of them, not to be reasonable and necessary.
The Arbitrator noted that Unifund provided no reason, medical or otherwise, explaining why it refused to pay the benefit. As such, Unifund had to pay the $2,934.90 claimed by the Insured.
According to Arbitrator Sapin:
Unifund’s statement that it requires an IE to determine “if” the impairment is predominantly a minor injury to which the MIG applies does not meet the requirements of a s. 38(8) notice for two reasons: one, it is not a “medical” reason; and two, it is not the same thing as stating that it believes the MIG applies, which is what s. 38(9) requires and which is one of the grounds on which Unifund is entitled to an IE under s. 38(10)….
Given that an insured person’s treating practitioner must provide a factually based medical opinion to support a claim for treatment outside the MIG, I find it is reasonable to require an insurer who chooses to refuse to pay an initial claim to counter with something more than simply a desire “to determine if your impairment is predominantly a minor injury as described in the Minor Injury Guideline,” as Unifund has done in this case. This is particularly so where, as in the case here, Unifund refused to pay for the treatment pending an IE, a response I find undermines the stated purpose of the MIG to provide access to early treatment, a purpose based on sound medical principles.
Arbitrator Sapin provided Insurers with a guideline to follow when sending a notice letter to an Insured:
I find it follows logically from these requirements that in its s. 38(8) notice to the insured person that medical benefits will not be paid, the insurer, in explaining why the benefits are not payable, must indicate that it has reviewed the Treatment and Assessment Plan and any medical documentation provided; compared it to the criteria in the MIG; and determined either that there is insufficient compelling evidence (of pre-existing injuries or conditions, for example) or insufficient medical documentation to persuade it that the accident injuries fall outside of the MIG, and therefore, the insurer believes the MIG applies and the treatment claimed is not reasonable or necessary (because the treatment does not conform to the MIG treatment protocols, for example).
According to Arbitrator Sapin, that type of response would meet the Insurer’s obligation to provide “medical reasons” as required by s. 38(8) when it chooses to refuse benefits because it believes the MIG applies. Arbitrator Sapin held that the “medical and other reasons for the examination” in the Notice of Examination under s. 44(5) should contain substantially similar information.
Arbitrator Sapin concluded that by imposing the more onerous requirement upon Insurers to provide medical reasons if they believe the MIG applies, the 2010 Schedule makes Insurers accountable for any initial decision that limits or denies initial treatment. According to Arbitrator Sapin, the requirement to provide medical reasons prevents Insurers from deciding to refuse treatment arbitrarily or on principle.
Therefore, it would be prudent for Insurers to begin utilizing the approach set forth by Arbitrator Sapin when dealing with MIG claims and particularly, to include the following in any denial or request for an examination under s. 44:
The claims adjuster has reviewed the MIG and the treating health practitioner’s medical opinion, and has concluded that the health practitioner has not provided compelling evidence that the person’s injuries are outside the MIG, or that the treatment claimed is reasonable or necessary.
 Section 55(2), An insured person shall not commence a mediation proceeding under section 280 of the Act if any of the following circumstances exist: The insurer has provided the insured person with notice in accordance with this Regulation that it requires an examination under section 44, but the insured person has not complied with that section.