Catastrophic Impairment, what do you need to know and what is new


Catastrophic impairment is a “hot topic”, to say the less, in the field of the accidents benefits and insurance companies. But, why is so important? Why is so polemic? We can resume to one main point, the money involve.

When a person is seeking to receive a benefit from an insurance company, being classified under the category of “catastrophic impairment” could represent a big difference in the amount of money that the person can receive from the insurance company.


Where we can find the definition of catastrophic impairment?

In Ontario, the Statutory Accident Benefits Schedule (SABS), define in his clauses 2(1.2)(f) and (g) what we can consider as a catastrophic impairment. Basically, the law define it as follow:


For the purposes of this Regulation, a catastrophic impairment caused by an accident is,

  1. paraplegia or quadriplegia;
  2. the amputation or other impairment causing the total and permanent loss of use of an arm or a leg;
  3. the total loss of vision in both eyes;
  4. subject to subsection (4), brain impairment that, in respect of an accident, results in,
    1. a score of 9 or less on the Glasgow Coma Scale as published in Jennett, B. and Teasdale, G.,Management of Head Injuries, Contemporary Neurology  Series, Volume 20, F.A. Davis Company, Philadelphia, 1981, according to a test administered within a reasonable period of time after the accident by a person trained for that purpose, or
    2. a score of 2 (vegetative) or 3 (severe disability) on the Glasgow Outcome Scale, as published in Jennett, B. and Bond, M., Assessment of Outcome After Severe Brain Damage, Lancet i:480, 1975, according to a test administered more than six months after the accident by a person trained for that purpose;
  5. subject to subsections (4), (5) and (6), an impairment or combination of impairments that, in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4th edition, 1993, results in 55 per cent or more impairment of the whole person; or
  6. subject to subsections (4), (5) and (6), an impairment that, in accordance with the American Medical Association’s Guides to the Evaluation of Permanent Impairment, 4th edition, 1993, results in a class 4 impairment (marked impairment) or class 5 impairment (extreme impairment) due to mental or behavioral disorder.


What about case law?

Being a main issue in the field of the accident benefits, is reasonable that exists a lot of case law related with what we can consider and we cannot consider as catastrophic impairment. We can mentioned two recent important cases related with the catastrophic impairment definition

  • Aviva and Pastore (2012 ONCA 642) : in this case, the Ontario Court of Appeal stated that is enough be markedly impaired in one of the four of her activities of daily living , social functioning, concentration and deterioration on the job, to the person be considered under the category of catastrophic impair and ask for a higher compensation.
  • Kusnierz v. The Economical Mutual Insurance  (2010 ONSC 5749): in this case,Ontario Court of Appeal found that is possible combine psychological and physical impairments to reach the “minimum” percentage required to be consider as a case of catastrophic impairment.


What is new?

Recently, on June 12, 2012, the Ministry of Finance released the Superintendent’s Report on the Definition of Catastrophic Impairment in the Statutory Accident Benefits Schedule, which is the new project related with catastrophic impairment, the purpose is to ensure that the most seriously injured accident victims are treated fairly.

The government directed consult with the medical community to amend the definition of catastrophic impairment as set out in the Statutory Accident Benefits Schedule, and to set out which need to be the qualifications and general requirements for health professionals who conduct catastrophic impairment evaluations.


What is next?

The definition of catastrophic impairment still will be a hot topic in the near future because involves economic issues and have a great impact in the insurance companies, who pressure  the Ontario government to define and clarify the extent and limits of this concept, because certainty about this is important to both sides, companies and insured people. Is just a matter of time to see what direction is going to take this definition and how is going to impact the insurance industry.

Carlos Vera is a Paralegal student at Centennial College in Toronto studying professional communications with Omar Ha-Redeye.

Auto Insurance Rates in Ontario

Who is Responsible?

There is a lot of confusion amongst drivers in Ontario as to how auto insurance rates are determined.  Sometimes it may seem as though insurance providers randomly pluck numbers out of thin air; I myself have thought that when I receive my annual renewal notice.  The truth is auto insurance is strictly regulated by the Financial Services Commission of Ontario (FSCO).  Although each insurance provider has the flexibility to set their own rates based on a number of criteria, the Superintendent of Financial Services must review and approve any changes.

Five Key Facts about the FSCO:

  1. Makes sure auto insurance companies follow the law
  2. Helps consumers avoid being victimized by fraud
  3. Provides tips for drivers on how to find the best auto insurance rates
  4. Helps drivers resolve disputes with their insurers
  5. Helps keep rates reasonable


The Role of the Government

In August 2013, the provincial government announced its Auto Insurance Cost and Rate Reduction Strategy.  This is an on-going action meant to reduce rates by up to 15%, while ensuring that consumers remain protected.

Some of the changes that have already been implemented:

  • Offering a wider range of options on medical and rehabilitation benefits, attendant care, housekeeping and home maintenance expenses, caregiver benefits, tort compensation and compensation for property damage
  • Protecting consumers by strengthening the prohibition on the use of credit scoring, delays and other questionable screening techniques when providing quotes
  • Streamlining a number of processes to reduce transaction costs and ensure more accident benefit dollars go to treating accident victims


Auto Insurance Fraud

A major contributor to rising auto insurance rates is the prevalence of fraud.  In order to address this issue, the government announced the creation of an Auto Insurance Anti-Fraud Task Force in its 2011 Budget.  In November 2012 the group submitted their recommendations and in January 2013 the government took action.

In their commitment to the public they implemented the following modifications:

  • Requiring insurers to provide claimants with all reasons for denying a claim
  • Giving claimants a bi-monthly, detailed statement of benefits paid out on their behalf
  • Requiring claimants to confirm attendance at health clinics
  • Making providers subject to sanctions for overcharging insurers for goods and services
  • Banning providers from asking consumers to sign blank claims forms


Now What?

The government continues to stand by its promise to reduce auto insurance rates by tackling fraud, reducing costs, and implementing legislative changes.  I commend them for following through on this initiative, but I will only be able to confirm its effects when I see my own auto insurance policy renewal in the fall.


Farrah Rajan is a Paralegal student at Centennial College in Toronto studying professional communications with Omar Ha-Redeye.

May I Presume Dr. Watson is a Better Physician

May I Presume Dr. Watson is a Better Physician

With the rising costs of health care, and the growing demographics of baby boomers, health administrators are always looking for savings. A new and provocative study out of the Indiana University suggests that computer modelling can choose better and less-expensive treatments than the physicians alone, resulting in a 50% reduction in costs and 40% increase in patient outcomes.

  By using a new framework that employs sequential decision-making, the previous single-decision research can be expanded into models that simulate numerous alternative treatment paths out into the future; maintain beliefs about patient health status over time even when measurements are unavailable or uncertain; and continually plan/re-plan as new information becomes available. In other words, it can “think like a doctor.”

 Although Derrick Harris at Digacom states that nobody is suggesting we replace physicians with computers, he does point out other advances in this area:


Omar Ha-Redeye is the Principal of Fleet Street Law, a full-service law chambers in Toronto.

Project Whiplash Ringleader Sent to Prison

Project Whiplash Ringleader Sent to Prison

On February 23, 2012, Toronto Police arrested 37 individuals in connection with an insurance scam. The operation, called Project Whiplash, targeted a group that allegedly staged 77 motor vehicle collisions.

This week the ringleader of the operation, Uthayakanthan Thirunavukkarasu, was sent to prison for 3.5 years and was ordered to pay restitution of $375,000. An estimated $1.2 million flowed through his account for the scam.

At least one of the staged crashes in May 2007 resulted in a brain injury.

Josh Tapper and Wendy Gillis of the Toronto Star explained how the scam worked:

 A recruiter might scope possible participants inside a public space, like a coffee shop, insisting the plan is foolproof, an easy way to earn money. From there, the recruiter acts as coach. He tells people where the accident will occur, where inside the vehicle they should sit and what to tell authorities following the crash…

While police say that numerous collisions allegedly submitted for insurance claims did not actually occur, those that did were also planned carefully. In one collision racket, a scheming driver might stop in front of a laneway and motion an oncoming vehicle to enter traffic; his partner, driving in the opposite lane, then “accidentally” collides with the car… emergency personnel are sometimes called to make the scene more realistic.

With a police investigation underway, the scammers would allegedly forge medical documents claiming injury, often signing on behalf of doctors who never actually assessed the patients. Some of the accused are identified as paralegals, who allegedly filed the insurance claims seeking financial recovery for vehicle damage, physiotherapy, chiropractic work and lost wages.

Insurance companies have decried the practice of staged collisions as one of the reasons for higher premium rates.

Omar Ha-Redeye is the Principal of Fleet Street Law, a full-service law chambers in Toronto.

Nell Toussaint v. Attorney General of Canada, 2011 FCA 213

This week, the Supreme Court of Canada refused leave to appeal from the Federal Court of Appeal in the case of Nell Toussaint v. Attorney General of Canada. The case considers constitutional arguments against the denial of health coverage to people in Canada contrary to immigration law. Human rights advocates denounced the decision citing Canada’s commitment to international human rights which supports the provision of health care to all people even if they have committed the most heinous of crimes. The case, therefore, provides an interesting look at health law in the immigration sphere.


Ms. Toussaint had come from Grenada in 1999 on a visitor’s visa and never left. She worked until 2006 when her health began to deteriorate and she could no longer work. In order to receive medical benefits, she needed to legitimize her immigration status. In 2008, she attempted to apply for permanent or temporary residency status. She also applied to have the application fees waived but was denied, and so the applications were never processed. In 2009, she applied for benefits under the Interim Federal Health program, in which Citizenship and Immigration Canada covers the cost of emergency medical care for indigent persons that it has legally admitted to Canada under an Order in Council. She was denied coverage because of her illegal immigration status.

She brought an application for judicial review and made the case that a denial of coverage infringed her rights under ss. 7 and 15 of the Charter. The Federal Court dismissed her application, as did the Federal Court of Appeal. As mentioned, the Supreme Court of Canada refused leave to appeal. The crux of the decision in both courts was summarized by Stratas JA. in the FCA decision.

If the Federal Court accepted the appellant’s request, the curiosity of some might be piqued: even though the appellant has disregarded Canada’s immigration laws for the better part of a decade, she would be able to take one of Canada’s immigration laws (the Order in Council), get a court to include her by extending the scope of that law, and then benefit from that extension while remaining in Canada contrary to Canada’s immigration laws.

This is a summary of the FCA decision.

Order in Council Interpretation

The Order in Council (OIC PC 1957–11/848) reads:

The Board recommends that Order in Council P.C. 4/3263 of June 6, 1952, be revoked, and that the Department of National Health and Welfare be authorized to pay the costs of medical and dental care, hospitalization, and any expenses incidental thereto, on behalf of:

(a) an immigrant, after being admitted at a port of entry and prior to his arrival at destination, or while receiving care and maintenance pending placement in employment, and

(b) a person who at any time is subject to Immigration jurisdiction or for whom the Immigration authorities feel responsible and who has been referred for examination and/or treatment by an authorized Immigration officer,

in cases where the immigrant or such a person lacks the financial resources to pay these expenses, chargeable to funds provided annually by Parliament for the Immigration Medical Services of the Department National Health and Welfare.

The Director, Program Management and Control, Health Management Branch decided Ms. Toussaint’s initial application for medical coverage. In his decision, he stated:

The Interim Federal Health Program is an interim measure to provide emergency and essential health care coverage to eligible individuals who do not qualify for private or public health coverage and who demonstrate financial need. IFHP services aim to serve individuals in the following four groups of recipients:

  • Refugee claimants;
  • Resettled Refugees;
  • Persons detained under the Immigration and Refugee Protection Act (IRPA); and,
  • Victims of Trafficking in Persons (VTIPs).

As you have not provided any information to demonstrate that your client falls into any of the above-mentioned categories, I regret to inform you that your request for IFHP coverage cannot be approved.

Ms. Toussaint argued, first, that “immigrant” in paragraph (a) of the ought to mean “a person who seeks admission to Canada for permanent residence” and that she was in the process of apply for permanent residence. Stratas JA did not accept this interpretation, and instead relied on the definition of an immigrant as set out in the Immigration Act, where

(i) The person seeking admission to Canada for permanent residence was “admitted at a port of entry” but has not “[arrived] at destination,” i.e., is in transit between entry and destination, or

(ii) The person seeking admission to Canada for permanent residence is receiving “care and maintenance pending placement in employment.”

Ms. Toussaint did not fulfill this definition. Stratas JA stressed that the OIC was focused on providing coverage for those who were entering Canada for the first time. The applicant was a visitor who had decided to remain in Canada contrary to immigration laws.

Paragraph (b) of the OIC refers to any “person”, rather than immigrant. Stratas JA again agreed with the Federal Court’s decision in interpreting this paragraph.

However, by way of clarification, “those persons whose status is being processed by the Immigration authorities” must mean a person who sought that status before or upon entry to Canada. The Program could not have been intended to pay the medical expenses of those who arrive as visitors but remain illegally in Canada and who, after the better part of a decade of living illegally in Canada, suddenly choose to try to regularize their immigration status. Coverage for those persons would be against the whole tenor of the Order in Council, the history of the Order in Council, and the Minister’s stated rationale.

The FCA thus agreed with the interpretation of the OIC as excluding Ms. Toussaint from coverage.

Charter Challenges

s. 7 Right to Life and Security of the Person

Ms. Toussaint argued that her exclusion from medical coverage infringed on her right to life and security of the person under s. 7 of the Charter. The court agreed that, despite receiving emergency surgery and life-saving medication without having to pay, Ms. Toussaint was exposed to serious health risks. However, the court did not accept that the Order in Council was the operative cause of the injury to her rights to life and security of the person. (See TrueHope Nutritional Support Limited v. Canada (A.G.), 2011 FCA 114) Rather, the court suggested that the applicant’s own conduct endangered her life, and that had she acted legally and obtained proper immigration status, she would have been entitled to coverage.

Principles of Fundamental Justice

Ms. Toussaint also argued that “[g]overnments ought never to deny access to healthcare necessary to life as a means of discouraging unwanted or illegal activity, including to those who have entered or remained in a country without legal or documented status.” The appellant submits that “[t]his principle is fundamental to judicial and legislative practice in Canada.” Stratas JA rejected this argument as well. In doing so, he cited the broad finding in Chaoulli by McLachlin CJC that the Charter does not confer a freestanding constitutional right to health care (Chaoulli v. Quebec (Attorney General), [2005] 1 S.C.R. 791 at para. 104). Also,

The appellants are, in essence, seeking to expand the law…so as to create a new human right to a minimum level of health care…. [T]he law in Canada has not extended that far…[A] freestanding right to health care for all of the people of the world who happen to be…in Canada would not likely be contemplated by the Supreme Court. (Covarrubias v. Canada (Minister of Citizenship and Immigration), [2007] 3 F.C.R. 169 at para. 36.)

The court also did not accept an argument that the Order in Council’s exclusion was arbitrary. (at para. 83) Stratas JA took these findings as support that there is no recognized principle to fundamental justice under s. 7 that the applicant receive medical care.

s. 15 Discrimination Under Enumerated and Analogous Grounds

Stratas JA rejected the argument that the applicant had been denied coverage was contrary to s. 15. With regards to discrimination on analogous grounds, he commented

“Immigration status” is not a “[characteristic] that we cannot change.” It is not “immutable or changeable only at unacceptable cost to personal identity.” Finally “immigration status” – in this case, presence in Canada illegally – is a characteristic that the government has a “legitimate interest in expecting [the person] to change.” Indeed, the government has a real, valid and justified interest in expecting those present in Canada to have a legal right to be in Canada. (at para. 99)

A final policy comment was made by the court.

If the appellant were to prevail in this case and receive medical coverage under the Order in Council without complying with Canada’s immigration laws, others could be expected to come to Canada and do the same. Soon, as the Federal Court warned, Canada could become a health care safe haven, its immigration laws undermined. Many, desperate to reach that safe haven, might fall into the grasp of human smugglers, embarking upon a voyage of destitution and danger, with some never making it to our shores. In the end, the Order in Council – originally envisaged as a humanitarian program to assist a limited class of persons falling within its terms – might have to be scrapped.

Alexander Rozine is an Associate at D’Angela Fox Vanounou LLP, a plaintiff-side personal injury firm in Toronto.

Ontario Expected to Slash Physician Funding

When an Ontario Medical Association (OMA) agreement with the Province of Ontario expires on March 31, 2012, the Province is expected to reduce physician compensation to address growing costs.

Ontario currently spends approximately $10 billion a year on the Province’s 24,000 physicians, and health funding of $47 billion a year typically represents the largest line item on provincial budgets at 42 per cent .

The cuts may come in the form of wage freezes. The previous agreement had included a 5% global increase to the OHIP Schedule of Benefits on October 1, 2009, a 3% increase on October 1, 2010, and a 4.25% increase on September 1, 2011.

Ontario’s 2010 budget prominently featured wage restraint measures, including a three-year MPP salary freeze and two-year freezes for non-bargained employees. No funding was allocated for fiscal increases in any future collective agreements. The Ontario Public Service had already been reduced by five per cent in the three years before the budget.

Adam Radwanski of The Globe suggests that the Province could look for savings in the following areas:

  • increased emphasis on Family Health Teams instead of Fee For Service
  • tighter guidelines for referrals and prescription refills
  • reduced fees for some costly specialist procedures
  • greater requirements for hospital duties
  • remote physician services via telephone and Internet, and electronic health records

The 2010-2012 agreement with the OMA allocated $340 million for new programs that will not likely be reproduced in the next agreement.  The previous agreement did include funds for hiring an additional 500 licensed nurses to assist physicians in their offices through collaobrative health strategies like Family Health Teams

Depending on the success of these programs, greater funding for allied health staff could be perceived as a way to keep physician costs down.  Either way, physician funding is quickly being perceived as one of the more ineffeicient ways to deliver primary care.

 The Drummond Report, expected shortly, will likely frame the discussion further, especially highlighting the role of physicians with health institutions like hospitals. 

OMA Contract With MOHLTC – March 31, 2012

Omar Ha-Redeye is the Principal of Fleet Street Law, a full-service law chambers in Toronto.