Increased transparency over complaints is being introduced as part of reforms to improve workers’ compensation scheme claims handling performance, icare CEO Richard Harding has told a NSW Parliamentary Committee today.

icare has moved to a model with six claims service providers and a greater focus on psychological injuries as part of an overhaul of the Nominal Insurer scheme.

Mr Harding says complaints handling tracking will provide an additional level of accountability, and will include a pathway for escalation from the claims service provider to icare.

“Up until literally a few months ago icare had no mechanism for tracking complaints. We didn’t have a record of the number of complaints that were being dealt with at that very frontline,” he said. “That’s a new level of transparency that we will get.”

The new model also includes professional claims handling standards, financial incentives for performance and the scheduled introduction of increased competition.

Mr Harding says it will take time for improvements to flow through, and a steady process is preferred, rather than the disruption experienced with previous sudden changes.

“We have seen improvements actuarially come through that gives us great confidence that we’re heading in the right direction,” he said. “But it will be long and slow.”

Mr Harding says stresses for injured workers accessing the scheme could be eased with regulatory changes, including around the numerous requirements case managers must tick off at first interactions.

“That can change that first call from an empathetic understanding call about ‘help me understand what your needs are’ to a ‘must do these things to complete my compliance checklist’ and it changes the relationship,” he said.

Mr Harding also said rule changes would be welcomed to allow clearer data on secondary psychological injuries, where mental health issues arise after a primary physical claim.

State Insurance Regulatory Authority (SIRA) CEO Adam Dent told the committee that SIRA is closely monitoring the implementation and performance of the new claims model, and there has been “encouraging progress” in onboarding new providers.

SIRA says there has been a stabilisation in return-to-work data in the past financial year, following previous deteriorations.

Workers and Home Building Compensation Regulation Executive Director Darren Parker told the committee that the target premium rate is still below breakeven and the financial strength of the scheme will continue to deteriorate for the next 12 months before starting to turn around.

“That’s at the same time we can expect that there’ll be better return to work rates and better outcomes for workers,” he said. “It’s still going to take a number of years till June 2030 for the financial position of the Nominal Insurer to meet the capital target zone.”

SIRA also told the inquiry that outcomes from a review of the Treasury Managed Fund, which covers public service employees, will be provided to stakeholders next month.

The review has examined 951 claim files, identifying concerns about rising psychological injuries, including from harassment and bullying, and the need to better provide return-to-work opportunities.

The Standing Committee on Law and Justice 2023 review of the workers’ compensation scheme is continuing on from last year’s review, conducted under the previous Government, which had resolved to focus on the increase in psychological claims.