The State Insurance Regulatory Authority (SIRA) says NSW workers’ compensation scheme return-to-work rates have stabilised and should improve as icare’s new claims management model gains traction. 

Six claims services providers have been introduced in the Nominal Insurer scheme, with the new model including a focus on psychological claim handling, development of professional standards and improving capabilities and financial incentives. 

“Higher quality claims managers, lower turnover across those claims services providers is where we’re going to see the real rubber hit the road, I think in terms of return-to-work rates,” SIRA CEO Adam Dent told a NSW Parliamentary inquiry. “But at the moment, I think stabilisation is a positive thing.” 

SIRA is conducting ongoing quarterly audits of the Nominal Insurer’s management of the first four weeks of a workers claim. 

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

icare CEO Richard Harding told the inquiry that increased transparency over complaints made to claim service providers is part of reforms to improve performance. 

“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 Standing Committee on Law and Justice 2023 review of the workers’ compensation scheme has picked up the work conducted last year under the previous government, continuing a focus on the increase in psychological claims. 

Mr Harding told the inquiry that a “test and learn” team based in Wollongong was looking at new approaches to improve the management of mental health. 

“Early indications indicate that tailored case management is essential, yet case managers currently are over involved in compliance,” he said. 

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.