The recent decision in Kelly v. Guarantee Company of North America, FSCO A12-006663, (August 7, 2014), considered a claim for retroactive attendant care benefits under the Statutory Accident Benefits Schedule (SABS).
Ms. Kelly was seriously injured in a motor vehicle accident on April 6, 2009. There was no disagreement that she suffered a catastrophic impairment as a result of same.
The dispute between Ms. Kelly and her Statutory Accident Benefits provider, Guarantee, related to attendant care services provided to Ms. Kelly by her parents and Parkwood Hospital between April 6, 2009 and June 23, 2009.
There was no Form 1 provided by Ms. Kelly to Guarantee covering the attendant care at the time that she was in the hospital. It was not until February 1, 2013 that Ms. Kelly commissioned an occupational therapist to issue a retroactive Form 1 covering the period of April 6, 2009 to June 23, 2009.
Guarantee refused to pay Ms. Kelly the attendant care benefits on the basis of the retroactive Form 1, since the Form 1 and the assessment were not, in its view, compliant with the requirements of the Schedule. Under section 39(3) of the 1996-Schedule1 (now section 42(5) of the SABS-20102) an Insurer may, but is not required to, pay an expense incurred before an assessment of attendant needs is submitted to the Insurer.
The basis for Guarantee's position was that in the absence of a provision specifically authorizing a retroactive Form 1, a claim for attendant care services does not crystallize until a Form 1 is provided. According to Guarantee, a Form 1 could not deal retrospectively with services provided prior to the provision of the Form 1, but could only deal with subsequent care services.
At the Preliminary Issue Hearing, Arbitrator Wilson disagreed with Guarantee's position and held that Ms. Kelly was entitled to payment for the attendant care services, in the amount of $6,000.00 per month.
Arbitrator Wilson was of the view that the law was clear that insurance coverage provisions are to be interpreted broadly, while coverage exclusions or restrictions are to be construed narrowly in favour of the Insured. Arbitrator Wilson noted that the "no fault" system of insurance compensation in Ontario was aimed at providing prompt and timely financial assistance to those in need after an accident.
Arbitrator Wilson further noted that is has been well-accepted in the case law that a valid Form 1 is a prerequisite for the payment of attendant care expenses. However, the issue of whether a Form 1 may be issued retroactively was less clear cut.
In this case, Arbitrator Wilson noted that while a Form 1 may be a pre-condition to the payment of attendant care expenses, he did not accept that requiring an injured person in "every circumstance" to complete all the paperwork including a Form 1 before incurring any attendant care expenses was congruent with the scheme of the SABS.
Arbitrator Wilson noted that Ms. Kelly's claim for attendant care benefits was not frivolous. Her injuries were serious and life-threatening. Given the seriousness of her injuries, all attention was initially focused on treating her and addressing her immediate care concerns. As such, Arbitrator Wilson noted that it was "not surprising that neither Ms. Kelly nor her family turned their mind to hiring an occupational therapist to issue a Form 1 at this critical time."
According to Arbitrator Wilson, subsection 16(4) of the Schedule provides specifically that "the monthly amount payable by the [attendant care] benefit shall be determined in accordance with a Form 1." The requirement merely states that the payment be determined in accordance with the Form 1, however, it does not set a timeline for the Form 1 to be issued. Furthermore, while section 39(3) of the Schedule provides that an Insurer may, but is not required to, pay an expense incurred before an assessment of attendant care needs that complies with subsection (1) is submitted to the Insurer, it does not create an "absolute bar" to a subsequent claim for attendant care services.
Arbitrator Wilson noted that there was no question that both the hospital and her parents provided attendant care services to Ms. Kelly. Furthermore, both the Form 1 and the supporting materials particularized the time spent by the parents in assisting Ms. Kelly. Given the gravity of Ms. Kelly's impairments, the Arbitrator found that the time outlined was credible.
According to Arbitrator Wilson, this was not one of those "abusive cases where an unscrupulous insured attempts to maximize accident benefits with a dubious attendant care claim."
In this case, Arbitrator Wilson noted that:
This claim is for attendant care services in the initial months following the accident when her health was precarious and her needs greatest. It would seem strange that the failure to issue a form in a time of crisis should block an insured from ever claiming indemnity for any attendant care services that were found to be reasonable and necessary.
Arbitrator Wilson reviewed the jurisprudence on the issue of payment of retroactive attendant care benefits, including the case of T.N. v. Personal.3 In that case, Arbitrator Bayefsky had held that the question (once a retroactive Form 1 is filed) becomes simply "whether the evidence prior to the receipt of the Form 1 reflects the assessment contained in the Form 1."
As the Arbitrator found that Ms. Kelly had met the evidentiary burden of substantiating her need for the attendant care outlined in the Form 1, Ms. Kelly was entitled to the payment of retroactive attendant care benefits from April 6, 2009 to June 23, 2009.
Furthermore, as the Arbitrator found that Guarantee had taken a "regrettable position" on this issue by insisting that no payment would be made without a Form 1, despite the fact that the needs of Ms. Kelly were evident, Guarantee was required to pay Ms. Kelly's costs.
Overall, the decision is in line with recent Financial Services Commission of Ontario decisions concerning the retroactivity of attendant care benefits.
Previously, Insurers were confident in taking the position that attendant care benefits were not payable prior to the receipt of a Form 1. Now, and pending the appeal decision in T.N. v. Personal, it appears that Insurers can, in fact, be faced with claims for retroactive attendant care benefits with limited information as to the extent of the claim or the expenses incurred.
While the recent decisions appear to open the floodgates to large retroactive attendant care claims, in actuality, they support the fact that an Insurer has a duty to assess the claim and adjust the claim, especially in situations when an Insured is incapable or perhaps delayed in doing so due to their accident related injuries. In both T.N. v. Personal and Kelly v. Guarantee, it was clear to all parties involved that the Insureds had serious objective injuries and that attendant care was required. In such situations, an Insurer will not be allowed to rely on a technical defence, like the lack of a submission of a Form 1, to deny payment of attendant care.
Whether a claim for retroactive attendant care is payable will essentially come down to all the facts of the case and a consideration of whether or not the services were reasonably required. Arbitrator Wilson makes a clear distinction in Kelly between a claim for retroactive attendant care benefits from a clearly injured Insured as opposed to an "unscrupulous insured" with a "dubious" claim. Just because there is a retroactive Form 1 submitted does not mean that the Insured automatically establishes entitlement to the expenses.
Overall, what this decision highlights is the need for Appellate guidance on the issue of retroactive attendant care. The recent decisions on this issue appear to have watered down the provisions of the SABS and what is needed is clear guidance as to how this issue will be dealt with on a go forward basis. The recent decisions have created a slippery slope for entitlement to retroactive attendant care benefits because there can always be some reason given as to why a Form 1 was not submitted previously. While the hospitalization of the Plaintiff in this case was accepted by the Arbitrator as a valid excuse, there are no parameters given as to what would constitute an acceptable reason in different circumstances. The test as it now stands is simply too subjective to provide any real certainty for either Plaintiff or Defence Counsel and hopefully, clarification in this regard will be provided in the near future.
1. Statutory Accident Benefits Schedule - Accidents on or after November 1, 1996.
2. Statutory Accident Benefits Schedule - Effective September 1, 2010.
3. T.N. and Personal Insurance Company of Canada (FSCO A06-000399, July 26, 2012).
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