Regulation of service providers in the NSW

workers compensation system

WorkCover NSW

April 2011

Authorised by:

Gary Rolls
NSW President
Australian Physiotherapy Association NSW Branch
Locked Bag 409
Silverwater BPC 1818
Phone: (02) 8748 1555
Fax: (02) 9647 2244
www.physiotherapy.asn.au
Australian Physiotherapy Association

The Australian Physiotherapy Association (APA) is the peak body representing the interests of
Australian physiotherapists and their patients. The APA is a national organisation with state and
territory branches and specialty subgroups. The APA corporate structure is one of a company limited by
guarantee. The organisation has approximately 12,000 members, some 70 staff and over 300 members
in volunteer positions on committees and working parties. The APA is governed by a Board of Directors
elected by representatives of all stakeholder groups within the Association.
The APA vision is that all Australians will have access to quality physiotherapy, when and where
required, to optimise health and wellbeing. The APA has a Platform and Vision for Physiotherapy 2020
and its current submissions are publicly available via the APA website www.physiotherapy.asn.au.

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 Regulation of service providers in the NSW
workers compensation system

Introduction
The APA does not in any way support the provision of services that are not clinically justifiable to
any client, and fully supports the right of WorkCover NSW to take action against practitioners who
have been proven to routinely bill incorrectly and/or provide inappropriate services to injured
workers. The APA however is concerned about the focus on this small minority of practitioners and
feel that the document does not in any way address the checks and balances required to ensure that
innocent parties would not become caught up in the compliance processes designed to hold
practitioners to account for inappropriate practices. The APA acknowledges that there will be
instances of over-servicing in any group of health professionals, but contends that these
practitioners are the exception, not the rule.
The APA believes that the right for injured workers to choose their own practitioner is essential to a
well-functioning health system, and that the changes proposed in the discussion document have the
potential to erode this right significantly. The proposed changes would decrease the ability for an
injured worker to have their own choice of practitioner. Such changes would represent a significant
departure from the established WorkCover NSW position. The APA feels that the violation of this
basic tenet would be detrimental to patient outcomes, placing a further psychosocial barrier in front
of return to work (RTW) for injured workers.
In addition, the APA is concerned that the changes as outlined in the discussion document will
increase the adversarial relationship between the injured worker and the insurer. Increasingly time-
consuming and inflexible clinical controls will discourage physiotherapists from treating injured
workers. In the process of targeting inappropriate service provision, proposed changes have the
potential to affect return to work adversely by further complicating an already cumbersome system.
Another important consideration that has not been raised in the discussion paper is that any
improvements to the regulatory system should encompass educative approaches that provide
mentoring and guidance to practitioners who require it, rather than proceeding directly to punitive
action.
The APA is concerned that there is a lack of detail within the discussion document about how
mechanisms should work. This gives the impression that WorkCover is seeking broad powers
unlimited by transparency or by regulatory checks and balances.
This document provides feedback on the individual proposals outlined in the discussion document,
and make suggestions on how mechanisms that support WorkCover’s goals could function.

Focus on the injured worker

The document has a focus on providers who misuse the workers compensation system. The APA is
concerned that the discussion document proposes to make such sweeping changes to ensure
compliance without reference to the overall cost of a worker’s compensation claim, and without a
focus on improving the current system.
This discussion document looks at the cost of service provision, but ignores the overall cost of an
injured worker’s claim. The APA contends that in assessing health practitioner compliance costs,
this overall cost should be taken into consideration.

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 The APA recognises that WorkCover’s data-collection processes are complicated by the
involvement of multiple insurers. However, in order to ensure that the provision of health services is
both clinically and cost effective, the APA strongly urges WorkCover to implement robust
mechanisms to collect wholistic data relevant to the injured worker.
Massive changes are proposed and these would negatively impact on the complex relationships
between worker, provider, insurer and employer. Such changes would add an additional layer of
complexity, add to the conflict within the system, and further serve to confuse workers.
These changes are designed to prevent an extremely small number of current providers who work
outside the requirements of the system, and whom WorkCover has identified as being responsible
for providing treatment that is not clinically justified, and to deter other providers who may consider
operating in this way. However the APA believes that such broad changes would be to the detriment
of RTW for injured workers, would alienate many competent providers and that implementation costs
are likely to be greater than the funds recovered from physiotherapists.

1. Power to approve service providers

The APA contends that registration as a physiotherapist ensures that a practitioner is appropriately
qualified to treat a workers’ compensation client, provided the injury or condition is within his or her
scope of practice. For this reason, the APA objects to WorkCover’s proposal to approve practitioners
prior to them being eligible to treat injured workers. The regulation of the title Physiotherapist is
sufficient to ensure that providers are appropriately qualified to treat injured workers. The APA
believes that further education on the complexities of the workers’ compensation system is useful to
physiotherapists; however an administrative application process to approve physiotherapists’
entrance to the system is an unnecessary barrier to patient care.
The discussion paper says that WorkCover should have the right to assess practitioners as being
“not fit and proper persons to provide those services”. The APA does not believe that WorkCover or
insurers are in a position to make such decisions about providers, but that the Physiotherapy Board
of Australia is the correct authority to make this type of assessment. The APA maintains that while it
may be appropriate in some instances for funding bodies to make assessments about further
payment for treatment, there are inherent conflicts of interest in assessment of competency to
practice that are not present in the assessments made by the Physiotherapy Board of Australia.
The objective of this proposal is to enable WorkCover to ban practitioners who are providing
multiple, unnecessary treatments to injured workers, treatments negatively impacting on workers’
return to work, and treatment not in the best interests of the worker. The APA has no objections to a
change of legislation that enables WorkCover to investigate cases of suspected fraud. Where the
investigative procedure is robust and includes the opportunity for review by an external source, and
the practitioner has been found to have defrauded WorkCover, the APA does not object to
WorkCover barring a provider from accessing funding through the WorkCover system. However,
forcing all physiotherapists to apply for approval from WorkCover before providing treatment will
result in an additional administrative burden to practitioners and to WorkCover. This burden will be
unnecessary for the vast majority of physiotherapists, and will add to the cost of an already
expensive system.
Therefore, rather than WorkCover ‘approving’ physiotherapists to treat injured workers, the APA
recommends that limited legislative amendments be made. Instead of the implementation of a
cumbersome approvals system, the APA proposes that all physiotherapists be automatically eligible
to provide services under the WorkCover system. Where WorkCover has proven that a provider has
breached their obligations and educative approaches have been unsuccessful, legislative
amendments should enable WorkCover to restrict or remove access to workers’ compensation
payments, and recommend that the injured worker seek an alternative provider.
Steps for taking action to remove a practitioner’s workers’ compensation payment rights must be
clearly and transparently articulated to all workers and providers. The development of such a
process should be the focus of further discussion with the professions. These steps should initially

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 be conciliatory /educational, moving on to more punitive action if a practitioner is unable or unwilling
to address his or her behaviour.
As a starting point, and to illustrate the type of processes that could lead to the removal of
WorkCover NSW rights, the APA puts forward the following steps:
• WorkCover or practitioner identified servicing problem.
• Initial contact with provider outlining problems identified.
• Review of case or cases by an expert or specialist physiotherapist in the relevant area/s.
• Interview with provider by an appropriately qualified panel, with allowance for the
physiotherapist to bring a support person of their own choosing.
• If fault is attributable to the provider, the panel should focus on how the behaviour could be
rectified, with a view to negotiating an agreement between WorkCover and the provider.
• An internal review/appeal mechanism should be available.
• If fault is not attributable to the provider, the provider should be eligible to invoice
WorkCover to recover any costs associated with the process. This should include lost
opportunity, locum costs, legal costs and travel costs.
• If fault is attributable to the provider, and he or she is unwilling to work with WorkCover to
change his or her behaviour, action to restrict, suspend or remove a practitioner’s right to bill
WorkCover for the treatment of clients should be considered.
The APA supports WorkCover’s position that there be capacity for administrative review of any
decision made by this process, and that the most appropriate review body would be the
Administrative Decisions Tribunal.

2. Power to decline specific types of services

The discussion document outlines a process whereby WorkCover would approve or reject specific
clinical treatment modalities or practitioners. As a matter of principle, the APA is unreservedly
opposed to insurer/funder management of the clinical care of physiotherapy patients, and is
concerned that the discussion document does not provide information on how treatment guidelines
would be developed, how determinations would be made that specific treatments would be banned
or whether treatment pathways would be prescribed.
Subsequent discussions with WorkCover NSW clarified that the point of the discussion paper was to
investigate strategies for excluding unacceptable, fringe practices. The APA is still concerned that
the powers sought by WorkCover would provide insurers with the capacity to overrule a
physiotherapist’s treatment plan, and to provide unacceptable interference with clinical processes.
The APA supports the concept that WorkCover should direct practitioners towards evidence-based
treatment that will assist a worker to maximise function and return to work as quickly as possible (or
alternatively maximisation of function where return to work is not feasible) where appropriate.
However, it is important to build proper controls into the approval process that ensure that clinical
decision-making processes remain with the appropriate health professional.
A rigorous framework for the assessment of what WorkCover could determine as a fringe treatment
is required. This should preferably include a review of literature on the modality and the profession
who would provide the treatment, and should also include serious consultation with professions
involved in treating injured workers.
Blanket banning of particular treatment modalities and pre-approval requirements for all treatment
could have a number of unintended consequences that are not in the best interests of the worker.
These may include:

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 • Scope creep – where agents who are unqualified and have not examined the worker
become the arbiters of clinical care
• Implementation of a one-size-fits-all approach, where treatment for specific injuries is
prescribed, and does not allow for consideration of factors such as biopsychosocial or co-
morbidities to be taken into consideration
• Delay in clinical care – additional administrative processes are very likely to prevent early
intervention; a substantial body of evidence demonstrates that early intervention is vital to
facilitate early and durable return to work
• Interference in the therapeutic relationship between the physiotherapist and the injured
worker
• Blurring of the lines of clinical accountability between the injured worker and the
physiotherapist
In addition, the APA believes that proscribing or prescribing treatments for specific conditions or
injuries would stifle innovation in the treatment of injured workers. Innovative models of care arise
through adaption of treatment to suit specific circumstances. The APA cautions WorkCover that this
approach could discourage practitioners from adaptable approaches, and reduce the flexibility of the
workforce to respond to the changing needs of injured workers.
Treatment requirements
The APA does not object to the concept of adding a requirement that treatment be ‘in the best
interests of the worker, but believes that this is no less broad and objective than the other existing
requirements. The APA therefore questions the benefit of the addition to the worker.
The APA is also concerned that providers will be held accountable for circumstances beyond their
control, such as where there is conflict between the best interests of the worker and the best
interests of the employer or WorkCover. For example, many physiotherapists report that their clients
find return to work difficult because employers are hesitant to allow injured workers to return to
reduced or amended duties, despite this being in the best interests of the worker.
The document discusses clinical guidelines and WorkCover’s power to issue these guidelines with
or without the relevant professional associations. The APA objects to the concept of a funding body
developing specific clinical guidelines in isolation from the relevant profession. The development of
specific clinical guidelines must to be in partnership with the relevant professional organisations –
rather than in consultation. Insurance agents would need significant training to understand the
correct application of clinical guidelines, and costs to WorkCover would be likely to increase
significantly. The APA cautions that the development of specific, clinical guidelines is a costly and
time consuming process, and guidelines also need to be subject to review at regular intervals.
While the APA recognises the need for compensable bodies to implement regulatory processes to
ensure that services provided are clinically justifiable, the APA is concerned that such extreme
measures are being proposed without a review of the approval processes for physiotherapists at the
level of individual physiotherapist, Independent Physiotherapy Consultants (IPC) and insurers.
Physiotherapists are already required to apply for approval for sessions provided to clients, and this
mechanism should be able to prevent the type of over-servicing that is the target of the discussion
document.
The current system has been demonstrated to provide the opportunity for WorkCover or an insurer
to discontinue services that they believe are inappropriate. It has been the experience of many APA
members that further sessions have been rejected by insurers, or treatment has been discontinued
at the direction of an IPC.
However, there remain rare cases of extremely high levels of service with the system. This shows
that there are gaps in the system, and the APA believes that WorkCover should work more closely
with insurers and IPCs to ensure that the system works to prevent inappropriate levels of servicing.

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 The discussion document also infers that additional, prior-approval processes would be needed to
implement guidelines and ensure proscribed treatments are not provided. The APA strongly objects
to any measures that increase the regulatory burden on physiotherapists, or that delays early
interventions.
The discussion document states that “the power to decline specific types of services brings health
care provided and paid for in workers compensation in line with best practice in the Australian
community and ensures that injury management plans are in the workers’ best interests.” The APA
disputes the claim that the power to refuse a treatment type is best practice within the Australian
Community, and requests evidence to support the assertion that such powers ensure that injury
management plans are in the best interests of the worker.
In summary, the APA does not dispute that WorkCover should be in a position to refuse to pay for
treatment that is useless or detrimental to an injured worker. However the APA is concerned that
powers to decline services would interfere with physiotherapy treatment unless safety mechanisms
were built into the legislation. A robust and transparent legislative process must be in place to
ensure that:
• The clinical autonomy of physiotherapists is not negatively impacted upon
• Clinical guidelines are not implemented by insurers or by WorkCover in isolation from the
Australian Physiotherapy Association
• Clear accountabilities for clinical treatment are in place
• The regulatory burden is not increased
• Early intervention is not compromised

3. Payment of fees for services

As previously discussed with WorkCover, the APA does not support gazetted fees for workers’
compensation patients. However, the APA recognises the need for compensable bodies to control
costs and ensure that the system can be feasibly maintained.
The APA believes that the market should determine chargeable fees for physiotherapy payments,
and that the gazettal of fees by government authorities creates restrictions on the market for
physiotherapy services.
WorkCover has indicated that it is against the spirit of the current legislation to allow workers to pay
a gap fee, and that if gap payments were allowed, injured workers would have no choice but to pay
a gap fee for treatment. The APA’s research has shown that this is not the case and workers would
still have a choice to receive a fully-funded service. Very few providers charge a gap fee under the
QLD system, where gap fees are allowable, and scheduled fees are reasonably similar to those in
NSW. The APA believes that WorkCover’s fear that injured workers will have no choice but to pay a
gap fee is unfounded, as experience around the rest of Australia shows that very few injured
workers are actually charged a gap fee where payments for standard type consultations are
reasonably in line with the average market rate.
The APA recommends that WorkCover facilitate access to more costly expert and specialist
physiotherapy services by allowing physiotherapists to charge gap payments to injured workers.
This is in line with the principle of choice, and would not disadvantage injured workers who did wish
to ‘top up’ their entitlements under the WorkCover scheme and to access physiotherapists with
additional experience and qualifications.
The APA also feels that the ability for injured workers to make financial contributions to the
management of their condition would help them take ownership of their treatment. Some members
have observed that clients who are not required to make any payment for their service are more
likely to fail to show up for their appointment – indicating that co-contributions do have an effect on a
clients’ perception of the value of service.
The discussion document is very much concerned with the concept of providers charging a fee to an
injured worker at the point of service. The APA believe that physiotherapists should retain the right

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 to charge a workers’ compensation client on the spot, as APA research shows that this is in line with
what normally occurs with private clients. (The APA’s 2010 Assessment of Market Rates for
Physiotherapy Services showed that 96% of private physiotherapy patients are required to pay on
the spot for physiotherapy treatment). Physiotherapists operate small businesses which are
adversely affected by payment delays, and the APA feels that is reasonable for a physiotherapist to
ask for payment from a worker in line with the usual practice in the community. If WorkCover wishes
to create an offence against seeking payment for service from injured workers directly, it should
ensure that payment is provided within a reasonable timeframe. To do this, the APA believes that
WorkCover should implement a maximum time by which payment must be made to the service
provider. The APA would be happy to further consult on appropriate timeframes.
The APA is concerned about the introduction of requirements banning direct billing of clients, as
resulting administrative procedures and increased risk of non-payment for services would run the
risk of discouraging physiotherapists from providing services to injured workers.
Injury Management Plans (IMP)
The APA strongly disagrees with WorkCover’s proposal to prohibit service providers from recovering
payment for services provided to an injured worker where the treatment was not in accordance with
the injury management plan. Plans may need to change over time. For example, particular,
originally-planned, treatment modalities may not have been effective for the patient, or a condition
may be exacerbated or improved between consultations.
Creating this requirement would add to uncertainty for providers around the types of services that
they can provide. In addition to the concerns about changes in management, physiotherapists do not
necessarily even see IMPs for their clients, and holding physiotherapists accountable for these plans
transfers unacceptable risk to the physiotherapist.
Implementing this requirement would mean that any physiotherapists would be required to chase up
a copy of the IMP, risking significant delays in intervention and thus return to work. It could also
result in consultations where no intervention was provided because re-assessment required a new
management plan. The requirement is not in line with the APA’s National Physiotherapy Service
Descriptors which say that re-assessment is required as part of a standard physiotherapy
consultation.
Where a treatment is reasonably necessary, the service provider is appropriately qualified, and the
service provided is clinically appropriate, the exclusion of a particular treatment solely because it
was not written on a pre-approved IMP is unjustified.
Appropriate qualifications
Given physiotherapists are registered with the Physiotherapy Board of Australia as being
appropriately qualified, the APA does not believe WorkCover Australia should be empowered to
prohibit service on the grounds that the provider was not appropriately qualified. Where practitioners
are providing services out of their scope of expertise, practitioners should be reported to their
relevant registration board.
The APA believes that injured workers should be able to choose the most appropriate provider for
their needs. All health professionals should practise within the scope of their training and experience
regardless of the professions registrations status and professionals treating members of the public
should be held to a robust code of conduct.
The APA believes that WorkCover should have the authority to ensure that unregistered providers
have appropriate professional affiliations and are held to an appropriate code of conduct by a
relevant body.
Recovery of monies paid
The APA does not oppose WorkCover’s move to gain the necessary authority to recover monies
paid where there is clear evidence of fraud. WorkCover should explicitly define what constitutes
fraudulent claiming and disseminate this information widely, and the APA should be involved in the
development of such guidelines.

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 WorkCover should not, however, have legislative authority to recover payment for services that were
pre-approved by the insurer.
The APA also believes that legislative changes must be flexible enough to support WorkCover to be
discretionary in its recovery actions. For example, it is unlikely to be cost-effective for WorkCover to
reclaim small amounts and in circumstances where providers have been unaware that they
contravened the requirements, an educative approach rather than a punitive approach should be
taken.

4. Establish WorkCover consultative mechanisms

The APA would like to see WorkCover move to work more closely with the physiotherapy profession
on improving outcomes for injured workers and sees scope in this review to do just that. The APA
feels that such a move would make practitioner reviews a less adversarial and more educative
process for physiotherapists.
Although this section is very vague about the makeup and specific role of the proposed consultative
mechanism, the APA feels that there is a focus on punitive case reviews, rather the providing an
educative support mechanism for physiotherapists with long-term or otherwise difficult clients. The
APA is therefore deeply disappointed that the main focus of this section is on the reviewing rights to
participate in WorkCover programs and the prescription of treatment regimes.
The APA is concerned about the ‘arguments against’ proposal, which seems to insinuate that the
consultative mechanism could be required to approve treatments prior to commencement, therefore
delay treatment, and could limit the range of services available to injured workers.
The APA seeks more specific information on the exact role of these committees, their makeup, the
differences between them and the IPC system, and how they would ‘provide information to
professional peers on good practice both in their profession and in the workers compensation
system.’ Depending on these factors, the APA may support the concept of such committees if they
included practicing physiotherapists, preferably nominated by the APA, and if the committees have a
focus on working collaboratively with clinicians rather than solely to take a disciplinary approach.
The APA believes that such a consultative mechanism would need to have a robust regulatory
system to ensure that providers who give clinically appropriate care do not get unfairly caught up in
this mechanism. For example, neurology physiotherapists can routinely treat catastrophically-injured
clients for long periods of time and may see these patients a number of times per week. They may
be pinpointed as outliers because of their treatment patterns, even though these patterns are
clinically justifiable.
Review of the existing mechanisms
The APA is concerned that WorkCover is seeking additional review powers without committing to
examine the rate of success of the existing systems. The insurer approval process and the IPC
review system should be examined to strengthen effectiveness prior to implementing new systems
that have the potential to further complicate an already burdensome system.
The APA supports the continuation of assumed approval of Treatment Management Plans after five
working days if no authority has been issued by the insurer. This allows for continuity of treatment
and early intervention. The APA believes that any change in this arrangement would result in
financial uncertainty for practitioners, delays in treatment and therefore delayed RTW for workers.
The APA believes that WorkCover should work with insurers to develop strategies to ensure that all
plans are resolved within the five-day, allocated time frame.

5. Establish panels of service providers for specific service types

As stated earlier in this document, the APA acknowledges and understands that WorkCover must
ensure that its workers compensation scheme is financially sustainable into the future. However the
focus on driving down fees to the lowest possible level as outlined in this section of the discussion

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 document is incompatible with WorkCover’s aims of increased compliance with the system, and
improved rates or RTW.
The APA objects to the establishment of provider panels such as those described in the discussion
document as they are problematic on a number of levels.
Such panels would reduce competition between providers by referring clients directly to a provider
on the basis of cost. The APA’s experience with health fund preferred provider schemes is that they
fail to recognise the differing levels of experience and additional training that different
physiotherapists may have.
The APA is also concerned that contractual arrangements between physiotherapists and WorkCover
will be offered on a take-it or leave-it basis, as is the case with private health insurer funds, or that
WorkCover could decide to restrict the number of providers able to provide services to injured
workers.
The discussion document says that the establishment of provider panels would ensure that only
appropriately-qualified service providers would be available to provide services to injured workers.
The APA strongly objects to the concept of limiting service capacity to select providers, and does not
believe that this approach supports the best outcomes for injured workers.
Perhaps the most important objection that the APA has to the establishment of provider panels is
that of worker choice. Injured workers are entitled to receive the same level of service that they
would in the community and this includes the right to choose the practitioner that they feel meets
their needs. Choice of practitioner provides the worker with the opportunity to take ownership of the
management of their own injury.
The APA is also concerned that the establishment of provider panels would further serve to alienate
providers and drive them away from providing service to injured workers because of increased
administrative and reporting requirements.
The APA does not object to a system of rewarding practitioners on the basis of additional skills and
training, and instead proposes that the two-tier system of payments currently in place be subject to a
review to establish its effectiveness and capacity for improvement, in consultation with the APA.
Use Medicare as a model for WorkCover
The APA does not support the use of the Medicare model for the provision of physiotherapy services
to injured workers. Specific Medicare rebates for the breadth of services that physiotherapists
provide to injured workers are not available at this time, therefore adoption of the Medicare model
would not be appropriate for physiotherapy treatment.
The APA also wishes to point out that the Medicare model is not intended to cover the full cost of
treatment, and practitioners working under this model are free to bulk bill or charge a gap as their
business model dictates. WorkCover would need to adopt this policy if it were to implement a
Medicare model.
WorkCover should also recognise that the Medicare model does not provide a mechanism for pre-
approval of treatments, and the APA is concerned that if such a system were to be implemented,
then piecemeal billing could become the norm - that is that physiotherapists could be required to bill
for each treatment module (eg. manual therapy, hot-pack, electrotherapy etc). The APA does not
believe that this is in the best interests of the worker – rather, that outcome-based treatment would
be more effective to facilitate early and durable return to work.

Conclusion
The APA acknowledges the need for WorkCover to gain increased powers to restrict payments to
rogue providers who knowingly and purposefully operate outside of framework of the NSW workers
compensation system. However there is deep concern within the profession around how increased
powers could affect compliant providers. These could be providers who are working appropriately
but their service levels appear unusual due to factors such as their client cohort or focus on injured

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 workers in their practice, or providers who are unknowingly working inappropriately and therefore in
need of education and guidance.
The proposals in the discussion paper need significant reworking to assure the physiotherapy
profession that processes and safeguards would be in place to stop WorkCover from undertaking
punitive action against a physiotherapist without first having taken appropriate steps to ensure that
the practitioner was intentionally and illegally abusing the workers compensation system.
The APA believes that there are already mechanisms in place that should prevent the provision of
clinically-unjustifiable servicing from occurring, and the APA recommends that these less rigid
procedures be reviewed and strengthened in consultation with the APA.
The APA also believes that such rigid structures and guidelines as proposed by the document have
significant potential to curb innovative practices and therefore reduce the ability for the profession to
respond to new situations with the flexibility required of a health practitioner in today’s constantly
changing environment. The focus on bad practices detracts from the document, and the APA
suggests that WorkCover work on seeking out good practice, to reward and publicise the work of
successful physiotherapists who achieve above-average return to work outcomes.

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