Canadian Underwriter
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Chronic Subjective Injury Claims


November 30, 2010   by Brad Nickerson


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A major issue confronting liability, health, and disability insurers is persistent or chronic subjective injury (CSI) claims. A CSI is a descriptive medical condition where there is not an objective diagnostic test available to verify the severity — or even existence — of the alleged condition. The ultimate financial exposure of a CSI claim, however, can often meet or exceed what is typically seen with severe and objective physical or neurological injuries.

A CSI claim is typically a soft tissue injury, a mild traumatic brain injury or a psychologically disruptive event leading to conditions such as Post Traumatic Stress Disorder (PTSD), that evolves into a chronic injury or persistent behavioral disorder.

In order to assess the severity, or even the existence of a CSI, adjusters typically rely on the claimant’s subjective self-report of their condition, rather than on objective injury diagnostic criteria. Diagnostic tools for objective injuries include physical examinations, x-rays, MRIs and CT scans.

When an insurer receives notice of a serious objective injury, such as a spinal cord injury, a moderate to severe brain injury or a severe orthopedic injury, it is usually a relatively straightforward matter to predict and reserve for the ultimate probable claim exposure. Claims handling and rehabilitation procedures for serious or catastrophic objective injuries are also typically efficient and well-developed. With a serious objective injury, the insurer generally knows with a fair degree of certainty what it has on their hands, and therefore how to effectively manage its exposure.

But when a CSI claim is initially reported, the acute medical condition will often appear relatively minor or benign. That being said, a certain percentage of these apparently minor injury claims evolve, irrespective of the specific compensation environment, into conditions that can have a financial impact on the insurer similar to that of the serious or catastrophic objective injury. To date, efforts and programs to effectively manage CSI claims, which are essentially defined by their epistemic uncertainty, have proven less than satisfactory.

An escalating public health concern

It is apparent from the available data that CSI claims are an escalating public health problem. Estimates from Health Canada indicate that persistent chronic disorders have become an epidemic, currently affecting 20 per cent to 30 per cent of Canadians. The last National Population Health Survey estimated chronic pain conditions cost the economy approximately $15,000 per person affected per year. A report on the Economic Burden of Illness in Canada determined that indirect costs, such as long-term disability payments were highest for chronic musculoskeletal disorders. 1 A Danish study found that patients with chronic pain experience twice as many days missed at work, are seven times more likely to quit their job due to health reasons, make twice as many contacts with health care professionals and make 25 per cent more use of health care resources. 2

Non-specific chronic pain conditions were costing the U.S. economy over $60 billion per year in lost productivity and health care costs, according to a calculated analysis by Stewart and Colleagues published in 2003. This was at least equal to the costs of heart disease or cancer.

Investigative programs

When assessing CSI claims adjusters must rely on the claimant’s subjective self-report. The validity of the claimant’s self-report is, by it’s very nature, contingent on their truthfulness. The problem is that it can be exceptionally difficult to know when someone is being truthful. Knowing truth implies getting inside the mind of another human being. When confronted with CSI claims, the insurance industry still commonly applies investigative programs designed and intended for objective injuries. These measures are of questionable value when applied to CSI claims, except for exclusionary purposes. For example, one may use one such measure to determine what types of injury are not present. Investigative programs intended for objective injuries may in fact increase the financial severity of a chronic subjective injury claim. What is required are more effective methods as opposed to more effective individual tools. Tools implemented as part of a general claims handling program can contain the costs associated with CSI claims and other types of behavioral disorders simply by being applied differently.

Unfortunately, some traditional claims management approaches also tend to assume if the claimant does not have a serious objective injury, and their disability persists beyond typical time lines, then the claimant is likely be exaggerating their claim. However accurate this view may be in any given case, the courts do not default to a description of the patient’s condition as fraud or exaggeration simply because the claimant does not appear to have suffered a clinically significant objective injury and their disability persists beyond a normal time frame. The courts are generally indifferent as to whether the plaintiff’s condition is the result of an objective injury or a valid behavioral disorder. If the validity of the claimant’s condition is established to the court’s satisfaction, then the only remaining concern is whether the defendant is responsible for causing the plaintiff’s condition. In cases involving disability carriers and other types of no-fault insurance regimes, the question becomes whether there is any right to indemnity under the terms of contract or governing statute.

The key consideration in determining if a CSI is a compensable condition, aside from the issue of causation, is the mental state of claimant. Is their condition real to them? Programs designed to investigative and validate objective injuries do not tell anything about a claimant’s intent or interior mental state.

Integrated claims management

Integrated claims management (ICM) seeks to discover how the subject sees the world, without taking the accuracy of the subject’s view for granted. Rather than an all or nothing approach, ICM practitioners consider the claimant authoritative only about how things seem to them. This requires the practitioner listen to the claimant and takes what he or she says seriously, but to also look at everything else available to us. These things include the subject’s behavior, interactions, bodily responses and environment, and the practitioner will be ready to conclude that the subject is wrong even about his or her own mind. The approach is to set up integrated programs designed to function as an experiment. The tools utilized function as a scientific test to assess the validity of the individual’s self-reported mental state; that on which their medical diagnosis is based. An ICM practitioner regards medical diagnosis as provisional; in fact, it is only a working hypothesis to be applied to a process for verification. ICM demands that one remain skeptical about what one can claim to know, until that information is empirically verified.

When we apply an objective injury assessment model, which first and foremost requires the claimant to prove that they are injured, we risk driving the claimant further and deeper into their illness role, sometimes irredeemably. Ultimately, an objective injury validity model, applied to a CSI claim, is self-defeating and often to the insurer’s financial detriment.

ICM does not dismiss the first-person perspective, but rather brackets it so that it can be inter-subjectively verified by empirical means. Once the experimentation ensues, a claimant’s perspective is assessed like scientific evidence.

Applying a validating experiment is compatible with the application of falsifiability as a criterion for demarcating science from non-science. The criterion of falsifiability was enshrined in United States law as part of the Daubert Standard set by the U.S. Supreme Court for whether scientific evidence is
admissible in a jury trial.

That something is falsifiable does not mean it is false. It means that if something were false, then its falsehood could be demonstrated by way of a conceivable experiment. An example of this type of reasoning is the well-known Black Swan hypothesis, where the assertion “all swans are white,” can be proven wrong by experiment. In Australia where a species of black swan was found to exist, this assertion is proven false. As Albert Einstein is reported to have said, “No amount of experimentation can ever prove me right; a single experiment can prove me wrong.”

ICM is quite simply a program to design and implement validating experiments to prove if a claimant is credible.

Integrated investigative program

If we cannot verify the validity of the claimant’s alleged injury condition or if the claimant is inconsistent in their presentation or non-compliant with treatment, these behaviors will be carefully documented. Mitigation or credibility defenses that might later arise in litigation will possess significant, if not compelling, narrative power. ICM assumes a comprehensive assessment program that can include a wide variety of possible investigative tools. The overall goal is to determine if the claimant’s provisional diagnosis, based on their subjective self-report, is incompatible with possible empirical observations. This type of integrated investigative program may utilize, but is certainly not limited to:

• the behavioral observations of clinicians (physicians, therapists, psychologists) within a designed “treatment as assessment” rehabilitation program;

• independent medical examinations and/or functional capacity evaluations;

• surveillance and video-documentary programs;

• general background and lifestyle investigations.

In the accident benefit and disability realm, an ICM based “treatment as assessment” rehabilitation program can be a critical determinant. An experiment-based ICM program in the clinical environment can also facilitate the behavioral remodeling of the claimant. With a valid CSI disorder, an ICM program provides scientific tools to functionally rehabilitate the claimant, and move them away from the injury role they have assumed. If compliance or consistency issues arise and persist in the clinical environment, sufficient evidence will often be obtained during the course of the ICM program to demonstrate, to a legal standard, that the claimant is not credible. In such cases, if a claimant continues in the litigation or adjudication process, they do so at their own peril.

Whether it is determined that a given claimant is credible but can be returned to functional wellness, or whether it is shown that the claimant is not credible, and assertive defense tactics need to be implemented, the application of ICM programs to the current CSI epidemic, would doubtless result in very significant financial savings to the North American insurance industry.

Brad Nickerson is a senior loss consultant with Canpro Investigations.

1. Public Health Agency of Canada, 1998 2. Sjgren et al., 2003