Some ACC facts

March 12th, 2009 at 2:00 pm by David Farrar

Brian Fallow writes on . He bashes Nick Smith up a bit for calling the scheme insolvent (and I agree that was not the most useful contribution to the debate). But Fallow also concedes there are problems:

The briefing to the incoming minister highlights three troubling trends.

One is in the number of claims. In the 2007-08 year claims rose 4 per cent when the population grew only 1 per cent.

In the case of workplace accidents alone the number of claims per million hours worked has increased by 15.6 per cent over the past four years, and is now at the same rate as Australia (where the trend has been declining).

Secondly the proportion of claimants who return to work has been trending down, from 93 per cent in 2001 to 87 per cent six years later.

And the combined effect of more claims and high rates of inflation in the health industry have pushed ACC’s overall cost of medical treatment up an arresting 55 per cent in the three years to June 2008.

So more people are claiming, workplace accident rate is increasing, rehabilitation rates are declining and costs are massively blowing out.

And since then:

The Department of Labour’s most recent quarterly report card on ACC says: “The three-month rehabilitation rate, return-to-work rate and long-term claims pool are continuing to show negative results, indicating clients are staying on the scheme longer, thus increasing outstanding liabilities, particularly weekly compensation.”

And who is driving the cost increases:

Another $200 million was the result of court rulings (about asbestos) and legislative changes to increase the scheme’s coverage, on top of $600 million in Cabinet-approved policy decisions.

The Labour Government did.

“The previous Government wanted to increase ACC benefits take-up and coverage. Now the new Government wants greater cost control.”

The shift in focus is fair enough.

But ACC is a civilised and cost-effective approach to dealing with the injured. Why undermine confidence in the scheme, unless you plan to undermine the scheme itself?

I don’t think the scheme is being undermined. It is the previous management of the scheme that is being highlighted as lacking.

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14 Responses to “Some ACC facts”

  1. gd (2,286 comments) says:

    like all good schemes ACC started out in 1974 as a good idea.

    Alas it has been high jacked by politicans civil servants and the so called ‘healthcare industry”

    All self interested and none interested in the basic tenents that formed its creation

    Thats why the only solution is to go back to the 1974 Principles on which the scheme was founded and thru a transition period return to the original goals of the scheme.

    this doesnt mean that innocent folks are caste off at vall. what is requires is a common sense( wouldnt that be a novel idea) approach to the reformation process.

    Aint rocket science can be done is there is a will a capacity and a capability to do so.

    OTU JK BE

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  2. Ryan Sproull (7,060 comments) says:

    I’m about to use ACC for the first time in my life. Some injuries are impeding my productivity at work.

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  3. Ryan Sproull (7,060 comments) says:

    OTU JK BE

    On the upside, John Key boils eggs?

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  4. Jack5 (4,895 comments) says:

    My experience of ACC is its fees are far too high and would be cheaper under private company cover.
    ACC squeezes safe occupations and activities to cover rip-off industries where people are on and off ACC payouts. I know of a person who sells services both through his small company and directly. ACC hits him twice for fees.

    I remember reading somewhere that when private competition was allowed in the forest industry, costs of ACC-type cover plummeted and safety shot up, because the private companies just refused cover to employers with bad records, putting them out of business.

    Brian Fallow likes the welfare state, as he has written in defence of setting aside state money for future super (he must be in his 50s) as well as for state control of ACC.

    The idea of surrendering right to sue in return for an ACC-type coverage makes a lot of sense, provided the Human Rights COmmission doesn’t try to allow people to sue as well as have ACC cover. But it makes even more sense when there is private participation in coverage.

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  5. llew (1,533 comments) says:

    OTU JK BE

    That’s gd’s old NZ honour. Soon he’ll be able to upgrade to Grand Pasha gd.

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  6. Don the Kiwi (1,649 comments) says:

    Do professional athletes claim for injuries under ACC? Such as rugby and league players?

    Surely they should carry their own accident insurance.

    It is high time ACC was shaken up. I know a guy who is approaching retirement and does not have a physical job, but is an administrator. He is obese, and while just walking along, hurt his knee. Claimed a work accident on ACC.

    There was NO accident – his obesity caused the problem.

    Yet his doctor arranged a small op. on ACC, and he was advised that any recurring condition was ACC claimable.

    To me, this is rorting the system.

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  7. wreck1080 (3,807 comments) says:

    Who was it that recently stated ACC being an extension of social welfare. Oh how true.

    ACC needs sorting. A few basics….

    1. No treatment is free. An 80% treatment subsidy could apply, with an upper limit of around $200? This nails many of those who use ACC just because it is free.

    2. Narrow the definition of an ‘accidect’. Asbestos exposure is not an accident.

    3. Lower the weekly wage payment, from 80% to 70% of income.

    4. mental illness of any kind is not an accident.

    5. Foreigners / tourists are not covered by ACC. Only those with kiwi residence are covered.

    6. Sports injuries are not covered. You wanna break your leg playing soccer/rugby/etc, then you get private insurance. This could be built into club fees.

    7. ‘High’ risk claimants will pay more ACC. eg, if you have more than 5 claims in a year, you must pay double. Or something like that.

    8. Do not dabble in shares. Stick ACC cash in the bank.

    9. Introduce competition – maybe, if the previous points do not work.

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  8. anonymouse (708 comments) says:

    Don: Professional Cricket and Rugby have the highest levy in ACC

    According to the rate (7.42%), it is around twice as dangerous as logging (3.94%). professional sports players are employees, and their employers pays a very large whack.

    Given the small population, I imagine that after a few years of injuries it would be fairly easy for ACC to work out the right levy so the income mets expenditure.

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  9. greenfly (1,059 comments) says:

    DPF said: “I don’t think the scheme is being undermined”
    You don’t? I’m so relieved! To me it seemed glaringly obvious that it was!
    Thanks for the clarification.

    [DPF: It is being saved. Unless you think the average household can afford to pay $47 a week more in levies]

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  10. gd (2,286 comments) says:

    As I posted above IMHO we need to get back to the basics Governments especially the last lot have treated ACC as an extension of the social welfare system

    If the 1974 Act principles were enforced there would be no fiscal blowout and governments would be forced to face up to the realities.

    Thats the problem with the bad governance we are lumbered with in NZ. Pollies civil servants and vested interest groups all working (conspiring ?) to rort the tax payer at every turn.

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  11. side show bob (3,660 comments) says:

    So much for the tax cut. That didn’t last long did it. ACC makes the AGW scam seem like a small time con. When will those in power get it into their thick skulls that we are on to their bullshit and are feed up. It doesn’t work, dump the fucking thing.

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  12. reid (16,110 comments) says:

    I don’t think the scheme is being undermined. It is the previous management of the scheme that is being highlighted as lacking.

    Liarbore produced exactly the results it wanted. Increase people’s dependency on the State.

    Of course they never admit to this and the idiot media never thinks to investigate this as a way to explain this and other activities which all shared the same objective.

    ACC achieved this very successfully and would have continued along that path had Liarbore remained.

    The management of the scheme was therefore perfectly aligned with what their govt masters were directing them to do. It wasn’t the management, it was the governance direction set by Liarbore, the idiot media’s failure to alert the public and the profound ignorance of the reef-fish who blithely swam by, unaware of the wolf in their midst who was devouring their resources, bit by bit by bit all the while pretending it was only doing this cause it weallly weally cared about people.

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  13. OECD rank 22 kiwi (2,820 comments) says:

    ACC needs to be cut to the bone if not scrapped entirely.

    The levy increases are outrageous. It’s politicians reaching into the ordinary, hard working taxpayer’s pocket and helping themselves yet again so they can feel important about “doing something”. If ACC is insolvent let it fall over. Next year people can pay $0 in ACC levies and finally get a full appreciation of the value of a dollar.

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  14. jackp (668 comments) says:

    My wife just stopped going to a physiotherapist because she simply thought she was fine. The physio on the other hand wanted her to keep going. Her doctor, an orthepedic surgeon thought she was fine and to stop going. But again, the physiotherapist wanted her to continue. Give me a break (no pun intended) My wife is only one person. Can you imagine the excess costs of thousands of more cases like this? Greenfly, why would you want us to pay more for ACC when there is blatant fraud going on?

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