The Herald editorial:
An excess charge of $50 or $100 a claim, as recommended by the corporation, could reduce its costs by about $1.6 billion over 10 years, a considerable saving for any service in the economy. The value would lie not only in the money raised from charges but also in the effect on claimants’ behaviour.
Insurance policies typically contain excess charges to discourage needless or frivolous claims. Accident compensation needs to do the same. The scheme may have been conceived as a form of social welfare rather than insurance, according to its venerable “father”, Sir Owen Woodhouse, in the Herald yesterday, but he was speaking of an era of closed, welfare-state economies with high taxation rates and universal benefits.
And I don’t think anyone can deem acceptable a household paying $45 a week in ACC levies alone.
Any excess charges introduced for accident compensation claims will have to provide exemptions for the bearers of community service cards. None must be denied treatment for injury because they cannot afford the excess, as ACC Minister Nick Smith has acknowledged.
That would be a sensible way to balance up the costs and benefits.
But it cannot be denied that the scheme is vulnerable to needless claims for minor injury. Most people have had the experience of visiting their doctor with a niggling ache and the first question asked is whether it might result from a known event. The ACC forms are always at hand and many a patient who is willing and capable of paying for treatment is invited to put in a claim.
It is human nature to make excessive use of any service that comes free. And for that reason it is usually in the interest of the service providers to oppose a charge. Even a token charge – much lower than the sums suggested for ACC – would cause many claimants to reassess their need. It would also force providers to satisfy paying clients that continuing treatment was worthwhile.
A charge would be unpopular and the Key Government has not yet shown a willingness to be unpopular when it needs to be. It did not adopt the corporation’s charging suggestion in the changes announced for the scheme last week. If it is suggested again when an independent panel completes an ACC “stocktake” next year, it should be accepted. The years of plenty have passed.