SPONSORED ROUNDTABLE | At the latest in a series of roundtables to support best practice for mental health in the group insurance sector, hosted by Investment Magazine and supported by AIA Australia, 13 experts turned their minds to how to improve access to early intervention and rehabilitation services.
All agreed there is an undeniable link between early access to rehabilitation and the likelihood of claimants getting back to work sooner and achieving better mental health outcomes.
“I’m a big fan of work, I think it has a hugely restorative effect in bringing a sense of human satisfaction and self-esteem that is very important,” Association of Superannuation Funds of Australia chief executive Martin Fahy said. This is particularly important because super funds and their insurers are witnessing a rising incidence of secondary mental health claims for people who have been injured and/or out of work.
Financial Services Council chief executive Sally Loane said that while comprehensive data is not available, it is estimated that about 40 per cent of all claims lodged across the broader life insurance sector now have a mental health component. “One-in-four Australians will be touched in some way by mental illness at some point in their lives, so it is an absolutely massive issue,” Loane said.
Cbus Super head of insurance Noel Lacey said mental health-related issues now ranked as the second most common secondary cause sighted in disability claims lodged by the construction industry fund’s members. “It’s very common among people who go off work initially for some other issue and then don’t get the right help to recover,” Lacey said.
At Comcare, the agency that manages workers’ compensation claims for Commonwealth Government employees, the incidence of mental health-related claims has gone down in recent years; nevertheless, the persistent nature of psychological injuries means the overall cost related to them keeps rising.
“Around 7 per cent of our claims are related to psychological injury but they account for 28 per cent of our costs, which is really disproportionate,” Comcare mental health program lead Kevin St Mart said. “We’re finding that, over time, about 50 per cent of psychological injury claims will involve at least 26 weeks off work.”
For that reason, exploring how to support earlier rehabilitation is a “major focus” for the organisation, he said.
AIA Australia chief group insurance officer Stephanie Phillips said mental health claims were commonly lodged after people had been out of the workforce for a long time, often following illness or injury. “We know the longer that someone is off work, the harder it is to get back,” Phillips said.
That is why promoting early intervention and access to rehabilitation services is so important, she argued. “If someone’s off work for 70 days, they’ve got a 35 per cent chance of going back, so after a year they’ve got a very slim chance of getting back,” she said. “The benefits of being able to intervene much earlier with occupational rehabilitation, or even a wellness initiative, would be really great.”
AIA Australia’s RESTORE program − a wellness and work-readiness program available to its group insurance clients’ members – highlights the benefits of simply helping people become more active and connected to society, Phillips said.
Change the law
All of the industry representatives at the roundtable called for reform of the regulatory barriers that prevent rehabilitation from playing a greater role in group insurance.
Berrill & Watson principal John Berrill is a consumer lawyer who has been helping clients with insurance claims for more than 25 years. He is a vocal advocate for legislative reform to make it easier for super funds and their insurers to provide access to early medical intervention and rehabilitation services via group insurance policies.
“The sole purpose test within the Superannuation Industry Supervision Act makes it very difficult, so there is a need for legislative change,” Berrill said. The two main regulatory obstacles in super are: the conflict between the sole or ancillary purpose test for use of superannuation money to pay for medical expenses, and the definition of ‘total permanent disability’ (TPD) that does not allow for rehabilitation.
The FSC’s Life Insurance Working Group and the Insurance in Superannuation Industry Working Group have both been examining the case for change. AIA Australia and New Zealand chief executive Damien Mu said that while protecting member balances against unnecessary balance erosion was important, the preclusion of certain rehabilitation services on the grounds of concerns about costs was “just irrational”.
“We have to come together and get this change done,” Mu said.
Another obstacle to achieving best practice around early intervention and rehabilitation is the sheer complexity of the multiple health, mental health and insurance frameworks that individuals are dealing with.
Many people who eventually qualify for a TPD payout via group insurance have already interacted with other schemes, such as workers’ compensation, compulsory third-party insurance, health insurance, Centrelink or the disability support pension.
Loane said the overlapping of agencies and different types of insurances needed to be better mapped and understood to help reduce “gross inefficiencies” in the delivery of services.
Victorian Senator Jane Hume said the Turnbull Government had a focus on mental health filtering through many different portfolios, most obviously health and social services, but also in areas such as Treasury. She promised to listen to the industry experts and report back to her colleagues in Canberra on ideas that might lead to better functioning policy.
National Mental Health Commission co-chair Lucy Brogden noted OECD figures show the costs associated with mental health account for roughly 4 per cent of GDP.
Any reform of the rules around the role of rehabilitation within group insurance would throw up new challenges for the industry.
SuperFriend chief executive Margo Lydon said that if the industry were successful in lobbying the government for the right to provide early intervention services, it would be incumbent upon it to do so, and not drag people through a three- to six-month waiting process.
“I’d love to see an industry-wide practice of pay first, ask questions later,” Lydon said.
Mental Health Australia chief executive Frank Quinlan warned that if the law was amended to allow group insurers to fund early intervention and rehabilitation services, the industry would still face a huge challenge in delivering it.
“Frankly, we have relatively poor information about how to take any one cohort and provide them with effective psycho-social support,” Quinlan said. He called for more cross-sector data-sharing and collaboration to promote best practice.
Sunsuper is one super fund that has already innovated within the constraints of the current laws, with the introduction of its TPD Assist program. Under this product, claimants typically receive incremental payments each year, rather than a lump sum.
“TPD Assist is very much about early intervention, rehabilitation and looking at how we can best help people get back to work,” Sunsuper executive general manager Teifi Whatley said. “And while it’s early days, we are starting to see some very promising results come out the program. It’s something we are absolutely committed to continuing and learning from with our partners at AIA.”
But Whatley acknowledged the current legislation presented some serious roadblocks. “We can assist them [members] with retraining but not in terms of medical expenses, and they go hand-in-hand, so it is half a solution,” she said.
Work with employers
Perhaps the strongest lead indicator funds have of when a member might be off work, and headed toward making an income protection or TPD claim via their group insurance, is when their employer fails to make a quarterly contribution on their behalf.
The gathering agreed on the need for funds and insurers to strengthen their engagement with employers, both in terms of encouraging earlier notification of issues that might lead to claims and in promoting mentally healthy workplaces.
Lydon said she saw a big role for super funds and group insurers to play in educating employers and medical professionals about the benefits of recovery at work.
The Mental Health Commission’s Brogden noted there was a reticence among many big employers to invest too much time and energy in helping employees suffering from mental health conditions get back to work.
“We consistently hear the feedback that it’s easier to pay someone to go away than bring them back,” Brogden said. She suggested it would be great to see corporate boards demand more comprehensive measurement and reporting of how companies manage the challenge of getting staff on claim back to work.
Mu agreed. “It’s no longer good enough just to get a return on capital; there’s a social licence to operate that employers have to consider,” he said.
Along with strengthening its engagement with employers, the group-insurance sector can improve how it communicates with members directly. REST Industry Super head of member services, Amelia Butler, is leading a ‘claims transformation’ project at the fund, which has more than 2 million members. She said better data systems and processes were being implemented to make it easier to communicate with members earlier and ensure new members know what they are entitled to under their insurance at the time of joining the fund.
“On a personal level, I really believe there is a bigger role for superannuation funds and employers to play in advocating for mental health and wellness,” Butler said.
St Mart said Comcare’s experience had shown how digital communication tools were successful in facilitating earlier conversations with claimants, leading to better outcomes.
Loane predicted technology and digital communication strategies would be key to funds improving their member engagement, making early intervention easier. “Millennials are not going to read a letter from a super fund,” she said. “You’ve got to talk to them on Facebook or wherever they are. Our sector has simply got to embrace new digital technologies.”
Mu said it was cause for optimism that new technologies now made it much more economical for funds to engage regularly with members. “It used to cost a million dollars to send everyone in a fund a letter,” he said. “Now they are all on the app.”