Commentary of the draft Road Accident Benifit scheme
Commentary of the draft Road Accident Benifit scheme
THE ROAD ACCIDENT FUND BENEFIT SCHEME BILL
The State published the Road Accident Fund Benefit Scheme Bill 2013 on the 08th of February 2013 for comment.
In its current form it is a horrendous piece of Legislation depriving the innocent accident victim of virtually all their rights and benefits.
A summary of the Bill is as follows. It is intended to provide for a social security scheme – to provide set of defined benefits on a no-fault basis and to exclude liability of certain persons otherwise liable for such damages in terms of the common law.
Pre-accident income will be capped at a level determined by the minister.
The object of the Act is to interalia exclude from civil liability certain persons responsible for bodily injuries or death caused by or arising from road accidents.
Road accident means the collision or impact caused by or arising from the use of a vehicle at any place within the republic.
(Note that this will include negligent as well as intentional incidents where the injured party is either the master of his own misfortune for example the negligent drunk driver or someone who internationally uses the vehicle as a weapon for example a road rage incident.)
The only exception being in respect of bodily injury or death caused by using a vehicle to perpetrate a terrorist activity in which case the Administrator will not be liable to provide a benefit nor is the liability of any person excluded.
EXCLUSION OF LIABILITY OF OWNER, DRIVER AND EMPLOYER OF DRIVER
No civil action for damages in respect of bodily injuries to or the death of any person caused by or arising from a road accident (including international collisions) shall lie against the owner or driver of a vehicle involved in the road accident or against the employer or the driver.
Categories of Benefits
The Act will only make provision for the following 4 types of benefits:
1. Payment for the Health Care Services.
2. Payment for the Income Support Benefit.
3. Payment for the Family Support Benefit.
4. Payment for the Funeral Benefit.
Contracted Health Care Services
The administrator may enter into agreement with public and private health care services for the delivery of health care services on an agreed fee structure from tariffs to be determined by the Minister.
No person other than the administrator will be liable to a contracted health care service provider for providing a health care service to an injured person unless the service provider falls outside the terms of agreement between the administrator and the health care service or the person is a medical scheme.
The tariff has not yet been published but in respect of the RAF Amendment Act of 2005 which took effect on the 01st August 2008 the Minister used the state full paying patient tariff which tariff is so low it will ensure that no private provider will be able to contract and in effect the patient will be treated at a state hospital only.
NON-CONTRACTED HEALTH CARE SERVICE PROVIDERS
The administrator will be liable to pay a non-contracted health care service provider, or any person who paid such a health care service provider the costs of health care service provided to the injured person provided that;
Claims submitted in the manner set out.
The minister may limit the liability of the health care service, repairs to mobility aids and compiling medical reports to a prescribed tariff until such time the tariff is prescribed the liability of the Administrator shall be limited to the reasonable and necessary costs of the health care service. The administrator is only liable for health care services received in the Republic.
The Administrator may require its prior approval in respect of non-emergency health care services and will not be liable in respect of such health care services if prior approval had not been obtained after it been required.
INDIVIDUAL TREATMENT OR REHABILITATION PLAN
The administrator may determine that future health care services provided to a beneficiary in terms of an individual treatment or rehabilitation plan provided that once the Administrator adopts the individual treatment plan the liability for payment for health care services will be limited to the health care services provided for in the plan. The administrator can proceed to force the plan on the claimant if the claimants consent has been requested and he feels that the beneficiary is being unreasonable in not consenting.
The administrator will be liable to provide temporary income support to the injured person as well as long term income support to injured persons; however no such support will be paid to a person who is not ordinarily resident in the Republic for example any tourist will not be covered nor would a South African citizen who is currently working outside the country for extended periods.
TEMPORARY INCOME SUPPORT BENEFIT
The administrator is liable to pay a temporary income support provided that the claim has been submitted timeously (in no more than 60 days of the injury or death)
Claims must be accompanied by proof of the claims pre accident income in the manner provided for failing which the claimant MUST have been deemed to earn the national average income as the pre-accident income.
The National average income figure is determined by the Minister.
The following proof must be provided to avoid the claim been calculated on the national average income
If the claimant earned annual income equal to or in excess of the income tax threshold at which the claimant becomes liable to pay income tax. The claim must be supported by income tax assessments for every year in which the claimant was liable to pay income tax during the three years preceding the road accident
Should the claimant be unable to provide this and can prove that it is not their fault then the claim may be supported in another manner failing which the national average income applies.
Should the claimant be unable to provide proof of income as set out in the section and in the case of economically inactive people the claimant will be deemed to earn the average national income.
Temporary income support claims must be accompanied by confirmation by medical practitioner that the claimant is unfit to perform their pre-accident occupation due to bodily injury or the person is not economically active that their injury will materially and detrimentally affect the ability to earn an income.
The amount of temporary income support is calculated as follows;
Pre-accident income less taxation subject to this amount not exceeding the income cap and not being less than the average national income
Note: You have no entitlement to temporary income support for the first 60 days after the accident or for more than two years from the date of the accident ( Note this affectively means to a maximum period you can receive income support is 22 months)
Or for any period before you turn the age of 18 or for any period after you reach the age of 60
Further note the temporary income support is calculated on the basis that you will receive 75% of the income as determined so even if your income exceeded the cap would have been reduced to the cap and reduced again to be 75% to the cap.
NB: a temporary support beneficiary is not entitled to any inflationary adjustments once determined.
LONG-TERM INCOME SUPPORT BENEFIT
The administrator is liable to pay long-term income benefit again the claimant is required to prove in the manner set out in the act the income namely the three years of tax statements to avoid being deemed to have earned the National average pre-accident income.
The claimant must be assessed by an occupational therapist or other suitable expert re: post accident vocational ability. The administrator will be liable for the cost of the assessment and to prescribe the tariff; the administrator must determine an amount that represents the claimant post accident earnings capacity; the minister may any time adjust such amount with reference to the actual income earned; the total income may not exceed the pre-accident income cap per year and may not be less than the average national income.
Your period of entitlement for long term support excludes the first two years from the date of the road accident (in other words if you don’t apply for temporary income timeously you will lose your benefit for the first two years) and you only have 60 days from the time of the debilitating accident or death of spouse or parent to submit the claim together with support documents or your claim prescribes.
You are not entitled to income support for any period before the injured person reaches eighteen
Or any period after the injured person has reached the age of sixty the income is calculated in the same namely 75% of the income is determined less any post accident earning capacity that the administrator may determine you have. Long term income support is paid by monthly installment.
In the long term income support beneficiary is NOT entitled to inflationary adjustments of the income support benefit paid by the administrator.
Spouse includes those married in terms of the Marriage Act, the Recognition of Customary Marriages Act, the Civil Union Act, the spouse in any union recognizes a marriage according with the tenets of any religion and a person who is the partner of the deceased in a permanent domestic life partnership in terms of which the parties established a contractual reciprocal duty of support.
VOCATIONAL TRAINING PROGRAMMES
The administrator may at any time require a temporary or long term income support beneficiary to participate in a vocational training program; and if so required by the Administrator then the continuation of the income support benefit must be made conditional on the beneficiary participating in such program. The Administrator may require the beneficiary to attend if it believes the claimant to be unreasonable in not consenting.
FAMILY SUPPORT BENEFITS
The Administrator will be liable to pay a family support benefit. The claimant must submit proof of the breadwinner’s pre-accident income in the same manner namely the three years tax statements failing which he would be deemed to have earned an average national income unless the claimant can prove the failures are not their fault. No family income support will be paid to a person who is not ordinarily resident in the republic. The pre-accident income of the surviving spouse less taxation must be used in the calculation of the family support benefit provided that the amount used in the calculation may not exceed the pre-accident income cap. The act sets out various formulas to use in calculating the amount of income support but as an example for the surviving spouse with no children who’s spouse died and who has no income will get 50% of their spouses earnings subject to a cap.
The dependant who is the surviving spouse will be entitled to a family support benefit for 15 years from the date of the death of the breadwinner or until they have reached the age of sixty whichever period is the shortest irrespective of whether they are still in need of support.
A dependant who is a child is entitled to support benefit for as long as they would have been legally entitled to support and would have received support has the breadwinner not died or until they reach the age of 60 whichever is the shortest.
A beneficiary of a family support benefit is NOT entitled to inflationary adjustments of the family support benefit paid.
The Administrator will be liable to pay an immediate family member of the deceased the lump sum of R10 000.00 upon submission of death certificate or any other person who is not an immediate family member has made a claim once submission of the death certificate for all reasonable expenses incurred of the funeral up to R10 000.00.
Any benefit granted terminates upon death of the beneficiary. The Administrator may at any time terminate, suspend or revise entitlement to beneficiary. The Administrator may terminate or suspend any benefit for various reasons including if they feel that the person unreasonably refuses employment which is in their capabilities and from which they can generate income or refuse to participate in a rehabilitation plan or vocational training program.
INFORMATION TO BE FURNISHED TO THE ADMINISTRATOR BY THIRD PARTY
Road Traffic Management Corporation must furnish the Administrator all the relevant documents relating to the road accident.
The South African Police Services must furnish at the request of the Administrator all relevant records relating to the road accident.
And interestingly the South African Revenue Service must grant the Administrator access to and furnish copies of all records as maintained in terms of the Income Tax Act relating to a claim for or beneficiary of an income benefit or family support benefit.
A financial institution as defined in the Financial Services Board Act must furnish the Administrator on request all the relevant information relating to the assets and investments of a claimant beneficiary of an income benefit or support benefit.
Claims for benefit will lapse unless submitted within the following periods:
Health care benefit claim by health care service provider must be submitted within 120 days.
By medical scheme by 120 days.
By any other person within one year.
INCOME SUPPORT BENEFITS
Temporary income support benefit must be submitted within 60 days.
Long term income support benefit must be submitted within 18 months.
Family support benefits must be submitted within 1 year.
Funeral benefit must be submitted within 30 days.
The above periods do not run against minors or persons incapable of submitting a claim due to bodily injuries.
Or person detained in terms of means of health legislation or a person under Curatorship.
TIME PERIODS FOR DETERMINATION OF CLAIMS
The Administrator must accept or reject claims within the following time periods.
Health care benefits within 120 days.
Temporary Benefit within 30 days.
Long Term Income within 180 days.
Family Support Benefit within 180 days.
Funeral Benefit within 30 days.
If the Administrator does not accept or reject the claim within the above periods it will be deemed to be rejected and the claimant may then lodge an appeal.
If the Administrator accepts the claim payment must start within 30days after the beneficiary is notified that the claim is accepted.
The claimant may within 30 days of being informed of the decision of the Administrator or expiry of the periods above lodge an appeal in writing.
Appeals have to be made to an internal appeal body comprising of three employees of RABS to decide appeals.
The appeal board may confirm or reverse any decision or substitute with its own.
The appeal board may refer any issue raised in an appeal to a medical or any other expert including referring it to an expert for final determination in which event the medical or any other expert may by themselves confirm or reverse any decision or substitute their own decision (Note this means the appeal is decided by 3 employees of the party you claiming from/suing and they in turn can refer it to a single expert who’s decision is final. There is no provision made for any further appeals.
The appeal board must now determine the appeal within 180 days after lodging the appeal and inform the appellant of the outcome in writing exception being appeals made against claims which were deemed to be rejected because the RAF did not act in time and in that case must be determined within 30 days; so if you lodged the claim and the fund did not act it would then go into appeal to be decided by a board of either three employees or potentially one expert by themselves and their would be no further appeal against the decision available to you.
PROFESSIONAL AND OTHER FEES
The administrator will not be liable to contribute to the cost of the claimant’s medical and legal costs; to prepare and submit a claim or to appeal even if the appeal was brought about by RABS failure to make a decision or making an incorrect decision or any other costs to meet any other requirement in the act
LIMITATION OF LIABILITY
The administrator or employees will not be liable in respect of anything done or omitted to be done in good faith in the exercise of any power or performance of any duty imposed upon the act (exception gross negligence)
RESTRICTION ON TRANSFER OF RIGHTS TO BENEFITS
Benefits may not be transferred, ceded, pledged or otherwise encumbered or disposed of unless the Minister consents to it in writing.
The effect which is the client is unable to provide any security to the attorney or any other expert to pay them after the matter is successfully completed. The RABS are not liable to pay for any such costs.
EXPERTS OR LEGAL FEES
Even if shown that the fees where incurred due to the RABS failing to act, acting in error and even if the expert costs incurred as shown RABS were incorrect in there calculations. The claimant will not be compensated for these funds nor for any negligent actions of RABS employees (unless the level of negligence reaches gross negligence levels)
Only a claimant who has the funds to fund all these costs in advance will be able to fight their case. The majority of the population will not be in a position to do so and will have to be satisfied with what RABS decide they wish to give them. This is disturbing in particular considering RABS and its staff may not be held liable for negligent handling of the claim and that the fund had previously pleaded in Myhill vs RAF “Link” that it denied it is under a legal obligation to settle claims for amounts which are fair and reasonable.