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Policy Information Sheet
Compensable Clients Policy
Policy No: B56
Part B
The Compensable clients’ policy describes how a person’s compensation payment
will be treated by the Disability Services Commission (the Commission) should they
either apply for or already have Commission funding or provided services. The
revised policy has been aligned to National Disability Insurance Scheme (NDIS Rule
Supports for Participants) as far as currently applicable to Western Australia. The
NDIS Rule Supports for Participants – Accounting for Compensation 2013 states that
the NDIS is designed to complement, not replace, existing compensation
arrangements for personal injury.
As a government agency, the Commission is obliged to recover funds from an
individual in receipt of its services where an individual has received compensation,
damages, settlement or otherwise in relation to the disability. Individuals are not
entitled to Commission funding to the extent that the award of compensation or
settlement provides for the cost of the disability services until after the payout has
been fully used. Once the compensation is used the individual goes into the funding
system.
A self-funded support period is applicable where the compensation or settlement is
in the form of a lump sum award or in a series of periodic payments.
The policy will ensure that the Disability Service Organisations (DSOs), and the
Commission manage the transition period arising from the compensation payout in a
manner that will support people with disability to pursue their goals and maximise
their independence.
1.
Definition
For the purposes of this policy, the following definitions will apply:
1.1 Compensation
This is defined in accordance with NDIS Act 2013 section11. Under
subsection 11(1) “Compensation” means a payment (with or without
admission of liability) in respect of:
(a) compensation or damages in respect of personal injury
(b) personal injury, under a scheme of insurance or compensation under a
Commonwealth, State or Territory law, including a payment under a contract
entered into under such a scheme
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(c) personal injury, in settlement of a claim for damages or a claim under
such an insurance scheme
that is wholly or partly in respect of the cost of supports that may be provided
to a participant (whether or not specifically identified as such). It does not
matter whether the payment is made directly to the person who sustained the
personal injury or to another person in respect of that person.
Subsection 11(2): A payment referred to in subsection (1) may be:
(a) in the form of a lump sum or in the form of a series of periodic payments
(b) made within or outside Australia.
1.2 Compensable clients
This means an individual who is a participant, or who later becomes a
participant of a Commission funded activity and receives compensation.
1.3
Preclusion or self-support period
This refers to a period where a Compensable client may be excluded from
Commission funded support as a result of the intent of the compensation
payout (as a lump sum, in a court approved compromises or as a structured
settlement).
1.4 Lump-sum award
This refers to an award granted by a court that covers past losses and losses
likely to be suffered in the future. Past losses include the loss up to the time
of judgment.
1.5 A structured settlement
This is the result of an agreement mutually reached between the parties to a
case (regardless of whether this agreement is later used as the basis of a
court order).
2.
Policy Statement
The purpose of this policy is to articulate the principles underlying the
Disability Services Commission’s (the Commission) position regarding
compensation payments.
The Principles:
2.1 Double support: where individuals receive compensation payments,
the Commission does not duplicate the funding for support provided for
by these compensation payments. This principle is about an individual
receiving compensation and other Commission funded support
payments for the same period. An individual may not be funded twice
(or doubly compensated) for the same period as a result of a
compensation pay out. Should this occur, the disability support funded
by the Commission, prior to a compensation payment being awarded or
made, may need to be repaid.
2.2 Self-funded support period: This principle applies where lump sum
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compensation is awarded. The Commission funding to be recovered
and or preclusion period to be applied will be determined depending on
the nature of court approved compromises or structured settlements.
 The 50 per cent rule is to be used when a settlement is made
under a compromise of claim.
 If structured settlements are settled, the 50 per cent rule is
used to deem that half of the total payment of the structured
settlement is considered the compensation part of a lump
sum.
 Where structured settlements are finalised after a contested
hearing, the compensation part of the lump sum is made up of
the amounts awarded specifically for economic loss.
2.3 Future care: Where the compensation or settlement clearly specifies an
amount related to future care, an individual may be expected to live on
that amount until fully expended before disability support payments can
commence or be re-instated.
2.4 Compensation used to acquire assets: If an individual converts part
or all of their compensation settlement awarded for future care into an
investment asset(s) (for example, the purchase of an investment home)
they may be expected to sell the asset(s) and use the proceeds for care
support.
3. Implementation
The Commission is responsible for:
3.1 advising DSOs and compensable clients of their responsibilities under
this policy. This is available as an information sheet on the
Commission’s Internet site (www.disability.wa.gov.au)
3.2 advising DSOs of the transition arrangements as a result of an individual
no being longer eligible for Commission funded services due to
compensation payout
3.3 determining the cost of service for all compensable services provided.
The Commission will seek to recover for past services provided and for
future services to be provided, in accordance with the amount and intent
of the settlement
3.4 ensuring all monies is recovered from compensable clients, as
appropriate.
Disability Service Organisations are responsible for:
3.5 ensuring that no details of out-of-court compensation payouts or
settlements will be released to any other party without the permission of
the client.
The Individual/Guardian or Legal representative is responsible for:
3.6 advising the Commission in writing of any potential compensation
payout;
3.7 advising the Commission of the final settlement amount with relevant
support documentation
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3.8 advising the service provider of their intention to change payment
arrangements or withdraw/or switch to another provider giving due
notice upon receipt of compensation in order to manage the transition
appropriately
3.9 paying the Commission the amount due as a result of compensation
payout upon receipt of an invoice or notice of settlement.
The Commission is committed to the continuous improvement of its services. It will,
therefore, review its policy on Compensable Clients on a regular basis. The contact
person for enquiries regarding this policy is Manager Business Services Unit,
Funding Directorate, telephone (08) 9426 9624, toll free 1800 998 214, TTY (08)
9426 9315.
In addition, formal complaints can be lodged through the Commission’s existing
formal complaint mechanism by contacting Consumer Liaison Officer, telephone (08)
9426 9244, toll free 1800 998 214, TTY (08) 9426 9315, email clo@dsc.wa.gov.au
Date: December 2013
Policy Information Sheet – Compensable Clients Policy