Operational Guideline – Compensation –
Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or
Settlement
Legislation
1.
Read ss.4, 105B, 106 and 107 of the National Disability Insurance Scheme Act 2013 (NDIS Act)
and the National Disability Insurance Scheme (Supports for Participants – Accounting for
Compensation Rules 2013 (Supports for Participants – Accounting for Compensation Rules).
2.
This Operational Guideline is consistent with the law as in effect on 9 December 2013.
General principles
3.
People with disability and their families and carers should have certainty that people with disability
will receive the care and support they need over their lifetime.
See s.4(3) of the NDIS Act.
4.
People with disability should be supported to receive reasonable and necessary supports, including
early intervention supports.
See s.4(5) of the NDIS Act.
5.
People with disability should be supported to receive supports outside the National Disability
Insurance Scheme (NDIS), and be assisted to coordinate these supports with the supports
provided under the NDIS.
See s.4(14) of the NDIS Act.
6.
The financial sustainability of the NDIS should be ensured.
See s.4(17)(b) of the NDIS Act.
Background
7.
This Operational Guideline applies when a participant, or prospective participant, has received
compensation under a judgement or settlement:
a.
In which the NDIS component of the amount of compensation is either fixed or objectively
identifiable, or
b.
In which it is not possible to identify the NDIS component of the amount of compensation but
the judgement or settlement fixes an amount of compensation,
in respect of a personal injury that has caused, to any extent, their impairment.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 1 of 16
8.
9.
In circumstances where the NDIS component of the amount of compensation is either fixed or
objectively identifiable, a delegate is to apply:
a.
The criteria set out in Table 1 to determine whether a compensation reduction amount is
payable, and
b.
The steps set out in Table 2 to calculate that amount.
In circumstances where it is not possible to identify the NDIS component of the amount of
compensation but the judgement or settlement fixes an amount of compensation, a delegate is to
apply:
a.
The criteria set out in Table 3 to determine whether a compensation reduction amount is
payable, and
b.
The steps set out in Table 4 to calculate that amount.
10. This Operational Guideline applies to both participants and persons who later become participants.
11. When a person receives one compensation payment awarded by a court and another payment as
part of a settlement, each payment is to be treated separately and the compensation reduction
amount for each compensation payment is to be worked out. This means that more than one
compensation reduction amount will apply to the person, worked out in accordance with the
relevant Operational Guidelines on compensation for revising the plan and reducing the supports.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 2 of 16
Table 1: Where the NDIS component is fixed by the judgement or
settlement or can be objectively identified – r.3.1(a)
Requirements
Considerations (including evidence
relied on and established facts)
A participant’s plan must be revised and the reasonable and necessary supports stated in the plan
reduced by an amount (the compensation reduction amount) if Criteria 1, 2, 3 and 4 are met:
Criterion 1
Yes
The person has suffered a personal injury which
has caused, to any extent, their impairment,
regardless of whether the person was a participant
at the time of the injury.
No
Criterion 2
Yes
The person was awarded compensation under a
judgement or settlement in respect of that injury.
No
Criterion 3
Yes
It is possible to identify the NDIS component of
the amount of compensation.
No
Note: The NDIS component of an amount of
compensation under a judgement or settlement
means the component of the compensation that
relates to the provision of supports of a kind that
may be funded or provided under the NDIS after
the date of judgement or settlement, and may
include a component that consists of periodic
payments.
Criterion 4
Yes
The NDIS component of the award of
compensation is either fixed by a non-consent
judgement or is objectively identifiable.
No
Example: Commutation of benefits under a
statutory scheme. Commutation involves an
agreement between the injured person and the
compensation scheme for the payment of
entitlements as a lump sum, rather than periodic
payments.
Were all of Criteria 1, 2, 3 and 4 met?
Yes
No
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
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Requirements
Considerations (including evidence
relied on and established facts)
If yes, the participant’s plan must be revised and the reasonable and necessary supports stated in the
plan reduced by the compensation reduction amount, calculated in accordance with Table 2.
Example
Peter sustained a catastrophic brain injury in a motor vehicle accident in 2008. He was 45 years old at
the time of the accident and was travelling to work. In addition to making a claim with his employer’s
workers’ compensation insurer, Peter pursues a common law action against the at-fault driver and their
CTP insurer.
Peter’s common law claim proceeds to court and the court awards damages to Peter (in a non-consent
judgement), including $4 million for future care and support and $1 million for past care.
On 10 June 2015 Peter becomes a participant in the NDIS. His award of compensation must be taken
into account in determining his reasonable and necessary supports because he satisfies the criteria of
Table 1.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 4 of 16
Table 2: Calculating the compensation reduction amount where the
criteria of Table 1 are met – rs.3.11 and 3.12
The purpose of calculating the compensation reduction amount is to ensure that a participant does
not receive funding from the NDIS for reasonable and necessary supports that are funded under an
amount of compensation received from a judgement or settlement.
In circumstances where the criteria of Table 1 are met because a participant has received compensation
by way of judgement or settlement and the NDIS component is fixed or can be objectively identified, then
Table 2 provides that, as a general rule, their funding for reasonable and necessary supports from the
NDIS is to be reduced by an amount equivalent to the value of the compensation for care and support
received under that judgement or settlement.
Steps
Considerations (including evidence relied
on and established facts)
Calculations
For the purposes of Table 1, to calculate the compensation reduction amount, follow Steps 1 to 5:
Step 1
Identify the NDIS component of the
amount of compensation.
Note: See Criterion 3 in Table 1 for the
meaning of NDIS component.
Step 2
Subtract the amount (if any) that the
delegate considers is equal to the total
amounts that the participant has
personally paid for supports that are of a
kind that are funded or provided under
the NDIS in the time between:
1.
The date of the judgement or
settlement, and
2.
When the person became a
participant.
If the NDIS component includes a part that
is by way of a periodic payment (for
example, a payment each month or year), it
is calculated as follows:
1.
If the amount is specified in a
judgement – that amount
2.
If the amount is not specified in a
judgement, but the delegate is satisfied
that a specified amount was paid by the
defendant to ensure the provision of
the periodic payments – that amount,
or
3.
Otherwise - the value of the periodic
payments as assessed in accordance
with accepted actuarial standards, in
consultation with the Scheme Actuary.
This Step reflects that a participant may
have paid for their own supports for a period.
This subtraction means that the participant
will not be disadvantaged by this, and their
compensation reduction amount will be
lower as a result.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 5 of 16
Steps
Considerations (including evidence relied
on and established facts)
Step 3
This Step reflects that a participant may
have had earlier plans which incorporated a
reduction in respect of the same personal
injury. Each time a plan is replaced or
reviewed, this new or reviewed plan is to
take into account earlier compensation
reduction amounts to ensure it is not
double counted. The duration of most plans
is less than 12 months.
Subtract the amount of any reduction in
funding that has occurred under a
previous plan in respect of this personal
injury (if any).
Calculations
Step 4 – Consider whether the person has received more than one compensation payment
If:
1.
A person has received a compensation payment that is made up of (1) a part that is included in a
judgement or settlement and (2) a part associated with an insurance or statutory scheme, and
2.
A compensation reduction amount has been identified for the judgement or settlement,
then:
Note: A participant may have more than one compensation claim in respect of the same injury. For
example, a participant may sustain their injury at work and receive workers’ compensation payments as
well as common law damages from a court ordered judgement.
Step 4.1
Subtract any compensation reduction
amount worked out for:
1.
An insurance or a statutory
scheme, or
2.
Another judgement
This will be assessed under either this
Operational Guideline or Operational
Guideline – Compensation – Revise the
Plan and Reduce the Supports –
Compensation Received under an Insurance
Scheme or a Commonwealth, State or
Territory Scheme.
in relation to this injury.
Step 4.2
Add the amount of any reduction in
funding that has occurred under a
previous plan in respect of this personal
injury (if any).
Step 4.3
Add the amount of any reduction in
funding considered equal to the total
amount paid personally by the participant
This Step reflects that a participant may
have had earlier plans which incorporated a
reduction in respect of the same personal
injury. Each time a plan is replaced or
reviewed, this new or reviewed plan is to
take into account earlier compensation
reduction amounts to ensure it is not
double counted. The duration of most plans
is less than 12 months.
This Step reflects that a participant may
have paid for their own supports for a period.
This subtraction means that the participant
will not be disadvantaged by this, and their
compensation reduction amount will be
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
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Steps
Considerations (including evidence relied
on and established facts)
for supports of a kind funded under the
NDIS Act after the compensable event
and before becoming a participant.
lower as a result.
Step 5
The Supports for Participants – Accounting
for Compensation Rules do not define what
constitutes special circumstances, and a
wide range of circumstances can be
considered. Special circumstances may
include financial hardship suffered by the
participant.
Consider whether to ignore and not
recover part or the whole of the
compensation reduction amount if it is
appropriate because of the special
circumstances of the case.
Calculations
Once these Steps have been applied, the compensation reduction amount will be the total remaining
after Step 5 has been considered.
However, the compensation reduction amount cannot be negative. If, after working out the
compensation reduction amount, the amount is nil or less than nil, the delegate is to record the
compensation reduction amount as nil and therefore there will be no reduction in the person’s
supports.
The amount is to be recovered over the expected lifetime of the participant in accordance with accepted
actuarial standards, and not as a lump sum. Delegates are to consult their supervisor in relation to
approaching the Scheme Actuary.
Example
After Peter becomes a participant on 10 June 2015, he is assessed as requiring a package of care and
support of $200,000 a year.
Peter’s compensation reduction amount is calculated as follows:
Step 1: Identify the NDIS component of the amount of compensation. This is the component that
relates to the provision of supports of a kind that may be funded or provided under the NDIS after
the date of the judgement.
This is worked out to be the entire amount awarded for future care and support – $4 million.
Step 2: Subtract the amount that the delegate considers is equal to the amounts the participant has
paid for supports that are of a kind that are funded or provided under the NDIS in the time between
the date of the judgement and when the person became a participant.
In this case, Peter used a commercial provider to provide his own care and support between the
time of the judgement in 2013 and the date he became a participant in the scheme on 10 June
2015. The cost of this care and support was $400,000. Peter also spent $250,000 modifying his
house. The delegate considers that all of the cost of care and support and all of the cost of the
home modifications are supports of a kind that are funded by the NDIS and subtracts $650,000
from the amount identified in Step 1.
Step 3: Subtract the amount of any reduction in funding that has occurred under a previous
compensation reduction amount.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
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This is Peter’s first NDIS plan, there has been no previous compensation reduction amount and
Peter has not received any other compensation payments that could result in a compensation
reduction amount.
Step 4: Consider whether the person has received more than one compensation payment.
This is Peter’s only compensation payment.
Step 5: Consider whether to ignore and not recover part or the whole of the compensation
reduction amount if it is appropriate because of the special circumstances of the case.
Peter does not appear to have special circumstances and therefore it is not appropriate to ignore
and not recover part or the whole of the compensation reduction amount
As the compensation reduction amount is not negative, Peter’s compensation reduction amount
does not change. Peter’s compensation reduction amount is therefore $3.35 million.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 8 of 16
Table 3: Where the NDIS component is not fixed by the judgement or
settlement or cannot be objectively identified – r.3.1(b)
Requirements
Considerations (including evidence
relied on and established facts)
A participant’s plan must be revised and the reasonable and necessary supports stated in the plan
reduced by an amount (the compensation reduction amount) if Criteria 1, 2, 3 and 4 are met:
Criterion 1
Yes
The person has suffered a personal injury which
has caused, to any extent, their impairment,
regardless of whether the person was a participant
at the time of the injury
No
Criterion 2
Yes
The person was awarded compensation under a
judgement or settlement in respect of that injury.
No
Criterion 3
Yes
Criterion 2 and Criterion 3 of Table 1 are not met.
No
Note: That is, the NDIS component of the amount
of the judgement or settlement is not fixed or
cannot be objectively identified.
Criterion 4
Yes
The judgement or settlement fixes a total amount
of compensation in respect of the injury, but it is
not itemised.
No
Were all of Criteria 1, 2, 3 and 4 met?
Yes
No
If yes, the participant’s plan must be revised and the reasonable and necessary supports stated in the
plan reduced by the compensation reduction amount, calculated in accordance with Table 4.
Example
Jessie is injured in an accident and becomes a participant in the NDIS soon after the injury. Jessie’s
injury is not covered by a statutory scheme and she elects to sue a third party for damages, including
past and future care and support, lost income and pain and suffering.
The parties agree to settle the matter without admission of fault and compensation is fixed at $70,000.
The settlement fixes an amount of compensation but the NDIS component cannot be objectively
identified. Jessie’s compensation must be taken into account in determining her reasonable and
necessary supports because she satisfies the criteria of Table 3.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 9 of 16
Table 4: Calculating the compensation reduction amount where the
criteria of Table 3 are met – rs 3.13 to 3.16
The purpose of calculating the compensation reduction amount is to ensure that a participant does
not receive funding from the NDIS for reasonable and necessary supports that are funded under an
amount of compensation received from a judgement or settlement.
In circumstances where the criteria of Table 3 are met because a participant has received compensation
by way of judgement or settlement (but the NDIS component is not fixed or cannot be objectively
identified), then Table 4 provides that, as a general rule, their funding for reasonable and necessary
supports from the NDIS is to be reduced by an amount equivalent to the value of the compensation for
care and support calculated to have been received under that judgement or settlement.
Steps
Considerations (including evidence relied
on and established facts)
Calculation
For the purposes of Table 3, to calculate the compensation reduction amount, follow Steps 1 to 6:
Step 1 – Note the amount of compensation identified in Table 3 and subtract amounts that are
payable under Commonwealth and state/territory legislation
Step 1.1
Note the amount of compensation fixed
under the judgement or settlement.
Step 1.2
Subtract the sum of the amounts (if any)
payable in respect of the amount of
compensation under:
1.
The Health and Other Services
(Compensation) Act 1995
2.
The Health and Other Services
(Compensation) Care Charges Act
1995
3.
Part 3.14 of the Social Security Act
1991, or
4.
A law of the Commonwealth, a
state or a territory, prescribed by
the Supports for Participants –
Accounting for Compensation
Rules.
This Step has the effect of reducing the
participant’s award of compensation
because other legislation requires the
participant to repay amounts back from their
award of compensation. It would be unfair to
the participant to not reduce the
compensation received in these
circumstances.
This reduction means that the
compensation reduction amount will be
lower than it would have been otherwise.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 10 of 16
Steps
Considerations (including evidence relied
on and established facts)
Step 1.3
This Step has the effect of reducing the
participant’s award of compensation
because the participant is subject to a period
of preclusion under a statutory scheme of
entitlements. It would be unfair to the
participant to not reduce the compensation
received in these circumstances.
Subtract an amount the delegate
considers reflects the value of any period
of preclusion:
1.
2.
That arises from a Commonwealth,
a state or a territory statutory
scheme of entitlements (for
example, the Social Security Act
1991), and
Calculation
This reduction means that the
compensation reduction amount will be
lower than it would have been otherwise.
Is in respect of the injury.
Step 1.4
Subtract 50% of the amount of
compensation if Step 1.3 does not apply
(because the person is not subject to a
period of preclusion) and:
1.
The participant claimed damages in
relation to lost earnings or lost
capacity to earn, and
2.
The amount of compensation fixed
under the judgement or settlement
included an amount in respect of
those damages.
This Step reflects the general approach to
calculating the amount of an award of
compensation that is not for care and
supports (i.e. for damages in relation to lost
earnings or lost capacity to earn).
It only applies if Step 1.3 does not apply.
Step 2 – Ensure that the compensation reduction amount is not greater than the value of the
NDIS providing reasonable and necessary supports
Step 2.1
Calculate the value of the reasonable
and necessary supports that would have
been provided to the participant and
funded under the NDIS Act over the
participant’s expected lifetime had the
participant been a participant from the
time of the compensable event
Note: This amount is to be calculated in
accordance with any applicable actuarial
model published by the NDIA on its
website.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
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Steps
Considerations (including evidence relied
on and established facts)
Calculation
Step 2.2
Compare the amount calculated at the
end of Step 1 to the amount calculated
under Step 2.1.
Step 2.3 (A)
If the amount calculated in Step 1 is
greater than the amount calculated in
Step 2.1 – the amount determined under
Step 2.1 replaces the amount calculated
in Step 1 as the compensation
reduction amount.
Step 2.3 (B)
If the amount calculated in Step 1 is less
than the amount calculated in Step 2.1 –
the amount determined under Step 1
remains as the current compensation
reduction amount.
This Step reflects that the compensation
reduction amount should not be greater
than the value of the NDIS providing
reasonable and necessary supports. It would
be unfair to the participant if this was
otherwise.
This Step reflects that the compensation
reduction amount should only be reduced
to the extent that the value of the NDIS
providing reasonable and necessary
supports is less than that amount.
Step 3 – Subtract any reasonable and necessary supports paid by the participant
Step 3.1
Subtract an amount equivalent to the
total of the amounts that were paid by
the participant for supports of the kind
that funded under the NDIS in the period
between the compensable event and the
date the person became a participant.
This Step reflects that a participant may
have paid for their own supports for a period.
This subtraction means that the participant
will not be disadvantaged by this, and their
compensation reduction amount will be
lower as a result.
Step 4 – Subtract any amounts obtained by the NDIA from the participant from the previous
recovery of NDIS amounts or compensation reduction amounts
Step 4.1
Subtract any recoverable amounts
obtained by the NDIA from the
participant under ss.106 and 107 of the
NDIS Act in respect of the compensable
amount.
Step 4.2
Subtract any amount deducted under
s.105B of the NDIS Act.
Ss.106 and 107 deal with the recovery of
NDIS amounts received by a participant from
a judgement or settlement.
S.105B deals with recoverable amounts
obtained by the NDIA after the NDIA
instituted action or took over a claim to
obtain compensation under s.105.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
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Steps
Considerations (including evidence relied
on and established facts)
Step 4.3
This Step reflects that a participant may
have had earlier plans which incorporated a
reduction in respect of the same personal
injury. Each time a plan is replaced or
reviewed, this new or reviewed plan is to
take into account earlier compensation
reduction amounts to ensure it is not
double counted. The duration of most plans
is less than 12 months.
Subtract the amount of any previous
compensation reduction amount
determined and applied by the NDIA.
Calculation
Step 5 – Consider whether the person has received more than one compensation payment
If:
1.
A person has received a compensation payment that is made up of (1) a part that is included in a
judgement or settlement and (2) a part associated with an insurance or statutory scheme, and
2.
A compensation reduction amount has been identified for the judgement or settlement,
then:
Note: A participant may have more than one compensation claim in respect of the same injury. For
example, a participant may sustain their injury at work and receive workers’ compensation payments as
well as common law damages from a court ordered judgement.
Step 5.1
Subtract any compensation reduction
amount worked out for:
1.
An insurance or a statutory
scheme, or
2.
Another judgement
This will be assessed under either this
Operational Guideline or Operational
Guideline – Compensation – Revise the
Plan and Reduce the Supports –
Compensation Received under an Insurance
Scheme or a Commonwealth, State or
Territory Scheme.
in relation to this injury.
Step 5.2
Add the amount of any reduction in
funding that has occurred under a
previous plan in respect of this personal
injury (if any).
Step 5.3
Add the amount of any reduction in
funding equal to the total amount paid
personally by the participant for supports
This Step reflects that a participant may
have had earlier plans which incorporated a
reduction in respect of the same personal
injury. Each time a plan is replaced or
reviewed, this new or reviewed plan is to
take into account earlier compensation
reduction amounts to ensure it is not
double counted. The duration of most plans
is less than 12 months.
This Step reflects that a participant may
have paid for their own supports for a period.
This subtraction means that the participant
will not be disadvantaged by this, and their
compensation reduction amount will be
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 13 of 16
Steps
Considerations (including evidence relied
on and established facts)
of a kind funded under the NDIS Act after
the compensable event and before
becoming a participant.
lower as a result.
Calculation
Step 6 – Consider any special circumstances
Step 6.1
Consider whether to ignore and not
recover part or the whole of the
compensation reduction amount if the
delegate considers it is appropriate
because of the special circumstances of
the case.
The Supports for Participants – Accounting
for Compensation Rules do not define what
constitutes special circumstances, and a
wide range of circumstances can be
considered. Special circumstances may
include financial hardship suffered by the
participant.
Once these Steps have been applied, the compensation reduction amount will have been calculated.
However, the compensation reduction amount cannot be negative. If, after working out the
compensation reduction amount, the amount is nil or less than nil, the delegate is to record the
compensation reduction amount as nil and therefore there will be no reduction in the person’s
supports.
The amount is to be recovered over the expected lifetime of the participant in accordance with accepted
actuarial standards, and not as a lump sum. Delegates are to consult their supervisor in relation to
approaching the Scheme Actuary.
Example
Jessie has settled her claim for compensation against the third party for $70,000. At the time of
settlement Jessie has a life expectancy of eleven years and the value of the NDIS providing reasonable
and necessary supports to the participant is calculated by the NDIA to be $7,500 a year. She received
one year of care and support from the NDIS before the case was settled and a delegate has made a
decision under s.107 of the NDIS Act that $7,500 is to be recovered. Jessie has received $2,000 worth
of medical services through Medicare and the $2000 is payable by Jessie under the Health and Other
Services (Compensation) Act 1995.
The settlement fixes an amount of compensation for the injury but the NDIS component cannot be
objectively identifiable. The compensation reduction amount is calculated as follows:
Step 1.1: Calculate the amount of compensation fixed under the judgement or settlement.
The amount of compensation is $70,000.
Step 1.2: Subtract the sum of the amounts (if any) payable in respect of the amount to
compensation under the Health and Other Services (Compensation) Act 1995, the Health and
Other Services (Compensation) Care Charges Act 1995, Part 3.14 of the Social Security Act 1991
or a law of the Commonwealth, a State or a Territory prescribed by the Supports for Participants –
Accounting for Compensation Rules.
In this case, Jessie had to pay $2,000 to the Health and Other Services (Compensation) Act 1995
and therefore $2,000 needs to be subtracted.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 14 of 16
Step 1.3: Subtract an amount the delegate considers reflects the value of any period of preclusion
that arises from a Commonwealth, a state or a territory statutory scheme of entitlements and is in
respect of the injury.
Because Jessie is not precluded from income support, there is no deduction at this step.
Step 1.4: Subtract 50% of the amount of compensation if Step 1.3 does not apply, the delegate is
not satisfied that the participant claimed damages in relation to lost earnings or lost capacity to earn
and the delegate is satisfied that the amount of compensation fixed under the judgement or
settlement included an amount in respect of those damages.
Jessie is not subject to a preclusion period for the purposes of Step 1.3. The delegate makes a
decision that they are satisfied that:
a.
Jessie claimed damages for lost earnings or lost capacity to earn, and
b.
The final quantum under the judgement or settlement included an amount in respect of those
damages.
Therefore, 50% of the amount of compensation should be subtracted, which amounts to $35,000.
Step 2: Ensure that the compensation reduction amount is not greater than the value of the
NDIS providing reasonable and necessary supports.
The amount remaining in this case is $33,000 which is less than the value of the reasonable and
necessary supports that a delegate considers would have been provided to the participant and
funded under the NDIS Act over the participant’s expected lifetime had the participant been a
participant from the time of the compensable event (11 years at $7,500 per year). Therefore, the
amount of $33,000 is not replaced.
Step 3: Subtract any reasonable and necessary supports paid by the participant.
Jessie became a participant soon after the injury. Jessie did not pay any money for supports of the
kind that are funded under the scheme in the period between the compensable event and the date
she became a participant. The delegate considers the equivalent amount to be zero. Therefore,
there is no subtraction for Step 3.
Step 4.1: Subtract any recoverable amounts obtained by the NDIA from the participant under
ss.106 and 107 of the NDIS Act in respect of the compensable amount.
Jessie received one year of care and support from the NDIS before the case was settled and a
delegate has made a decision under s.107 of the NDIS Act that $7500 is to be recovered from her.
Accordingly, an amount of $7,500 should be subtracted.
Step 4.2: Subtract any amount deducted under s.105B of the NDIS Act.
No deduction applies because the case was not conducted by the NDIA using its powers under
s.105 of the NDIS Act so there was no amount recovered under s.105B.
Step 4.3: Subtract the amount of any previous compensation reduction amount determined by
the NDIA.
No deduction applies under Step 4.3 because this is Jessie’s first plan to which a compensation
reduction amount applies.
Step 5: Subtract any other compensation reduction amounts in respect of the injury.
There has been only one compensation payment received by Jessie in relation to this injury which
means there is no other compensation reduction amount under r.3.1(a) in respect of the injury.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 15 of 16
Step 6: Consider whether to ignore and not recover part or the whole of the compensation
reduction amount if it is appropriate because of the special circumstances of the case.
Jessie does not appear to have special circumstances and therefore it is not appropriate to ignore
and not recover part of the whole of the compensation reduction amount.
As the compensation reduction amount is not negative, Jessie’s compensation reduction amount
does not change. Jessie’s compensation reduction amount is therefore $25,500.
Operational Guideline – Compensation – Revise the Plan and Reduce the Supports –
Compensation Received from a Judgement or Settlement (v 1.0)
Publication date: 9 December 2013
Page 16 of 16