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12.7.1.2 Methodology to apply to transitional cases where the date of effect of the PI is on or after 1 July 2013

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Last amended 
18 December 2014

The following table outlines the method contained within Chapter 25 of GARP M for calculating PI (including interim) compensation where a person has a condition accepted under the MRCA and a condition accepted under the VEA and/or the SRCA and the date of effect of the MRCA PI claim is on or after 1 July 2013.  This methodology calculates the total amount of PI payable to a person under the MRCA.  If a person has previously been paid a MRCA PI lump sum or is already in receipt of periodic PI a subsequent calculation of the additional PI payable is required (see 12.7.1.6).

 

Step

Action

Methodology to apply to transitional cases where the PI claim is made on or after 1 July 2013

1

As at the date of the determination, determine the combined effect of the MRCA and any VEA and/or SRCA condition/s that were accepted conditions on the date the person claimed MRCA PI.  (For instructions on combining across the three Acts see Note 1 below)

This entails conducting a new assessment of the person's VEA and/or SRCA condition/s under GARP M at the same time as assessing the impairment suffered as a result of all MRCA conditions.

It also includes determining a lifestyle factor using the instructions in Chapter 22 of GARP M.  (For instructions on determining a lifestyle factor for this step where interim PI claims are being determined see Note 2 below).

Calculate the compensation that would notionally be payable under the MRCA for all of the conditions included in the assessment. (For instructions on determining the appropriate compensation factor for this purpose, see 12.7.1.7).

2

Determine whether the new MRCA condition/s contribute at least 5 impairment points to the overall impairment rating calculated in Step 1.  (For instructions on determining whether the MRCA condition has contributed 5 points see 12.7.3)

3

If the new MRCA condition/s contribute at least 5 impairment points proceed to Step 4.

If the new MRCA condition/s do not contribute at least 5 impairment points the claim for PI compensation is rejected as it does not meet the required threshold. (see Note 5 & 6 below)

4

Use the GARP M assessment without any MRCA condition/s to calculate a notional amount of PI payable under the MRCA for the VEA and/or SRCA condition/s referred to in Step 1.

(For instructions on determining the appropriate compensation factor for this purpose, see 12.7.1.7)

(For instructions on determining a lifestyle factor for this step where interim PI claims are being determined, see Notes 2 and 3 below)

5.

Subtract the amount calculated in step 4 from the amount calculated in Step 1 to obtain the notional amount payable under the MRCA.

6

If any VEA conditions were accepted conditions on the date the person claimed MRCA PI:

  • (a) subject to Note 4 below, calculate the amount of disability pension (DP) payable on that date as a percentage of the General Rate on that date; and
  • (b) using that percentage, calculate the notional equivalent amount of disability pension payable on the date of the MRCA determination.

7.

Check whether the total amount payable under the VEA, SRCA and MRCA exceeds the maximum weekly rate of PI by adding the following amounts together:

  • the amount calculated under Step 5; and
  • the amount calculated at Step 6(b); and
  • SRCA section 24, 25 and 27 lump sum amounts (the SRCA payments being converted as set out in 12.7.1.4) for the SRCA conditions referred to in Step 1.

8.

If the amount calculated in Step 7 exceeds the maximum PI, the gross amount payable under the MRCA is calculated as follows:

  • (a) subtract the maximum MRCA PI rate from the Step 7 amount;
  • (b) subtract the amount calculated in (a) from the amount calculated in Step 5.

The resulting amount is the MRCA PI payment.

9.

If the amount calculated in Step 7 does not exceed the maximum PI, the amount payable is the amount calculated in Step 5.

10.

If no previous PI has been paid under the MRCA the amount calculated in step 5 or step 8 will form the basis of the offer of a choice between a periodic payment and a lump sum.

If previous PI has been paid in the form of a lump sum and/or is being paid as a periodic payment, the amount calculated in step 5 or step 8 is the gross MRCA PI payable and must be reduced by the periodic equivalent of the lump sum and/or by the periodic payment whichever is relevant to the client. (see 12.7.1.6) The resulting net amount can be converted to a lump sum under section 78 of the MRCA.

 

Note 1 The PIAMA calculator requires delegates to calculate the combined VEA/SRCA impairment points and input them into the appropriate field.  The calculator automates the process of combining points from all MRCA conditions and then combines the VEA/SRCA points input by the delegate with the combined MRCA points to obtain a whole person impairment.  In order to calculate the combined VEA/SRCA points (points for the ‘old conditions’) delegates should apply the following steps:

  • combine impairment points for individual SRCA conditions from highest to lowest impairment points;
  • combine impairment points for individual VEA conditions from highest to lowest impairment points;
  • combine the overall SRCA points with the overall VEA points to obtain a total rating for the ‘old conditions’

Note 2: The lifestyle factor for step 1 where interim PI is being determined is calculated using the same steps as are applied for non-transitional interim PI claims (see 5.8.4).  In step 1 of that process the former conditions are any VEA conditions accepted before the date of the PI claim and any MRCA conditions previously determined.

Note 3: The lifestyle factor for this step is the top of the shaded area applicable to the number of impairment points attributed to the VEA/SRCA conditions being taken account of in the calculation.

Note 4: If the client’s DP is reduced by an overpayment, the amount to be included in step 6 (a) is the gross DP payable prior to reduction by the overpayment.

However, if the client’s DP is being offset due to receipt of other compensation (e.g. due to their receipt of SRCA PI lump sums or a common law payment), the amount to be included in step 6 is the actual DP that was being paid (net) at the date of the PI claim converted to the amount rate, not the gross DP. However, if there have been any indexation changes see 12.7.1.5 to explain how to convert the VEA DP amount.

Note 5: Whilst Step 2 may not be met, the change in total impairment points may mean the client is entitled to other forms of compensation e.g. Gold Card or SRDP under the MRCA.  The new combined impairment points should be noted in the appropriate systems and the client considered for other thresholds (see Note 6) such as a Section 281 Treatment (Gold Card), Section 199 SRDP and Section 80 additional (PI) payments.

Note 6: Along with meeting the required threshold points for Section 199 SRDP and Section 80 additional (PI) payments, the criteria for these entitlements also require that compensation be paid or entitled to be paid.