ACC’s financial squeeze: The human toll

Source: Radio New Zealand

Each day, Jacob Hamlin measures his life in four-hour windows – the amount of time he can manage before his brain “stops working”.

It has been this way since the 40-year-old father slipped on an icy path five years ago, hitting his head on the corner of a square post and suffering a concussion.

Chronic fatigue, brain fog and balance problems eventually cost him his job as a systems engineer for an aircraft software company, but despite experiencing ongoing symptoms, ACC stopped his weekly compensation in January.

“I received a letter saying they think I should be better by now, ending support, and that there must be a pre-existing condition causing my issues.”

ACC says a neurologist reviewed his case and concluded his ongoing symptoms were due to his pre-existing conditions rather than his covered injury.

Those conditions included ADHD, migraines and a potential sleep disorder, but Hamlin says these things had never stopped him from holding down a demanding job before his concussion, and losing weekly compensation has plunged his young family into hardship.

At the moment, he can only manage four “productive hours” a day, he says.

“When I do too much my brain stops working. I lose my balance. I get really confused. If I do something physical like mow the lawns, I can do an hour, then have to take an hour break.”

After ACC cut him off, Hamlin got a second opinion that found his symptoms were from his concussion. An independent review overturned ACC’s decision two months ago, but he was – until RNZ made enquiries – still waiting for his payments to resume.

“We’ve spent all our savings… we’re just holding on until they pay us.”

The new neuropsychological assessment suggested his symptoms might also be permanent, and he worried about his future in an ACC system he believed had become “more adversarial than rehabilitative”.

“I feel like they’re just denying everyone and seeing what sticks.”

The growing number ‘exited’ from ACC

Hamlin’s story isn’t unique. He is one of more than 8000 long-term clients “exited” in the year to June.

ACC planned to exit 11,000 more by next June, and was using AI to help decide which long-term claimants should go back to work.

The cull came as ACC’s rehabilitation performance was in decline, with more people getting injured and taking longer to recover. With looming debts and liabilities on its books, ACC Minister Scott Simpson instructed his agency to reduce the number of people receiving compensation for more than a year, which was about 25,000 – the highest it had ever been.

ACC said deciding who leaves was based on advice from expert clinical assessors on a case-by-case basis, but advocates helping claimants challenge those exits worried too many people were being pushed out of the scheme before they were ready.

A breakdown of reasons why people had left the long-term claim pool last year could now be revealed.

Newly released ACC figures showed while the agency reported 8741 were removed from the pool, the actual total was 10,682. This is because 1941 were exited, but later re-entered the long-term claims pool.

Of the 8741 removed just 13 percent returned to their pre-injury role, and 3.6 percent were retrained to do alternative work.

For 5333 people – or nearly half that of the 10,682 exited – ACC could not “accurately determine” the reason for them leaving.

It said some of them were likely to be related to vocational independence or returning to a pre-injury role, but the data it had was indicative only.

It also could not say how many of them were removed for what it called “causation”, which is when it argued a sprain or strain should not have kept someone off work for months. Or, as in Hamlin’s case, their ongoing symptoms must have been due to a pre-existing condition rather than their original injury.

In a letter to lawyer and advocate Warren Forster, who obtained the figures from ACC under the Official Information Act, ACC said it would require a large manual review of all claims to give an overview of the reasons.

But the data did show a year-on-year increase in the number of people exiting the long-term claim pool in each of the last five years. A total of 42,733 people had left the pool in the last five years.

Advocates like Forster said the figures revealed a system under political pressure to reduce costs. He feared the drive to shrink the long-term claim pool could deliver short-term gains, but would come at a long-term cost.

“There is absolutely a pattern of systemic exit. There’s no doubt whatsoever that ACC is exiting long-term claimants at a scale that’s unprecedented.”

Many claimants he helped were exited due to ‘causation’, but they needed more support not less, he said.

“People aren’t off work for four years because of a sprain. Something else is going on – a tendon tear, a disc prolapse, mental distress – and none of that analysis is being done.”

Cutting people off when they were not ready shifted responsibility to the Ministry of Social Development (MSD), families and communities, he said.

“This cost isn’t going away – it’s just being moved and without any accountability.”

ACC’s staff may know where individual clients ended up, and the agency did surveys on work-readiness. But it did not systematically track outcomes for people who left.

“It’s almost impossible to believe an organisation whose job is rehabilitation doesn’t know whether it’s actually rehabilitating anyone,” Forster said.

ACC chief executive Megan Main suggested such tracking was not its job.

“Our role is to support people, it’s not to make sure someone has a job to go to. There are so many reasons why someone might, or might not return to work after injury,” she told RNZ’s Nine to Noon programme last month.

“In addition to our responsibility to support people to be rehabilitated, to recover, we also have a responsibility to all New Zealanders who pay their levies to make sure that ACC is only funding injury related treatment,” she said.

Some claimants worried the cost cutting measures meant they would be pushed into work before they were ready.

‘Kicked me when I’m down’

On day two of methadone withdrawal, Johanna Cotter got a phone call. She assumed it would be her regular ACC case manager checking in.

“I’d just spoken to him the day before and he knew I was fragile. Day two is meant to be the worst.”

Instead, it was a new voice. The caller told her: “I’m your new case manager.”

Cotter was blindsided. She had built a year-long relationship with her case manager.

“I trusted him and we had a plan to get me back to work around March 2026.”

The timing felt “inhumane”, she says.

“I’m on day two of my freaking methadone withdrawal… They’ve really kicked me when I’m down.”

Cotter feared the switch to ACC’s new ‘integrated recovery’ case management team was about accelerating her return to work.

Internal documents showed about half of clients in the long-term claim pool had been moved into this team by April in a bid to speed up their rehabilitation and get them back to independence or work faster.

ACC said ‘integrated recovery’ was a multidisciplinary team for clients that had been out of work and on weekly compensation for more than a year, “and have the potential to achieve a positive rehabilitation outcome”.

It said the call to Cotter from her new case manager two weeks ago was simply to introduce herself, and there had been no discussion of her returning to work earlier than planned.

“Our customer resolutions team have acknowledged Johanna’s experience and her new recovery coordinator will continue to work closely with her,” it said in a statement.

The sudden news, however, was the last straw in what Cotter said had been a gruelling fight to get help from ACC.

A botched stomach operation in 2017 followed by pandemic delays to fix the issue left her addicted to prescription painkillers. She had spent the past year tapering off methadone.

“I was in a very high-performing role earning $150,000 a year… and ended up surviving on a benefit of $28,000 a year.”

ACC eventually covered her treatment injury and addiction, but delays in getting financial support hit hard.

“I had to fight to get the backpayment… I had to take out my KiwiSaver, my parents had to help me pay my mortgage, I had to sell my lifestyle block… It was absolutely soul-destroying.”

A large chunk of her backpay went straight to repaying MSD for the benefit she had received.

Cotter did want to return to work when ready, but feared being pushed into it too soon.

“Methadone is known as one of the hardest drugs to come off. I know the government’s trying to get people back to work… but they’re going to have all these people not quite ready who may relapse.”

The ‘spirit of the ACC Act’

The focus on removing long-term claimants was short-sighted, Labour’s ACC spokesperson Camilla Belich said.

“ACC’s own evidence suggests most injuries are preventable… it’s an area to invest in, but what we are sadly seeing at the moment is the exact opposite.”

ACC had reduced its investments in key injury prevention programmes, including at Worksafe, Water Safety New Zealand and programmes targeting sexual and family violence and Māori.

She questioned whether the long-term cost projections used to justify exits were reliable, and said Labour would “honour the spirit” of the ACC Act if it was returned to government next year.

ACC had publicly acknowledged its rehabilitation performance had been in decline for several years. It prompted previous ACC Minister Andrew Bayly to commission an independent report into what it could do to lift its performance.

RNZ understood the final report was sitting on Simpson’s desk. The report, by consultancy Finity, “will be released in due course”. he said in a statement.

“ACC officials assure me that New Zealanders with serious long-term injuries continue to receive support from ACC.

“ACC staff are charged with making difficult decisions every day. Often they deal with clients who have long-standing and complicated personal situations. I rely on ACC staff to use their judgement given each client’s individual circumstances.”

ACC’s culture had also been in the spotlight. Another independent review released in September found its culture was far from positive and staff consistently failed to uphold public service standards.

Advocate Daniel Wood believed the act was strong, but ACC staff often failed to implement the rules correctly.

Seven of the 10 recommendations from the culture review were now being implemented, ACC chair Jan Dawson told MPs during last week’s Scrutiny Week.

All staff had been engaged in developing a “new set of values” Main added.

“This month we’ll share with our people the new strategy which addresses both the culture review and the case management review recommendation, which was to simplify and get to the core of what we do,” she said.

Main declined to be interviewed, but in a statement said ACC considered each client’s entitlements on a case-by-case basis using clinical notes and evidence to make decisions.

“If a client feels that we have made the wrong decision on their claim or entitlement we have a robust independent review process in place,” she said.

Reviews could take months, however. Wood estimates he has had about 30 clients exited from the long-term claim pool in the past four months.

“They have no option but to challenge the decision through an independent review, which can take at least six to eight months – and that’s optimistic.”

People and their families could face significant financial hardship while they waited for decisions to be made, he said.

“Relationships end… and there are self-harm instances.”

Main told Nine to Noon ACC was focused on making sure reviews happened “as timely as possible”, but admitted there had been an increase in clients seeking them since it had taken “a more active role in case management.”

Support in order to get support

Hamlin said fighting ACC while living with a brain injury had been almost impossible without support.

“You’re not able to put much effort [into] it – you almost need an advocate the whole time.

“If we didn’t have health insurance to get those specialist reports showing the proof of my injury, we probably wouldn’t have won our case.”

When RNZ first spoke to Hamlin two weeks ago he was waiting for ACC to resume both his weekly compensation and backpay, which he had been told would happen at the same time.

After RNZ made enquiries about the case, ACC resumed his weekly compensation payments on 1 December. The agency said it was working with MSD to calculate the backdated compensation that he was now owed since his payments stopped in January.

“We acknowledge the difficult financial position Jacob is in and are working at pace to set up his financial supports. We are also supporting Jacob with a training for independence programme and will continue to support him on his recovery journey,” ACC acting head of client recovery Matthew Goodger said in a statement.

For Hamlin, this support was vital. He could not rebuild his life in four-hour windows alone and hoped others were not forced to spend what little they had battling the same system.

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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand