Compensation Is Worse Overall

“There is sound evidence that people who are injured and seek compensation tend to have worse outcomes than people with the same injury who remain outside of compensation settings.”

This is front page of my local Worker’s Compensation Service newsletter (WorkCover SA Newslink Issue 11 – April 2008.)

They are right – except for the word “seek”.

Some people end up in a compensation system even if they don’t want to be there and don’t seek to be there. I know of no evidence that says they do any better in the system than those who “seek” compensation.

Something about the system itself is so flawed that it actually injures people or worsens injury or prevents the natural course of recovering from an injury.

This is tragic.

This title at the top of the article says, “Improving health outcomes in the compensation sector.”

In my state we are having an entire debate about how much we should be funding a compensation system and what it should be providing for injured workers.

With the statement at the start it seems like they would then go on to say that we should scrap the compensation system entirely, but no.

Later on in the article it says ignores the opening line and says…

“Early notification and connection with the compensation sector are essential for people with compensable injuries, as are appropriate treatment or diagnosis of the injury.”

With the best of intentions in the world, compensation schemes are somehow a flawed system.

I used to treat people under the local compensation system. I now no longer do. It wasn’t until I left the system that I recognized that the experiences I had in treating people and needing to cover a much wider range of issues than just the original injury, were not just about me.

The research literature says that there is something about being in a compensation scheme itself, that makes injuries take longer to recover and recover less completely in the end.

It doesn’t matter whether the system is for workers, or for motor vehicle accidents, nor whether it is a no-fault compensation or not, the results almost always come out worse.

That’s why I took the best of my advice and experience and put it into an “online consultation”.

If you, or someone you know, is considering or already involved in compensation then I have collated all my expertise and advice to help you manage the situation here:

-Dr Martin Russell

7 thoughts on “Compensation Is Worse Overall”

  1. I’m not the least surprised about this. Compensation cases take a long time to reach a conclusion, during which time the victim is focused on the injury rather than recovery. Also there is a vested interest in ‘being injured’ rather than recovery.

    If I fall over and it’s my fault I can call myself an idiot and concentrate on getting better. If I fall over and it’s someone else’s fault, I also have this sense of outrage to deal with. If I take action, I’m stoking the fires of this outrage and pursuing the “look-what-you’ve-done-to-me” approach for however long it takes the case to conclude.

    One should consider the true costs of pursuing compensation weighed against the advantages of letting go.

  2. Well it’s nice to have research to show what those “true costs” really are, but will it change people’s use of compensation systems?

    I hope the link I gave helps people with that decision, AND to make better use of a compensation system if they find themselves in it.

    There are times when I might take up compensation, but I’d handle the process very differently than most people end up doing. I think with the right approach it may be enormous help.

    Just like all treatments, it has some risks.

  3. There is a lot to be said about the no-blame approach. It sounds as if the negligent party gets off pretty light.

    However, the victim is in a very empowered position. The deal is that the victim accepts an offer that at least covers any financial loss the victim may have incurred as a result (generally less than could be gained by pursuing compensation) if the negligent party agrees to meet with the victim, discuss what went wrong and agree on measures to address the problem which must be put into place within a specific timescale.

    The main criteria is a victim prepared to sacrifice some personal gain for the sake of a thin slice of progress.

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  5. It’s a controversial subject. On the one hand they should be compensated, on the other hand it hurts them. Maybe the solution will be to make the compensation depend on the healing time meaning the shorter the healing time the compensation will be bigger.

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