Neutral Citation: 2002 ONFSCDRS 63

FSCO A01-000231

Between:

Jaime Pereira Applicant

and

Allstate Insurance Company of Canada Insurer

Reasons for Decision

Before: K. Maine Palmer

Heard: November 19, 20, December 13, 2001 and January 3, 2002, at Toronto.

Appearances: Frank A. Sabetti for Mr. Pereira Todd J. McCarthy for Allstate Insurance Company of Canada

Issues:

Mr. Pereira was injured in a motor vehicle accident on September 18, 1998. He applied for and received statutory accident benefits from Allstate Insurance Company of Canada ("Allstate"), payable under the Schedule.¹ This arbitration concerns an outstanding balance of $1,740 for treatment Mr. Pereira received from a treatment centre, Integrated Health Recovery ("IHR"). The parties were unable to resolve their disputes through mediation and Mr. Pereira applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues in this hearing are:

Is Allstate liable to pay $1,740 for treatment Mr. Pereira received at Integrated Health Recovery?
Is Allstate liable to pay a special award to Mr. Pereira under subsection 282(10) of the Insurance Act?
Should Allstate or Mr. Pereira pay the expenses of this proceeding?

Result:

Allstate must pay Mr. Pereira $993 for services rendered by Integrated Health Recovery.
Allstate Insurance Company of Canada must pay Mr. Pereira $250, including interest, as a special award under subsection 282(10) of the Insurance Act.
The issue of expenses is not yet determined.

EVIDENCE AND ANALYSIS

Onus of Proof of Collateral Insurance:

At the beginning of this hearing, the parties concentrated on the necessity of treatment Mr. Pereira received at the IHR clinic and the reasonableness of its cost. However, by the end of the hearing, the evidence focussed on the amounts paid by Mr. Pereira's extended health insurer for this treatment and what balance remains outstanding.

This shift in focus is important because Ontario motor vehicle insurers are not the "primary payers" of supplementary medical and rehabilitation expenses, even when those expenses are required as a result of a motor vehicle accident. Subsection 268(1) of the Insurance Act requires that automobile policies contain the statutory accident benefits in the Schedule, but subsections 268(6) and (7) also state that other policies of insurance come first, with respect to this type of coverage:

(1) Every contract evidenced by a motor vehicle liability policy) including every such contract in force when the Statutory Accident Benefits Schedule is made or amended, shall be deemed to provide for the statutory accident benefits set out in the Schedule and any amendments to the Schedule, subject to the terms, conditions, provisions, exclusions and limits set out in that Schedule. 1993, c. 10, s. 26 (1).

(6) The insurance mentioned in subsection . (1) is excess ..insurance to any other insurance not being automobile insurance of the same type indemnifying the injured person...for the expenses.

(7) The insurance mentioned in subsection (1) is excess insurance to any other insurance indemnifying the injured person...for the expenses. R.S.O. 1990, c. I.8, s. 268 (6, 7).

Likewise, subsection 60(2) of the Schedule more particularly provides that:

Payment of a medical, rehabilitation or attendant care benefit or a benefit under Part VI [Other Expenses] is not required for that portion of an expense for which payment is reasonably available to the insured person under any insurance plan or law or under any other plan or law.

Mr. Pereira submitted that the onus was on the Insurer to prove that collateral insurance benefits were reasonably available to him.

Conversely, Allstate submitted that the collateral benefits issue had not been properly addressed by Mr. Pereira or IHR at any stage. Allstate submitted Mr. Pereira admitted that Clarica is the first loss payer, but took no responsibility to determine what Clarica should have paid. Allstate submitted that based on exhibits 25 and 26, it had shown that Mr. Pereira had received or had available to him $2,517.30 for this treatment. This amount, when added to what Allstate paid ($1,724.00) results, in Allstate's submission, in no outstanding balance owing by Allstate for treatment at IHR.

In cases before the Commission, the party who bears the legal burden of proof must prove a fact to the civil law standard—often described as proving on a balance of probabilities or a preponderance of the evidence. Otherwise that party loses on that issue. Many examples are found in Commission cases where, for lack of evidence, applicants have failed to persuade an arbitrator that certain expenses claimed were ever made or that they were reasonably necessary. The legal burden of proof becomes important in hearings at the Commission when the evidence leaves the arbitrator with a degree of uncertainty. In this case, uncertainty arises about what was paid by Clarica to Mr. Pereira for treatment he received as a result of the injuries from his accident. No clear statement in the Act or the Schedule tells us which party bears the legal burden of proof with respect to collateral insurance. In their text on evidence law, Sopinka, Lederman and Bryant discuss criteria articulated by the British House of Lords to determine the incidence of the legal burden of proof where a statute is vague.² The criteria include the mischief at which the law was aimed, the effect of the law, and practical considerations such as the ease or difficulty respective parties would encounter in discharging the burden.

In insurance litigation, disputes arise as to how claims should be settled where there is "double insurance" and both policies prohibit such coverages or contain conditions exempting the insurer from all payment if the insured person is entitled to indemnity under another policy.³ Two recent cases in the Ontario Superior Court of Justice have dealt with disputes between automobile insurers and travel or extended health insurers as to which is the primary carrier obliged to pay benefits, but neither case discusses the onus of proof issue.⁴

In my view, the effect of a combined reading of subsections 268(6) and (7) of the Act and subsection 60(2) of the Schedule clearly imposes on Mr. Pereira the obligation to bring his claim within the terms of the Allstate policy. Allstate only has to pay what Clarica does not pay or does not cover.

Allstate challenged the amount of collateral benefits received by or available to Mr. Pereira. Mr. Pereira is in the position to determine what claims will be submitted to Clarica, respond to any inquiries it makes, then submit any unpaid claims to Allstate. In this case, Mr. Pereira relied on IHR as his agent to make these submissions for him and to follow-up on the issue with both insurers. It was clearly in IHR's best interests for it to do so.

The issue of which party bears the burden of proof in cases of collateral medical and rehabilitation insurance has not been discussed extensively in the Commission's case law or in court decisions. In a typical case, the issue of what is reasonably available from the collateral insurance carrier has been sorted out well before the hearing.⁵ The insured person is required to disclose the existence of such insurance on the Application for Benefits, as Mr. Pereira did in this case in his application dated October 9, 1998.⁶ At any time an insurer can request "any information reasonably required to assist the insurer in determining the person's entitlement to a benefit," under the provisions of subsection 33(1) of the Schedule, and according to subsection 33(2) the benefit is not payable for any period before the person complies with this request.

The language relating to collateral insurance benefits "reasonably available" has formed part of all three Schedules to the Insurance Act since 1990. In the 1990 Schedule, it was found at section 9(1), in the 1994 Schedule at subsection 75(13), and in the present Schedule, at subsection 60(2). In the 1990 Schedule, the provision was found pay Part II benefits (for supplementary medical, rehabilitation and care) even if the insured person was entitled to welfare benefits. In the 1994 Schedule the provision moved to a separate part entitled Interaction with Other Systems, which dealt with workers' compensation benefits, accidents in Quebec, and benefits for non-residents, as well as the collateral benefits issue.

In my opinion, the separation of the collateral insurance provisions into a separate part of the Schedule, reinforces the notion that, according to the provisions of the Act, collateral benefits are not an "exception" to the scheme set out in section 268 of the Act. Statutory accident benefits are truly excess insurance.

In fact, from the inception of mandatory medical and rehabilitation benefits and accident benefits in motor vehicle liability policies, the insurance has been qualified as "excess insurance" with strict language absolving an automobile insurer from liability "for those portions of such expenses payable or recoverable under any medical . . . plan or law or, . . . under any other insurance contract …⁷

The language "received or available," a phrase somewhat similar to the term "reasonably available" of subsection 60(2) of the Schedule at issue here, has been used elsewhere in the Schedule⁸ and in previous Schedules. For example, in Bill 68, the Schedule in force from June 20, 1990 to December 31, 1993, the insurer was entitled to deduct 80 per cent of any income received or available to the applicant after the accident. In the case of Patriarca and Pilot Insurance,⁹ I wrote that the burden of proving any deduction was applicable was on the Insurer. Once income replacement benefits have been found owing, based on the applicant's proof that he meets the eligibility tests of the Schedule, then any deduction that will benefit the insurer should lie with the insurer to prove, as an exception. As stated in MacGillivray and Parkington, On Insurance Law, "The usual rule is that once the insured has proved that the case comes within the general risk, it is for the insurers to prove that it comes within an exception."¹⁰

However, in Mr. Pereira's case, the language of the Act and Schedule is such that no medical or rehabilitation benefit becomes owing if the payment is reasonably available from another source. Automobile insurance for such expenses is excess insurance.

In the case Glinka and Dufferin Mutual Insurance Company, (FSCO A99-000849, November 21, 2000),¹¹ Arbitrator Joachim observed as follows in the portion of the decision dealing with certain benefits claimed by Ms. Glinka:

Dr. Harris charged $175 per hour for a two-hour clinical interview, one hour of test administration, one hour of test scoring and two hours of report writing. In addition, he charged $75 for the preparation of the treatment plan. ... I heard no evidence that the hourly rate of $175 was unreasonable. On the contrary, the evidence indicates that Ms. Glinka's disability insurer, Sun Life, considers $165 per hour a "reasonable and customary charge" for psychological counselling.

Under section 60(2) of the Schedule, Dufferin is not required to pay that portion of Dr. Harris' account for which payment is reasonably available to Ms. Glinka under any insurance plan. The onus is on Dufferin to establish that the payment for Dr. Harris account is reasonably available under the Sun Life plan. Sun Life has paid expenses relating to psychological treatment and indicated that it considers a rate of $165 per hour a reasonable and customary fee.

I heard no evidence whether the completion of forms, such as treatment plans, was covered by the Sun Life policy. Ms. Glinka provided no explanation why Dr. Harris' account was not submitted to Sun Life. Indeed, although Sun Life is the primary carrier, she has repeatedly sought to obtain expenses from Dufferin first. I am satisfied that the evidence demonstrates that the Sun Life policy would have covered payment at the rate of $165 per hour for the assessment services provided by Dr. Harris. Accordingly, Dufferin is not required to pay for $990 (6 hours x $165) of Dr. Harris' account. The remaining fee of $135 ($60 plus $75 for the treatment plan) is payable by Dufferin.

[emphasis added]

It appears that the question of which party bears the onus of proof of collateral insurance was not in issue before Arbitrator Joachim. I disagree with her statement that the automobile insurer in the Glinka case bore the legal onus of proof as to what payments were reasonably available under the Sun Life plan. In my view, once the existence of a collateral insurance policy with medical and rehabilitation benefits has been established, an Applicant bears the legal burden to prove what benefits are owing from automobile insurer.

My opinion is that in this arbitration, the legal onus is on Mr. Pereira to prove, on a preponderance of probabilities, that any amount is owing from Allstate in order to satisfy IHR's accounts. As the court put it in the case of Whelan Estate v. Mutual Life [1989] N. J. No. 16 (Nfld. SCTD), "The burden of proof is upon the assured to show that the loss was proximately caused by a peril insured against." The onus is not on Allstate to show how much was reasonably available from the collateral insurance policy.

In general, this obligation would not impose a heavy burden for any Applicant. He or his agent, like IHR, submits treatment invoices to the collateral insurer, which examines them, issues an explanation and pays any amounts available under its policy. The Applicant or his agent then submits the invoices, along with the collateral insurer's explanation, to the automobile insurer as proof of what was reasonably available to the insured person under the primary plan.

In this hearing, Allstate called evidence on this issue. Allstate summoned Mr. Pereira's extended health insurer, Clarica, to disclose the amount Clarica paid to Mr. Pereira over a certain period. However, Clarica's evidence is not crystal clear as to what amounts were paid, when, for what treatment. As will be discussed below, I have determined that Mr. Pereira met his legal burden of proof and has shown that Clarica paid $1358 toward his treatment at IHR after the accident. I do not find that any additional money was "reasonably available" from Clarica. Accordingly, $2,867 remained potentially liable for Allstate to pay.

Clarica Evidence:

On the consent of the parties, I adjourned the hearing from December 13, 2001 to January 3, 2002 after hearing testimony from a representative of Clarica Insurance, Mark Macdonald, about the difficulty Clarica was encountering to retrieve Mr. Pereira's supplementary health care records from 1998 and 1999. Mr. Macdonald testified that he had been informed that the records existed in an off-site storage facility and that it would take several days to locate them.

Mr. Macdonald resumed his testimony on January 3, 2002. He brought six pages from the group policy of insurance held by Mr. Pereira's employer, effective November 1, 1998. Mr. Macdonald could not clarify whether or not this was a renewal policy. He also brought a one-page computer print-out dated December 4, 2001 which he testified related to payments made by Clarica to Mr. Pereira. The payments for supplementary health care totalled $2,517.30 ($1,330 + $1,187.30). Mr. Macdonald did not bring any hard copies of file material pertaining to Mr. Pereira.

According to the Clarica policy documents, Mr. Pereira's supplementary health coverage was subject to a yearly deductible of $25. In addition, most eligible expenses had to be prescribed by a physician, with the exception of chiropractic and acupuncture. Mr. Pereira was entitled to $750 per year of acupuncture treatment, $750 of physiotherapy, $750 of massage therapy, and $750 of chiropractic, including one x-ray per year. For treatment covered under the provincial health plan (OHIP), these expenses would not be reimbursed until the annual maximum under the plan had been exhausted.

IHR submitted six invoices to Allstate from October 30, 1998 to January 14, 1999 relating to Mr. Pereira's treatment from October 20, 1998 to January 7, 1999. Five Explanations of Benefit from Clarica¹² were filed by Mr. Pereira. I am satisfied from a detailed examination of the Clarica documents and IHR's six invoices that all six invoices were submitted to Clarica as required by the Schedule. No benefits were allowed by Clarica on the first invoice number 8215, dated October 30, 1998. The Explanation of Benefits refers to a letter enclosed that was not produced.

The following table reconciles the amounts charged by IHR to the amounts paid by Clarica. Some of the payments from Clarica were made as late as November 12, 1999, a year after the treatment was rendered (exhibit 27).

Invoice No.	Amount Submitted	Amount Paid by Clarica	Amount Outstanding
8215	$985	$ 0	$985
8361	$820	$335	$485
8459	$710	$247	$463
8619	$570	$427	$143
8746	$945	$251	$694
8921	$195	$ 98	$ 97
Total:	4,225	1,358	2,867

Clarica paid $1358 in four cheques: a total of $761 from three cheques ($195+$315+$251) was received between December 15, 1998 and February 16, 1999, then on November 12, 1999 a fourth cheque for $597, covering various treatments from November 3, 1998 to January 7, 1999. Only the $761 reached IHR and was credited to Mr. Pereira's account. Mr. Pereira admits he received the fourth cheque from Clarica and cashed it. He testified he moved after the accident and one month prior to this hearing found in a box his personal cheque for $597 made payable to IHR, in an envelope with the statement from Clarica. Due to inadvertence, he never delivered the cheque to IHR. If he has not done so already, Mr. Pereira should pay $597 to IHR forthwith. I find Allstate is not responsible for this amount.

Allstate eventually paid IHR $1724. This leaves a balance of $1,143 in dispute in this hearing ($1,740 - $597, or, $2,867 - $1,724).

From exhibit 25, Mr. Macdonald testified that Clarica's payments to Mr. Pereira to December 4, 2001 with respect to supplementary health care totalled $2,517.30 ($1,330 + $1,187.30). If this sum was received by Mr. Pereira solely on account of his treatment at IHR, then no amount is outstanding from Allstate, as shown by the following calculation:

Total accounts submitted by IHR	$4,225
less total paid by Clarica, according to ex. 25	$2,517.30
Balance for submission to Allstate	$1,707.70
Total paid by Allstate	$1,724.
Balance remaining owing to IHR by Allstate	($ 16.30)

However, Mr. Macdonald's evidence with respect to the $2,517.30 allegedly paid by Clarica and the documentary evidence from Clarica have not convinced me, on a balance of probabilities, that $2,517.30 was either paid on account of Mr. Pereira's treatment at IHR or that it was indeed ever received by Mr. Pereira. The information contained in exhibit 25 is meagre and Mr. Macdonald, although an honest and impartial witness, could supply little illumination.

Even though the hearing was adjourned in December to enable Clarica to obtain from storage the documents that would support the computer print-out, no such evidence was produced at the resumption of the hearing. Mr. Pereira testified that he received approximately $1,300 from Clarica relating to his treatment at IHR. He produced documents that supported this contention. He admitted, in reply evidence, that he had received a cheque for $597 from Clarica that he had not paid over to IHR through his oversight. Mr. Macdonald testified that Clarica paid some funds in the third quarter of 1999 for treatment by a chiropractor, Dr. S. Greenspan. Dr. Greenspan charged $29.65 per visit, but Clarica only reimbursed Mr. Pereira $28.00 per visit.

On the basis of Mr. Macdonald's testimony and the small amount of documentation produced by Clarica, I cannot find that Clarica paid more than $1,358 on account of the treatment Mr. Pereira received at IHR. Where Mr. Macdonald's evidence differs with that of Mr. Pereira, I prefer Mr. Pereira's evidence on this point. Mr. Pereira's evidence was credible and the documents he produced supported his oral testimony. Mr. Macdonald's evidence was scanty and uninformed.

That being said, I return to the disputed $1,143 that IHR says remains owing to it by Allstate.

The Main Issue:

An overriding principle of the Schedule, set out in section 14, is that those who sustain an impairment as a result of an accident are entitled to payment for all reasonable and necessary medical expenses they incur. In this case, Allstate argues that some of the treatment Mr. Pereira received at IHR was overpriced, and hence, unreasonable. It also says that some of it was unnecessary.

Section 38 of the Schedule provides that before expenses in respect of which a medical or rehabilitation benefit may be payable are incurred, the insured person must submit a treatment plan to the insurer. The treatment plan itself has a number of requirements. In this case, Dr. V. Levitin, a chiropractor and director of the IHR clinic, submitted two treatment plans, one dated October 20, 1998 and a second one dated November 23, 1998. In the first treatment plan, Dr. Levitin described Mr. Pereira's impairment or disability as being a whiplash disorder of grade 2, a strain/sprain injury to his lumbar spine, and cervicogenic headaches. He planned 12 treatment sessions over four weeks at an estimated cost of $2,145. For that price his clinic would provide interferential therapy, moist heat, chiropractic mobilization, acupuncture, an active therapy program (stretching and exercise), and a re-assessment and report after four weeks. The proposed treatment was described in detail over two pages in the treatment plan. Allstate received the plan on November 2, 1998.

By a letter dated November 4, 1998, Mr. Bill Gold, the adjuster handling the file, wrote to Mr. Pereira's then representative rejecting the first treatment plan.

Since the amount of treatment, and certainly the cost of the Integrated Plan seem excessive for the injury described we are not prepared to fund any of the goods or services contemplated by the Treatment Plan.

As you are aware, a medical/rehabilitation assessment is presently being scheduled and we have forwarded the Integrated Treatment Plan to the Designated Assessment Centre for their comments.

The medical/rehabilitation DAC¹³ had previously been arranged after Allstate rejected a previous treatment plan dated September 25, 1998 from Dr. Shahin Pourgol, a chiropractor, who had proposed to treat Mr. Pereira by means of "chiropractic treatments and examinations" over two months, five visits per week, "decreasing in frequency over time." Dr. Pourgol's estimated cost of treatment was $2,500.

Mr. Gold wrote to the Toronto Hospital, Toronto Western Division, the closest DAC to Mr. Pereira's residence, on October 22, 1998 with the following specific questions:

a) Is the medical expense contemplated by the enclosed treatment plans both reasonable and necessary for treatment of injuries sustained in the automobile accident?

b) Please give us your recommendations for further treatments or rehabilitation if further treatment or rehabilitation is required. Please also give us your recommendation for the duration of any such future treatment.

Along with the letter Mr. Gold enclosed Dr. Pourgol's treatment plan, a treatment plan from CBI dated September 24, 1998, where he had sent Mr. Pereira for an insurer's examination, and a disability certificate dated September 29, 1998 from Mr. Pereira's family doctor, Dr. N. Fernandez.

Dr. Igor Steiman, a chiropractor, assessed Mr. Pereira on November 19, 1998 at a DAC examination. Dr. Steiman determined that Mr. Pereira's headaches, neck pain, left anterior upper chest pain, upper back pain, lower back pain, and left upper arm pain were all consistent with the history of the motor vehicle accident—a collision in which Mr. Pereira's vehicle was impacted on the front left side, leaving about $10,000 in damage to the automobile. Allstate did not produce any subsequent correspondence to the DAC or Dr. Steiman. It is unclear just what documents Dr. Steiman had from the IHR clinic. Dr. Steiman refers to IHR's treatment plan dated October 20, 1998 in his report. He does not refer, however, to Dr. Levitin's narrative report of the same date. Nor does he refer to any clinical notes and records from the IHR clinic, which would have helped him understand more fully exactly what treatment Mr. Pereira had been receiving.

According to the referral checklist of documents found in the Guidelines for Designated Assessment Centres to Conduct Assessments for Accidents on or after November 1, 1996(As amended, June 1998), at numbers 5 and 7, a "summary of treatment and services received to date" and "health professional's or hospital reports" should have been included in the referral package of documents sent to the DAC. The Guideline also notes that the "SABS requires complete disclosure of all relevant information necessary to complete the assessment. While the insurance company and the claimant share responsibility for supplying this information, the insurance company is responsible for ensuring that all elements in the referral package are received by the DAC prior to the assessment appointment ." In my opinion Dr. Steiman did not have all the records that should have been sent to him in order to give the most informed answer possible with respect to the questions he was asked to answer.

Dr. Steiman was critical of what he presumed was the delayed onset of spinal manipulative therapy and a concurrent active exercise program. Mr. Pereira had apparently told him he was attending at IHR three times a week. According to Dr. Steiman's report Mr. Pereira indicated his treatment consisted of

electricity applied to his shoulders, and upper or lower back; this appears to be of no benefit except transiently. Though Mr. Pereira felt more relaxed after eight sessions of acupuncture therapy, it did not improve his symptoms, and has been discontinued. Thus far, Mr. Pereira has received one treatment of spinal manipulation. Massage therapy and exercise therapy are planned in the future.

Dr. Steiman wrote:

I do not understand why spinal manipulative therapy and a concurrent active exercise program were not undertaken sooner. The overall cost of the proposed treatments exceeds the average by about $500. However, there is no standard fee for chiropractic or acupuncture treatments.

At this time, I feel that it would be reasonable and necessary for Mr. Pereira to receive three chiropractic treatments a week, for four weeks, consisting of manual soft tissue therapy and spinal manipulative therapy. Concurrently, he would benefit from the commencement of an active exercise program, three times a week for two weeks, ensuring that he is instructed during this time such that he is able to continue this comprehensive stretching, strengthening and conditioning program for his neck, back and extremities on his own thereafter.

. . . The most recent treatment plan appears to have provided for inadequate therapy at an above-average cost.

Dr. Levitin's Testimony:

At the hearing, the clinical notes and records of IHR were presented and Dr. Vladimir Levitin testified about the treatment Mr. Pereira received at his clinic.

According to Dr. Levitin's testimony and the clinical notes of IHR, Mr. Pereira had received more chiropractic manipulation and exercise therapy than Dr. Steiman understood or Mr. Pereira apparently reported. According to Dr. Levitin's chiropractic progress notes, he had examined and adjusted Mr. Pereira on nine occasions before Dr. Steiman's examination on November 19, 1998, being October 22 and 27, November 3, 4, 9, 11, 12, 16 and 18. Dr. Levitin testified, with the use of his clinical notes, that on October 22, 1998, for example, he adjusted Mr. Pereira's spine: C3 in right rotation, C5 in left lateral flexion and L3 in right rotation. Dr. Levitin testified that he always prepared the patient for an adjustment by first performing myofascial treatment. In addition, on subsequent visits he engaged in an "interactive assessment" inquiring of the patient how he was faring. Mr. Pereira subsequently received chiropractic treatment on November 23, 24, 25, 30, December 1, 3, 7, 14, 15, 17, 19, 21, 1999 and January 12, 1999.

Although Dr. Steiman's report notes that massage treatment was yet to begin, according to IHR's clinical records, Mr. Pereira received massage therapy on November 11, 1998. Subsequently, Mr. Pereira also received massage treatment on December 1 and 14, 1998 and January 7, 1999. Dr. Levitin testified that the massage treatments were one hour in duration. This is not specifically noted on the treatment card, but is the IHR clinic standard. If the treatment were for a half-hour, for example, Dr. Levitin testified this would be marked on the treatment card. I find, with respect to the first massage treatment at IHR, the notes of the massage therapist do not correspond to the date on which the treatment was billed. The therapist's notes indicate massage was performed on November 11, but the treatment was not billed until November 24, 1998. Dr. Levitin testified that Mr. Pereira received the massage therapy beginning November 24, 1998. Subsequent massages on December 1 and 14, 1998 and January 7, 1999 were billed on the same date as noted in the treatment record. I find Mr. Pereira reported to Dr. Steiman the massage treatment was yet to begin when he was examined on November 19, 1998. As a result, I find it more likely than not that Mr. Pereira's first massage therapy treatment was provided on November 24, 1998, not November 11, 1998 as mistakenly noted in the therapy records.

Dr. Levitin testified about his examination of Mr. Pereira on October 22, 1998. He outlined the various tests he performed, as set out in his report dated October 20, 1998.

Assessment Charges and Treatment Plans

Dr. Levitin justified his charges at the IHR clinic. He stated that according to the Ontario Chiropractic Association (OCA) guidelines published in June 1997, he may charge up to $250 per hour for an assessment. He had estimated that in most cases he would spend 30 to 45 minutes taking a history from the patient, 30 minutes in a physical examination, and 40 minutes to draft a report. He determined he would charge $275 for the initial assessment, based on a time estimate of 70 minutes per patient. He kept no time sheet on Mr. Pereira or any other patient.

Treatment Plan

Dr. Levitin charged $75 for completing a treatment plan, which he claimed was a standard charge under the OCA guidelines, number 14-11.

Acupuncture Charges

IHR charged $65 per acupuncture treatment given by Dr. Zachary Simkhovitch, a Ph.D. in rehabilitation sciences and certified doctor of acupuncture. Dr. Levitin also testified that Dr. Simkhovitch has additional qualifications as a registered massage therapist. Dr. Levitin testified that $65 per treatment is a recommended fee according to the Acupuncture Foundation of Canada. Dr. Levitin testified that the OCA guidelines provide that where acupuncture is performed by a chiropractor, a recommended fee of $30 is suggested (22-08). Dr. Levitin testified that on October 20, 1998 Mr. Pereira received approximately 30 minutes of acupuncture treatment in two areas of his body.

Active/Passive Combination Therapy

Dr. Levitin described the active therapy program provided by IHR. He testified that therapy progresses from passive and active stretches to cardiovascular exercises, isometric and isotonic exercises, strengthening exercises, area-specific exercises as well as general conditioning of the patient. Dr. Levitin testified that by December 1998, on some days, Mr. Pereira just received active treatment and was able to do without the passive therapy, for a couple of sessions. However, he suffered a relapse and the clinic had to re-introduce passive modalities like interferential current.

Dr. Levitin testified that Mr. Pereira usually came to the clinic in the evening and would spend about two hours there receiving treatment. At that time IHR did not keep time sheets. IHR claimed $125 for the active and passive therapy program based on OCA rates and the Ontario Kinesiology Association guidelines of $110 per hour. According to OCA code 25-01 "Self-directed therapeutic exercise training or monitoring" is billed at $15 for 10 minutes, or $90 per hour. Dr. Levitin estimated that Mr. Pereira spent approximately one hour in active therapy on each visit to the clinic.

Dr. Levitin testified in detail about Mr. Pereira's activities and treatment on each clinic visit.

He could not explain why there were no chiropractic or kinesiology notes for Mr. Pereira's treatment on December 29, 1998. He testified that it could have been a clerical error, that is a billing error. From the material available at the hearing, Dr. Levitin could not say for sure that Mr. Pereira had attended the clinic that day. I do not allow any claim for treatment made on this date, as I am not convinced, on a preponderance of the evidence, that Mr. Pereira attended at IHR that day.

Dr. Levitin had no record of any communication to Allstate from IHR of what exactly the collateral insurer, Clarica, had paid, before Allstate made the payment of $1,724 in October 2000. However, both Dr. Levitin and Bill Gold, Allstate's adjuster, testified about several meetings they had concerning approximately ten IHR files where Allstate was the accident benefit insurer.

Dr. Levitin testified that the IHR clinic received a payment of $1,724 from Allstate on October 13, 2000, marked in "partial settlement for treatment October 20, 1998 to January 7, 1999." No letter or explanation accompanied the cheque or followed it. IHR's bookkeeper applied the cheque to the treatment account for treatment between October 20 and November 16, 1998. According to IHR's records $1,740 remains outstanding.¹⁴

Allstate's Evidence:

Mr. Bill Gold, Allstate's adjuster, testified he received Mr. Pereira's file from the initial adjuster on October 21, 1998 about one month after the accident. By that time Allstate had already asked Mr. Pereira to attend for an examination by Dr. Paula Stern, chiropractor, at the Canadian Back Institute. Dr. Stern examined Mr. Pereira on September 24, 1998, six days after the accident.

Mr. Gold met with Mr. Pereira on October 29, 1998. Mr. Pereira had begun treatment at IHR two weeks before. Mr. Pereira told Mr. Gold he had pain in his low and mid back, front and back neck, and left wrist, and suffered diminished strength in his left arm. Mr. Gold understood Mr. Pereira was attending daily at IHR from about 6:00 p.m. to 7:30 or 8:00 p.m. Mr. Gold testified he understood Mr. Pereira received about 15 minutes of chiropractic treatment, heat or TENS for 30 minutes, acupuncture for 30 to 40 minutes, and was performing about 30 minutes of exercises.

Mr. Gold received the IHR treatment plan on November 2, 1998. By that time the DAC process had already started in relation to an earlier treatment plan from Dr. Pourgol, received October 20, 1998. On October 22, 1998 Mr. Gold advised Mr. Pereira's representative that he would fund no more than 15 treatments of chiropractic or physiotherapy because Dr. Fernandez, in his disability certificate of October 16, 1998 had diagnosed a WAD 2 and not a WAD 3, as diagnosed by Dr. Pourgol.

Allstate's first adjuster had already outlined in forms called Explanation of Benefits Payable by Insurance Company, sent October 8, 1998 and October 20, 1998 that it was important for Mr. Pereira to provide Allstate with the "collateral carrier information" relating to medical and rehabilitation expenses. On the October 20, 1998 communication, the first adjuster wrote "Met Life is primary."

By the time Mr. Gold received the DAC report, on November 30, 1998, he still had no information about payments from the collateral benefit carrier, Clarica. On December 22, 1998, Mr. Gold wrote Mr. Pereira's legal representative enclosing a copy of Dr. R. Soric's report from December 15, 1998.

Dr. Soric, a physiatrist, wrote:

This patient does not present with any clinical evidence of ongoing neuromusculoskeletal pathology. This is not to say that I would not suggest that he completes his course of treatments. This should not extend for more than 2-3 weeks. I would recommend that he be provided with a home program oriented toward stretching exercises for the cervical and lumbar region, as well as strengthening exercises for the neck and the lower back.

On January 14, 1999 Mr. Gold sent Dr. Levitin a copy of Dr. Soric's report. Mr. Gold also wrote that he looked forward to receiving Dr. Levitin's "final invoice when you have an Explanation of Benefits Payable from the collateral benefit insurer." By January 14, 1999 Mr. Pereira had ceased treatment at IHR.

Mr. Gold wrote again to IHR on February 22, 1999 asking for a copy of IHR's clinical notes and records to "help us better understand your charge of up to $195 per treatment session." Mr. Gold also asked Dr. Levitin to "explain in detail how your billing amounts were established. They appear to be considerably in excess of the treatment costs of other chiropractors in your local area."

Mr. Gold followed up with a short letter dated March 30, 1999. He had not received any reply to his correspondence to IHR and reiterated that if IHR's invoices were not paid in full by Clarica, Allstate wanted his clinical notes and records "in order to determine to what extent we are prepared to fund your services."

According to exhibit 11, Mr. Pereira did not send any statements from Clarica to IHR until September 17, 1999 when he faxed them from his workplace. Mr. Pereira wrote that he would forward a cheque for $761 to IHR soon. According to the documents he faxed, Mr. Pereira had received 3 cheques totalling $761 in December 1998, late January 1999 and February, 1999.

The final correspondence from Allstate filed in the arbitration, dated March 23, 200, responded to IHR's application for mediation at FSCO. Mr. Gold reiterated that he wished to have IHR's clinical notes to find out "what services you provided to this patient and . . . determine if the amounts charged are, or are not, reasonable." Mr. Gold asked for details of the names, qualifications, and experience of each person who provided services to Mr. Pereira. He also asked to have documentation from Clarica confirming all IHR's invoices had been submitted to them and explaining the amount of coverage available from them.

Mr. Gold testified he believed Allstate received no correspondence that showed 3 of 6 invoices had been submitted to Clarica until near the end of October 2000. To his recollection, there was no evidence the other invoices had ever been submitted. However, I find invoices from IHR and explanation of benefit forms from Clarica with a red Allstate date stamp of September 30, 1999 (a year before) filed in this arbitration, confirm that, in fact, that information had been in Allstate's possession for over one year, shortly after Mr. Pereira faxed the information to IHR.¹⁵

In October 2000 Mr. Gold calculated what he believed was appropriate for Allstate to pay IHR. He testified he still had no information, he thought, about the collateral benefits, although I find this was not the case.

Mr. Gold testified he thought a reasonable fee for the IHR assessment and therapy was as set out in the right column of the chart below:

Description	IHR Charges	Allstate Calculation
Initial assessment	275.	210.
	75.	75.
Acupuncture (8 @ $65)	520.	260. (@$32.50)
Comb. (23 @ $125)	2,875	1,725. (@ $75)
Massage (4@ $70)	280.	140. (@$35)
TOTAL	4,015	2,410.
plus misc.	200.	75.
Subtotal	4,265
less Clarica	-761.	-761.
Total	3,505	1,724.

Mr. Gold testified he still did not have any clinical notes and records by the time he calculated what he felt Allstate owed IHR. He noted for the initial assessment that $250 was the maximum the OCA allowed for a 60- minute examination and assessment. Mr. Gold already had an assessment and treatment plan from Dr. Stern at CBI for $200. He allowed $210 to IHR as appropriate.

Regarding acupuncture, Mr. Gold testified his understanding was that acupuncture could be charged at $60 to $70 per hour. The OCA recommended $30 per acupuncture treatment. He felt the treatments were likely 30 minutes and allowed half the $65 claimed. Mr. Gold testified that he had "no way of knowing who provided the service." In fact, I find Mr. Gold had a treatment plan that showed the acupuncture treatment would be given by "Dr. Z. Simkhovitch, Ph.D., DAC, RMT" shown on the treatment plan as a Doctor of Acupuncture.

With respect to massage, there were four charged at $70 each. Mr. Gold felt a half hour treatment was more common than one hour and in 1998, $70 was at the high end of the scale for 1 hour. He allowed $35 per massage.

With respect to the combined active/passive treatment, Mr. Gold felt $125 was too high. In his testimony, he repeated Dr. Steiman's words: "inadequate treatment at excessive cost." Dr. Stern would have charged the OHIP fee ($9.65) plus $20 per chiropractic treatment. Mr. Gold testified the Ammoa - Williams decision had been released by that time, and Arbitrator Sapin had determined up to $40 including OHIP was appropriate for chiropractic treatment. Weighing it all, he decided $30 including OHIP would be reasonable. (This rate approximates what Dr. Stern would have charged.)¹⁶

Mr. Gold testified he would allow $75 for each session of active rehabilitation because Mr. Pereira was a "reasonably intelligent gentleman who would not need someone holding his hand while he is on the treadmill for 20 minutes." Mr. Gold testified that in most treatment settings one clinician supervises everyone who is in the gym at that time, perhaps up to five people. In that case, he testified none of them can receive 1:1 treatment.

The total Mr. Gold was prepared to pay was $2,485, reduced by Clarica's payments of $761 to $1,724.

ANALYSIS

Necessity of Treatment:

After hearing Mr. Pereira's and Dr. Levitin's testimony and reviewing the documentary medical evidence about the type of treatment rendered, I am satisfied that it was reasonable for Mr. Pereira to receive treatment on account of the injuries he received in the accident of September 18, 1998 until January 7, 1999, the date of the last treatment the IHR clinic rendered. My reasons follow.

I find Dr. Steiman, the chiropractor who conducted the medical/rehabilitation DAC assessment, was under a misapprehension as to the exact nature of Dr. Levitin's treatment, in that he did not know that Mr. Pereira was already receiving chiropractic spinal manipulative therapy and a concurrent active exercise program at the time of his evaluation on November 19, 1998. This is exactly the type of treatment that Dr. Steiman recommended in his report. (Dr. Steiman recommended four weeks of chiropractic treatment three times weekly. He also recommended two more weeks of active exercise treatment with instruction for continuing the program as home exercise thereafter.) In addition, Dr. Soric, the physiatrist who examined Mr. Pereira for Allstate on December 15, 1998 also recommended that Mr. Pereira complete his course of treatment, for approximately three more weeks, then continue with a home exercise program. I accept Dr. Soric's opinion.

Accordingly, I find the treatment rendered by the IHR Clinic to be a necessary expense incurred by Mr. Pereira to reduce or eliminate the effects of the disability he sustained in the accident of September 18, 1998 and to facilitate his ability to lead as normal a work life as possible.

Reasonableness of the Cost of Treatment:

I did not find Mr. Gold's analysis of the costs of the IHR clinic very helpful. My general impression was that Mr. Gold thought IHR charged too much for everything. His calculations as to what Allstate would pay were made arbitrarily (i.e. established at random) and, in some cases, were less than what CBI would have charged (and which he was prepared for Allstate to pay).

Dr. Steiman, the assessor at the DAC, was of the view that the IHR fees were approximately $500 greater than "the average." However, Dr. Steiman was also mistaken as to the type of treatment Mr. Pereira was then undergoing. He also qualified his opinion by stating, "there is no standard fee for chiropractic or acupuncture treatments." I do not find Dr. Steiman's opinion with respect to the cost of the IHR treatment helpful to decide what was reasonable in this case.

Assessment and Treatment Plan:

No one disputes a charge of $75 for completing treatment plans. I allow that amount.

The Ontario Chiropractic Association (OCA) Guidelines, dated June 1997, suggest that a maximum of $250 for an Extended Assessment for a new patient is reasonable, with a detailed examination of more than one region or system, or where the complaint is complicated. IHR charged $275 for the initial assessment, based on 1.5 hours estimated time for new patients in general. I am not satisfied by the evidence provided at the hearing that more than one hour was or should have been expended in Mr. Pereira's case. I allow $250.

I am not satisfied that any treatment was provided on December 29, 1998 whatsoever. No charge for that day is allowed.

I allow the full $125 charged by IHR for each active treatment session or active-passive combination treatment session because this block fee includes both approximately one hour in a supervised exercise program, passive treatment such as moist heat or interferential current and an interactive assessment and adjustment by Dr. Levitin on each occasion.

I allow the amount claimed by IHR for acupuncture treatment, as I am satisfied that the treatment, as carried out by Dr. Simkhovitch, was offered by a professional with expert credentials in this field. Dr. Simkhovitch stopped the treatment of Mr. Pereira when it appeared to have no lasting benefit.

I allow the amount claimed by IHR for massage therapy, as I am satisfied that Mr. Pereira received an hour of treatment, less an acceptable time allowance for dressing and undressing. Mr. Pereira was not sure of the length of his treatment, although he estimated a half hour. He noted he did not wear a watch and was not focussed on the length of the treatment. I prefer Dr. Levitin's evidence with respect to the duration of Mr. Pereira's massage therapy treatments, where his evidence differed materially from Mr. Pereira's evidence.

I allow the amounts claimed for the second treatment plan and the re-assessment and report in December 1998. These amounts are reasonable and follow the practice outlined in the Schedule.

In summary, I allow the following amounts with respect to Mr. Pereira's treatment at IHR:

Description	IHR Charges	Allstate Cale	Allowed At
Initial assessment	275.	210.	250.
	75.	75.	75.
Acupuncture (8 @ $65)	520.	260.	520.
Comb. (23 @ $125)	2,875	1,725	2,750.¹⁷
Massage (4@ $70)	280.	140.	280.
Subtotal	$4,025.	$2,485.	$3,875.
	75.	75.
Reassess/Report - 14/12	125.	125.
Subtotal	$4,225.	$4,075.
less Clarica	-761.	-761.	-$1,358
Total	$3,505.	$1,724.	$2,717

Since I have allowed $2,717 as the reasonable and necessary charges of IHR, net of the collateral insurance, and Allstate has already paid $1724, the remaining amount that Allstate should pay is $993.

Special Award

The parties each made submissions on the issue of a special award. Under subsection 282(10) of the Act an arbitrator must grant a special award if she finds that an insurer has unreasonably withheld or delayed payments, in addition to awarding the benefits and interest to which an insured person is entitled. The maximum special award is a lump sum of "up to 50 per cent of the amount to which the person was entitled at the time of the award together with interest on all amounts then owing to the person (including unpaid interest) at the rate of 2 per cent per month, compounded monthly, from the time the benefits first became payable under the Schedule."

In my opinion, Allstate unreasonably delayed payment in this case. Allstate made no payment at all until October 2000 even though the treatment was given from October 1998 to early January 1999. On October 13, 2000 Allstate paid IHR $1724. However, Allstate did not receive any information about what had been paid by Clarica until well after the treatment was ended. The DAC assessor, Dr. Steiman, was of the opinion that after November 21, 1998 (the end of the first treatment plan) it was reasonable and necessary for Mr. Pereira to receive three chiropractic treatments a week for four weeks and an active exercise program three times weekly for two weeks. According to the Schedule, at subsection 38(14), Dr. Steiman's opinion should have provoked Allstate to pay for that much treatment, pending the resolution of any dispute. My reading of Dr. Steiman's report indicates that, in his opinion, the first treatment plan should also have been paid, less about $500, pending the resolution of any dispute. However, Allstate was only obliged to pay the reasonable and necessary treatment expenses that were not paid by Clarica.

On December 15, 1998, Dr. Soric, who examined Mr. Pereira in an insurer's examination, told Allstate that Mr. Pereira should continue his treatment for another two to three weeks.

Mr. Gold wrote directly to Dr. Levitin at IHR on March 30, 1999 and invited him to re-submit IHR's invoices "after they have been addressed by the collateral benefit insurer." I have found that Allstate first learned some of what Clarica had paid in collateral benefits about September 30, 1999. Mr. Pereira had faxed eight or nine pages of material to IHR on September 17, 1999 (exhibit 11). The invoices which were proven submitted by that time totalled $3,320 and $761 was paid, leaving $2,559 outstanding. Allstate has not explained the delay between October 1, 1999 and October 13, 2000, with respect to this amount, when it paid $1,724 on account of IHR's treatment.

IHR's Invoice 8921, for $195, dated January 14, 1999 indicates "This invoice was submitted to extended health care." It was stamped received by Allstate in the first nine days of February 1999 (the date stamp on exhibit 23 has been partly obliterated by hole punching for Allstate's file). However, no material was produced by either side that confirmed what Clarica's payment for invoice 8921 was, until Mr. Pereira produced a copy of Clarica's statement dated November 12, 1999 that dealt with treatments from IHR beginning November 3, 1998 and ending January 7, 1999. Clarica paid $597.00 in that cheque to Mr. Pereira. Mr. Pereira did not produce that statement until January 3, 2002 at the resumption of the hearing. Up to the end of the hearing, Mr. Pereira had not paid IHR the $597 sent to him by Clarica for that treatment.

From the evidence I received at this hearing, no one involved in this process, from Mr. Pereira himself, to the IHR accounting personnel, to Mr. Gold was diligent about making sure Allstate had the correct information as to what Clarica had paid. Mr. Pereira was careless in remitting amounts Clarica did pay to IHR, promptly after he received them.

Considering all these facts, I grant a special award against Allstate in the sum of $250, including interest.

Interest:

I heard no submissions about interest in this case. If the parties cannot resolve this issue themselves, they may apply to re-open the hearing for submissions on this issue. In that event, I will need to receive submissions on the interaction of section 268 of the Act, and subsection 60(2), section 46, and section 38 of the Schedule.

EXPENSES:

The parties advised at the close of the hearing, in accordance with section 77 of the Dispute Resolution Practice Code - 4th Edition (May 31, 2001), that one or more of the parties seeks to have an Offer to Settle or a Response to an Offer to Settle considered in connection with an award of expenses. Accordingly, within 10 days of the delivery of this decision, either party may file any relevant offer or response for my consideration. In addition, either party may request an appointment for submissions on the issue.

May 10, 2002

K. Julaine Palmer Arbitrator

Date

Financial Services Commission of Ontario