KEY POINTS:
When Isabella goes to the shops or to a cafe, her eyes dart left and right. Which one? Who is it?
The sense she feels of being watched is a legacy of an investigation by the fraud unit of the Accident Compensation Corporation (ACC).
Isabella led an active life before two injuries and an unsuccessful operation more than a decade ago left her with a permanent disability that makes it impossible for her to be active for long periods.
Those circumstances made her one of ACC's longterm clients or - as she suspects the corporation saw it - liabilities. She was part of what was referred to within ACC as "the tail"; the long-term injured and, therefore, expensive clients. She believes that as a result she was targeted by ACC's fraud unit.
Private investigators followed her and filmed her. On the strength of a heavily-edited video that showed her meeting friends, shopping and washing her car, she was accused of fraud and her ACC payments stopped.
She fought, won and in the process exposed dubious tactics used by the fraud unit. Isabella subsequently made submissions to an independent review of the ACC fraud unit. The review, made public last month, heavily criticised the unit as aggressive, heavy-handed, out of touch and prone to investigate for no good reason.
The reviewers found significant faults with the fraud team that dealt with treatment providers (such as physiotherapists) and the claimant section that pursued Isabella. There was no obvious concern with the third arm, the Serious Fraud & Investigation Support Team.
Issues identified included:
* Some full investigations triggered by malicious calls from a claimant's estranged partner or family member.
* Reports of an overbearing and unduly aggressive approach.
* Investigator ignorance of the claimant's injury and rehabilitation plan. For example, claimants have been investigated for carrying out volunteer work or household chores despite these being specifically agreed as part of their rehabilatation plan.
* Investigations continuing for long periods (one for 10 years) despite no evidence being found.
* Unprofessional methods used in some investigations, including chasing neighbours and telling people the claimant is committing fraud.
* A general lack of closure when investigations end. Claimants are informed the investigation has been closed, "but this often comes in the form of warning not to do 'it' again".
Isabella has received several written apologies from ACC - including from its fraud unit. She believes this was because she was prepared to fight and was backed by her doctor. She says she knows of people who couldn't cope with the aggravation and gave up.
"Without my GP I could easily have been totally overcome. He told ACC they were fraudulent. That started things for me."
Surveillance equipment specialists Isabella hired concluded that the 28-minute tape had been heavily edited from hours of footage taken at different times, and questioned whether it had been done "to satisfy the request of a client ... as opposed to providing an open unbiased presentation of all the evidence".
The GP noted from the time sequences 29 edits or omissions. ACC had failed to note, for example, that Isabella had physiotherapy - providing temporary relief - before washing the car and it was an activity her doctor recommended for rehabilitation.
Isabella is not her real name. She does not want to be identified for this article because - despite the apologies - she fears retaliation.
ACC blamed a rogue fraud unit for her ordeal. She suspects they might be the scapegoat for a drive to get long-term claimants off the books.
Giving precedence to cost-cutting was also a theme of a review, headed by David Goddard, QC, of ACC's management of physiotherapy services. The report will be given to ACC Minister Ruth Dyson this month but a draft has been circulated.
The review arose out of the disquiet of New Zealand First's ACC spokesman Peter Brown about what he was hearing from physiotherapists. He made sure a review of the way physiotherapy services are funded and accredited by ACC was part of the Confidence and Supply Agreement between the Government and his party after the last election.
The concerns centre on a new system introduced in 2002 called Endorsed Provider Network, or EPN. Physiotherapists who opted in are paid more per treatment by ACC but they can't charge extra while those who remain outside the EPN system are paid less per treatment by ACC but can co-charge the patient.
Some senior physiotherapists, such as Murray Hing and Malcolm Hood, who between them have worked with the All Blacks, national league, hockey, soccer and basketball sides, didn't sign up because it effectively made them employees of ACC, which dictated what they were worth (the same as a newly-qualified physiotherapist) and the number of treatments patients would receive.
Under its injury-profile treatment system, ACC grades injuries and dictates a set number of treatments. But, say Hing and Hood, all sprained ankles or injured necks are not equal. The system mitigates against those with more complex injuries getting appropriate treatment.
Application can be made for further treatment but the task is onerous and by going into bat for the patient, they say they have become a target for ACC. They believe ACC's fraud unit targets those who don't toe the line.
"You become a bugbear to ACC and you get labelled an outlier, an over-servicer," says Hing. "They then decide they are going to investigate you for fraud as a way of modifying your treatment behaviour."
ACC won't comment until the final report is presented at the end of the month but its clinical services director, Dr Kevin Morris, says ACC objects to the suggestion that there is any connection between physiotherapists who do not hold an EPN contract and fraud investigation. "Fraud investigations are instigated as a separate issue to any other relationship with ACC."
Hing says he was informed by some patients that ACC's fraud unit were accusing him of fraud. He had then confronted ACC to be told he was subject to a random audit. He doesn't accept this, noting all eight physiotherapists who worked with him were "audited" and the only time he'd been audited in his career came within weeks of him publicly criticising the new system.
Those who believe ACC has misused fraud investigations cite ACC seminars in which it was stated that its intervention strategies had "significantly changed provider's treatment patterns". Those strategies included investigating outliers, "hounding" fraudulent providers, being "ruthless with bad providers".
ACC has acknowledged "this type of language is inappropriate and should not be used by any ACC staff"
Critics say it gives away the corporations true tactics and intent. "Bad providers", they claim, are those who don't toe ACC's line and note that no evidence of fraud is uncovered in the vast majority of investigations.
John Miller, a specialist lawyer, says ACC is one of the cheapest personal injury compensation systems in the world, far less costly than common law systems where a small percentage of injured get adequate recompense while it cost a fortune to run, with lawyers arguing about what happened in traffic accidents five years earlier. In one instance in Sydney, Miller notes, swings were closed in a council playground in response to high premiums for litigation insurance.
Established on the principle - that he calls humanitarian, and the Business Round Table labels socialist - of real compensation, the injured could get 80 per cent of normal income and it provided for lump sum payments for permanent disabilities.
Legislation in 1992 made it "leaner and meaner", says Miller, and under past chief executives there was a drive to remove as many longterm and expensive claimants as possible. But, he says, rather than help claimants develop skills to find work, they would say "you're a brain-damaged journalist but you could be a car park attendant and the fact you couldn't find such a job where you lived was immaterial'.
"Given that atmosphere of removing people, the fraud unit, I think, had carte blanche because that fitted in with the philosophy of removing claimants by hook or by crook."
That many of ACC's investigators are former police officers used to dealing with crooks rather than clients, along with an absence of personal contact between managers and claimants, were factors, Miller says. "It's much easier to be harsh to people on paper."
However, there are signs ACC is becoming more rehabilitation-focused, he says. The reviews were an encouraging sign.
