Definition of permanent impairment
When a worker sustains a workplace injury or illness it may result in a permanent impairment. Workers’ compensation schemes may offer a lump sum compensation payment based on a worker’s level of permanent impairment. A prerequisite to determining the level of permanent impairment is the understanding that impairment should not be determined until the claimant has reached a point of maximum medical improvement. This is the point at which the impairment has become stable or is not likely to improve despite medical treatment.
In addition to the principles of assessment contained in the American Medical Association (AMA) Guides, scheme legislation also provides substantial guidance on how to determine whether impairment is permanent. Table 4.18 lists the legislative definitions of permanent impairment and the criteria by which an injury is judged to be permanent.
Permanent impairment guidelines
Each of the schemes substitutes or removes sections of their respective editions of the AMA Guide. The necessity for these modifications is primarily due to differences in Australian and US clinical practice, but these are sometimes the result of differences in legislative processes. Table 4.19 illustrates the approach taken by the various schemes to substitute or remove assessment criteria from the AMA Guide.
Threshold impairment levels
Most schemes require a worker’s injury or illness to meet a certain level of impairment to receive lump sum compensation. Some schemes may require a worker wait a certain period before they are able to apply for permanent impairment.
Schemes may require that where a pre-existing non-compensable impairment exists, the assessing doctor discount the pre-existing impairment before making a final assessment of impairment. Table 4.20 lists threshold impairment tests, the waiting period and the discounting provisions under each scheme.